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Enerpac Tool Group Reports First Quarter Fiscal 2024 Results and Affirms Full-Year Guidance

First Quarter of Fiscal 2024 Continuing Operations Highlights*

  • Net sales were $142 million, a 1.9% increase year-over-year, with organic growth of 5.5%**
  • Gross margin expanded 360 basis points year-over-year to 52.3%
  • GAAP operating margin was 20.2% and adjusted operating margin was 22.8%
  • Net earnings were $18 million, or $0.33 per share
  • Adjusted EBITDA was $35 million, an increase of 31% year-over-year. Adjusted EBITDA margin was 24.6%, an increase of 550 basis points year-over-year.
  • Returned approximately $26 million to shareholders through share repurchases

*This press release contains financial measures in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”) in addition to non-GAAP financial measures. Reconciliations of the non-GAAP financial measures to the comparable GAAP measures are presented in the tables accompanying this release.

**Organic growth, formerly referred to as core growth, represents revenue growth excluding the impact of foreign exchange rates, acquisitions, and divestitures. A reconciliation of organic sales growth to the comparable net sales growth is presented in the tables accompanying this release.

Enerpac Tool Group Corp. (NYSE: EPAC) today announced results for its fiscal first quarter ended November 30, 2023.

“We began fiscal 2024 with another good quarter, underscored by solid top-line growth and greatly expanded profitability,” said Paul Sternlieb, Enerpac Tool Group’s President & CEO. “While we maintain a cautious tone regarding full-year results, given economic and geopolitical uncertainty, our performance demonstrates the continued benefits of Enerpac’s ASCEND transformation program, four-pillar growth strategy, and the permanent changes across the organization that are making Enerpac more efficient, more productive, and easier to do business with.”

Consolidated Results from Continuing Operations

(US$ in millions, except per share)

Three Months Ended

November 30, 2023

November 30, 2022

Net Sales

$142.0

$139.4

Operating Profit

$28.7

 

$12.3

Adjusted Op Profit

$32.4

 

$23.1

Net Income

$18.3

 

$6.4

Diluted EPS

$0.33

$0.11

Adjusted Diluted EPS

$0.39

$0.29

Adjusted EBITDA

$34.9

 

$26.6

First Quarter Fiscal 2024 Consolidated Results Comparisons

“First quarter gains in operating profit and margins reflect the success of our transformational initiatives that enhance productivity and efficiency at the gross profit and SG&A lines,” stated Tony Colucci, Executive Vice President and Chief Financial Officer. “Additionally, reported results reflect lower ASCEND-related charges.”

Consolidated net sales for the first quarter of fiscal 2024 were $142.0 million compared to $139.4 million in the prior-year period, an increase of 1.9%. Organic sales, excluding the disposition of Cortland Industrial and the impact of foreign currency, increased 5.5% year-over-year, with product sales up 4.2% and service revenues ahead 10.1%. Net sales growth for the Industrial Tools & Services (IT&S) reportable segment of 7.6%, with organic growth of 5.8%, was partly offset by a year-over-year decline at Cortland Biomedical, which comprises the Other operating segment.

Gross margin expanded approximately 360 basis points year-over-year to 52.3%, driven by operational improvements related to ASCEND, favorable sales mix, volume leverage, carryover price increases from fiscal 2023, and the disposition of Cortland Industrial. Selling, general and administrative expenses of $44.6 million were $9.6 million lower year-over-year. Adjusted SG&A was 29.0% of sales, down from 31.2% of sales in the year-ago period.

Operating profit increased 133% year-over-year to $28.7 million, with an operating profit margin of 20.2%, up from 8.8% in the first quarter of fiscal 2023. Adjusted operating profit increased 40% to $32.4 million, with an adjusted operating margin of 22.8%, a 620 basis point expansion over the prior-year period.

First quarter fiscal 2024 net earnings and diluted EPS were $18.3 million and $0.33 respectively, compared to $6.4 million and $0.11, respectively, in the year-ago period.

First quarter adjusted EBITDA was $34.9 million compared to $26.6 million in the year-ago period, achieving an adjusted EBITDA margin of 24.6%, up 550 basis points from 19.1% in the first quarter of fiscal 2023.

Net cash used by operating activities was $6.7 million for the first quarter of fiscal 2024 as compared to $17.5 million of cash provided by operations in the prior-year period. The decrease in cash from operations was primarily due to the timing of annual incentive compensation payments along with payments made for the ASCEND transformation program. In fiscal 2023, the annual incentive compensation payment was recorded in the second quarter.

