ESAB Corporation Announces Third Quarter 2024 Results
ESAB reported Q3 2024 sales of $673 million, showing a 1% decrease on a reported basis but a 1% increase in core organic growth. The company achieved net income of $69 million ($1.13 per share) and core adjusted net income of $77 million ($1.25 per share). Core adjusted EBITDA reached $125 million, up 6% with margin expanding 130 basis points to 19.6%. ESAB updated its 2024 outlook, now expecting full-year core organic sales growth of 0.0% to 1.0%, with core adjusted EBITDA projected at $500-515 million and core adjusted EPS of $4.80-4.95.
ESAB ha riportato vendite per il terzo trimestre del 2024 pari a 673 milioni di dollari, mostrando una diminuzione dell'1% su base riportata, ma un aumento dell'1% nella crescita organica principale. L'azienda ha registrato un utile netto di 69 milioni di dollari (1,13 dollari per azione) e un utile netto rettificato principale di 77 milioni di dollari (1,25 dollari per azione). L'EBITDA rettificato principale ha raggiunto i 125 milioni di dollari, con un aumento del 6% e un margine in espansione di 130 punti base al 19,6%. ESAB ha aggiornato le sue previsioni per il 2024, prevedendo ora una crescita delle vendite organiche principali per l'intero anno compresa tra lo 0,0% e l'1,0%, con un EBITDA rettificato principale previsto tra 500 e 515 milioni di dollari e un utile per azione rettificato principale di 4,80-4,95 dollari.
ESAB reportó ventas de 673 millones de dólares en el tercer trimestre de 2024, lo que muestra una disminución del 1% en base reportada, pero un aumento del 1% en el crecimiento orgánico principal. La compañía logró un ingreso neto de 69 millones de dólares (1.13 dólares por acción) y un ingreso neto ajustado fundamental de 77 millones de dólares (1.25 dólares por acción). El EBITDA ajustado fundamental alcanzó los 125 millones de dólares, un incremento del 6% con un margen que se expandió en 130 puntos básicos al 19.6%. ESAB actualizó su perspectiva para 2024, esperando ahora un crecimiento de las ventas orgánicas fundamentales del 0.0% al 1.0% para todo el año, con un EBITDA ajustado fundamental proyectado entre 500 y 515 millones de dólares y ganancias por acción ajustadas fundamentales de 4.80-4.95 dólares.
ESAB는 2024년 3분기 매출이 6억 7천 3백만 달러에 달했으며, 보고 기준으로 1% 감소했지만 핵심 유기 성장에서 1% 증가했다고 보고했습니다. 회사는 6천 9백만 달러의 순이익 (주당 1.13 달러)과 7천 7백만 달러의 핵심 조정 순이익 (주당 1.25 달러)을 달성했습니다. 핵심 조정 EBITDA는 1억 2천 5백만 달러에 달하며, 6% 증가하고, 마진이 130 베이시스 포인트 확장되어 19.6%에 이릅니다. ESAB는 2024년 전망을 업데이트하여 이제 연간 핵심 유기 매출 성장률을 0.0%에서 1.0%로 예상하고, 핵심 조정 EBITDA를 5억에서 5억 1천 5백만 달러, 핵심 조정 주당 순이익을 4.80에서 4.95 달러로 예상하고 있습니다.
ESAB a annoncé des ventes de 673 millions de dollars au troisième trimestre 2024, marquant une baisse de 1 % sur une base déclarée, mais une augmentation de 1 % dans la croissance organique principale. L'entreprise a réalisé un bénéfice net de 69 millions de dollars (1,13 dollar par action) et un bénéfice net ajusté principal de 77 millions de dollars (1,25 dollar par action). L'EBITDA ajusté principal a atteint 125 millions de dollars, en hausse de 6 % avec une marge qui s'est élargie de 130 points de base pour atteindre 19,6 %. ESAB a mis à jour ses prévisions pour 2024, s'attendant désormais à une croissance des ventes organiques principales sur l'année pleine allant de 0,0 % à 1,0 %, avec un EBITDA ajusté principal projeté entre 500 et 515 millions de dollars et un bénéfice par action ajusté principal de 4,80 à 4,95 dollars.
ESAB berichtete im dritten Quartal 2024 von einem Umsatz von 673 Millionen Dollar, was einen Rückgang von 1 % auf Berichtsbasis, aber einen Anstieg von 1 % im organischen Kerngeschäft zeigt. Das Unternehmen erzielte einen Nettoertrag von 69 Millionen Dollar (1,13 Dollar pro Aktie) und einen zentralen adjustierten Nettoertrag von 77 Millionen Dollar (1,25 Dollar pro Aktie). Das zentrale adjustierte EBITDA erreichte 125 Millionen Dollar, was einem Anstieg von 6 % entspricht, während die Marge um 130 Basispunkte auf 19,6 % ausgeweitet wurde. ESAB aktualisierte seine Prognosen für 2024 und erwartet nun ein organisches Umsatzzuwachs für das gesamte Jahr von 0,0 % bis 1,0 %, wobei das zentrale ajustierte EBITDA auf 500-515 Millionen Dollar und den zentralen ajustierten Gewinn pro Aktie auf 4,80-4,95 Dollar geschätzt wird.
