Dover Reports Third Quarter 2024 Results
DOWNERS GROVE, Ill., Oct. 24, 2024 /PRNewswire/ -- Dover (NYSE: DOV), a diversified global manufacturer, announced its financial results for the third quarter ended September 30, 2024. All comparisons are to the comparable period of the prior fiscal year, unless otherwise noted.
Three Months Ended September 30, Nine Months Ended September 30,
($ in millions, except per share data) 2024 2023 % Change* 2024 2023 % Change*
U.S. GAAP
Revenue $1,984 $1,958 1 % $5,816 $5,780 1 %
Earnings from continuing operations 313 262 19 % 1,162 686 69 %
Diluted EPS from continuing operations 2.26 1.86 22 % 8.37 4.88 72 %
Non-GAAP
Organic revenue change - % - %
Adjusted earnings from continuing operations (1) 314 301 4 % 846 812 4 %
Adjusted diluted EPS from continuing operations 2.27 2.14 6 % 6.09 5.78 5 %
(1) Q3 and year-to-date 2024 and 2023 adjusted earnings from continuing operations exclude after tax purchase accounting expenses and restructuring and other costs. Q3 and year-to-date 2024 also exclude an after-tax gain on disposition of a minority owned equity method investment, and
year-to-date 2024 excludes the after-tax gain and post-closing adjustments on the disposition of De-Sta-Co.
* Change may be impacted by rounding.
For the quarter ended September 30, 2024, Dover generated revenue of $2.0 billion, an increase of 1%. GAAP earnings from continuing operations of $313 million increased 19%, and GAAP diluted EPS from continuing operations of $2.26 was up 22%. On an adjusted basis, earnings from continuing operations of $314 million increased 4% and adjusted diluted EPS from continuing operations of $2.27 was up 6%.
For the nine months ended September 30, 2024, Dover generated revenue of $5.8 billion, an increase of 1% compared to the prior year. GAAP earnings from continuing operations of $1.2 billion increased by 69%, and GAAP diluted EPS from continuing operations of $8.37 was up 72%. On an adjusted basis, earnings from continuing operations of $846 million increased 4%, and adjusted diluted EPS from continuing operations of $6.09 was up 5% compared to the prior year.
A full reconciliation between GAAP and adjusted measures and definitions of non-GAAP and other performance measures are included as an exhibit herein.
MANAGEMENT COMMENTARY:
Dover's President and Chief Executive Officer, Richard J. Tobin, said, "Dover's third quarter results were in line with our expectations, driven by excellent production performance and positive margin mix from our growth platforms in clean energy, biopharma components, thermal connectors, and CO2 refrigeration systems. Top line performance was broad-based across the majority of the portfolio, more than offsetting near-term headwinds in polymer processing, beverage can-making, and heat exchangers for European heat pumps. Consolidated bookings continued their positive trajectory, with robust order rates in our secular-growth-exposed markets.
Our ongoing strategic portfolio evolution is aided by our strong balance sheet position. We closed the divestiture of our Environmental Solutions Group business in early October, reducing our exposure to cyclical capital goods. We expect to end the year with substantial firepower to pursue value-creating capital deployment as we continue to expand our businesses in high growth, high margin priority platforms.
We have a constructive outlook for the remainder of 2024 and for next year. Underlying end market demand is very healthy across the portfolio driven by our secular growth platforms, coupled with the bottoming of our long-cycle-exposed end markets in 2024. We expect to more than offset the dilution from the waste hauling equipment divestiture next year through a combination of solid top line organic growth, healthy margin accretion from positive mix and productivity, and value creating capital deployment."
FULL YEAR 2024 GUIDANCE:
In 2024, Dover expects to generate GAAP EPS from continuing operations in the range of $10.11 to $10.21 (adjusted EPS from continuing operations of $8.08 to $8.18), based on full year revenue growth of 1% to 3%. Full year 2024 guidance excludes the impact of the Environmental Solutions Group business unit, which was moved to discontinued operations for reporting purposes.
CONFERENCE CALL INFORMATION:
Dover will host a webcast and conference call to discuss its third quarter results at 9:30 A.M. Eastern Time (8:30 A.M. Central Time) on Thursday, October 24, 2024. The webcast can be accessed on the Dover website at dovercorporation.com. The conference call will also be made available for replay on the website. Additional information on Dover's results and its operating segments can be found on the Company's website.
ABOUT DOVER:
Dover is a diversified global manufacturer and solutions provider with annual revenue of over $7 billion. We deliver innovative equipment and components, consumable supplies, aftermarket parts, software and digital solutions, and support services through five operating segments: Engineered Products, Clean Energy & Fueling, Imaging & Identification, Pumps & Process Solutions and Climate & Sustainability Technologies. Dover combines global scale with operational agility to lead the markets we serve. Recognized for our entrepreneurial approach for over 65 years, our team of over 24,000 employees takes an ownership mindset, collaborating with customers to redefine what's possible. Headquartered in Downers Grove, Illinois, Dover trades on the New York Stock Exchange under "DOV."