Industrial Tools & Services (IT&S)

 

(US$ in millions)

 

 

 

Three Months Ended

November 30, 2023

November 30, 2022

Net Sales

$137.0

$127.3

Operating Profit

$35.6

$26.6

Operating Profit %

26.0%

 

20.9%

Adjusted Op Profit (1)

$38.5

 

$29.1

Adjusted Op Profit % (1)

28.1%

22.9%

 

(1) Excludes approximately $2.1 million of restructuring charges and $0.8 million of ASCEND charges in the first quarter of fiscal 2024 and approximately $0.9 million of restructuring charges and $1.5 million of ASCEND charges in the first quarter of fiscal 2023.

IT&S Results Comparisons

First quarter fiscal 2024 net sales for IT&S were $137.0 million, ahead 7.6% year-over-year with organic growth of 5.8%. Organic growth was driven by a 4.5% increase in product sales and a 10.1% increase in service revenues. The segment’s operating profit margin increased 510 basis points to 26.0% and adjusted operating profit margin improved 520 basis points to 28.1%.

Corporate Expenses from Continuing Operations

Corporate expenses were $8.9 million and $15.8 million for the first quarter of fiscal 2024 and fiscal 2023, respectively. The year-over-year decline was driven by significantly lower ASCEND-related charges during the quarter. Adjusted corporate expenses(2) of $8.1 million for the first quarter increased $0.7 million compared to the prior year, as a result of higher incentive compensation.

(2) First quarter fiscal 2024 adjusted corporate expense excludes approximately $0.3 million of restructuring charges, $0.4 million of ASCEND charges, and $0.1 million of impairment and divestiture charges as compared to approximately $0.1 million of restructuring charges, $7.9 million of ASCEND charges, and $0.4 million of leadership transition charges in the first quarter of fiscal 2023.

 

Balance Sheet and Leverage

 

 

(US$ in millions)

 

November 30, 2023

August 31, 2023

November 30, 2022

Cash Balance

 

$148.0

$154.4

$129.2

Debt Balance

 

$244.5

$214.1

$202.2

Net Debt to Adjusted EBITDA*

 

0.9x

0.6x

0.7x

 

 

 

 

 

*Calculated in accordance with the terms of the Company’s September 2022 Senior Credit Facility.

Net debt at November 30, 2023, was $96.5 million, resulting in a net debt to adjusted EBITDA ratio of 0.9x. The Company repurchased approximately one million shares of its common stock in the first quarter of fiscal 2024 for $26 million under its share repurchase program announced in March 2022.

Outlook

“With the solid start to fiscal 2024, we are on track to achieve our full-year financial objectives,” concluded Sternlieb.

As such, the Company affirms its fiscal 2024 guidance, projecting a net sales range of $590 million to $605 million. The forecast anticipates organic growth of approximately 2% to 4%, with expected adjusted EBITDA in the range of $142 million to $152 million, and free cash flow between $60 million to $70 million. This forecast is based on key foreign exchange rate assumptions and assumes the absence of a broad-based global recession. The key foreign exchange rates and other guidance assumptions are included in the presentation materials accompanying the earnings webcast.

Conference Call Information

An investor conference call is scheduled for 7:30 am CT on December 20, 2023. Webcast information and conference call materials, including an earnings presentation, are available on the Enerpac Tool Group company website (www.enerpactoolgroup.com).

Safe Harbor Statement

Certain of the above comments represent forward-looking statements made pursuant to the provisions of the Private Securities Litigation Reform Act of 1995. In addition to statements with respect to guidance, the terms “outlook,” “guidance,” “may,” “should,” “could,” “anticipate,” “believe,” “estimate,” “expect,” “objective,” “plan,” “project” and similar expressions are intended to identify forward-looking statements. Such forward-looking statements are subject to inherent risks and uncertainties that may cause actual results or events to differ materially from those contemplated by such forward-looking statements. In addition to the assumptions and other factors referred to specifically in connection with such statements, risks and uncertainties that may cause actual results or events to differ materially from those contemplated by such forward-looking statements include, without limitation, general economic uncertainty, market conditions in the industrial, oil & gas, energy, power generation, infrastructure, commercial construction, truck and automotive industries, the impact of geopolitical activity, including the invasion of Ukraine by Russia and international sanctions imposed in response thereto, as well as the armed conflict involving Hamas and Israel, the ability of the Company to achieve its plans or objectives related to its growth strategy, market acceptance of existing and new products, market acceptance of price increases, successful integration of acquisitions, the impact of dispositions and restructurings, the ability of the Company to continue to achieve its objectives related to the ASCEND program, including any assumptions underlying its calculation of expected incremental operating profit or program investment, operating margin risk due to competitive pricing and operating efficiencies, supply chain risk, risks related to reliance on independent agents and distributors for the distribution and service of products, material, labor, or overhead cost increases, tax law changes, foreign currency risk, interest rate risk, commodity risk, tariffs, litigation matters, impairment of goodwill or other intangible assets, the Company’s ability to access capital markets and other risks and uncertainties that may be referred to or noted in the Company’s reports filed with the Securities and Exchange Commission from time to time, including those described in the Company’s Form 10-K for the fiscal year ended August 31, 2023 and most recent report on Form 10-Q. Enerpac Tool Group disclaims any obligation to publicly update or revise any forward-looking statements as a result of new information, future events or any other reason.