- Core adjusted EBITDA increased 6% to $125 million
- Margin expanded 130 basis points to 19.6%
- Core organic growth increased 1%
- Raised guidance midpoint for 2024 core adjusted EPS to $4.80-4.95
- Reported sales decreased 1% to $673 million
- Challenging end market environment noted by management
Insights
ESAB delivered a solid Q3 2024 with notable financial metrics:
The company's improved guidance signals confidence, raising the midpoint of core adjusted EBITDA to
Despite challenging market conditions, ESAB's geographic diversification and strategic acquisitions are proving effective. The
The industrial compounding sector faces headwinds, yet ESAB's performance indicates market share gains through new product launches and commercial transformation initiatives. The company's strategic focus on bolt-on acquisitions (
Geographic diversification across 150 countries provides a natural hedge against regional market fluctuations. The updated guidance, particularly the improved organic sales growth outlook of
- Positive core organic growth
- New equipment gaining traction
- EBX driving record margin
- Raised mid-point of 2024 outlook
ESAB reported third quarter sales of
“ESAB delivered another strong quarter, marked by positive volume growth, record margin, and robust cash flow, amid a challenging end market environment,” said Shyam P. Kambeyanda, President and CEO of ESAB. “Our growth is driven by our unmatched geographic footprint, the launch of new award-winning products, and strategic investments in commercial transformation and bolt-on acquisitions. ESAB continues to enhance margin and cash flow through the use of EBX, further boosting our confidence in achieving our long-term targets by 2028."
Updated Full Year 2024 Outlook
ESAB now expects full year 2024 total core sales growth of (1.5)% to (0.5)%, core organic sales growth of
About ESAB Corporation
Founded in 1904, ESAB Corporation is a focused premier industrial compounder. The Company’s rich history of innovative products, workflow solutions and its business system ESAB Business Excellence (“EBX”), enables the Company’s purpose of Shaping the world we imagine™. ESAB Corporation is based in
Conference Call and Webcast
The Company will hold a conference call to discuss its third quarter 2024 results beginning at 8:00 a.m. Eastern on Tuesday, October 29, 2024, which will be open to the public by calling +1-888-550-5302 (
Non-GAAP Financial Measures and Other Adjustments
ESAB has provided in this press release financial information that has not been prepared in accordance with accounting principles generally accepted in
Adjusted net income from continuing operations represents Net income from continuing operations attributable to ESAB Corporation, excluding Restructuring and other related charges, acquisition-amortization and other related charges and pension settlement loss. Adjusted net income, includes the tax effect of non-GAAP adjusting items at applicable tax rates and excludes the impact of discrete tax charges or gains in each period. ESAB also presents adjusted net income margin from continuing operations, which is subject to the same adjustments as adjusted net income from continuing operations. Adjusted net income per diluted share from continuing operations is a calculation of adjusted net income from continuing operations over the weighted-average diluted shares outstanding. ESAB also presents Core adjusted net income from continuing operations and Core adjusted net income per share - diluted from continuing operations, which are subject to the same adjustments as Adjusted net income from continuing operations and Adjusted net income per diluted share from continuing operations, further removing the impact of
Adjusted EBITDA excludes from Net income from continuing operations the effect of Income tax expense, Interest expense (income) and other, net, Restructuring and other related charges, acquisition-amortization and other related charges, pension settlement loss and depreciation and other amortization. ESAB presents adjusted EBITDA margin, which are subject to the same adjustments as adjusted EBITDA. Further, ESAB presents these non-GAAP performance measures on a segment basis, which excludes the impact of Restructuring and other related charges, separation costs, acquisition-amortization and other related charges, pension settlement loss and depreciation and other amortization from operating income. ESAB also presents Core adjusted EBITDA and Core adjusted EBITDA margin, which are subject to the same adjustments as Adjusted EBITDA and Adjusted EBITDA margin, respectively, further removing the impact of
ESAB presents organic sales growth, which excludes the impact of acquisitions and foreign exchange rate fluctuations and presents core organic sales growth, which further excludes the impact of the
Adjusted free cash flow represents cash flows from operating activities excluding cash outflows related to the Company’s separation from Enovis Corporation and discontinued operations, less Purchases of property, plant and equipment net of proceeds from sale of certain properties. Cash conversion represents Adjusted free cash flow divided by Adjusted net income from continuing operations.
These non-GAAP financial measures assist ESAB management in comparing its operating performance over time because certain items may obscure underlying business trends and make comparisons of long-term performance difficult, as they are of a nature and/or size that occur with inconsistent frequency or relate to unusual events or discrete restructuring plans and other initiatives that are fundamentally different from the ongoing productivity and core business of the Company.
ESAB management also believes that presenting these measures allows investors to view its performance using the same measures that the Company uses in evaluating its financial and business performance and trends.
Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information calculated in accordance with GAAP. Investors are encouraged to review the reconciliation of these non-GAAP measures to their most directly comparable GAAP financial measures. A reconciliation of non-GAAP financial measures presented above to GAAP results has been provided in the financial tables included in this press release.