FORWARD-LOOKING STATEMENTS:
This press release contains "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. All statements in this document other than statements of historical fact are statements that are, or could be deemed, "forward-looking" statements. Forward-looking statements are subject to numerous important risks, uncertainties, assumptions and other factors, some of which are beyond the Company's control. Factors that could cause actual results to differ materially from current expectations include, among other things, general economic conditions and conditions in the particular markets we serve; supply chain constraints and labor shortages that could result in production stoppages, inflation in material input costs and freight logistics; the impact of interest rate and currency exchange rate fluctuations; the impacts of natural or human-induced disasters, acts of war, terrorism, international conflicts, and public health crises on the global economy and on our customers, suppliers, employees, business and cash flows; changes in customer demand and capital spending; competitive factors and pricing pressures; our ability to develop and launch new products in a cost-effective manner; our ability to identify, consummate and successfully integrate acquisitions; acquisition valuation levels; and our ability to derive expected benefits from restructuring, productivity initiatives and other cost reduction actions. For details on the risks and uncertainties that could cause our results to differ materially from the forward-looking statements contained herein, we refer you to the documents we file with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the year ended December 31, 2023, and our Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. These documents are available from the Securities and Exchange Commission, and on our website, dovercorporation.com. The Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise.
INVESTOR SUPPLEMENT - THIRD QUARTER 2024
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DOVER CORPORATION
CONSOLIDATED STATEMENTS OF EARNINGS
(unaudited)(in thousands, except per share data*)
Three Months Ended September 30, Nine Months Ended September 30,
2024 2023 2024 2023
Revenue $1,983,542 $1,958,428 $5,816,043 $5,779,664
Cost of goods and services 1,220,355 1,219,047 3,603,146 3,631,023
Gross profit 763,187 739,381 2,212,897 2,148,641
Selling, general and administrative expenses 429,570 402,838 1,301,606 1,234,223
Operating earnings 333,617 336,543 911,291 914,418
Interest expense 34,128 32,390 102,867 100,407
Interest income (5,176) (3,808) (14,013) (8,552)
Gain on dispositions (68,633) (597,913)
Other income, net (13,032) (10,274) (33,016) (20,758)
Earnings before provision for income taxes 386,330 318,235 1,453,366 843,321
Provision for income taxes 73,434 56,252 291,781 157,636
Earnings from continuing operations 312,896 261,983 1,161,585 685,685
Earnings from discontinued operations, net 34,204 27,770 99,558 74,881
Net earnings $347,100 $289,753 $1,261,143 $760,566
Basic earnings per share:
Earnings from continuing operations $2.28 $1.87 $8.42 $4.90
Earnings from discontinued operations, net $0.25 $0.20 $0.72 $0.54
Net earnings $2.53 $2.07 $9.14 $5.44
Weighted average shares outstanding 137,251 139,878 137,913 139,833
Diluted earnings per share:
Earnings from continuing operations $2.26 $1.86 $8.37 $4.88
Earnings from discontinued operations, net $0.25 $0.20 $0.72 $0.53
Net earnings $2.51 $2.06 $9.08 $5.41
Weighted average shares outstanding 138,223 140,615 138,830 140,603
Dividends paid per common share $0.515 $0.51 $1.54 $1.52
* Per share data may be impacted by rounding.