Non-GAAP Financial Information

This press release contains financial measures that are not measures presented in conformity with GAAP. These non-GAAP measures include organic growth, EBITDA from continuing operations, adjusted EBITDA from continuing operations, adjusted earnings from continuing operations, adjusted diluted earnings per share from continuing operations, adjusted operating profit from continuing operations, segment adjusted operating profit and adjusted EBITDA, adjusted corporate expense, adjusted SG&A expense, free cash flow and net debt. This press release includes reconciliations of non-GAAP measures to the most comparable GAAP measure, included in the tables attached to this press release or in footnotes to the tables included in this press release. Management believes the non-GAAP measures presented in this press release are commonly used financial measures for investors to evaluate Enerpac Tool Group’s operating performance and financial position with respect to the periods presented and, when read in conjunction with the condensed consolidated financial statements, present a useful tool to evaluate ongoing operations and provide investors with metrics they can use to evaluate aspects of the Company’s performance from period to period. In addition, these are some of the financial metrics management uses in internal evaluations of the overall performance of the Company’s business. Management acknowledges that there are many items that impact a company’s reported results and the adjustments reflected in these non-GAAP measures are not intended to present all items that may have impacted these results. In addition, these non-GAAP measures are not necessarily comparable to similarly titled measures used by other companies.

About Enerpac Tool Group

Enerpac Tool Group Corp. is a premier industrial tools, services, technology, and solutions provider serving a broad and diverse set of customers and end markets for mission-critical applications in more than 100 countries. The Company makes complex, often hazardous jobs possible safely and efficiently. Enerpac Tool Group’s businesses are global leaders in high pressure hydraulic tools, controlled force products, and solutions for precise positioning of heavy loads that help customers safely and reliably tackle some of the most challenging jobs around the world. The Company was founded in 1910 and is headquartered in Menomonee Falls, Wisconsin. Enerpac Tool Group common stock trades on the NYSE under the symbol EPAC. For further information on Enerpac Tool Group and its businesses, visit the Company's website at www.enerpactoolgroup.com.

(tables follow)

Enerpac Tool Group Corp.
Condensed Consolidated Balance Sheets
(In thousands)
 
(Unaudited)
November 30, August 31,

2023

2023

Assets
Current assets
Cash and cash equivalents

$

147,956

 

$

154,415

 

Accounts receivable, net

 

94,925

 

 

97,649

 

Inventories, net

 

80,081

 

 

74,765

 

Other current assets

 

36,997

 

 

28,811

 

Total current assets

 

359,959

 

 

355,640

 

 
Property, plant and equipment, net

 

37,963

 

 

38,968

 

Goodwill

 

266,538

 

 

266,494

 

Other intangible assets, net

 

37,726

 

 

37,338

 

Other long-term assets

 

63,381

 

 

64,157

 

 
Total assets

$

765,567

 

$

762,597

 

 
Liabilities and Shareholders' Equity
Current liabilities
Trade accounts payable

$

45,505

 

$

50,483

 

Accrued compensation and benefits

 

21,775

 

 

33,194

 

Current maturities of long-term debt

 

4,375

 

 

3,750

 

Income taxes payable

 

4,772

 

 

3,771

 

Other current liabilities

 

50,557

 

 

56,922

 

Total current liabilities

 

126,984

 

 

148,120

 

 
Long-term debt, net

 

240,128

 

 

210,337

 

Deferred income taxes

 

6,031

 

 

5,667

 

Pension and postretirement benefit liabilities

 

10,168

 

 

10,247

 

Other long-term liabilities

 

60,580

 

 

61,606

 

Total liabilities

 

443,891

 

 

435,977

 

 
Shareholders' equity
Capital stock

 

16,793

 

 

16,752

 

Additional paid-in capital

 

223,474

 

 

220,472

 

Treasury stock

 

(826,622

)

 

(800,506

)

Retained earnings

 

1,028,871

 

 

1,011,112

 

Accumulated other comprehensive loss

 

(120,840

)

 

(121,210

)

Stock held in trust

 

(3,576

)

 

(3,484

)

Deferred compensation liability

 

3,576

 

 

3,484

 

Total shareholders' equity

 

321,676

 

 

326,620

 

 
Total liabilities and shareholders' equity

$

765,567

 

$

762,597

 

Enerpac Tool Group Corp.
Condensed Consolidated Statements of Earnings
(In thousands, except per share amounts)
(Unaudited)
   