Forward Looking Statements
This press release includes forward-looking statements, including forward-looking statements within the meaning of the
ESAB CORPORATION |
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CONSOLIDATED AND CONDENSED STATEMENTS OF OPERATIONS |
|||||||||||||||
Dollars in thousands, except per share data |
|||||||||||||||
(Unaudited) |
|||||||||||||||
|
|
|
|
||||||||||||
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||
|
September 27, 2024 |
|
September 29, 2023 |
|
September 27, 2024 |
|
September 29, 2023 |
||||||||
|
|
|
|
|
|
|
|
||||||||
Net sales |
$ |
673,250 |
|
|
$ |
680,996 |
|
|
$ |
2,070,047 |
|
|
$ |
2,085,418 |
|
Cost of sales |
|
419,460 |
|
|
|
431,282 |
|
|
|
1,290,915 |
|
|
|
1,324,392 |
|
Gross profit |
|
253,790 |
|
|
|
249,714 |
|
|
|
779,132 |
|
|
|
761,026 |
|
Selling, general and administrative expense |
|
145,900 |
|
|
|
145,439 |
|
|
|
434,537 |
|
|
|
442,836 |
|
Restructuring and other related charges |
|
1,875 |
|
|
|
3,129 |
|
|
|
8,572 |
|
|
|
17,742 |
|
Operating income |
|
106,015 |
|
|
|
101,146 |
|
|
|
336,023 |
|
|
|
300,448 |
|
Pension settlement loss |
|
— |
|
|
|
— |
|
|
|
12,155 |
|
|
|
— |
|
Interest expense and other, net |
|
16,894 |
|
|
|
20,502 |
|
|
|
49,925 |
|
|
|
58,831 |
|
Income from continuing operations before income taxes |
|
89,121 |
|
|
|
80,644 |
|
|
|
273,943 |
|
|
|
241,617 |
|
Income tax expense |
|
18,074 |
|
|
|
19,808 |
|
|
|
54,463 |
|
|
|
77,806 |
|
Net income from continuing operations |
|
71,047 |
|
|
|
60,836 |
|
|
|
219,480 |
|
|
|
163,811 |
|
Loss from discontinued operations, net of taxes |
|
(1,214 |
) |
|
|
(1,723 |
) |
|
|
(3,684 |
) |
|
|
(4,259 |
) |
Net income |
|
69,833 |
|
|
|
59,113 |
|
|
|
215,796 |
|
|
|
159,552 |
|
Income attributable to noncontrolling interest, net of taxes |
|
(1,593 |
) |
|
|
(1,543 |
) |
|
|
(4,698 |
) |
|
|
(4,506 |
) |
Net income attributable to ESAB Corporation |
$ |
68,240 |
|
|
$ |
57,570 |
|
|
$ |
211,098 |
|
|
$ |
155,046 |
|
Earnings (loss) per share – basic |
|
|
|
|
|
|
|
||||||||
Income from continuing operations |
$ |
1.14 |
|
|
$ |
0.98 |
|
|
$ |
3.54 |
|
|
$ |
2.63 |
|
Loss on discontinued operations |
$ |
(0.02 |
) |
|
$ |
(0.03 |
) |
|
$ |
(0.06 |
) |
|
$ |
(0.07 |
) |
Net income per share - basic |
$ |
1.12 |
|
|
$ |
0.95 |
|
|
$ |
3.48 |
|
|
$ |
2.56 |
|
Earnings (loss) per share – diluted |
|
|
|
|
|
|
|
||||||||
Income from continuing operations |
$ |
1.13 |
|
|
$ |
0.97 |
|
|
$ |
3.50 |
|
|
$ |
2.61 |
|
Loss on discontinued operations |
$ |
(0.02 |
) |
|
$ |
(0.03 |
) |
|
$ |
(0.06 |
) |
|
$ |
(0.07 |
) |
Net income per share – diluted |
$ |
1.11 |
|
|
$ |
0.94 |
|
|
$ |
3.44 |
|
|
$ |
2.54 |
|
ESAB CORPORATION |
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RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES |
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Dollars in millions, except per share data |
|||||||||||||||
(Unaudited) |
|||||||||||||||
|
Three Months Ended(1) |
|
Nine Months Ended(1) |
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|
September 27, 2024 |
|
September 29, 2023 |
|
September 27, 2024 |
|
September 29, 2023 |
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|
|
||||||||||||||
Adjusted Net Income |
|
||||||||||||||
Net income from continuing operations (GAAP) |
$ |
71.0 |
|
|
$ |
60.8 |
|
|
$ |
219.5 |
|
|
$ |
163.8 |
|
Less: Income attributable to noncontrolling interest, net of taxes |
|
1.6 |
|
|
|
1.5 |
|
|
|
4.7 |
|
|
|
4.5 |
|
Net income from continuing operations attributable to ESAB Corporation (GAAP) |
$ |
69.4 |
|
|
$ |
59.3 |
|
|
|
214.8 |
|
|
|
159.3 |
|
Restructuring and other related charges – pretax(2) |
|
1.9 |
|
|
|
3.1 |
|
|
|
8.6 |
|
|
|
17.7 |
|
Acquisition-amortization and other related charges – pretax(3) |
|
10.0 |
|
|
|
9.3 |
|
|
|
25.5 |
|
|
|
27.8 |
|
Pension settlement loss – pretax |
|
— |
|
|
|
— |
|
|
|
12.2 |
|
|
|
— |
|
Tax effect on above items(4) |
|
(2.8 |
) |
|
|
(3.2 |
) |
|
|
(11.3 |
) |
|
|
(11.0 |
) |
Discrete tax adjustments(5) |
|
0.1 |
|
|
|
0.5 |
|
|
|
(6.5 |
) |
|
|
20.1 |
|
Adjusted net income from continuing operations (non-GAAP) |
$ |
78.6 |
|
|
$ |
69.0 |
|
|
$ |
243.3 |
|
|
$ |
213.9 |
|
Adjusted net income from continuing operations attributable to |
|
1.9 |
|
|
|
3.2 |
|
|
|
11.3 |
|
|
|
10.8 |
|
Core adjusted net income from continuing operations (non-GAAP) |
