First Quarter:
- Sales were $633 million, a 4% increase from the prior
year
- Net income was $110 million
- Earnings per diluted share were $1.90
- Adjusted earnings per diluted share were $2.21
- EBITDA was $197 million, 31% of sales
Guidance:
- Narrowing previously issued full-year fiscal 2024 revenue
guidance to 4% to 7% growth over record fiscal 2023 and adjusted
earnings per diluted share to the range of $10.00 to $10.50 per
share
Nordson Corporation (Nasdaq: NDSN) today reported results for
the fiscal first quarter ended January 31, 2024. Sales were $633
million, a 4% increase compared to the prior year’s first quarter
sales of $610 million. The increase in first quarter 2024 sales
included a favorable acquisition impact of 5%, partially offset by
an organic sales decrease of 2%. The organic sales decrease was
driven by ongoing pressure in electronics product lines, partially
offset by growth in medical interventional, industrial and polymer
processing product lines.
Net income was $110 million, or $1.90 of earnings per diluted
share, compared to prior year’s first quarter net income of $104
million, or $1.81 of earnings per diluted share. Adjusted net
income was $128 million, a $4 million increase from the prior year
adjusted net income of $123 million. First quarter 2024 adjusted
earnings per diluted share were $2.21, a 3% increase from the prior
year adjusted earnings per diluted share of $2.14. The increase was
driven by higher operating profit, partially offset by increased
interest expense.
EBITDA in the first quarter was $197 million, or 31% of sales,
compared to prior year EBITDA of $181 million, or 30% of sales. The
9% increase in EBITDA was a result of higher operating profit,
driven by improved gross margins year-over-year.
Commenting on the Company’s fiscal 2024 first quarter results,
Nordson President and Chief Executive Officer Sundaram Nagarajan
said, “Sales results were in line with our first quarter
expectations. The segments delivered a strong operating performance
exceeding our first quarter earnings guidance. This is a great
example of our entrepreneurial teams using NBS Next to meet the
needs of our customers, while also taking strategic actions that
position them for future profitable growth. I am particularly
pleased with the solid performance of our IPS and MFS segments
during the quarter, while ATS continued to manage the ongoing
weakness of the electronics end market. The ARAG acquisition
integration continued to make steady progress and contributed to
our sales and EBITDA margin performance in the quarter.”
First Quarter Segment
Results
Industrial Precision Solutions sales of $355 million increased
14% from the prior year, inclusive of an 11% acquisition impact.
The organic sales increase of 2% was driven primarily by industrial
coatings, polymer processing and nonwovens product lines. Operating
profit was $108 million, an increase of $6 million from the prior
year. EBITDA in the quarter was $126 million, or 36% of sales, a
16% increase from the prior year first quarter EBITDA of $109
million, or 35% of sales. The year-over-year increase was driven by
the ARAG acquisition and higher organic sales and gross profit.
Medical and Fluid Solutions sales of $160 million increased 3%
compared to the prior year first quarter. The increase was driven
by growth in the medical interventional solutions product lines.
Operating profit was $46 million, an increase of $7 million from
the prior year. EBITDA in the quarter was $60 million, or 37% of
sales, a 13% increase from the prior year first quarter EBITDA of
$53 million, or 34% of sales. The increase in EBITDA was driven by
both higher sales and improved gross margins.
Advanced Technology Solutions sales of $119 million decreased
18% compared to the prior year first quarter. The organic sales
decrease was driven by weakness across the segment, primarily
electronics dispense products serving semiconductor end markets.
Operating profit was $19 million, an increase of $2 million from
the prior year amount, which included acquisition-related expenses
for the CyberOptics acquisition. EBITDA in the quarter was $22
million, or 19% of sales, a 28% decrease from the prior year first
quarter EBITDA of $31 million, or 21% of sales. The decrease was
driven by lower sales.
Outlook
The Company is entering the second quarter of fiscal 2024 with
approximately $750 million in backlog, which continues to normalize
and remain concentrated in systems businesses. Based on current
visibility and order entry trends, the Company is narrowing its
previously issued full-year revenue growth to 4% to 7% over record
fiscal 2023 and adjusted earnings per diluted share to the range of
$10.00 to $10.50 per diluted share. Second quarter fiscal 2024
sales are forecasted in the range of $645 to $670 million with
adjusted earnings in the range of $2.20 to $2.35 per diluted
share.
