Recent Quotes View Full List My Watchlist Create Watchlist Indicators DJI Nasdaq Composite SPX Gold Crude Oil EL&P Market Index Markets Stocks ETFs Tools Overview News Currencies International Treasuries Columbus McKinnon Reports Record Net Sales, Gross Margin and Operating Income in Fiscal 2024 By: Columbus McKinnon Corporation via Business Wire May 29, 2024 at 06:30 AM EDT Columbus McKinnon Corporation (Nasdaq: CMCO), a leading designer, manufacturer and marketer of intelligent motion solutions for material handling, today announced financial results for its full year and fourth quarter fiscal 2024, which ended March 31, 2024. Results include the addition of montratec®, which was acquired on May 31, 2023 ("the acquisition"). Fiscal Year 2024 Highlights (compared with prior year period) Record net sales of $1.0 billion, up 8% driven by growth across all geographies including the acquisition of montratec Gross margin up 50 basis points to 37.0%; Adjusted Gross Margin1 up 80 basis points to 37.3% Net income of $46.6 million with a net margin of 4.6%; Adjusted EBITDA1 of $166.7 million, up 13% with Adjusted EBITDA Margin1 of 16.4%, up 60 basis points Generated net cash provided by operating activities of $67.2 million and Free Cash Flow1 of $42.4 million with Free Cash Flow Conversion1 of 91% Net Leverage Ratio1,2 decreased to 2.4x; Expect Net Leverage Ratio1,2 of ~2.0x target by end of year Fiscal 2025 Fourth Quarter 2024 Highlights (compared with prior year period) Delivered $265.5 million of net sales demonstrating continued momentum, up 5% driven by growth across all geographies with strength in precision conveyance, up 23% Orders increased 5% led by precision conveyance, up 25% Net income of $11.8 million with a net margin of 4.4%; Adjusted EBITDA1 of $43.0 million, up 8% with Adjusted EBITDA Margin1 of 16.2%, up 50 basis points “Our team delivered another record year of sales, gross margin, operating income, and Adjusted EBITDA Margin1 reflecting the solid progress we are making with our transformation. These results provide another proof point on the path to achieving our long-term financial objectives. Our team continues to execute on commercial and operational initiatives to improve productivity, reduce lead times, and enhance customer experience, which position us to scale our business and deliver top-tier financial results,” said David J. Wilson, President and Chief Executive Officer. “While we are taking a prudent view of our outlook for fiscal 2025, we remain cautiously optimistic given the solid momentum exiting fiscal 2024 and our encouraging pipeline of opportunities. We are focused on execution as we thoughtfully navigate this uncertain environment.” Fourth Quarter Fiscal 2024 Sales ($ in millions) Q4 FY 24 Q4 FY 23 Change % Change Net sales $ 265.5 $ 253.8 $ 11.7 4.6 % U.S. sales $ 155.0 $ 149.4 $ 5.6 3.7 % % of total 58 % 59 % Non-U.S. sales $ 110.5 $ 104.4 $ 6.1 5.8 % % of total 42 % 41 % For the quarter, sales increased $11.7 million, or 4.6%. The acquisition contributed $4.9 million, or 1.9%. In the U.S., sales were up $5.6 million, or 3.7%, driven by favorable sales volume of $3.1 million, price improvement of $2.1 million and $0.4 million of contribution from the acquisition. Sales outside the U.S. increased $6.1 million, or 5.8%, driven by $4.5 million of sales related to the acquisition and $3.6 million of price improvement offset by $3.3 million of lower sales volume. Favorable foreign currency translation was $1.3 million. Fourth Quarter Fiscal 2024 Operating Results ($ in millions) Q4 FY 24 Q4 FY 23 Change % Change Gross profit $ 94.3 $ 91.2 $ 3.1 3.4 % Gross margin 35.5 % 35.9 % (40) bps Adjusted Gross Profit1 $ 97.1 $ 91.2 $ 5.9 6.5 % Adjusted Gross Margin1 36.6 % 35.9 % 70 bps Income from operations $ 25.4 $ 27.5 $ (2.0 ) (7.4 )% Operating margin 9.6 % 10.8 % (120) bps Adjusted Operating Income1 $ 31.1 $ 29.2 $ 1.9 6.6 % Adjusted Operating Margin1 11.7 % 11.5 % 20 bps Net income $ 11.8 $ 13.9 $ (2.1 ) (15.0 )% Net income margin 4.4 % 5.5 % (110) bps