$ |
76.7 |
|
|
$ |
65.8 |
|
|
$ |
232.0 |
|
|
$ |
203.1 |
|
Adjusted net income margin from continuing operations |
|
11.7 |
% |
|
|
10.2 |
% |
|
|
11.8 |
% |
|
|
10.3 |
% |
|
|
|
|
|
|
|
|
||||||||
Adjusted Net Income Per Share |
|
|
|
|
|
|
|
||||||||
Net income per share – diluted from continuing operations (GAAP) |
$ |
1.13 |
|
|
$ |
0.97 |
|
|
$ |
3.50 |
|
|
$ |
2.61 |
|
Restructuring and other related charges – pretax(2) |
|
0.03 |
|
|
|
0.05 |
|
|
|
0.14 |
|
|
|
0.29 |
|
Acquisition-amortization and other related charges – pretax(3) |
|
0.16 |
|
|
|
0.15 |
|
|
|
0.42 |
|
|
|
0.46 |
|
Pension settlement loss – pretax |
|
— |
|
|
|
— |
|
|
|
0.20 |
|
|
|
— |
|
Tax effect on above items(4) |
|
(0.05 |
) |
|
|
(0.05 |
) |
|
|
(0.19 |
) |
|
|
(0.18 |
) |
Discrete tax adjustments(5) |
|
— |
|
|
|
0.01 |
|
|
|
(0.11 |
) |
|
|
0.33 |
|
Adjusted net income per share – diluted from continuing operations (non-GAAP) |
$ |
1.28 |
|
|
$ |
1.13 |
|
|
$ |
3.96 |
|
|
$ |
3.51 |
|
Adjusted net income per share – diluted from continuing operations attributable to |
|
0.03 |
|
|
|
0.05 |
|
|
|
0.19 |
|
|
|
0.17 |
|
Core adjusted net income per share – diluted from continuing operations (non-GAAP) |
$ |
1.25 |
|
|
$ |
1.08 |
|
|
$ |
3.78 |
|
|
$ |
3.34 |
|
__________ |
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(1) Numbers may not sum due to rounding. |
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(2) Includes severance and other termination benefits, including outplacement services as well as the cost of relocating associates, relocating equipment, lease termination expenses, impairment of long-lived assets and other costs in connection with the closure and optimization of facilities and product lines. |
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(3) Includes transaction expenses, amortization of intangibles, fair value charges on acquired inventories and integration expenses. |
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(4) This line item reflects the aggregate tax effect of all non-tax adjustments reflected in the proceeding line items of the table. ESAB estimates the tax effect of each adjustment item by applying ESAB’s overall estimated effective tax rate to the pretax amount, unless the nature of the item and/or tax jurisdiction in which the item has been recorded requires application of a specific tax rate or tax treatment, in which case the tax effect of such item is estimated by applying such specific tax rate or tax treatment. |
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(5) For 2024, discrete adjustments relate to a favorable final ruling in the 2023 tax case in a foreign jurisdiction mentioned below. For 2023, discrete tax adjustments include the impact of net discrete tax expenses related to dividend withholding tax and the impact of an uncertain tax position due to an adverse court ruling in a foreign jurisdiction. |
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(6) Represents |
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ESAB CORPORATION |
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RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES |
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Dollars in millions |
|||||||||||||||||||||||
(Unaudited) |
|||||||||||||||||||||||
|
Three Months Ended September 27, 2024(1) |
|
Nine Months Ended September 27, 2024(1) |
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|
|
|
EMEA & APAC |
|
Total |
|
|
|
EMEA & APAC |
|
Total |
||||||||||||
|
|
||||||||||||||||||||||
Net income from continuing operations (GAAP) |
|
|
|
|
$ |
71.0 |
|
|
|
|
|
|
$ |
219.5 |
|
||||||||
Income tax expense |
|
|
|
|
|
18.1 |
|
|
|
|
|
|
|
54.5 |
|
||||||||
Interest expense and other, net |
|
|
|
|
|
16.9 |
|
|
|
|
|
|
|
49.9 |
|
||||||||
Pension settlement loss |
|
|
|
|
|
— |
|
|
|
|
|
|
|
12.2 |
|
||||||||
Operating income (GAAP) |
$ |
49.9 |
|
|
$ |
56.1 |
|
|
$ |
106.0 |
|
|
|
151.8 |
|
|
|
184.3 |
|
|
|
336.0 |
|
Adjusted to add |
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Restructuring and other related charges(2) |
|
0.9 |
|
|
|
1.0 |
|
|
|
1.9 |
|
|
|
2.0 |
|
|
|
6.6 |
|
|
|
8.6 |
|
Acquisition-amortization and other related charges(3) |
|
4.8 |
|
|
|
5.2 |
|
|
|
10.0 |
|
|
|
13.5 |
|
|
|
12.1 |
|
|
|
25.6 |
|
Depreciation and other amortization |
|
3.8 |
|
|
|
5.7 |
|
|
|
9.5 |
|
|
|
10.9 |