DOVER CORPORATION
QUARTERLY SEGMENT INFORMATION
(unaudited)(in thousands)
2024 2023
Q1 Q2 Q3 Q3 YTD Q1 Q2 Q3 Q3 YTD Q4 FY 2023
REVENUE
---
Engineered Products $332,820 $285,297 $296,117 $914,234 $325,955 $287,408 $309,431 $922,794 $328,131 $1,250,925
Clean Energy & Fueling 445,053 463,014 500,685 1,408,752 430,729 441,166 466,959 1,338,854 449,423 1,788,277
Imaging & Identification 276,806 287,593 283,966 848,365 283,091 271,932 276,179 831,202 285,530 1,116,732
Pumps & Process Solutions 465,729 477,239 472,463 1,415,431 413,881 465,626 431,373 1,310,880 444,811 1,755,691
Climate & Sustainability Technologies 364,292 436,706 431,127 1,232,125 455,325 449,001 475,911 1,380,237 398,345 1,778,582
Intersegment eliminations (981) (1,067) (816) (2,864) (1,552) (1,326) (1,425) (4,303) (1,428) (5,731)
Total consolidated revenue $1,883,719 $1,948,782 $1,983,542 $5,816,043 $1,907,429 $1,913,807 $1,958,428 $5,779,664 $1,904,812 $7,684,476
EARNINGS FROM CONTINUING OPERATIONS
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Segment Earnings:
Engineered Products $62,532 $52,095 $56,621 $171,248 $54,064 $38,872 $63,525 $156,461 $67,590 $224,051
Clean Energy & Fueling 69,675 87,536 99,536 256,747 73,605 83,616 92,483 249,704 78,900 328,604
Imaging & Identification 69,959 75,786 77,247 222,992 68,315 61,336 70,316 199,967 72,545 272,512
Pumps & Process Solutions 118,737 137,217 138,277 394,231 115,244 129,337 117,907 362,488 121,917 484,405
Climate & Sustainability Technologies 50,759 79,127 76,015 205,901 73,778 76,074 84,060 233,912 71,468 305,380
Total segment earnings 371,662 431,761 447,696 1,251,119 385,006 389,235 428,291 1,202,532 412,420 1,614,952
Purchase accounting 44,187 44,332 48,356 136,875 40,603 38,644 38,956 118,203 40,379 158,582
expenses (1)
Restructuring and other costs (2) 23,971 11,590 16,581 52,142 14,053 18,143 11,581 43,777 19,150 62,927
Disposition costs (3) - 1,302 1,302
(Gain) loss on dispositions 4 (529,943) 663 (68,633) (597,913)
Corporate expense / other 5 42,159 39,526 36,110 117,795 40,301 34,138 30,937 105,376 45,957 151,333
Interest expense 36,365 32,374 34,128 102,867 34,214 33,803 32,390 100,407 30,897 131,304
Interest income (4,756) (4,081) (5,176) (14,013) (2,091) (2,653) (3,808) (8,552) (4,944) (13,496)
Earnings before provision for income taxes 759,679 307,357 386,330 1,453,366 257,926 267,160 318,235 843,321 279,679 1,123,000
Provision for income taxes 6 157,577 60,770 73,434 291,781 51,234 50,150 56,252 157,636 21,500 179,136
Earnings from continuing operations $602,102 $246,587 $312,896 $1,161,585 $206,692 $217,010 $261,983 $685,685 $258,179 $943,864
SEGMENT EARNINGS MARGIN
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Engineered Products 18.8 % 18.3 % 19.1 % 18.7 % 16.6 % 13.5 % 20.5 % 17.0 % 20.6 % 17.9 %
Clean Energy & Fueling 15.7 % 18.9 % 19.9 % 18.2 % 17.1 % 19.0 % 19.8 % 18.7 % 17.6 % 18.4 %
Imaging & Identification 25.3 % 26.4 % 27.2 % 26.3 % 24.1 % 22.6 % 25.5 % 24.1 % 25.4 % 24.4 %
Pumps & Process Solutions 25.5 % 28.8 % 29.3 % 27.9 % 27.8 % 27.8 % 27.3 % 27.7 % 27.4 % 27.6 %
Climate & Sustainability Technologies 13.9 % 18.1 % 17.6 % 16.7 % 16.2 % 16.9 % 17.7 % 16.9 % 17.9 % 17.2 %
Total segment earnings margin 19.7 % 22.2 % 22.6 % 21.5 % 20.2 % 20.3 % 21.9 % 20.8 % 21.7 % 21.0 %
(1) Purchase accounting expenses are primarily comprised of amortization of acquired intangible assets.
(2) Restructuring and other costs relate to actions taken for headcount reductions, facility consolidations and site closures, product line exits, and other asset charges.
(3) Q4 and FY 2023 disposition costs relate to the sale of De-Sta-Co in our Engineered Products segment.
4 (Gain) loss on dispositions including post-closing adjustments related to the disposition of De-Sta-Co in Q1 2024 and the disposition of a minority owned equity method investment in Q3 2024 in the Engineered Products and Climate & Sustainability Technologies segments, respectively.
5 Certain expenses are maintained at the corporate level and not allocated to the segments. These expenses include executive and functional compensation costs, non-service pension costs, non-operating insurance expenses, shared business services and digital overhead costs, deal related expenses and various administrative expenses relating to the corporate headquarters.