Diluted EPS $ 0.41 $ 0.48 $ (0.07 ) (14.6 )% Adjusted EPS1 $ 0.75 $ 0.80 $ (0.05 ) (6.3 )% Adjusted EBITDA1 $ 43.0 $ 39.7 $ 3.2 8.2 % Adjusted EBITDA margin1 16.2 % 15.7 % 50 bps Adjusted EPS1 excludes amortization of intangible assets related to acquisitions. The Company believes this better represents its inherent earnings power and cash generation capability. Full Year and First Quarter Fiscal 2025 Guidance The Company is issuing the following guidance for the first quarter of fiscal 2025, ending June 30, 2024: Metric Q1 FY25 Net sales Low-single digit growth year-over-year Adjusted EPS3 Flat to slightly down year-over-year First quarter 2025 guidance assumes approximately $9 million of interest expense, $8 million of amortization, an effective tax rate of 25% and 29.2 million diluted average shares outstanding. The Company is issuing the following guidance for fiscal 2025, ending March 31, 2025: Metric FY25 Net sales Low-single digit growth year-over-year Adjusted EPS3 Mid to high-single digit growth year-over-year Capital Expenditures $20 million to $30 million Net Leverage Ratio3 ~2.0x Fiscal 2025 guidance assumes approximately $33 million of interest expense, $30 million of amortization, an effective tax rate of 25% and 29.4 million diluted average shares outstanding. Teleconference/Webcast Columbus McKinnon will host a conference call today at 10:00 AM Eastern Time to discuss the Company’s financial results and strategy. The conference call will be accessible through live webcast and via phone by dialing 201-493-6780. The webcast, earnings release and earnings presentation will be available at the Company's investor relations website at investors.cmco.com. A replay of the webcast will also be archived on the Company's investor relations website and available via phone by dialing 412-317-6671 and enter conference ID number 13746170 through June 5, 2024. ______________________ 1 Adjusted Gross Profit, Adjusted Gross Margin, Adjusted Operating Income, Adjusted Operating Margin, Adjusted EPS, Adjusted EBITDA, Adjusted EBITDA Margin, Free Cash Flow, Free Cash Flow Conversion and Net Leverage Ratio are non-GAAP financial measures. See accompanying discussion and reconciliation tables provided in this release for reconciliations of these non-GAAP financial measures to the closest corresponding GAAP financial measures. 2 On a financial covenant basis per the Company’s Amended and Restated Credit Agreement 3 The Company has not reconciled the Adjusted EPS and Net Leverage Ratio guidance to the most comparable GAAP outlook because it is not possible to do so without unreasonable efforts due to the uncertainty and potential variability of reconciling items, which are dependent on future events and often outside of management’s control and which could be significant. Because such items cannot be reasonably predicted with the level of precision required, we are unable to provide guidance for the comparable GAAP financial measures. Forward-looking guidance regarding Adjusted EPS and Net Leverage Ratio are made in a manner consistent with the relevant definitions and assumptions noted herein. About Columbus McKinnon Columbus McKinnon is a leading worldwide designer, manufacturer and marketer of intelligent motion solutions that move the world forward and improve lives by efficiently and ergonomically moving, lifting, positioning, and securing materials. Key products include hoists, crane components, precision conveyor systems, rigging tools, light rail workstations and digital power and motion control systems. The Company is focused on commercial and industrial applications that require the safety and quality provided by its superior design and engineering know-how. Comprehensive information on Columbus McKinnon is available at www.cmco.com. Safe Harbor Statement This news release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are generally identified by the use of forward-looking terminology, including the terms “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “illustrative,” “intend,” “likely,” “may,” “opportunity,” “plan,” “possible,” “potential,” “predict,” “project,” “shall,” “should,” “target,” “will,” “would” and, in each case, their negative or other various or comparable terminology. All statements other than statements of historical facts contained in this release, including, but are not limited to, statements relating to: (i) our strategy, outlook and growth prospects and our full year and first quarter fiscal 2025 guidance; (ii) our operational and financial targets and capital distribution policy; (iii) general economic trend and trends in the industry and markets; (iv) the risk and costs associated with the integration of, and our ability to integrate acquisitions successfully to achieve synergies; (v) the effectiveness of our new facility in Monterrey, Mexico to provide cost savings and margin improvement (vi) the amount of debt to be paid down by the Company during fiscal 2025; and (vii) the competitive environment in which we operate are forward looking statements. Forward-looking statements are not based on historical facts, but instead represent our current expectations and assumptions regarding our business, the economy and other future conditions, and involve known and unknown risks, uncertainties and other factors that could cause the actual results, performance or achievements of the Company to differ materially from any future results, performance or achievements expressed or implied by the forward-looking statements. It is not possible to predict or identify all such risks. These risks include, but are not limited to, the risk factors that are described under the section titled “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended March 31, 2023 as well as in our other filings with the Securities and Exchange Commission, which are available on its website at www.sec.gov. Given these uncertainties, you should not place undue reliance on these forward-looking statements. Forward-looking statements speak only as of the date they are made. Columbus McKinnon undertakes no duty to update publicly any such forward-looking statement, whether as a result of new information, future events or otherwise, except as may be required by applicable law, regulation or other competent legal authority. Financial tables follow. COLUMBUS McKINNON CORPORATION Condensed Consolidated Income Statements - Unaudited (In thousands, except per share and percentage data) Three Months Ended March 31, 2024 March 31, 2023 Change Net sales $ 265,504 $ 253,843 4.6 % Cost of products sold 171,189 162,625 5.3 % Gross profit 94,315 91,218 3.4 % Gross profit margin 35.5 % 35.9 % Selling expenses 26,941 25,331 6.4 % % of net sales 10.1 % 10.0 % General and administrative expenses 27,353 26,353 3.8 % % of net sales 10.3 % 10.4 % Research and development expenses 7,059 5,506 28.2 % % of net sales 2.7 % 2.2 % Amortization of intangibles 7,525 6,559 14.7 % Income from operations 25,437 27,469 (7.4 )% Operating margin 9.6 % 10.8 % Interest and debt expense 9,169 7,668 19.6 % Investment (income) loss, net (547 ) (483 ) 13.3 % Foreign currency exchange loss (gain), net 752 (1,037 ) NM Other (income) expense, net 1,757 (73 ) NM Income before income tax expense 14,306 21,394 (33.1 )% Income tax expense 2,497 7,499 (66.7 )% Net income $ 11,809 $ 13,895 (15.0 )% Average basic shares outstanding 28,780 28,609 0.6 % Basic income per share $ 0.41 $ 0.49 (16.3 )% Average diluted shares outstanding 29,129 28,869 0.9 % Diluted income per share $ 0.41 $ 0.48 (14.6 )% Dividends declared per common share $ 0.14 $ 0.14 COLUMBUS McKINNON CORPORATION Condensed Consolidated Income Statements - Unaudited (In thousands, except per share and percentage data) Year Ended March 31, 2024 March 31, 2023 Change Net sales $ 1,013,540 $ 936,240 8.3 % Cost of products sold 638,702 594,141 7.5 % Gross profit 374,838 342,099 9.6 % Gross profit margin 37.0 % 36.5 % Selling expenses 105,341 102,528 2.7 % % of net sales 10.4 % 11.0 % General and administrative expenses 106,760 94,794 12.6 % % of net sales 10.5 % 10.1 % Research and development expenses 26,193 20,935 25.1 % % of net sales 2.6 % 2.2 % Amortization of intangibles 29,396 26,001 13.1 % Income from operations 107,148 97,841 9.5 % Operating margin 10.6 % 10.5 % Interest and debt expense 37,957 27,942 35.8 % Investment (income) loss, net (1,759 ) (315 ) 458.4 % Foreign currency exchange loss (gain), net 1,826 (2,189 ) NM Other (income) expense, net 7,597 (2,072 ) NM Income before income tax expense 61,527 74,475 (17.4 )% Income tax expense 14,902 26,046 (42.8 )% Net income $ 46,625 $ 48,429 (3.7 )% Average basic shares outstanding 28,728 28,600 0.4 % Basic income per share $ 1.62 $ 1.69 (4.1 )% Average diluted shares outstanding 29,026 28,818 0.7 % Diluted income per share $ 1.61 $ 1.68 (4.2 )% Dividends declared per common share $ 0.28 $ 0.28 COLUMBUS McKINNON CORPORATION Condensed Consolidated Balance Sheets - Unaudited (In thousands) March 31, 2024 March 31, 2023 ASSETS Current assets: Cash and cash equivalents $ 114,126 $ 133,176 Trade accounts receivable 171,186 151,451 Inventories 186,091 179,359 Prepaid expenses and other 42,752 32,254 Total current assets 514,155 496,240 Net property, plant, and equipment 106,395 94,360 Goodwill 710,334 644,629 Other intangibles, net 385,634 362,537 Marketable securities 11,447 10,368 Deferred taxes on income 1,797 2,035 Other assets 96,183 88,286 Total assets $ 1,825,945 $ 1,698,455 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities: Trade accounts payable $ 83,118 $ 76,736 Accrued liabilities 127,973 124,317 Current portion of long-term debt and finance lease obligations 50,670 40,604 Total current liabilities 261,761 241,657 Term loan, AR securitization facility and finance lease obligations 479,566 430,988 Other non-current liabilities 202,555 192,013 Total liabilities 943,882 864,658 Shareholders’ equity: Common stock 288 286 Treasury Stock (1,001 ) (1,001 ) Additional paid-in capital 527,125 515,797 Retained earnings 395,328 356,758 Accumulated other comprehensive loss (39,677 ) (38,043 ) Total shareholders’ equity 882,063 833,797 Total liabilities and shareholders’ equity $ 1,825,945 $ 1,698,455 COLUMBUS McKINNON CORPORATION Condensed Consolidated Statements of Cash Flows - Unaudited (In thousands) Year Ended March 31, 2024 March 31, 2023 Operating activities: Net income $ 46,625 $ 48,429 Adjustments to reconcile net income to net cash provided by (used for) operating activities: Depreciation and amortization 45,945 41,947 Deferred income taxes and related valuation allowance (15,786 ) (300 ) Net loss (gain) on sale of real estate, investments and other (1,431 ) (54 ) Stock-based compensation 12,039 10,425 Amortization of deferred financing costs 2,349 1,721 Loss (gain) on hedging instruments (1,366 ) (438 ) Cost of debt repricing 958 — Loss on retirement of fixed asset — 175 Non-cash pension settlement 4,984 — Gain on sale of building — (232 ) Non-cash lease expense 9,735 7,867 Changes in operating assets and liabilities, net of effects of business acquisitions: Trade accounts receivable (14,428 ) (4,858 ) Inventories (1,314 ) (9,087 ) Prepaid expenses and other (8,555 ) 6,667 Other assets 537 (123 ) Trade accounts payable 4,748 (13,964 ) Accrued liabilities (9,583 ) 9,150 Non-current liabilities (8,259 ) (13,689 ) Net cash provided by (used for) operating activities 67,198 83,636 Investing activities: Proceeds from sales of marketable securities 3,526 3,651 Purchases of marketable securities (4,076 ) (4,021 ) Capital expenditures (24,813 ) (12,632 ) Proceeds from sale of building, net of transaction costs — 373 Purchases of businesses, net of cash acquired (108,145 ) (1,616 ) Dividend received from equity method investment 144 313 Net cash provided by (used for) investing activities (133,364 ) (13,932 ) Financing activities: Proceeds from issuance of common stock 1,600 713 Purchases of treasury stock — (1,001 ) Fees paid for debt repricing (958 ) — Repayment of debt (60,604 ) (40,550 ) Proceeds from issuance of long-term debt 120,000 — Cash inflows