|
|
|
16.5 |
|
|
|
27.4 |
|
Adjusted EBITDA (non-GAAP) |
$ |
59.4 |
|
|
$ |
68.1 |
|
|
$ |
127.4 |
|
|
$ |
178.2 |
|
|
$ |
219.4 |
|
|
$ |
397.5 |
|
Adjusted EBITDA attributable to |
|
— |
|
|
|
2.6 |
|
|
|
2.6 |
|
|
|
— |
|
|
|
15.5 |
|
|
|
15.5 |
|
Core adjusted EBITDA (non-GAAP) |
$ |
59.4 |
|
|
$ |
65.5 |
|
|
$ |
124.8 |
|
|
$ |
178.2 |
|
|
$ |
203.9 |
|
|
$ |
382.1 |
|
Adjusted EBITDA margin (non-GAAP) |
|
20.6 |
% |
|
|
17.7 |
% |
|
|
18.9 |
% |
|
|
19.9 |
% |
|
|
18.7 |
% |
|
|
19.2 |
% |
Core adjusted EBITDA margin (non-GAAP)(5) |
|
20.6 |
% |
|
|
18.9 |
% |
|
|
19.6 |
% |
|
|
19.9 |
% |
|
|
19.2 |
% |
|
|
19.5 |
% |
__________ |
|||||||||||||||||||||||
(1) Numbers may not sum due to rounding. |
|||||||||||||||||||||||
(2) Includes severance and other termination benefits, including outplacement services as well as the cost of relocating associates, relocating equipment, lease termination expenses, impairment of long-lived assets and other costs in connection with the closure and optimization of facilities and product lines. |
|||||||||||||||||||||||
(3) Includes transaction expenses, amortization of intangibles, fair value charges on acquired inventories and integration expenses. |
|||||||||||||||||||||||
(4) Numbers calculated following the same definition as Adjusted EBITDA for total Company. |
|||||||||||||||||||||||
(5) Net sales were |
|||||||||||||||||||||||
ESAB CORPORATION |
|||||||||||||||||||||||
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES |
|||||||||||||||||||||||
Dollars in millions |
|||||||||||||||||||||||
(Unaudited) |
|||||||||||||||||||||||
|
Three Months Ended September 29, 2023(1) |
|
Nine Months Ended September 29, 2023(1) |
||||||||||||||||||||
|
|
|
EMEA & APAC |
|
Total |
|
|
|
EMEA & APAC |
|
Total |
||||||||||||
|
|
||||||||||||||||||||||
Net income from continuing operations (GAAP) |
|
|
|
|
$ |
60.8 |
|
|
|
|
|
|
$ |
163.8 |
|
||||||||
Income tax expense |
|
|
|
|
|
19.8 |
|
|
|
|
|
|
|
77.8 |
|
||||||||
Interest expense and other, net |
|
|
|
|
|
20.5 |
|
|
|
|
|
|
|
58.8 |
|
||||||||
Operating income (GAAP) |
$ |
46.5 |
|
|
$ |
54.7 |
|
|
$ |
101.1 |
|
|
$ |
132.4 |
|
|
$ |
168.0 |
|
|
$ |
300.4 |
|
Adjusted to add |
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Restructuring and other related charges(2) |
|
1.6 |
|
|
|
1.6 |
|
|
|
3.1 |
|
|
|
5.4 |
|
|
|
12.3 |
|
|
|
17.7 |
|
Acquisition-amortization and other related charges(3) |
|
5.2 |
|
|
|
4.0 |
|
|
|
9.3 |
|
|
|
16.0 |
|
|
|
11.9 |
|
|
|
27.8 |
|
Depreciation and other amortization |
|
3.9 |
|
|
|
5.0 |
|
|
|
9.0 |
|
|
|
11.1 |
|
|
|
15.5 |
|
|
|
26.6 |
|
Adjusted EBITDA (non-GAAP) |
$ |
57.2 |
|
|
$ |
65.3 |
|
|
$ |
122.5 |
|
|
$ |
164.9 |
|
|
$ |
207.7 |
|
|
$ |
372.6 |
|
Adjusted EBITDA attributable to |
|
— |
|
|
|
4.7 |
|
|
|
4.7 |
|
|
|
— |
|
|
|
15.7 |
|
|
|
15.7 |
|
Core adjusted EBITDA (non-GAAP) |
$ |
57.2 |
|
|
$ |
60.6 |
|
|
$ |
117.8 |
|
|
$ |
164.9 |
|
|
$ |
192.0 |
|
|
$ |
356.9 |
|
Adjusted EBITDA margin (non-GAAP) |
|
18.7 |
% |
|
|
17.4 |
% |
|
|
18.0 |
% |
|
|
18.2 |
% |
|
|
17.6 |
% |
|
|
17.9 |
% |
Core adjusted EBITDA margin (non-GAAP)(5) |
|
18.7 |
% |
|
|
17.9 |
% |
|
|
18.3 |
% |
|
|
18.2 |
% |
|
|
18.1 |
% |
|
|
18.1 |
% |
(1) Numbers may not sum due to rounding. |
|||||||||||||||||||||||
(2) Includes severance and other termination benefits, including outplacement services as well as the cost of relocating associates, relocating equipment, lease termination expenses, impairment of long-lived assets and other costs in connection with the closure and optimization of facilities and product lines. |
|||||||||||||||||||||||
(3) Includes transaction expenses, amortization of intangibles, fair value charges on acquired inventories and integration expenses. |
|||||||||||||||||||||||
(4) Numbers calculated following the same definition as Adjusted EBITDA for total Company. |
|||||||||||||||||||||||
(5) Net sales were |
|||||||||||||||||||||||
ESAB CORPORATION |
|||||||||||||||||||||||
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES |
|||||||||||||||||||||||
Change in Sales |
|||||||||||||||||||||||
Dollars in millions |
|||||||||||||||||||||||
(Unaudited) |
|||||||||||||||||||||||
|
|
||||||||||||||||||||||
|
Sales Growth(1) |
||||||||||||||||||||||
|
|
|
EMEA & APAC |
|
Total ESAB |
||||||||||||||||||
|
$ |
|
Change % |
|
$ |
|
|
Change % |
|
$ |
|
Change % |
|||||||||||