6 Q4 and FY 2023 include the net income tax benefit of internal reorganizations executed in 2023.
DOVER CORPORATION
QUARTERLY EARNINGS PER SHARE
(unaudited)(in thousands, except per share data*)
Earnings Per Share
---
2024 2023
Q1 Q2 Q3 Q3 YTD Q1 Q2 Q3 Q3 YTD Q4 FY 2023
Basic earnings per share:
Continuing operations $4.33 $1.79 $2.28 $8.42 $1.48 $1.55 $1.87 $4.90 $1.85 $6.75
Discontinued operations $0.22 $0.26 $0.25 $0.72 $0.16 $0.18 $0.20 $0.54 $0.27 $0.81
Net earnings $4.55 $2.05 $2.53 $9.14 $1.64 $1.73 $2.07 $5.44 $2.12 $7.56
Diluted earnings per share:
Continuing operations $4.30 $1.78 $2.26 $8.37 $1.47 $1.54 $1.86 $4.88 $1.84 $6.71
Discontinued operations $0.22 $0.25 $0.25 $0.72 $0.16 $0.18 $0.20 $0.53 $0.27 $0.80
Net earnings $4.52 $2.04 $2.51 $9.08 $1.63 $1.72 $2.06 $5.41 $2.11 $7.52
Net earnings and weighted average shares used in calculated earnings per share amounts are as follows:
Continuing operations $602,102 $246,587 $312,896 $1,161,585 $206,692 $217,010 $261,983 $685,685 $258,179 $943,864
Discontinued operations 30,119 35,235 34,204 99,558 21,882 25,229 27,770 74,881 38,083 112,964
Net earnings $632,221 $281,822 $347,100 $1,261,143 $228,574 $242,239 $289,753 $760,566 $296,262 $1,056,828
Weighted average shares outstanding:
Basic 139,051 137,443 137,251 137,913 139,757 139,862 139,878 139,833 139,893 139,848
Diluted 139,869 138,404 138,223 138,830 140,616 140,578 140,615 140,603 140,586 140,599
* Per share data may be impacted by rounding.
DOVER CORPORATION
QUARTERLY ADJUSTED EARNINGS AND ADJUSTED EARNINGS PER SHARE (NON-GAAP)
(unaudited)(in thousands, except per share data*)
Non-GAAP Reconciliations
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2024 2023
Q1 Q2 Q3 Q3 YTD Q1 Q2 Q3 Q3 YTD Q4 FY 2023
Adjusted earnings from continuing operations:
Earnings from continuing operations $602,102 $246,587 $312,896 $1,161,585 $206,692 $217,010 $261,983 $685,685 $258,179 $943,864
Purchase accounting expenses, pre-tax (1) 44,187 44,332 48,356 136,875 40,603 38,644 38,956 118,203 40,379 158,582
Purchase accounting expenses, tax impact (2) (9,711) (9,760) (10,633) (30,104) (9,140) (8,671) (8,670) (26,481) (8,847) (35,328)
Restructuring and other costs, pre-tax (3) 23,971 11,590 16,581 52,142 14,053 18,143 11,581 43,777 19,150 62,927
Restructuring and other costs, tax impact (2) (4,734) (2,479) (3,465) (10,678) (2,990) (3,665) (2,401) (9,056) (3,970) (13,026)
Disposition costs, pre-tax 4 - 1,302 1,302
Disposition costs, tax impact (2) - (270) (270)
(Gain) loss on dispositions, pre-tax 5 (529,943) 663 (68,633) (597,913)
(Gain) loss on dispositions, tax-impact (2) 114,973 (144) 18,889 133,718
Adjusted earnings from continuing operations $240,845 $290,789 $313,991 $845,625 $249,218 $261,461 $301,449 $812,128 $305,923 $1,118,051
Adjusted diluted earnings per share from continuing operations:
Diluted earnings from continuing operations per share $4.30 $1.78 $2.26 $8.37 $1.47 $1.54 $1.86 $4.88 $1.84 $6.71
Purchase accounting expenses, pre-tax (1) 0.32 0.32 0.35 0.99 0.29 0.27 0.28 0.84 0.29 1.13
Purchase accounting expenses, tax impact (2) (0.07) (0.07) (0.08) (0.22) (0.06) (0.06) (0.06) (0.19) (0.06) (0.25)
Restructuring and other costs, pre-tax (3) 0.17 0.08 0.12 0.38 0.10 0.13 0.08 0.31 0.14 0.45
Restructuring and other costs, tax impact (2) (0.03) (0.02) (0.03) (0.08) (0.02) (0.03) (0.02) (0.06) (0.03) (0.09)
Disposition costs, pre-tax 4 - 0.01 0.01
Disposition costs, tax impact (2) -
(Gain) loss on dispositions, pre-tax 5 (3.79) (0.50) (4.31)
(Gain) loss on dispositions, tax-impact (2) 0.82 0.14 0.96
Adjusted diluted earnings per share from continuing operations $1.72 $2.10 $2.27 $6.09 $1.77 $1.86 $2.14 $5.78 $2.18 $7.95
(1) Purchase accounting expenses are primarily comprised of amortization of acquired intangible assets.
(2) Adjustments were tax effected using the statutory tax rates in the applicable jurisdictions or the effective tax rate, where applicable, for each period.
(3) Restructuring and other costs relate to actions taken for headcount reductions, facility consolidations and site closures, product line exits, and other asset charges. Q1 and year-to-date 2024 include $3.4 million and Q3 and FY 2023 include $3.3 million of non-cash asset impairment charges for our Climate & Sustainability Technologies segment.