from hedging activities 24,057 24,495 Cash outflows from hedging activities (22,687 ) (24,221 ) Fees paid for borrowing on long-term debt (2,859 ) — Payment of dividends (8,044 ) (8,008 ) Other (2,304 ) (1,415 ) Net cash provided by (used for) financing activities 48,201 (49,987 ) Effect of exchange rate changes on cash (1,085 ) (1,931 ) Net change in cash and cash equivalents (19,050 ) 17,786 Cash, cash equivalents, and restricted cash at beginning of year 133,426 115,640 Cash, cash equivalents, and restricted cash at end of year $ 114,376 $ 133,426 COLUMBUS McKINNON CORPORATION Q4 FY 2024 Sales Bridge Quarter Year ($ in millions) $ Change % Change $ Change % Change Fiscal 2023 Sales $ 253.8 $ 936.2 Acquisition 4.9 1.9 % 32.6 3.5 % Volume (0.2 ) (0.1 )% (0.4 ) — % Pricing 5.7 2.3 % 33.8 3.6 % Foreign currency translation 1.3 0.5 % 11.3 1.2 % Total change $ 11.7 4.6 % $ 77.3 8.3 % Fiscal 2024 Sales $ 265.5 $ 1,013.5 COLUMBUS McKINNON CORPORATION Q4 FY 2024 Gross Profit Bridge ($ in millions) Quarter Year Fiscal 2023 Gross Profit $ 91.2 $ 342.1 Acquisition 0.8 13.8 Price, net of manufacturing cost changes (incl. inflation) 1.0 16.9 Foreign currency translation 0.4 3.8 Current year business realignment costs — (0.4 ) Monterrey, MX new factory start-up costs (2.6 ) (3.0 ) Factory and warehouse consolidation costs (0.2 ) (0.2 ) Sales volume & mix 3.7 0.9 Product liability — 0.9 Total change 3.1 32.7 Fiscal 2024 Gross Profit $ 94.3 $ 374.8 U.S. Shipping Days by Quarter Q1 Q2 Q3 Q4 Total FY 25 64 63 60 62 249 FY 24 63 62 61 62 248 FY 23 63 64 60 63 250 COLUMBUS McKINNON CORPORATION Additional Data1 (Unaudited) Period Ended March 31, 2024 December 31, 2023 March 31, 2023 ($ in millions) Backlog $ 280.8 $ 298.4 $ 308.7 Long-term backlog Expected to ship beyond 3 months $ 144.6 $ 151.3 $ 142.0 Long-term backlog as % of total backlog 51.5 % 50.7 % 46.0 % Debt to total capitalization percentage 37.5 % 38.5 % 36.1 % Debt, net of cash, to net total capitalization 32.0 % 33.7 % 28.9 % Working capital as a % of sales 2 19.1 % 20.6 % 17.3 % Three Months Ended March 31, 2024 December 31, 2023 March 31, 2023 ($ in millions) Trade accounts receivable Days sales outstanding 58.7 days 62.1 days 54.3 days Inventory turns per year (based on cost of products sold) 3.7 turns 3.1 turns 3.6 turns Days' inventory 98.6 days 117.7 days 101.4 days Trade accounts payable Days payables outstanding 50.9 days 50.1 days 53.3 days Net cash provided by (used for) operating activities $ 38.6 $ 29.1 $ 66.7 Capital expenditures $ 8.5 $ 6.0 $ 3.1 Free Cash Flow 3 $ 30.1 $ 23.1 $ 63.6 1 Additional Data: This data is provided to help investors understand financial and operational metrics that management uses to measure the Company’s financial performance and identify trends affecting the business. These measures may not be comparable with or defined in the same manner as other companies. Components may not add due to rounding. 2 March 31, 2024 and December 31, 2023 exclude the impact of the acquisition of montratec. 3 Free Cash Flow is a non-GAAP financial measures. See accompanying discussion and reconciliation tables provided in this release for reconciliations of these non-GAAP financial measures to the closest corresponding GAAP financial measures. NON-GAAP FINANCIAL MEASURES The following information provides definitions and reconciliations of the non-GAAP financial measures presented in this earnings release to the most directly comparable financial measures calculated and presented in accordance with generally accepted accounting principles (GAAP). The Company has provided this non-GAAP financial information, which is not calculated or presented in accordance with GAAP, as information supplemental and in addition to the financial measures presented in this earnings release that are calculated and presented in accordance with GAAP. Such non-GAAP financial measures should not be considered superior to, as a substitute for or alternative to, and should be considered in conjunction with, the GAAP financial measures