Three Months Ended
November 30, November 30,

2023

2022

Net sales

$

141,970

 

$

139,382

 
Cost of products sold

 

67,720

 

 

71,476

 
Gross profit

 

74,250

 

 

67,906

 
   
Selling, general and administrative expenses

 

42,216

 

 

53,247

 
Amortization of intangible assets

 

824

 

 

1,368

 
Restructuring charges

 

2,401

 

 

982

 
Impairment & divestiture charges

 

147

 

 

-

 
Operating profit

 

28,662

 

 

12,309

 
   
Financing costs, net

 

3,697

 

 

2,815

 
Other expense, net

 

991

 

 

702

 
Earnings before income tax expense

 

23,974

 

 

8,792

 
   
Income tax expense

 

5,669

 

 

2,383

 
Net earnings from continuing operations

 

18,305

 

 

6,409

 
(Loss) earnings from discontinued operations, net of income taxes

 

(567

)

 

1,044

 
Net earnings

$

17,738

 

$

7,453

 
   
Earnings per share from continuing operations  
Basic

$

0.34

 

$

0.11

 
Diluted

 

0.33

 

 

0.11

 
   
(Loss) earnings per share from discontinued operations  
Basic

$

(0.01

)

$

0.02

 
Diluted

 

(0.01

)

 

0.02

 
   
Earnings per share*  
Basic

$

0.33

 

$

0.13

 
Diluted

 

0.32

 

 

0.13

 
   
Weighted average common shares outstanding  
Basic

 

54,527

 

 

56,886

 
Diluted

 

55,008

 

 

57,317

 
   
*The total of earnings per share from continuing operations and loss (earnings) per share from discontinued operations may not equal earnings per share due to rounding.
Enerpac Tool Group Corp.
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
 
Three Months Ended
November 30, November 30,

 

2023

 

 

2022

 

Operating Activities
Cash (used in) provided by operating activities - continuing operations

$

(3,917

)

$

17,814

 

Cash used in operating activities - discontinued operations

 

(2,758

)

 

(281

)

Cash (used in) provided by operating activities

$

(6,675

)

$

17,533

 

 
Investing Activities
Capital expenditures

 

(1,567

)

 

(2,535

)

Purchase of business assets

 

(1,027

)

 

-

 

Cash used in investing activities - continuing operations

$

(2,594

)

$

(2,535

)

Cash used in investing activities

$

(2,594

)

$

(2,535

)

 
Financing Activities
Borrowings on revolving credit facility

 

39,000

 

 

14,000

 

Principal repayments on revolving credit facility

 

(8,000

)

 

(11,000

)

Principal repayments on term loan

 

(625

)

 

-

 

Proceeds from issuance of term loan

 

-

 

 

200,000

 

Payment for redemption of revolver

 

-

 

 

(200,000

)

Swingline borrowings/repayments, net

 

-

 

 

(4,000

)

Payment of debt issuance costs

 

-

 

 

(2,417

)

Purchase of treasury shares

 

(26,116

)

 

-

 

Stock options, taxes paid related to the net share settlement of equity awards & other

 

236

 

 

3

 

Payment of cash dividend

 

(2,178

)

 

(2,274

)

Cash provided by (used in) financing activities - continuing operations

$

2,317

 

$

(5,688

)

Cash provided by (used in) financing activities

$

2,317

 

$

(5,688

)

 
Effect of exchange rate changes on cash

 

493

 

 

(766

)

 
Net (decrease) increase from cash and cash equivalents

$

(6,459

)

$

8,544

 

Cash and cash equivalents - beginning of period

 

154,415

 

 

120,699

 

Cash and cash equivalents - end of period

$

147,956

 

$

129,243

 

Enerpac Tool Group Corp.
Supplemental Unaudited Data
Reconciliation of GAAP Measures to Non-GAAP Measures for Continuing Operations
(In thousands) Fiscal 2023 Fiscal 2024
Q1 Q2 Q3 Q4 TOTAL Q1 Q2 Q3 Q4 TOTAL
Net Sales
Industrial Tools & Services Segment

$

127,297

 

$

130,904

 

$

144,126

 

$

152,851

 

$

555,178

 

$

137,035

 

$

-

$

-

$

-

$

137,035

 

Other

 

12,085

 

 

11,056

 

 

12,127

 

 

7,758

 

 

43,026

 

 

4,935

 

 

-

 

-

 

-

 

4,935

 

Enerpac Tool Group

$

139,382

 

$

141,960

 

$

156,253

 

$

160,609

 

$

598,204

 

$

141,970

 

$

-

$

-

$

-

$

141,970

 

 
% Net Sales Growth
Industrial Tools & Services Segment

 

5

%

 

4

%

 

3

%

 

9

%

 

5

%

 

8

%

 