4 Q4 and FY 2023 disposition costs relate to the sale of De-Sta-Co in our Engineered Products segment.
5 (Gain) loss on dispositions represents a $529.9 million gain recorded during Q1 2024 and a $0.7 million post-closing adjustment recorded in Q2 2024 on the disposition of De-Sta-Co in the Engineered Products segment. Q3 2024 represents a $68.6 million gain primarily on disposition of a minority owned equity method investment in the Climate & Sustainability
Technologies segment.
* Per share data and totals may be impacted by rounding.
DOVER CORPORATION
QUARTERLY ADJUSTED SEGMENT EBITDA (NON-GAAP)
(unaudited)(in thousands)
Non-GAAP Reconciliations
---
2024 2023
Q1 Q2 Q3 Q3 YTD Q1 Q2 Q3 Q3 YTD Q4 FY 2023
ADJUSTED SEGMENT EBITDA
---
Engineered Products:
---
Segment earnings $62,532 $52,095 $56,621 $171,248 $54,064 $38,872 $63,525 $156,461 $67,590 $224,051
Other depreciation and amortization (1) 4,785 4,778 4,829 14,392 5,671 5,778 5,736 17,185 4,827 22,012
Adjusted segment EBITDA (2) 67,317 56,873 61,450 185,640 59,735 44,650 69,261 173,646 72,417 246,063
Adjusted segment EBITDA margin (2) 20.2 % 19.9 % 20.8 % 20.3 % 18.3 % 15.5 % 22.4 % 18.8 % 22.1 % 19.7 %
Clean Energy & Fueling:
---
Segment earnings $69,675 $87,536 $99,536 $256,747 $73,605 $83,616 $92,483 $249,704 $78,900 $328,604
Other depreciation and amortization (1) 7,921 7,627 8,310 23,858 7,046 7,541 7,686 22,273 7,844 30,117
Adjusted segment EBITDA (2) 77,596 95,163 107,846 280,605 80,651 91,157 100,169 271,977 86,744 358,721
Adjusted segment EBITDA margin (2) 17.4 % 20.6 % 21.5 % 19.9 % 18.7 % 20.7 % 21.5 % 20.3 % 19.3 % 20.1 %
Imaging & Identification:
---
Segment earnings $69,959 $75,786 $77,247 $222,992 $68,315 $61,336 $70,316 $199,967 $72,545 $272,512
Other depreciation and amortization (1) 3,733 3,271 3,905 10,909 3,394 3,745 3,972 11,111 4,182 15,293
Adjusted segment EBITDA (2) 73,692 79,057 81,152 233,901 71,709 65,081 74,288 211,078 76,727 287,805
Adjusted segment EBITDA margin (2) 26.6 % 27.5 % 28.6 % 27.6 % 25.3 % 23.9 % 26.9 % 25.4 % 26.9 % 25.8 %
Pumps & Process Solutions:
---
Segment earnings $118,737 $137,217 $138,277 $394,231 $115,244 $129,337 $117,907 $362,488 $121,917 $484,405
Other depreciation and amortization (1) 12,139 12,637 12,651 37,427 10,939 11,609 12,052 34,600 11,744 46,344
Adjusted segment EBITDA (2) 130,876 149,854 150,928 431,658 126,183 140,946 129,959 397,088 133,661 530,749
Adjusted segment EBITDA margin (2) 28.1 % 31.4 % 31.9 % 30.5 % 30.5 % 30.3 % 30.1 % 30.3 % 30.0 % 30.2 %
Climate & Sustainability Technologies:
---
Segment earnings $50,759 $79,127 $76,015 $205,901 $73,778 $76,074 $84,060 $233,912 $71,468 $305,380
Other depreciation and amortization (1) 7,275 7,220 7,048 21,543 6,624 6,895 6,954 20,473 7,084 27,557
Adjusted segment EBITDA (2) 58,034 86,347 83,063 227,444 80,402 82,969 91,014 254,385 78,552 332,937
Adjusted segment EBITDA margin (2) 15.9 % 19.8 % 19.3 % 18.5 % 17.7 % 18.5 % 19.1 % 18.4 % 19.7 % 18.7 %
Total Segments:
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Total segment earnings 2, 3 $371,662 $431,761 $447,696 $1,251,119 $385,006 $389,235 $428,291 $1,202,532 $412,420 $1,614,952
Other depreciation and amortization (1) 35,853 35,533 36,743 108,129 33,674 35,568 36,400 105,642 35,681 141,323
Total Adjusted segment EBITDA (2) 407,515 467,294 484,439 1,359,248 418,680 424,803 464,691 1,308,174 448,101 1,756,275
Total Adjusted segment EBITDA margin (2) 21.6 % 24.0 % 24.4 % 23.4 % 21.9 % 22.2 % 23.7 % 22.6 % 23.5 % 22.9 %
1 Other depreciation and amortization relates to property, plant, and equipment and intangibles, and excludes amounts related to purchase accounting expenses and restructuring and other costs.
