Nordson Corporation Reports Fourth Quarter and Fiscal Year 2024 Results
Fourth Quarter:
•Sales were $744 million, a 4% increase over prior year
•Earnings per diluted share were $2.12
•Adjusted earnings per diluted share were $2.78
•Atrion Medical acquisition integration progressing well
Full Year:
•Record sales of $2.7 billion, reflecting 2% growth over last year’s record sales
•Earnings per diluted share were $8.11
•EBITDA was a record $849 million, up 4% over prior year and 32% of sales
•Adjusted earnings per diluted share were $9.73
Fiscal 2025 Guidance:
•Fiscal 2025 forecasted sales range between $2,750 to $2,870 million and adjusted earnings in the range of $9.70 to $10.50
WESTLAKE, Ohio--(BUSINESS WIRE)--December 11, 2024--Nordson Corporation (Nasdaq: NDSN) today reported results for the fiscal fourth quarter ended October 31, 2024. Sales were $744 million, a 4% increase compared to the prior year’s fourth quarter sales of $719 million. The increase in fourth quarter 2024 sales included the favorable 6% impact of acquisitions and favorable currency translation of 1%, offset by an organic sales decrease of 3%.
Net income was $122 million, or earnings per diluted share of $2.12, compared to prior year’s fourth quarter net income of $128 million, or earnings per diluted share of $2.22. Adjusted net income was $160 million, an increase from prior year adjusted net income of $156 million. Fourth quarter 2024 adjusted earnings per diluted share were $2.78 compared to prior year adjusted earnings per diluted share of $2.71.
EBITDA in the fourth quarter was $241 million, or 32% of sales, an increase of 4% compared to prior year EBITDA of $227 million, also at 32% of sales.
Commenting on the Company’s fiscal 2024 fourth quarter results, Nordson President and Chief Executive Officer Sundaram Nagarajan said, “I appreciate our team’s focus and commitment to our customers, which delivered results above our fourth quarter guidance expectations. Our Advanced Technology Solutions segment delivered year-over-year fourth quarter sales growth, as electronics demand continued to steadily improve at fiscal year-end. During the down electronics cycle, our ATS team holistically implemented the NBS Next growth framework, making them responsive to the needs of our customers while also delivering a strong incremental operating performance. Our industrial product lines performed well against record comparisons from prior year. I’m also pleased with the early integration of our Atrion Medical acquisition, which contributed positively to the quarter.”
Fourth Quarter Segment Results
Industrial Precision Solutions sales of $392 million decreased 3% compared to the prior year fourth quarter, driven by a 5% organic sales decrease, a favorable acquisition impact of 1%, and a favorable currency impact of 1%. The organic sales decrease, following record organic sales in prior year fourth quarter, was driven by our industrial coatings, polymer processing and precision agriculture product lines, partially offset by double-digit growth in nonwovens product lines. Operating profit was $126 million in the quarter, or 32% of sales, a decrease of 4% compared to the prior year operating profit. The decrease in operating profit was driven by lower sales. EBITDA in the quarter was $143 million, or 37% of sales, a 3% decrease from the prior year fourth quarter EBITDA of $148 million, which also was 37% of sales.
Medical and Fluid Solutions sales of $200 million increased 19% compared to the prior year fourth quarter, driven primarily by the acquisition of Atrion, which offset an organic sales decrease of 3% and a favorable currency impact of 1%. The organic sales decrease was driven by softness in medical interventional solutions product lines, partially offset by modest growth in our medical fluid components and fluid solutions product lines. Operating profit totaled $44 million in the quarter, or 22% of sales,
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a decrease of 8% compared to the prior year operating profit. EBITDA in the quarter was $72 million, or 36% of sales, an increase versus the prior year fourth quarter EBITDA of $62 million, or 37% of sales.