As previously announced, the Company’s definition of adjusted
earnings now excludes acquisition related amortization for both
current and historical periods. It is not possible for the Company
to identify the amount or significance of future adjustments
associated with acquisition and integration costs, restructuring
costs, acquisition-related amortization, certain non-operating or
income tax items, or other non-routine costs that the Company
adjusts in the presentation of adjusted earnings guidance. These
items are dependent on future events that are not reasonably
estimable at this time. Accordingly, the Company is unable to
reconcile without unreasonable effort the forecasted range of
adjusted earnings guidance to a comparable GAAP range.
Nordson management will provide additional commentary on these
results and outlook during its previously announced webcast on
Thursday, February 22, 2024, at 8:30 a.m. eastern time, which can
be accessed at https://investors.nordson.com. For persons unable to
listen to the live broadcast, a replay will be available for 14
days after the event. Information about Nordson’s investor
relations and shareholder services is available from Lara Mahoney,
vice president, investor relations and corporate communications at
(440) 204-9985 or lara.mahoney@nordson.com.
Certain statements contained in this release are forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. Forward-looking statements may be identified by
terminology such as “may,” “will,” “should,” “could,” “expects,”
“anticipates,” “believes,” “projects,” “forecasts,” “outlook,”
“guidance,” “continue,” “target,” or the negative of these terms or
comparable terminology. These statements reflect management’s
current expectations and involve a number of risks and
uncertainties. These risks and uncertainties include, but are not
limited to, U.S. and international economic conditions; financial
and market conditions; currency exchange rates and devaluations;
possible acquisitions, including the Company’s ability to
successfully integrate acquisitions; the Company’s ability to
successfully divest or dispose of businesses that are deemed not to
fit with its strategic plan; the effects of changes in U.S. trade
policy and trade agreements; the effects of changes in tax law; and
the possible effects of events beyond our control, such as
political unrest, including the conflict between Russia and
Ukraine, acts of terror, natural disasters and pandemics, including
the recent coronavirus (COVID-19) pandemic and the other factors
discussed in Item 1A (Risk Factors) in the Company’s most recently
filed Annual Report on Form 10-K and in its Forms 10-Q filed with
the Securities and Exchange Commission, which should be reviewed
carefully. The Company undertakes no obligation to update or revise
any forward-looking statement in this press release.
Nordson Corporation is an innovative precision technology
company that leverages a scalable growth framework through an
entrepreneurial, division-led organization to deliver top tier
growth with leading margins and returns. The Company’s direct sales
model and applications expertise serves global customers through a
wide variety of critical applications. Its diverse end market
exposure includes consumer non-durable, medical, electronics and
industrial end markets. Founded in 1954 and headquartered in
Westlake, Ohio, the Company has operations and support offices in
over 35 countries. Visit Nordson on the web at www.nordson.com,
linkedin/Nordson, or www.facebook.com/nordson.