(2) Refer to Non-GAAP Disclosures section for definition.
(3) Refer to Quarterly Segment Information section for reconciliation of total segment earnings to earnings from continuing operations.
DOVER CORPORATION
QUARTERLY EARNINGS FROM CONTINUING OPERATIONS TO ADJUSTED SEGMENT EBITDA RECONCILIATION (NON-GAAP)
(unaudited)(in thousands)
Non-GAAP Reconciliations
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2024 2023
Q1 Q2 Q3 Q3 YTD Q1 Q2 Q3 Q3 YTD Q4 FY 2023
Earnings from continuing operations $602,102 $246,587 $312,896 $1,161,585 $206,692 $217,010 $261,983 $685,685 $258,179 $943,864
Provision for income taxes (1) 157,577 60,770 73,434 291,781 51,234 50,150 56,252 157,636 21,500 179,136
Earnings before provision for income taxes 759,679 307,357 386,330 1,453,366 257,926 267,160 318,235 843,321 279,679 1,123,000
Interest income (4,756) (4,081) (5,176) (14,013) (2,091) (2,653) (3,808) (8,552) (4,944) (13,496)
Interest expense 36,365 32,374 34,128 102,867 34,214 33,803 32,390 100,407 30,897 131,304
Corporate expense / other (2) 42,159 39,526 36,110 117,795 40,301 34,138 30,937 105,376 45,957 151,333
Disposition costs (3) - 1,302 1,302
(Gain) loss on dispositions 4 (529,943) 663 (68,633) (597,913)
Restructuring and other costs 5 23,971 11,590 16,581 52,142 14,053 18,143 11,581 43,777 19,150 62,927
Purchase accounting expenses 6 44,187 44,332 48,356 136,875 40,603 38,644 38,956 118,203 40,379 158,582
Total segment earnings 7 371,662 431,761 447,696 1,251,119 385,006 389,235 428,291 1,202,532 412,420 1,614,952
Add: Other depreciation and amortization 8 35,853 35,533 36,743 108,129 33,674 35,568 36,400 105,642 35,681 141,323
Total adjusted segment EBITDA 7 $407,515 $467,294 $484,439 $1,359,248 $418,680 $424,803 $464,691 $1,308,174 $448,101 $1,756,275
(1) Q4 and FY 2023 include the net income tax benefit of internal reorganizations executed in 2023.
(2) Certain expenses are maintained at the corporate level and not allocated to the segments. These expenses include executive and functional compensation costs, non-service pension costs, non-operating insurance expenses, shared business services and digital overhead costs, deal related expenses and various administrative expenses
relating to the corporate headquarters.
(3) Q4 and FY 2023 disposition costs relate to the sale of De-Sta-Co in our Engineered Products segment.
4 (Gain) loss on dispositions including post-closing adjustments related to the disposition of De-Sta-Co in Q1 2024 and the disposition of a minority owned equity method investment in Q3 2024 in the Engineered Products and Climate & Sustainability Technologies segments, respectively.
5 Restructuring and other costs relate to actions taken for headcount reductions, facility consolidations and site closures, product line exits, and other asset charges.
6 Purchase accounting expenses are primarily comprised of amortization of acquired intangible assets.
7 Refer to Non-GAAP Disclosures section for definition.
8 Other depreciation and amortization relates to property, plant, and equipment and intangibles, and excludes amounts related to purchase accounting expenses and restructuring and other costs.
DOVER CORPORATION
REVENUE GROWTH FACTORS AND ADJUSTED EPS GUIDANCE RECONCILIATIONS (NON-GAAP)
(unaudited)(in thousands, except per share data*)
Non-GAAP Reconciliations
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Revenue Growth Factors
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2024
Q3 Q3 YTD
Organic
Engineered Products 12.1 % 10.5 %
Clean Energy & Fueling (1.2) % 0.8 %
Imaging & Identification 3.3 % 2.8 %
Pumps & Process Solutions 1.9 % 1.0 %
Climate & Sustainability Technologies (9.4) % (10.7) %
Total Organic 0.3 % - %
Acquisitions 3.8 % 2.8 %
Dispositions (2.7) % (1.8) %
Currency translation (0.1) % (0.4) %
Total* 1.3 % 0.6 %
* Totals may be impacted by rounding.
2024
Q3 Q3 YTD
Organic
United States 8.4 % 5.0 %
Other Americas 1.7 % 4.4 %
Europe (4.6) % (3.0) %
Asia (9.5) % (7.7) %
Other (33.4) % (28.2) %
Total Organic 0.3 % - %
Acquisitions 3.8 % 2.8 %
Dispositions (2.7) % (1.8) %
Currency translation (0.1) % (0.4) %
Total* 1.3 % 0.6 %
* Totals may be impacted by rounding.