-

 

-

 

-

 

8

%

Other

 

26

%

 

4

%

 

5

%

 

-36

%

 

-2

%

 

-59

%

 

-

 

-

 

-

 

-59

%

Enerpac Tool Group

 

6

%

 

4

%

 

3

%

 

6

%

 

5

%

 

2

%

 

-

 

-

 

-

 

2

%

 
Adjusted Selling, general and administrative expenses
Selling, general and administrative expenses

$

53,247

 

$

52,059

 

$

48,809

 

$

50,949

 

$

205,063

 

$

42,216

 

$

-

$

-

$

-

$

42,216

 

Leadership transition charges

 

(400

)

 

(202

)

 

(90

)

 

(90

)

 

(783

)

 

-

 

 

-

 

-

 

-

 

-

 

M&A charges

 

-

 

 

(196

)

 

(166

)

 

(653

)

 

(1,015

)

 

-

 

 

-

 

-

 

-

 

-

 

ASCEND transformation program charges

 

(9,382

)

 

(11,197

)

 

(5,536

)

 

(8,381

)

 

(34,495

)

 

(1,093

)

 

-

 

-

 

-

 

(1,093

)

Adjusted Selling, general and administrative expenses

$

43,465

 

$

40,464

 

$

43,017

 

$

41,825

 

$

168,770

 

$

41,123

 

$

-

$

-

$

-

$

41,123

 

 
Adjusted Selling, general and administrative expenses %
Enerpac Tool Group

 

31.2

%

 

28.5

%

 

27.5

%

 

26.0

%

 

28.2

%

 

29.0

%

 

-

 

-

 

-

 

29.0

%

 
Adjusted Operating profit
Operating profit

$

12,309

 

$

13,972

 

$

25,439

 

$

32,202

 

$

83,922

 

$

28,662

 

$

-

$

-

$

-

$

28,662

 

Impairment & divestiture (benefit) charges

 

-

 

 

-

 

 

-

 

 

(6,155

)

 

(6,155

)

 

147

 

 

-

 

-

 

-

 

147

 

Restructuring charges (1)

 

982

 

 

2,987

 

 

2,252

 

 

1,461

 

 

7,681

 

 

2,401

 

 

-

 

-

 

-

 

2,401

 

Leadership transition charges

 

400

 

 

202

 

 

90

 

 

90

 

 

783

 

 

-

 

 

-

 

-

 

-

 

-

 

M&A charges

 

-

 

 

196

 

 

166

 

 

653

 

 

1,015

 

 

-

 

 

-

 

-

 

-

 

-

 

ASCEND transformation program charges

 

9,419

 

 

11,372

 

 

5,947

 

 

8,681

 

 

35,419

 

 

1,229

 

 

-

 

-

 

-

 

1,229

 

Adjusted operating profit

$

23,110

 

$

28,729

 

$

33,894

 

$

36,932

 

$

122,665

 

$

32,439

 

$

-

$

-

$

-

$

32,439

 

 
Adjusted Operating Profit by Segment
Industrial Tools & Services Segment

$

29,099

 

$

34,836

 

$

39,814

 

$

45,269

 

$

149,019

 

$

38,470

 

$

-

$

-

$

-

$

38,470

 

Other

 

1,424

 

 

1,156

 

 

1,965

 

 

254

 

 

4,799

 

 

2,118

 

 

-

 

-

 

-

 

2,118

 

Corporate / General

 

(7,413

)

 

(7,263

)

 

(7,885

)

 

(8,591

)

 

(31,153

)

 

(8,149

)

 

-

 

-

 

-

 

(8,149

)

Adjusted operating profit

$

23,110

 

$

28,729

 

$

33,894

 

$

36,932

 

$

122,665

 

$

32,439

 

$

-

$

-

$

-

$

32,439

 

 
Adjusted Operating Profit % by Segment
Industrial Tools & Services Segment

 

22.9

%

 

26.6

%

 

27.6

%

 

29.6

%

 

26.8

%

 

28.1

%

 

-

 

-

 

-

 

28.1

%

Other

 

11.8

%

 

10.5

%

 

16.2

%

 

3.3

%

 

11.2

%

 

42.9

%

 

-

 

-

 

-

 

42.9

%

Adjusted Operating Profit %

 

16.6

%

 

20.2

%

 

21.7

%

 

23.0

%

 

20.5

%

 

22.8

%

 

-

 

-

 

-

 

22.8

%

 
EBITDA from Continuing Operations (2)
Net earnings from continuing operations

$

6,409

 

$

7,158

 

$

16,976

 

$

23,105

 

$

53,649

 

$

18,305

 

$

-

$

-

$

-

$

18,305

 

Financing costs, net

 

2,815

 

 

3,105

 

 

3,250

 

 

3,219

 