Advanced Technology Solutions sales of $152 million increased 5% compared to the prior year fourth quarter, driven by an organic sales increase of 4% and a favorable currency impact of 1%. The organic sales increase was driven by double-digit growth in select test and inspection product lines and modest growth in our electronics processing product lines. Operating profit totaled $33 million in the quarter, or 22% of sales, an increase of 6% compared to the prior year operating profit due to higher sales and improved profit margins. EBITDA in the quarter was $41 million, or 27% of sales, an increase from the prior year fourth quarter EBITDA of $35 million, or 24% of sales.
Fiscal 2024 Full Year Results
Sales for the fiscal year ended October 31, 2024, were a record $2.7 billion, an increase of 2% compared to the prior year. This sales growth was driven by a favorable acquisition impact of 5%, partially offset by a 3% decrease in organic volume.
Net income was $467 million, or earnings per diluted share of $8.11, compared to prior year’s net income of $487 million, or earnings per diluted share of $8.46. Adjusted net income was $561 million, a decrease from prior year adjusted net income of $567 million. Adjusted earnings per diluted share were $9.73 compared to prior year adjusted earnings per diluted share of $9.85.
EBITDA was $849 million, or 32% of sales, compared to prior year EBITDA of $819 million, or 31% of sales. Free cash flow for the full-year was $492 million, which was a conversion rate of 105% of net income.
Reflecting on fiscal 2024, Mr. Nagarajan continued, “In 2021, we launched our Ascend strategy with the milestone of achieving $3 billion in annual sales and greater than 30% EBITDA margins by 2025. The strategy is delivering results and has ample runway to accelerate. Our diversified portfolio, built on our leadership in niche end markets with differentiated products, is delivering balanced results in the ever-changing macro environment. Our acquisition strategy is generating growth, and I am pleased with the integration and deployment of the NBS Next growth framework. We also continued to generate strong free cash flow in the year, allowing us to consistently reinvest in the business while returning cash to our shareholders.”
Outlook
Following four consecutive years of record-setting performance, we enter fiscal 2025 with approximately $580 million in backlog.
Based on the combination of order entry, backlog, current exchange rates and anticipated end market expectations, we anticipate delivering sales in the range of $2,750 to $2,870 million in fiscal 2025. Full year fiscal 2025 adjusted earnings are forecasted in the range of $9.70 to $10.50 per diluted share.
First quarter fiscal 2025 sales are forecasted in the range of $615 to $655 million with adjusted earnings in the range of $1.95 to $2.15 per diluted share.
Commenting on fiscal 2025 guidance, Nagarajan said, “Considering the evolving global macro-environment, we are entering 2025 with a conservative viewpoint. The fiscal first quarter is seasonally Nordson’s weakest quarter due to the holiday and calendar year-end slowdowns and cautious customer spending. While we remain confident about the long-term growth drivers of our end markets, we are being prudent about our expectations for end market recovery timing, particularly for our electronics and agricultural product lines. Even in uncertain times, our team delivers operational excellence and strong cash flow due to our close-to-the-customer business model, diversified niche end markets, differentiated products and the NBS Next growth framework.”
Nordson management will provide additional commentary on these results and outlook during its previously announced webcast on Thursday, December 12, 2024 at 8:30 a.m. eastern time, which can be accessed at https://investors.nordson.com. 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
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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.