Adjusted EPS Guidance Reconciliation
---
Range
2024 Guidance for Earnings per Share from Continuing Operations (GAAP) $10.11 $10.21
Purchase accounting expenses, net 1.01
Restructuring and other costs, net 0.31
Gain on dispositions, net (3.35)
2024 Guidance for Adjusted Earnings per Share from Continuing Operations (Non-GAAP) $8.08 $8.18
* Per share data and totals may be impacted by rounding.
DOVER CORPORATION
QUARTERLY CASH FLOW AND FREE CASH FLOW (NON-GAAP)
(unaudited)(in thousands)
Quarterly Cash Flow
---
2024 2023
Q1 Q2 Q3 Q3 YTD Q1 Q2 Q3 Q3 YTD Q4 FY 2023
Net Cash Flows Provided By (Used In):
Operating activities $146,456 $149,181 $353,244 $648,881 $220,240 $168,947 $331,795 $720,982 $498,564 $1,219,546
Investing activities 432,416 33,215 (402,512) 63,119 (41,952) (40,591) (48,529) (131,072) (586,643) (717,715)
Financing activities (80,782) (830,657) 92,994 (818,445) (306,565) (137,924) (312,716) (757,205) 189,149 (568,056)
Quarterly Free Cash Flow (Non-GAAP)
---
2024 2023
Q1 Q2 Q3 Q3 YTD Q1 Q2 Q3 Q3 YTD Q4 FY 2023
Cash flow from operating activities (1) $146,456 $149,181 $353,244 $648,881 $220,240 $168,947 $331,795 $720,982 $498,564 $1,219,546
Less: Capital expenditures (40,050) (35,822) (37,754) (113,626) (46,771) (38,183) (41,177) (126,131) (57,275) (183,406)
Free cash flow $106,406 $113,359 $315,490 $535,255 $173,469 $130,764 $290,618 $594,851 $441,289 $1,036,140
Cash flow from operating activities as a
percentage of revenue 7.8 % 7.7 % 17.8 % 11.2 % 11.5 % 8.8 % 16.9 % 12.5 % 26.2 % 15.9 %
Cash flow from operating activities as a
percentage of adjusted earnings from
continuing operations 60.8 % 51.3 % 112.5 % 76.7 % 88.4 % 64.6 % 110.1 % 88.8 % 163.0 % 109.1 %
Free cash flow as a percentage of
revenue 5.6 % 5.8 % 15.9 % 9.2 % 9.1 % 6.8 % 14.8 % 10.3 % 23.2 % 13.5 %
Free cash flow as a percentage of
adjusted earnings from continuing
operations 44.2 % 39.0 % 100.5 % 63.3 % 69.6 % 50.0 % 96.4 % 73.2 % 144.2 % 92.7 %
(1) Q2 and Q3 2024 include income tax payments of $56.0 million and $24.0 million, respectively, related to the gain on the disposition of De-Sta-Co. The remainder of the tax payments on the De-Sta-Co gain will be made during the fourth quarter of 2024.
DOVER CORPORATION
PERFORMANCE MEASURES
(unaudited)(in thousands)
2024 2023
Q1 Q2 Q3 Q3 YTD Q1 Q2 Q3 Q3 YTD Q4 FY 2023
BOOKINGS
---
Engineered
Products $329,925 $280,542 $284,823 $895,290 $329,005 $297,662 $330,566 $957,233 $312,416 $1,269,649
Clean Energy &
Fueling 471,610 442,086 507,329 1,421,025 454,526 440,137 449,663 1,344,326 401,195 1,745,521
Imaging &
Identification 278,433 288,641 281,289 848,363 290,712 262,092 271,113 823,917 297,312 1,121,229
Pumps &
Process
Solutions 473,632 461,426 448,074 1,383,132 464,297 394,317 363,111 1,221,725 455,390 1,677,115
Climate &
Sustainability
Technologies 453,086 406,269 332,503 1,191,858 371,643 310,911 340,474 1,023,028 325,625 1,348,653
Intersegment
eliminations (791) (1,591) (1,065) (3,447) (1,530) (1,913) (848) (4,291) (2,100) (6,391)
Total
consolidated
bookings $2,005,895 $1,877,373 $1,852,953 $5,736,221 $1,908,653 $1,703,206 $1,754,079 $5,365,938 $1,789,838 $7,155,776
2024
Q3 Q3 YTD
BOOKINGS GROWTH FACTORS
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Organic
Engineered Products - % 3.6 %
Clean Energy & Fueling 7.0 % 2.3 %
Imaging & Identification 4.3 % 3.8 %
Pumps & Process Solutions 15.1 % 6.1 %
Climate & Sustainability Technologies (2.1) % 17.0 %
Total Organic 5.1 % 6.5 %
Acquisitions 3.5 % 2.7 %
Dispositions (2.9) % (1.9) %
Currency translation (0.1) % (0.4) %
Total* 5.6 % 6.9 %
* Totals may be impacted by rounding.