For the three months ended September 29, 2023 |
$ |
305.8 |
|
|
|
|
$ |
375.2 |
|
|
|
$ |
681.0 |
|
|
|
|||||||
Components of Change: |
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Existing businesses (organic sales growth)(2) |
|
6.2 |
|
|
2.0 |
% |
|
|
0.4 |
|
0.1 |
% |
|
|
6.6 |
|
|
1.0 |
% |
||||
Acquisitions(3) |
|
2.8 |
|
|
|
0.9 |
% |
|
|
3.8 |
|
|
1.0 |
% |
|
|
6.6 |
|
|
|
1.0 |
% |
|
Foreign Currency translation(4) |
|
(26.0 |
) |
|
|
(8.5 |
)% |
|
|
5.1 |
|
|
1.4 |
% |
|
|
(20.9 |
) |
|
|
(3.1 |
)% |
|
Total sales growth |
|
(17.0 |
) |
|
|
(5.6 |
)% |
|
|
9.3 |
|
|
2.5 |
% |
|
|
(7.7 |
) |
|
|
(1.1 |
)% |
|
For the three months ended September 27, 2024 |
$ |
288.8 |
|
|
|
|
$ |
384.4 |
|
|
|
$ |
673.3 |
|
|
|
|||||||
(1) Numbers may not sum due to rounding. |
|||||||||||||||||||||||
(2) Excludes the impact of acquisitions and foreign exchange rate fluctuations, thus providing a measure of change due to organic growth factors such as price, product mix and volume. |
|||||||||||||||||||||||
(3) Represents the incremental sales in comparison to the portion of the prior period during which we did not own the business. |
|||||||||||||||||||||||
(4) Represents the difference between prior year sales valued at the actual prior year foreign exchange rates and prior year sales valued at current year foreign exchange rates. |
|||||||||||||||||||||||
|
Core Sales Growth(1)(5) |
||||||||||||||||||||||
|
|
|
EMEA & APAC |
|
ESAB |
||||||||||||||||||
|
$ |
|
Change % |
|
$ |
|
|
Change % |
|
$ |
|
Change % |
|||||||||||
For the three months ended September 29, 2023 |
$ |
305.8 |
|
|
|
|
$ |
338.3 |
|
|
|
$ |
644.1 |
|
|
|
|||||||
Components of Change: |
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Existing businesses (core organic sales growth)(2) |
|
6.2 |
|
|
2.0 |
% |
|
|
1.8 |
|
0.5 |
% |
|
|
8.0 |
|
|
1.2 |
% |
||||
Acquisitions(3) |
|
2.8 |
|
|
|
0.9 |
% |
|
|
3.8 |
|
|
1.1 |
% |
|
|
6.6 |
|
|
|
1.0 |
% |
|
Foreign Currency translation(4) |
|
(26.0 |
) |
|
|
(8.5 |
)% |
|
|
2.9 |
|
|
0.9 |
% |
|
|
(23.1 |
) |
|
|
(3.6 |
)% |
|
Total core sales growth |
|
(17.0 |
) |
|
|
(5.6 |
)% |
|
|
8.5 |
|
|
2.5 |
% |
|
|
(8.5 |
) |
|
|
(1.3 |
)% |
|
For the three months ended September 27, 2024 |
$ |
288.8 |
|
|
|
|
$ |
346.8 |
|
|
|
$ |
635.6 |
|
|
|
|||||||
(1) Numbers may not sum due to rounding. |
|||||||||||||||||||||||
(2) Excludes the impact of acquisitions and foreign exchange rate fluctuations, thus providing a measure of change due to organic growth factors such as price, product mix and volume. |
|||||||||||||||||||||||
(3) Represents the incremental sales in comparison to the portion of the prior period during which we did not own the business. |
|||||||||||||||||||||||
(4) Represents the difference between prior year sales valued at the actual prior year foreign exchange rates and prior year sales valued at current year foreign exchange rates. |
|||||||||||||||||||||||
(5) Represents sales excluding |
|||||||||||||||||||||||
ESAB CORPORATION |
|||||||||||||||||||||||
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES |
|||||||||||||||||||||||
Change in Sales |
|||||||||||||||||||||||
Dollars in millions |
|||||||||||||||||||||||
(Unaudited) |
|||||||||||||||||||||||
|
|
||||||||||||||||||||||
|
Sales Growth(1) |
||||||||||||||||||||||
|
|
|
EMEA & APAC |
|
Total ESAB |
||||||||||||||||||
|
$ |
|
Change % |
|
$ |
|
|
Change % |
|
$ |
|
Change % |
|||||||||||
For the nine months ended September 29, 2023 |
$ |
907.7 |
|
|
|
|
$ |
1,177.8 |
|
|
|
|
$ |
2,085.4 |
|
|
|
||||||
Components of Change: |
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Existing businesses (organic sales growth)(2) |
|
27.6 |
|
|
3.0 |
% |
|
|
4.0 |
|
|
0.3 |
% |
|
|
31.6 |
|
|
1.5 | % |
|||
Acquisitions(3) |
|
6.4 |
|
|
|
0.7 |
% |
|
|
3.9 |
|
|
|
0.3 |
% |
|
|
10.3 |
|
|
0.5 |
% |
|
Foreign Currency translation(4) |
|
(47.0 |
) |
|
|
(5.2 |
)% |
|
|
(10.3 |
) |
|
|
(0.9 |
)% |
|
|
(57.3 |
) |
|
(2.7 |
)% |
|
Total sales growth |
|
(13.0 |
) |
|
|
(1.4 |
)% |
|
|
(2.4 |
) |
|
|
(0.2 |
)% |
|
|
(15.4 |
) |
|
(0.7 |
)% |
|
For the nine months ended September 27, 2024 |
$ |
894.6 |
|
|
|
|
$ |
1,175.4 |
|
|
|
|
$ |
2,070.0 |
|
|
|
||||||
(1) Numbers may not sum due to rounding. |
|||||||||||||||||||||||
(2) Excludes the impact of acquisitions and foreign exchange rate fluctuations, thus providing a measure of change due to organic growth factors such as price, product mix and volume. |