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NORDSON CORPORATION
CONSOLIDATED STATEMENT OF INCOME (Unaudited)
(Dollars in thousands except for per-share amounts)
Three Months Ended
Twelve Months Ended
October 31, 2024
October 31, 2023
October 31, 2024
October 31, 2023
Sales
$
744,482
$
719,313
$
2,689,921
$
2,628,632
Cost of sales
341,658
335,220
1,203,792
1,203,227
Gross profit
402,824
384,093
1,486,129
1,425,405
Gross margin %
54.1
%
53.4
%
55.2
%
54.2
%
Selling & administrative expenses
223,932
199,054
812,128
752,644
Operating profit
178,892
185,039
674,001
672,761
Interest expense - net
(27,282)
(25,921)
(84,011)
(56,825)
Other income (expense) - net
(3,538)
1,462
(4,509)
(597)
Income before income taxes
148,072
160,580
585,481
615,339
Income taxes
25,904
32,802
118,197
127,846
Net Income
$
122,168
$
127,778
$
467,284
$
487,493
Weighted-average common shares outstanding:
Basic
57,188
57,020
57,176
57,090
Diluted
57,603
57,552
57,616
57,631
Earnings per share:
Basic earnings
$
2.14
$
2.24
$
8.17
$
8.54
Diluted earnings
$
2.12
$
2.22
$
8.11
$
8.46
4
NORDSON CORPORATION
CONSOLIDATED BALANCE SHEET (Unaudited)
(Dollars in thousands)
October 31, 2024
October 31, 2023
Cash and cash equivalents
$
115,952
$
115,679
Receivables - net
594,663
590,886
Inventories - net
476,935
454,775
Other current assets
87,482
67,970
Total current assets
1,275,032
1,229,310
Property, plant & equipment - net
544,607
392,846
Goodwill
3,280,819
2,784,201
Other assets
900,508
845,413
$
6,000,966
$
5,251,770
Notes payable and debt due within one year
$
103,928
$
115,662
Accounts payable and accrued liabilities
424,549
466,427
Total current liabilities
528,477
582,089
Long-term debt
2,101,197
1,621,394
Other liabilities
439,100
450,227
Total shareholders' equity
2,932,192
2,598,060
$
6,000,966
$
5,251,770
5
NORDSON CORPORATION
CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited)
(Dollars in thousands)
Twelve Months Ended
October 31, 2024
October 31, 2023
Cash flows from operating activities:
Net Income
$
467,284
$
487,493
Depreciation and amortization
136,175
111,898
Other non-cash items
5,883
16,105
Changes in operating assets and liabilities and other
(53,149)
25,786
Net cash provided by operating activities
556,193
641,282
Cash flows from investing activities:
Additions to property, plant and equipment
(64,410)
(34,583)
Acquisitions of businesses, net of cash acquired
(789,996)
(1,422,780)
Other - net
10,008
20,484
Net cash used in investing activities
(844,398)
(1,436,879)
Cash flows from financing activities:
Issuance (repayment) of long-term debt
464,353
976,043
Repayment of finance lease obligations
(6,148)
(6,840)
Dividends paid
(161,438)
(150,356)
Issuance of common shares
31,067
21,373
Purchase of treasury shares
(33,339)
(89,708)
Net cash provided by financing activities
294,495
750,512
Effect of exchange rate change on cash
(6,017)
(2,693)
Net change in cash and cash equivalents
273
(47,778)
Cash and cash equivalents:
Beginning of period
115,679
163,457
End of period
$
115,952
$
115,679
6
NORDSON CORPORATION
SALES BY GEOGRAPHIC SEGMENT (Unaudited)
(Dollars in thousands)
Three Months Ended
Sales Variance
October 31, 2024
October 31, 2023
Organic
Acquisitions
Currency
Total
SALES BY SEGMENT
Industrial precision solutions
$
392,150
$
405,436
(5.5)
%
1.2
%
1.0
%
(3.3)
%
Medical and fluid solutions
200,223
168,632
(3.2)
%
21.4
%
0.5
%
18.7
%
Advanced technology solutions
152,109
145,245
3.9
%
—
%
0.8
%
4.7
%
Total sales
$
744,482
$
719,313
(3.0)
%
5.7
%
0.8
%
3.5
%