Non-GAAP Measures Definitions
In an effort to provide investors with additional information regarding our results as determined by GAAP, management also discloses non-GAAP information that management believes provides useful information to investors. Adjusted earnings from continuing operations, adjusted diluted earnings per share from continuing operations, total segment earnings, total segment earnings margin, adjusted segment EBITDA, adjusted segment EBITDA margin, free cash flow, free cash flow as a percentage of revenue, free cash flow as a percentage of adjusted earnings from continuing operations, and organic revenue growth are not financial measures under GAAP and should not be considered as a substitute for earnings from continuing operations, diluted earnings from continuing operations per share, cash flows from operating activities, or revenue as determined in accordance with GAAP, and they may not be comparable to similarly titled measures reported by other companies.
The items described in our definitions herein, unless otherwise noted, relate solely to our continuing operations.
Adjusted earnings from continuing operations represents earnings from continuing operations adjusted for the effect of purchase accounting expenses, restructuring and other costs/benefits, disposition costs and gain/loss on dispositions. Purchase accounting expenses are primarily comprised of amortization of intangible assets. We exclude after-tax purchase accounting expenses because the amount and timing of such charges are significantly impacted by the timing, size, number and nature of the acquisitions the Company consummates. While we have a history of acquisition activity, our acquisitions do not happen in a predictive cycle. Exclusion of purchase accounting expenses facilitates more consistent comparisons of operating results over time. We believe it is important to understand that such intangible assets were recorded as part of purchase accounting and contribute to revenue generation. We exclude the other items because they occur for reasons that may be unrelated to the Company's commercial performance during the period and/or management believes they are not indicative of the Company's ongoing operating costs or gains in a given period.
Adjusted diluted earnings per share from continuing operations or adjusted earnings per share from continuing operations represents diluted earnings from continuing operations per share adjusted for the effect of purchase accounting expenses, restructuring and other costs/benefits, disposition costs and gain/loss on disposition.
Total segment earnings is defined as the sum of earnings before purchase accounting expenses, restructuring and other costs/benefits, disposition costs, gain/loss on dispositions, corporate expenses/other, interest expense, interest income and provision for income taxes for all segments. Total segment earnings margin is defined as total segment earnings divided by revenue.
Adjusted segment EBITDA is defined as segment earnings plus other depreciation and amortization expense, which relates to property, plant, and equipment and intangibles, and excludes amounts related to purchase accounting expenses and restructuring and other costs/benefits. Adjusted segment EBITDA margin is defined as adjusted segment EBITDA divided by revenue.
Management believes the non-GAAP measures above are useful to investors to better understand the Company's ongoing profitability as they better reflect the Company's core operating results, offer more transparency and facilitate easier comparability to prior and future periods and to its peers.
Free cash flow represents net cash provided by operating activities minus capital expenditures. Free cash flow as a percentage of revenue equals free cash flow divided by revenue. Free cash flow as a percentage of adjusted earnings from continuing operations equals free cash flow divided by adjusted earnings from continuing operations. Management believes that free cash flow and free cash flow ratios are important measures of liquidity because they provide management and investors a measurement of cash generated from operations that is available for mandatory payment obligations and investment opportunities, such as funding acquisitions, paying dividends, repaying debt and repurchasing our common stock.
Management believes that reporting organic revenue growth, which excludes the impact of foreign currency exchange rates and the impact of acquisitions and dispositions, provides a useful comparison of our revenue and trends between periods. We do not provide a reconciliation of forward-looking organic revenue to the most directly comparable GAAP financial measure pursuant to the exception provided in Item 10(e)(1)(i)(B) of Regulation S-K because we are not able to provide a meaningful or accurate compilation of reconciling items. This is due to the inherent difficulty in accurately forecasting the timing and amounts of the items that would be excluded from the most directly comparable GAAP financial measure or are out of our control. For the same reasons, we are unable to address the probable significance of unavailable information which may be material.
Performance Measures Definitions
Bookings represent total orders received from customers in the current reporting period and exclude de-bookings related to orders received in prior periods, if any. This metric is an important measure of performance and an indicator of revenue order trends.
Organic bookings represent bookings excluding the impact of foreign currency exchange rates and the impact of acquisitions and dispositions. This metric is an important measure of performance and an indicator of revenue order trends.
We use the above operational metrics in monitoring the performance of the business. We believe the operational metrics are useful to investors and other users of our financial information in assessing the performance of our segments.
Investor Contact: Media Contact:
Jack Dickens
Adrian Sakowicz
Senior Director - Investor Relations Vice President -
Communications
(630) 743-2566
(630) 743-5039
jdickens@dovercorp.com asakowicz@dovercorp.com
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SOURCE Dover