 

12,389

 

 

3,697

 

 

-

 

-

 

-

 

3,697

 

Income tax expense

 

2,383

 

 

2,988

 

 

4,688

 

 

5,190

 

 

15,249

 

 

5,669

 

 

-

 

-

 

-

 

5,669

 

Depreciation & amortization

 

4,193

 

 

4,226

 

 

4,084

 

 

3,810

 

 

16,313

 

 

3,426

 

 

-

 

-

 

-

 

3,426

 

EBITDA

$

15,800

 

$

17,477

 

$

28,998

 

$

35,324

 

$

97,600

 

$

31,097

 

$

-

$

-

$

-

$

31,097

 

 
Adjusted EBITDA from Continuing Operations (2)
EBITDA

$

15,800

 

$

17,477

 

$

28,998

 

$

35,324

 

$

97,600

 

$

31,097

 

$

-

$

-

$

-

$

31,097

 

Impairment & divestiture (benefit) charges

 

-

 

 

-

 

 

-

 

 

(6,155

)

 

(6,155

)

 

147

 

 

-

 

-

 

-

 

147

 

Restructuring charges (1)

 

982

 

 

2,987

 

 

2,252

 

 

1,461

 

 

7,681

 

 

2,401

 

 

-

 

-

 

-

 

2,401

 

Leadership transition charges

 

400

 

 

202

 

 

90

 

 

90

 

 

783

 

 

-

 

 

-

 

-

 

-

 

-

 

M&A charges

 

-

 

 

196

 

 

166

 

 

653

 

 

1,015

 

 

-

 

 

-

 

-

 

-

 

-

 

ASCEND transformation program charges

 

9,419

 

 

11,372

 

 

5,947

 

 

8,681

 

 

35,419

 

 

1,229

 

 

-

 

-

 

-

 

1,229

 

Adjusted EBITDA

$

26,601

 

$

32,234

 

$

37,453

 

$

40,054

 

$

136,343

 

$

34,874

 

$

-

$

-

$

-

$

34,874

 

 
Adjusted EBITDA by Segment
Industrial Tools & Services Segment

$

31,698

 

$

37,458

 

$

42,525

 

$

47,952

 

$

159,633

 

$

40,880

 

$

-

$

-

$

-

$

40,880

 

Other

 

2,316

 

 

2,050

 

 

2,855

 

 

739

 

 

7,961

 

 

2,324

 

 

-

 

-

 

-

 

2,324

 

Corporate / General

 

(7,413

)

 

(7,274

)

 

(7,927

)

 

(8,637

)

 

(31,251

)

 

(8,330

)

 

-

 

-

 

-

 

(8,330

)

Adjusted EBITDA

$

26,601

 

$

32,234

 

$

37,453

 

$

40,054

 

$

136,343

 

$

34,874

 

$

-

$

-

$

-

$

34,874

 

 
Adjusted EBITDA % by Segment
Industrial Tools & Services Segment

 

24.9

%

 

28.6

%

 

29.5

%

 

31.4

%

 

28.8

%

 

29.8

%

 

-

 

-

 

-

 

29.8

%

Other

 

19.2

%

 

18.5

%

 

23.5

%

 

9.5

%

 

18.5

%

 

47.1

%

 

-

 

-

 

-

 

47.1

%

Adjusted EBITDA %

 

19.1

%

 

22.7

%

 

24.0

%

 

24.9

%

 

22.8

%

 

24.6

%

 

-

 

-

 

-

 

24.6

%

 
Notes:
(1) Approximately $0.6 million of the Q4 fiscal 2023 restructuring charges were recorded in cost of products sold.
(2) EBITDA represents net earnings from continuing operations before financing costs, net, income tax expense, and depreciation & amortization. Neither EBITDA nor adjusted EBITDA are calculated based upon generally accepted accounting principles ("GAAP"). The amounts included in the EBITDA and adjusted EBITDA calculation, however, are derived from amounts included in the Condensed Consolidated Statements of Earnings. EBITDA and adjusted EBITDA should not be considered as alternatives to net earnings, operating profit or operating cash flows. The Company has presented EBITDA and adjusted EBITDA because it regularly reviews these performance measures. In addition, EBITDA and adjusted EBITDA are used by many of our investors and lenders, and are presented as a convenience to them. The EBITDA and adjusted EBITDA measures presented may not always be comparable to similarly titled measures reported by other companies due to differences in the components of the calculation.
Enerpac Tool Group Corp.
Supplemental Unaudited Data
Reconciliation of GAAP Measures to Non-GAAP Measures (Continued)
(In thousands) Fiscal 2023 Fiscal 2024
Q1 Q1
Net Sales by Segment
Industrial Tools & Services Segment

$

127,297

 

$

137,035

 

Other

 

12,085

 