|||||||||||||||||||||||
(3) Represents the incremental sales in comparison to the portion of the prior period during which we did not own the business. |
|||||||||||||||||||||||
(4) Represents the difference between prior year sales valued at the actual prior year foreign exchange rates and prior year sales valued at current year foreign exchange rates. |
|||||||||||||||||||||||
|
Core Sales Growth(1)(5) |
||||||||||||||||||||||
|
|
|
EMEA & APAC |
|
ESAB |
||||||||||||||||||
|
$ |
|
Change % |
|
$ |
|
|
Change % |
|
$ |
|
Change % |
|||||||||||
For the nine months ended September 29, 2023 |
$ |
907.7 |
|
|
|
|
$ |
1,063.3 |
|
|
|
|
$ |
1,971.0 |
|
|
|
||||||
Components of Change: |
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Existing businesses (core organic sales growth)(2) |
|
27.6 |
|
|
3.0 |
% |
|
|
(2.7 |
) |
|
(0.3 |
)% |
|
|
24.9 |
|
|
1.3 |
% |
|||
Acquisitions(3) |
|
6.4 |
|
|
|
0.7 |
% |
|
|
3.9 |
|
|
|
0.4 |
% |
|
|
10.3 |
|
|
0.5 |
% |
|
Foreign Currency translation(4) |
|
(47.0 |
) |
|
|
(5.2 |
)% |
|
|
(1.3 |
) |
|
|
(0.1 |
)% |
|
|
(48.3 |
) |
|
(2.5 |
)% |
|
Total core sales growth |
|
(13.0 |
) |
|
|
(1.4 |
)% |
|
|
(0.1 |
) |
|
|
— |
% |
|
|
(13.1 |
) |
|
(0.7 |
)% |
|
For the nine months ended September 27, 2024 |
$ |
894.6 |
|
|
|
|
$ |
1,063.4 |
|
|
|
|
$ |
1,958.0 |
|
|
|
||||||
(1) Numbers may not sum due to rounding. |
|||||||||||||||||||||||
(2) Excludes the impact of acquisitions and foreign exchange rate fluctuations, thus providing a measure of change due to organic growth factors such as price, product mix and volume. |
|||||||||||||||||||||||
(3) Represents the incremental sales in comparison to the portion of the prior period during which we did not own the business. |
|||||||||||||||||||||||
(4) Represents the difference between prior year sales valued at the actual prior year foreign exchange rates and prior year sales valued at current year foreign exchange rates. |
|||||||||||||||||||||||
(5) Represents sales excluding |
|||||||||||||||||||||||
ESAB CORPORATION |
|||||||||||||||
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES |
|||||||||||||||
Adjusted Free Cash Flow |
|||||||||||||||
Dollars in millions |
|||||||||||||||
(Unaudited) |
|||||||||||||||
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||
|
September 27, 2024 |
|
September 29, 2023 |
|
September 27, 2024 |
|
September 29, 2023 |
||||||||
|
|
|
|
|
|
|
|
||||||||
Net cash provided by operating activities (GAAP) |
$ |
101.0 |
|
|
$ |
107.4 |
|
|
$ |
228.5 |
|
|
$ |
208.1 |
|
Purchases of property, plant and equipment (GAAP) |
|
(10.7 |
) |
|
|
(11.9 |
) |
|
|
(27.1 |
) |
|
|
(28.9 |
) |
Proceeds from the sale of certain properties(1) |
|
1.9 |
|
|
|
1.9 |
|
|
|
1.9 |
|
|
|
2.8 |
|
Payments related to the Separation(2) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
4.4 |
|
Payments related to discontinued operations |
|
3.6 |
|
|
|
2.5 |
|
|
|
12.1 |
|
|
|
12.2 |
|
Adjusted free cash flow (non-GAAP) |
$ |
95.8 |
|
|
$ |
99.9 |
|
|
$ |
215.4 |
|
|
$ |
198.6 |
|
(1) Includes proceeds from the sale of certain properties related to restructuring efforts for which previous cash outlays were included in Net cash provided by operating activities. |
|||||||||||||||
(2) Separation payments relate to one-time non-recurring professional fees and employee costs incurred in the planning and execution of the Company’s separation from Enovis Corporation. |
|||||||||||||||
ESAB CORPORATION |
||||
2024 Outlook |
||||
Dollars in millions, except per share amounts |
||||
(Unaudited) |
||||
ESAB 2024 Outlook |
||||
|
|
Previous Guidance |
|
New Guidance |
2023 Core net sales |
|
|
|
|
Organic growth |
|
(1.0)%- |
|
|
Acquisitions |
|
|
|
|
Currency |
|
(2.5) % |
|
~(2.5)% |
2024 Core net sales growth range |
|
(2.5)%-(0.5)% |
|
(1.5)%-(0.5)% |
|
|
|
|
|
2023 Core adjusted EBITDA |
|
|
|
|
2024 Core adjusted EBITDA range |
|
|
|
|
|
|
|
|
|
2023 Core adjusted EPS |
|
|
|
|
2024 Core adjusted EPS range |
|
|
|
|
ESAB CORPORATION |
|||||||
CONSOLIDATED AND CONDENSED BALANCE SHEETS |
|||||||
Dollars in thousands, except share and per share amounts |
|||||||
(Unaudited) |
|||||||
|
|
|
|
||||
|
September 27, 2024 |
|
December 31, 2023 |
||||
|
|
|
|
||||
ASSETS |
|
|
|
||||
CURRENT ASSETS: |
|
|
|
||||
Cash and cash equivalents |
$ |