NORDSON
CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(Dollars in thousands except for
per-share amounts)
Three Months Ended
January 31,
2024
January 31,
2023
Sales
$
633,193
$
610,477
Cost of sales
284,766
281,610
Gross profit
348,427
328,867
Gross margin %
55.0
%
53.9
%
Selling & administrative expenses
188,992
184,648
Operating profit
159,435
144,219
Interest expense - net
(20,398
)
(9,943
)
Other expense - net
(338
)
(3,196
)
Income before income taxes
138,699
131,080
Income taxes
29,127
26,819
Net income
$
109,572
$
104,261
Weighted-average common shares
outstanding:
Basic
57,064
57,170
Diluted
57,555
57,762
Earnings per share:
Basic earnings
$
1.92
$
1.82
Diluted earnings
$
1.90
$
1.81
NORDSON
CORPORATION
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(Dollars in thousands)
January 31, 2024
October 31, 2023
Cash and cash equivalents
$
136,201
$
115,679
Receivables - net
537,702
590,886
Inventories - net
451,217
454,775
Other current assets
82,992
67,970
Total current assets
1,208,112
1,229,310
Property, plant and equipment - net
394,467
392,846
Goodwill
2,805,086
2,784,201
Other assets
839,412
845,413
$
5,247,077
$
5,251,770
Notes payable and debt due within one
year
$
116,585
$
115,662
Accounts payable and accrued
liabilities
435,095
466,427
Total current liabilities
551,680
582,089
Long-term debt
1,513,871
1,621,394
Other liabilities
457,559
450,227
Total shareholders' equity
2,723,967
2,598,060
$
5,247,077
$
5,251,770
NORDSON
CORPORATION
CONSOLIDATED STATEMENT OF CASH
FLOWS (Unaudited)
(Dollars in thousands)
Three Months Ended
January 31,
2024
January 31,
2023
Cash flows from
operating activities:
Net income
$
109,572
$
104,261
Depreciation and amortization
33,544
26,434
Other non-cash items
6,552
6,224
Changes in working capital
14,614
(58,371
)
Other
8,074
44,789
Net cash provided by operating
activities
172,356
123,337
Cash flows from
investing activities:
Additions to property, plant and
equipment
(7,530
)
(9,302
)
Acquisition of businesses, net of cash
acquired
—
(377,843
)
Other - net
1,805
9
Net cash used in investing activities
(5,725
)
(387,136
)
Cash flows from
financing activities:
Issuance (repayment) of long-term debt
(107,195
)
252,278
Repayment of finance lease obligations
(1,488
)
(1,318
)
Dividends paid
(38,855
)
(37,199
)
Issuance of common shares
14,418
8,807
Purchase of treasury shares
(7,371
)
(6,875
)
Net cash provided (used) in financing
activities
(140,491
)
215,693
Effect of exchange
rate change on cash:
(5,618
)
6,643
Net change in cash and cash
equivalents
20,522
(41,463
)
Cash and cash
equivalents:
Beginning of period
115,679
163,457
End of period
$
136,201
$
121,994
NORDSON
CORPORATION
SALES BY GEOGRAPHIC SEGMENT
(Unaudited)
(Dollars in thousands)
Three Months Ended
Sales Variance
January 31,
2024
January 31,
2023
Organic
Acquisitions
Currency
Total
SALES BY
SEGMENT
Industrial Precision Solutions
$
354,547
$
311,546
2.3
%
10.6
%
0.9
%
13.8
%
Medical and Fluid Solutions
159,526
154,287
3.1
%
—
%
0.3
%
3.4
%
Advanced Technology Solutions
119,120
144,644
(17.6
)%
—
%
—
%
(17.6
)%
Total sales
$
633,193
$
610,477
(2.2
)%
5.4
%
0.5
%
3.7
%
SALES BY
GEOGRAPHIC REGION
Americas
$
274,012
$
264,878
(0.3
)%
3.1
%
0.6
%
3.4
%
Europe
179,310
162,939
(7.0
)%
14.2
%
2.8
%
10.0
%
Asia Pacific
179,871
182,660
(0.5
)%
0.7
%
(1.7
)%
(1.5
)%
Total sales
$
633,193
$
610,477
(2.2
)%
5.4
%
0.5
%
3.7
%
NORDSON
CORPORATION
RECONCILIATION OF NON-GAAP
MEASURES - NET INCOME TO EBITDA (Unaudited)
(Dollars in thousands)
Three Months Ended
January 31,
2024
January 31,
2023
Net income
$
109,572
$
104,261
Income taxes
29,127
26,819
Interest expense - net
20,398
9,943
Other expense - net
338
3,196
Depreciation and amortization
33,544
26,434
Inventory step-up amortization (1)
2,944
4,306
Acquisition-related costs (1)
597
5,989
EBITDA (non-GAAP) (2)
$
196,520
$
180,948
(1)
Represents fees, severance and non-cash
inventory charges associated with acquisitions.
(2)
EBITDA is a non-GAAP measure used by
management to evaluate the Company's ongoing operations. EBITDA is
defined as operating profit plus certain adjustments, such as
severance, fees and non-cash inventory charges associated with
acquisitions, plus depreciation and amortization.