 

4,935

 

Total

$

139,382

 

$

141,970

 

 
Plus: Fx Impact on Net Sales
Industrial Tools & Services Segment

$

2,262

 

$

-

 

Other

 

-

 

 

-

 

Total

$

2,262

 

$

-

 

 
Plus: Impact from Divestitures or Acquisitions on Net Sales
Industrial Tools & Services Segment

$

-

 

$

-

 

Other

 

(7,031

)

 

-

 

Total

$

(7,031

)

$

-

 

 
Organic Sales by Segment (3)
Industrial Tools & Services Segment

$

129,559

 

$

137,035

 

Other

 

5,054

 

 

4,935

 

Total

$

134,613

 

$

141,970

 

 
Organic Sales Growth (Decline) %
Industrial Tools & Services Segment

 

6

%

Other

 

-2

%

Total

 

5

%

 
 
Net Sales by Product Line
Product

$

111,002

 

$

109,856

 

Service

 

28,380

 

 

32,114

 

Total

$

139,382

 

$

141,970

 

 
Plus: Fx Impact on Net Sales
Product

$

1,481

 

$

-

 

Service

 

781

 

 

-

 

Total

$

2,262

 

$

-

 

 
Plus: Impact from Divestitures or Acquisitions on Net Sales
Product

 

(7,031

)

 

-

 

Service

 

-

 

 

-

 

Total

$

(7,031

)

$

-

 

 
Organic Sales by Segment (3)
Product

$

105,452

 

$

109,856

 

Service

 

29,161

 

 

32,114

 

Total

$

134,613

 

$

141,970

 

 
Organic Sales Growth (Decline) %
Product

 

4

%

Service

 

10

%

Total

 

5

%

 
(3) Organic Sales (formerly referred to as "core sales") is defined as sales excluding the impact to foreign currency changes and the impact from recent acquisitions and divestitures to net sales
Enerpac Tool Group Corp.
Supplemental Unaudited Data
Reconciliation of GAAP Measures to Non-GAAP Measures (Continued)
(In thousands, except for per share amounts)
Fiscal 2023 Fiscal 2024
Q1 Q2 Q3 Q4 TOTAL Q1 Q2 Q3 Q4 TOTAL
Adjusted Earnings (4)
Net Earnings

$

7,453

 

$

4,497

 

$

12,380

 

$

22,231

 

$

46,561

 

$

17,738

 

$

-

$

-

$

-

$

17,738

 

Earnings (loss) from Discontinued Operations, net of income tax

 

1,044

 

 

(2,661

)

 

(4,596

)

 

(874

)

 

(7,088

)

 

(567

)

 

-

 

-

 

-

 

(567

)

Net Earnings from Continuing Operations

$

6,409

 

$

7,158

 

$

16,976

 

$

23,105

 

$

53,649

 

$

18,305

 

$

-

$

-

$

-

$

18,305

 

Impairment & divestiture (benefit) charges

 

-

 

 

-

 

 

-

 

 

(6,155

)

 

(6,155

)

 

147

 

 

-

 

-

 

-

 

147

 

Restructuring charges (1)

 

982

 

 

2,987

 

 

2,252

 

 

1,461

 

 

7,681

 

 

2,401

 

 

-

 

-

 

-

 

2,401

 

Leadership transition charges

 

400

 

 

202

 

 

90

 

 

90

 

 

783

 

 

-

 

 

-

 

-

 

-

 

-

 

M&A charges

 

-

 

 

196

 

 

166

 

 

653

 

 

1,015

 

 

-

 

 

-

 

-

 

-

 

-

 

ASCEND transformation program charges

 

9,419

 

 

11,372

 

 

5,947

 

 

8,681

 

 

35,419

 

 

1,229

 

 

-

 

-

 

-

 

1,229

 

Accelerated debt issuance costs

 

317

 

 

-

 

 

-

 

 

-

 

 

317

 

Net tax effect of reconciling items above

 

(719

)

 

(1,652

)

 

(3,197

)

 

(4,408

)

 

(9,976

)

 

(411

)

 

-

 

-

 

-

 

(411

)

Other income tax expense

 

-

 

 

144

 

 

-

 

 

-

 

 

144

 

 

-

 

 

-

 

-

 

-

 

-

 

Adjusted Net Earnings from Continuing Operations

$

16,808

 

$

20,407

 

$

22,234

 

$

23,427

 

$

82,877

 

$

21,671

 

$

-

$

-

$

-

$

21,671

 

 
Adjusted Diluted Earnings per share (4)
Net Earnings

$

0.13

 

$

0.08

 

$

0.22

 

$

0.40

 

$

0.82

 

$

0.32

 

$

-

$

-

$

-

$

0.32

 

Earnings (loss) from Discontinued Operations, net of income tax

 