SALES BY GEOGRAPHIC REGION
Americas
323,170
315,635
(6.0)
%
8.9
%
(0.5)
%
2.4
%
Europe
185,350
184,297
(6.6)
%
4.6
%
2.6
%
0.6
%
Asia Pacific
235,962
219,381
4.2
%
2.0
%
1.4
%
7.6
%
Total sales
$
744,482
$
719,313
(3.0)
%
5.7
%
0.8
%
3.5
%
Twelve Months Ended
Sales Variance
October 31, 2024
October 31, 2023
Organic
Acquisitions
Currency
Total
SALES BY SEGMENT
Industrial precision solutions
$
1,484,249
$
1,391,046
0.1
%
6.6
%
—
%
6.7
%
Medical and fluid solutions
695,452
660,316
(0.2)
%
5.4
%
0.1
%
5.3
%
Advanced technology solutions
510,220
577,270
(11.4)
%
—
%
(0.2)
%
(11.6)
%
Total sales
$
2,689,921
$
2,628,632
(2.5)
%
4.8
%
—
%
2.3
%
SALES BY GEOGRAPHIC REGION
Americas
1,178,626
1,149,760
(1.9)
%
4.3
%
0.1
%
2.5
%
Europe
726,100
682,676
(5.1)
%
10.2
%
1.3
%
6.4
%
Asia Pacific
785,195
796,196
(1.0)
%
1.0
%
(1.4)
%
(1.4)
%
Total sales
$
2,689,921
$
2,628,632
(2.5)
%
4.8
%
—
%
2.3
%
7
NORDSON CORPORATION
RECONCILIATION OF NON-GAAP MEASURES - NET INCOME TO EBITDA (Unaudited)
(Dollars in thousands)
Three Months Ended
Twelve Months Ended
October 31, 2024
October 31, 2023
October 31, 2024
October 31, 2023
Net income
122,168
127,778
467,284
487,493
Income taxes
25,904
32,802
118,197
127,846
Interest expense - net
27,282
25,921
84,011
56,825
Other expense - net
3,538
(1,462)
4,509
597
Depreciation and amortization
36,528
31,261
136,175
111,898
Inventory step-up amortization (1)
4,759
4,556
7,703
8,862
Severance and other (1)
12,717
—
17,332
5,487
Acquisition-related costs (1)
8,200
6,244
13,957
19,966
EBITDA (non-GAAP) (2)
241,096
227,100
849,168
818,974
(1) Represents severance as well as fees 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.
8
NORDSON CORPORATION
RECONCILIATION OF NON-GAAP MEASURES - EBITDA (Unaudited)
(Dollars in thousands)
Three Months Ended
Twelve Months Ended
October 31, 2024
October 31, 2023
October 31, 2024
October 31, 2023
SALES BY SEGMENT
Industrial precision solutions
$
392,150
$
405,436
$
1,484,249
$
1,391,046
Medical and fluid solutions
200,223
168,632
695,452
660,316
Advanced technology solutions
152,109
145,245
510,220
577,270
Total sales
$
744,482
$
719,313
$
2,689,921
$
2,628,632
OPERATING PROFIT
Industrial precision solutions
$
126,254
$
131,450
$
470,559
$
460,889
Medical and fluid solutions
44,264
48,041
187,731
189,367
Advanced technology solutions
33,464
31,526
94,231
101,662
Corporate
(25,090)
(25,978)
(78,520)
(79,157)
Total operating profit
$
178,892
$
185,039
$
674,001
$
672,761
OPERATING PROFIT ADJUSTMENTS (1)
Industrial precision solutions
$
2,899
$
4,658
$
8,976
$
4,658
Medical and fluid solutions
10,761
—
10,761
1,479
Advanced technology solutions
3,816
—
5,895
14,304
Corporate
8,200
6,142
13,360
13,874
Total adjustments
$
25,676
$
10,800
$
38,992
$
34,315
DEPRECIATION & AMORTIZATION
Industrial precision solutions
$
14,035
$
12,062
$
56,856
$
33,228
Medical and fluid solutions
17,239
13,547
58,061
54,988
Advanced technology solutions
3,340
3,529
13,433
15,185
Corporate
1,914
2,123
7,825
8,497
Total depreciation & amortization
$
36,528
$
31,261
$
136,175
$
111,898
EBITDA (NON-GAAP) (2)
Industrial precision solutions
$
143,188
37
%
$
148,170
37
%
$
536,391
36
%
$
498,775
36
%
Medical and fluid solutions
72,264
36
%
61,588
37
%
256,553
37
%
245,834
37
%
Advanced technology solutions
40,620
27
%
35,055
24
%
113,559
22
%
131,151
23
%
Corporate
(14,976)
(17,713)
(57,335)
(56,786)
Total EBITDA
$
241,096
32
%
$
227,100
32
%
$
849,168
32
%
$
818,974
31
%
(1) Represents severance as well as fees 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.