253,670 |
|
|
$ |
102,003 |
|
Trade receivables, less allowance for credit losses of |
|
420,938 |
|
|
|
385,198 |
|
Inventories, net |
|
422,654 |
|
|
|
392,858 |
|
Prepaid expenses |
|
58,732 |
|
|
|
61,771 |
|
Other current assets |
|
65,517 |
|
|
|
55,890 |
|
Total current assets |
|
1,221,511 |
|
|
|
997,720 |
|
Property, plant and equipment, net |
|
296,437 |
|
|
|
294,305 |
|
Goodwill |
|
1,667,878 |
|
|
|
1,588,331 |
|
Intangible assets, net |
|
499,789 |
|
|
|
499,535 |
|
Lease assets - right of use |
|
94,413 |
|
|
|
95,607 |
|
Other assets |
|
304,506 |
|
|
|
353,131 |
|
Total assets |
$ |
4,084,534 |
|
|
$ |
3,828,629 |
|
|
|
|
|
||||
LIABILITIES AND EQUITY |
|
|
|
||||
CURRENT LIABILITIES: |
|
|
|
||||
Accounts payable |
$ |
320,252 |
|
|
$ |
306,593 |
|
Accrued liabilities |
|
316,819 |
|
|
|
313,489 |
|
Total current liabilities |
|
637,071 |
|
|
|
620,082 |
|
Long-term debt |
|
1,080,182 |
|
|
|
1,018,057 |
|
Other liabilities |
|
489,556 |
|
|
|
542,833 |
|
Total liabilities |
|
2,206,809 |
|
|
|
2,180,972 |
|
Equity: |
|
|
|
||||
Common stock - |
|
60 |
|
|
|
60 |
|
Additional paid-in capital |
|
1,893,665 |
|
|
|
1,881,054 |
|
Retained earnings |
|
548,300 |
|
|
|
350,557 |
|
Accumulated other comprehensive loss |
|
(604,900 |
) |
|
|
(624,272 |
) |
Total ESAB Corporation equity |
|
1,837,125 |
|
|
|
1,607,399 |
|
Noncontrolling interest |
|
40,600 |
|
|
|
40,258 |
|
Total equity |
|
1,877,725 |
|
|
|
1,647,657 |
|
Total liabilities and equity |
$ |
4,084,534 |
|
|
$ |
3,828,629 |
|
ESAB CORPORATION |
|||||||
CONSOLIDATED AND CONDENSED STATEMENTS OF CASH FLOWS |
|||||||
Dollars in thousands |
|||||||
(Unaudited) |
|||||||
|
Nine Months Ended |
||||||
|
September 27, 2024 |
|
September 29, 2023 |
||||
|
|
|
|
||||
Cash flows from operating activities: |
|
|
|
||||
Net income |
$ |
215,796 |
|
|
$ |
159,552 |
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
||||
Depreciation, amortization and other impairment charges |
|
50,028 |
|
|
|
57,090 |
|
Stock-based compensation expense |
|
14,473 |
|
|
|
11,150 |
|
Deferred income tax |
|
2,394 |
|
|
|
756 |
|
Non-cash interest expense |
|
2,259 |
|
|
|
896 |
|
Pension settlement loss |
|
12,155 |
|
|
|
— |
|
Changes in operating assets and liabilities: |
|
|
|
||||
Trade receivables, net |
|
(39,075 |
) |
|
|
(15,170 |
) |
Inventories, net |
|
(31,651 |
) |
|
|
(16,212 |
) |
Accounts payable |
|
16,895 |
|
|
|
(17,746 |
) |
Other operating assets and liabilities |
|
(14,751 |
) |
|
|
27,783 |
|
Net cash provided by operating activities |
|
228,523 |
|
|
|
208,099 |
|
Cash flows from investing activities: |
|
|
|
||||
Purchases of property, plant and equipment |
|
(27,071 |
) |
|
|
(28,865 |
) |
Proceeds from sale of property, plant and equipment |
|
3,452 |
|
|
|
5,171 |
|
Acquisitions, net of cash received |
|
(86,537 |
) |
|
|
(18,665 |
) |
Other investing |
|
(4,058 |
) |
|
|
— |
|
Net cash used in investing activities |
|
(114,214 |
) |
|
|
(42,359 |
) |
Cash flows from financing activities: |
|
|
|
||||
Proceeds from borrowings on Senior Notes |
|
700,000 |
|
|
|
— |
|
Proceeds from borrowings on revolving credit facilities and other |
|
205,000 |
|
|
|
454,671 |
|
Repayments of borrowings on Term Loans |
|
(597,500 |
) |
|
|
(6,250 |
) |
Repayments of borrowings on revolving credit facilities and other |
|
(236,623 |
) |
|
|
(578,623 |
) |
Payment of debt issuance costs and other |
|
(15,522 |
) |
|
|
— |
|
Payment of dividends |
|
(12,135 |
) |
|
|
(9,702 |
) |
Distributions to noncontrolling interest holders |
|
(2,644 |
) |
|
|
(2,279 |
) |
Net cash provided by (used in) financing activities |
|
40,576 |
|
|
|
(142,183 |
) |
Effect of foreign exchange rates on Cash and cash equivalents |
|
(3,218 |
) |
|
|
(12,748 |
) |
Increase in Cash and cash equivalents |
|
151,667 |
|
|
|
10,809 |
|
Cash and cash equivalents, beginning of period |
|
102,003 |
|
|
|
72,024 |
|
Cash and cash equivalents, end of period |
$ |
253,670 |
|
|
$ |
82,833 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20241029328363/en/
Investor Relations Contact:
Mark Barbalato
Vice President, Investor Relations
E-mail: investorrelations@esab.com
Phone: 1-301-323-9098
Media Contact:
Tilea Coleman
Vice President, Corporate Communications
E-mail: mediarelations@esab.com
Phone: 1-301-323-9092
Source: ESAB Corporation
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