NORDSON
CORPORATION
RECONCILIATION OF NON-GAAP
MEASURES - EBITDA (Unaudited)
(Dollars in thousands)
Three Months Ended
January 31, 2024
January 31, 2023
SALES BY
SEGMENT
Industrial Precision Solutions
$
354,547
$
311,546
Medical and Fluid Solutions
159,526
154,287
Advanced Technology Solutions
119,120
144,644
Total sales
$
633,193
$
610,477
OPERATING
PROFIT
Industrial Precision Solutions
$
108,364
$
102,319
Medical and Fluid Solutions
46,100
39,384
Advanced Technology Solutions
19,038
16,963
Corporate
(14,067
)
(14,447
)
Total operating profit
$
159,435
$
144,219
OPERATING PROFIT
ADJUSTMENTS (1)
Industrial Precision Solutions
$
3,541
$
—
Advanced Technology Solutions
—
10,295
Total adjustments
$
3,541
$
10,295
DEPRECIATION
& AMORTIZATION
Industrial Precision Solutions
$
14,380
$
6,845
Medical and Fluid Solutions
13,705
13,625
Advanced Technology Solutions
3,441
3,812
Corporate
2,018
2,152
Total depreciation & amortization
$
33,544
$
26,434
EBITDA
(NON-GAAP) (2)
Industrial Precision Solutions
$
126,285
36%
$
109,164
35%
Medical and Fluid Solutions
59,805
37%
53,009
34%
Advanced Technology Solutions
22,479
19%
31,070
21%
Corporate
(12,049
)
(12,295
)
Total EBITDA
$
196,520
31%
$
180,948
30%
(1)
Represents fees, severance and non-cash
inventory charges associated with acquisitions.
(2)
EBITDA is a non-GAAP measure used by
management to evaluate the Company's ongoing operations. EBITDA is
defined as operating profit plus certain adjustments, such as
severance, fees and non-cash inventory charges associated with
acquisitions, plus depreciation and amortization.
NORDSON
CORPORATION
RECONCILIATION OF NON-GAAP
MEASURES - ADJUSTED NET INCOME AND EARNINGS PER SHARE
(Unaudited)
(Dollars in thousands)
Three Months Ended
January 31,
2024
January 31,
2023
GAAP AS
REPORTED
Operating profit
$
159,435
$
144,219
Other / interest expense - net
(20,736
)
(13,139
)
Net income
109,572
104,261
Diluted earnings per share
$
1.90
$
1.81
Shares outstanding - diluted
57,555
57,762
OPERATING PROFIT
ADJUSTMENTS
Inventory step-up amortization
$
2,944
$
4,306
Acquisition-related costs
597
5,989
ACQUISITION
AMORTIZATION OF INTANGIBLES
$
19,387
$
13,872
Total adjustments
$
22,928
$
24,167
Adjustments net of tax
$
18,113
$
19,223
EPS effect of adjustments and other
discrete tax items
$
0.31
$
0.33
NON-GAAP
MEASURES-ADJUSTED NET INCOME AND ADJUSTED EARNINGS PER
SHARE
Adjusted Net income (1)
$
127,685
$
123,484
Adjusted Diluted earnings per share
(2)
$
2.21
$
2.14
(1)
Adjusted net income is a non-GAAP measure
defined as net income plus tax effected adjustments and other
discrete tax items.
(2)
Adjusted earnings per share is a non-GAAP
measure defined as GAAP EPS adjusted for tax effected adjustments
and other discrete tax items.
Management uses certain non-GAAP measures,
such as adjusted net income, adjusted EPS and EBITDA, internally to
make strategic decisions, forecast future results, and evaluate the
Company's current performance. Given management's use of these
non-GAAP measures, the Company believes these measures are
important to investors in understanding the Company's current and
future operating results as seen through the eyes of management. In
addition, management believes these non-GAAP measures are useful to
investors in enabling them to better assess changes in the
Company's core business across different time periods. Because
non-GAAP financial measures are not standardized, it may not be
possible to compare these financial measures to other companies'
non-GAAP financial measures, even if they have similar names.
Amounts may not add due to rounding.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240221342336/en/
Lara Mahoney Vice President, Investor Relations & Corporate
Communications 440.204.9985 Lara.Mahoney@nordson.com
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