9
NORDSON CORPORATION
RECONCILIATION OF NON-GAAP MEASURES - ADJUSTED NET INCOME AND EARNINGS PER SHARE (Unaudited)
(Dollars in thousands)
Three Months Ended
Twelve Months Ended
October 31, 2024
October 31, 2023
October 31, 2024
October 31, 2023
GAAP AS REPORTED
Operating profit
$
178,892
$
185,039
$
674,001
$
672,761
Other / interest expense - net
(30,820)
(24,459)
(88,520)
(57,422)
Net income
122,168
127,778
467,284
487,493
Diluted earnings per share
$
2.12
$
2.22
$
8.11
$
8.46
Shares outstanding - diluted
57,603
57,552
57,616
57,631
OPERATING PROFIT ADJUSTMENTS
Inventory step-up amortization
$
4,759
$
4,556
$
7,703
$
8,862
Severance and other
12,717
—
17,332
5,487
Acquisition costs
8,200
6,244
13,957
19,966
ACQUISITION AMORTIZATION OF INTANGIBLES
$
19,560
$
17,880
$
76,972
$
59,719
INTEREST
908
6,817
908
6,817
Total adjustments
$
46,144
$
35,497
$
116,872
$
100,851
Adjustments net of tax
$
38,071
$
28,247
$
93,278
$
79,898
EPS effect of adjustments and other discrete tax items
$
0.66
$
0.49
$
1.62
$
1.39
NON-GAAP MEASURES-ADJUSTED NET INCOME AND ADJUSTED EARNINGS PER SHARE
Adjusted net income (1)
$
160,239
$
156,025
$
560,562
$
567,391
Adjusted earnings per share (2)
$
2.78
$
2.71
$
9.73
$
9.85
(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.
10
NORDSON CORPORATION
RECONCILIATION OF NON-GAAP MEASURES - OPERATING CASH FLOW TO FREE CASH FLOW (Unaudited)
(Dollars in thousands)
Year to Date
October 31, 2024
July 31, 2024
April 30, 2024
January 31, 2024
Net cash provided by operating activities
$
556,193
$
459,812
$
294,964
$
172,356
Additions to property, plant and equipment
(64,410)
(43,786)
(21,907)
(7,530)
Free Cash Flow - Year to Date (1)
491,783
416,026
273,057
164,826
Free Cash Flow - Quarter to Date (2)
75,757
142,969
108,231
164,826
Net Income - Year to Date
$
467,284
Free Cash Flow Conversion (3)
105
%
Year to Date
October 31, 2023
July 31, 2023
April 30, 2023
January 31, 2023
Net cash provided by operating activities
$
641,282
$
478,072
$
287,905
$
123,337
Additions to property, plant and equipment
(34,583)
(24,244)
(15,349)
(9,302)
Free Cash Flow (1)
606,699
453,828
272,556
114,035
Free Cash Flow - Quarter to Date (2)
152,871
181,272
158,521
114,035
(1) Free Cash Flow - Year to Date is a non-GAAP measure used by management to evaluate the Company's ongoing operations and is defined as Net cash provided by operating activities minus Additions to property, plant and equipment.
(2) Free Cash Flow - Quarter to Date is a non-GAAP measure used by management to evaluate the Company's ongoing operations and is equal to Free Cash Flow - Year to Date less prior period Free Cash Flow - Year to Date.
(3) Free Cash Flow Conversion - Year to Date is a non-GAAP measure used by management to evaluate the Company's ongoing operations and is defined as Free Cash Flow - Year to Date divided by Net Income - Year to Date.
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.