0.02

 

 

(0.05

)

 

(0.08

)

 

(0.02

)

 

(0.12

)

 

(0.01

)

 

-

 

-

 

-

 

(0.01

)

Net Earnings from Continuing Operations

$

0.11

 

$

0.12

 

$

0.30

 

$

0.41

 

$

0.94

 

$

0.33

 

$

-

$

-

$

-

$

0.33

 

Impairment & divestiture (benefit) charges, net of tax effect

 

-

 

 

-

 

 

-

 

 

(0.11

)

 

(0.11

)

 

0.00

 

 

-

 

-

 

-

 

0.00

 

Restructuring charges (1), net of tax effect

 

0.02

 

 

0.05

 

 

0.03

 

 

0.01

 

 

0.11

 

 

0.04

 

 

-

 

-

 

-

 

0.04

 

Leadership transition charges, net of tax effect

 

0.01

 

 

0.00

 

 

0.00

 

 

0.00

 

 

0.01

 

 

-

 

 

-

 

-

 

-

 

-

 

M&A charges, net of tax effect

 

-

 

 

0.00

 

 

0.00

 

 

0.01

 

 

0.01

 

 

-

 

 

-

 

-

 

-

 

-

 

ASCEND transformation program charges, net of tax effect

 

0.15

 

 

0.17

 

 

0.06

 

 

0.10

 

 

0.48

 

 

0.02

 

 

-

 

-

 

-

 

0.02

 

Accelerated debt issuance costs, net of tax effect

 

0.01

 

 

0.00

 

 

0.00

 

 

0.00

 

 

0.00

 

 

-

 

 

-

 

-

 

-

 

-

 

Other income tax expense

 

-

 

 

0.00

 

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

-

 

-

 

-

 

Adjusted Diluted Earnings per share from Continuing Operations

$

0.29

 

$

0.35

 

$

0.39

 

$

0.42

 

$

1.45

 

$

0.39

 

$

-

$

-

$

-

$

0.39

 

 
Free Cash Flow
Cash provided by (used in) operating activities

$

17,533

 

$

(7,756

)

$

17,254

 

$

50,572

 

$

77,603

 

$

(6,675

)

$

-

$

-

$

-

$

(6,675

)

Capital expenditures

 

(2,535

)

 

(2,346

)

 

(2,915

)

 

(919

)

 

(8,715

)

 

(1,567

)

 

-

 

-

 

-

 

(1,567

)

Free Cash Flow

$

14,998

 

$

(10,102

)

$

14,339

 

$

49,653

 

$

68,888

 

$

(8,242

)

$

-

$

-

$

-

$

(8,242

)

 
Notes continued:
(4) Adjusted earnings from continuing operations and adjusted diluted earnings per share represent net earnings and diluted earnings per share per the Condensed Consolidated Statements of Earnings net of charges or credits for items to be highlighted for comparability purposes. These measures are not calculated based upon GAAP and should not be considered as an alternative to net earnings or diluted earnings per share or as an indicator of the Company's operating performance. However, this presentation is important to investors for understanding the operating results of the current portfolio of Enerpac Tool Group companies.
 
For all reconciliations of GAAP measures to Non-GAAP measures, the summation of the individual components may not equal the total due to rounding. With respect to the earnings per share reconciliations the impact of share dilution on the calculation of the net earnings or loss per share and discontinued operations per share may result in the summation of these components not equaling the total earnings per share from continuing operations.
Enerpac Tool Group Corp.
Supplemental Unaudited Data
Reconciliation of GAAP To Non-GAAP Guidance
(In millions)
Fiscal 2024
Low High
Reconciliation of Continued Operations GAAP Operating Profit
To Adjusted EBITDA (5)
GAAP Operating profit

$

113

 

$

130

 

ASCEND transformation program charges

 

10

 

 

7

 

Restructuring charges

 

5

 

 

3

 

Adjusted operating profit

$

128

 

$

140

 

Other expense, net

 

(1

)

 

(1

)

Depreciation & amortization

 

15

 

 

13

 

Adjusted EBITDA

$

142

 

$

152

 

 
Reconciliation of GAAP Cash Flow From Operations to Free Cash Flow
Cash provided by operating activities

$

72

 

$

87

 

Capital expenditures

 

(12

)

 

(17

)

Free Cash Flow Guidance

$

60

 

$

70

 

 
Notes continued:
(5) Management does not provide guidance on GAAP financial measures as we are unable to predict and estimate with certainty items such as potential impairments, refinancing costs, business divestiture gains/losses, discrete tax adjustments, or other items impacting GAAP financial metrics. As a result, we have included above only those items about which we are aware and are reasonably likely to occur during the guidance period covered.

 

Contacts

Travis Williams

Director of Investor Relations

+1.262.293.1912

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