presented in this earnings release. The non-GAAP financial measures in this earnings release may differ from similarly titled measures used by other companies. COLUMBUS McKINNON CORPORATION Reconciliation of Gross Profit to Adjusted Gross Profit ($ in thousands) Three Months Ended March 31, Year Ended March 31, 2024 2023 2024 2023 GAAP gross profit $ 94,315 $ 91,218 $ 374,838 $ 342,099 Add back (deduct): Business realignment costs — — 346 — Monterrey, MX new factory start-up costs 2,552 — 2,987 — Factory and warehouse consolidation costs 262 — 262 — Non-GAAP adjusted gross profit $ 97,129 $ 91,218 $ 378,433 $ 342,099 Net Sales $ 265,504 $ 253,843 $ 1,013,540 $ 936,240 Gross margin 35.5 % 35.9 % 37.0 % 36.5 % Adjusted Gross Margin 36.6 % 35.9 % 37.3 % 36.5 % Adjusted Gross Profit is defined as gross profit as reported, adjusted for certain items. Adjusted Gross Profit Margin is defined as Adjusted Gross Profit divided by net sales. Adjusted Gross Profit and Adjusted Gross Margin are not measures determined in accordance with GAAP and may not be comparable with Adjusted Gross Profit and Adjusted Gross Profit Margin as used by other companies. Nevertheless, Columbus McKinnon believes that providing non-GAAP financial measures, such as Adjusted Gross Profit and Adjusted Gross Profit Margin, are important for investors and other readers of the Company’s financial statements and assists in understanding the comparison of the current quarter’s and current year's gross profit and gross profit margin to the historical periods' gross profit, as well as facilitates a more meaningful comparison of the Company’s gross profit and gross profit margin to that of other companies. COLUMBUS McKINNON CORPORATION Reconciliation of Income from Operations to Adjusted Operating Income ($ in thousands) Three Months Ended March 31, Year Ended March 31, 2024 2023 2024 2023 Income from operations $ 25,437 $ 27,469 $ 107,148 $ 97,841 Add back (deduct): Acquisition deal and integration costs 3 173 3,211 616 Business realignment costs — 848 1,867 5,140 Factory and warehouse consolidation costs 545 — 744 — Garvey contingent consideration — — — 1,230 Headquarter relocation costs 175 681 2,059 996 Monterrey, MX new factory start-up costs 3,734 — 4,489 — Cost of debt repricing 1,190 — 1,190 — Adjusted Operating Income $ 31,084 $ 29,171 $ 120,708 $ 105,823 Net Sales $ 265,504 $ 253,843 $ 1,013,540 $ 936,240 Operating margin 9.6 % 10.8 % 10.6 % 10.5 % Adjusted Operating Margin 11.7 % 11.5 % 11.9 % 11.3 % Adjusted Operating Income is defined as income from operations as reported, adjusted for certain items. Adjusted Operating Margin is defined as Adjusted Operating Income divided by net sales. Adjusted Operating Income and Adjusted Operating Margin are not measures determined in accordance with GAAP and may not be comparable with Adjusted Operating Income and Adjusted Operating Margin as used by other companies. Nevertheless, Columbus McKinnon believes that providing non-GAAP financial measures, such as Adjusted Operating Income and Adjusted Operating Margin, are important for investors and other readers of the Company’s financial statements and assists in understanding the comparison of the current quarter’s and current year's income from operations to the historical periods' income from operations and operating margin, as well as facilitates a more meaningful comparison of the Company’s income from operations and operating margin to that of other companies. COLUMBUS McKINNON CORPORATION Reconciliation of Net Income and Diluted Earnings per Share to Adjusted Net Income and Adjusted Earnings per Diluted Share ($ in thousands, except per share data) Three Months Ended March 31, Year Ended March 31, 2024 2023 2024 2023 Net income $ 11,809 $ 13,895 $ 46,625 $ 48,429 Add back (deduct): Amortization of intangibles 7,525 6,559 29,396 26,001 Acquisition deal and integration costs 3 173 3,211 616 Business realignment costs — 848 1,867 5,140 Factory and warehouse consolidation costs 545 — 744 — Garvey contingent consideration — — — 1,230 Headquarter relocation costs 175 681 2,059 996 Monterrey, MX new factory start-up costs 3,734 — 4,489 — Cost of debt repricing 1,190 — 1,190 — Non-cash pension settlement expense 385 — 4,984 — Tax indemnification payment owed1 1,192 — 1,192 — Normalize tax rate2 (4,767 ) 975 (12,763 ) 2,185 Adjusted Net Income $ 21,791 $ 23,131 $ 82,994 $ 84,597 Average diluted shares outstanding 29,129 28,869 29,026 28,818 Diluted income per share $ 0.41 $ 0.48 $ 1.61 $ 1.68 Adjusted EPS per diluted share $ 0.75 $ 0.80 $ 2.86 $ 2.94 1 Represents tax indemnification payment owed to the former owner of STAHL for a tax refund received by CMCO in the quarter ended March 31, 2024 for periods prior to the acquisition of STAHL by CMCO. 2 Applies a normalized tax rate of 25% in fiscal 2024 and 22% in fiscal 2023 to GAAP pre-tax income and non-GAAP adjustments above, which are each pre-tax. Adjusted Net Income and Adjusted Diluted EPS are defined as net income and diluted EPS as reported, adjusted for certain items, including amortization of intangibles, and also adjusted for a normalized tax rate. Adjusted Net Income and Adjusted Diluted EPS are not measures determined in accordance with GAAP and may not be comparable with the measures used by other companies. Nevertheless, Columbus McKinnon believes that providing non-GAAP financial measures, such as Adjusted Net Income and Adjusted Diluted EPS, are important for investors and other readers of the Company’s financial statements and assists in understanding the comparison of the current quarter’s and current year's net income and diluted EPS to the historical periods' net income and diluted EPS, as well as facilitates a more meaningful comparison of the Company’s net income and diluted EPS to that of other companies. The Company believes that presenting Adjusted Diluted EPS provides a better understanding of its earnings power inclusive of adjusting for the non-cash amortization of intangible assets, reflecting the Company’s strategy to grow through acquisitions as well as organically. COLUMBUS McKINNON CORPORATION Reconciliation of Net Income to Adjusted EBITDA ($ in thousands) Three Months Ended March 31, Year Ended March 31, 2024 2023 2024 2023 Net income $ 11,809 $ 13,895 $ 46,625 $ 48,429 Add back (deduct): Income tax expense 2,497 7,499 14,902 26,046 Interest and debt expense 9,169 7,668 37,957 27,942 Investment (income) loss, net (547 ) (483 ) (1,759 ) (315 ) Foreign currency exchange loss (gain), net 752 (1,037 ) 1,826 (2,189 ) Other (income) expense, net 1,757 (73 ) 7,597 (2,072 ) Depreciation and amortization expense 11,893 10,567 45,945 41,947 Acquisition deal and integration costs 3 173 3,211 616 Business realignment costs — 848 1,867 5,140 Factory and warehouse consolidation costs 545 — 744 — Garvey contingent consideration — — — 1,230 Headquarter relocation costs 175 681 2,059 996 Monterrey, MX new factory start-up costs 3,734 — 4,489 — Cost of debt repricing 1,190 — 1,190 — Adjusted EBITDA $ 42,977 $ 39,738 $ 166,653 $ 147,770 Net Sales $ 265,504 $ 253,843 $ 1,013,540 $ 936,240 Net income margin 4.4 % 5.5 % 4.6 % 5.2 % Adjusted EBITDA Margin 16.2 % 15.7 % 16.4 % 15.8 % Adjusted EBITDA is defined as net income before interest expense, income taxes, depreciation, amortization, and other adjustments. Adjusted EBITDA Margin is defined as Adjusted EBITDA divided by net sales. Adjusted EBITDA and Adjusted EBITDA Margin are not measures determined in accordance with GAAP and may not be comparable with Adjusted EBITDA and Adjusted EBITDA Margin as used by other companies. Nevertheless, Columbus McKinnon believes that providing non-GAAP financial measures, such as Adjusted EBITDA and Adjusted EBITDA Margin, are important for investors and other readers of the Company’s financial statements. COLUMBUS McKINNON CORPORATION Reconciliation of Net Leverage Ratio ($ in thousands) Year Ended March 31, 2024 2023 Net income $ 46,625 $ 48,429 Add back (deduct): Annualize EBITDA for the montratec acquisition1 1,331 Annualize synergies for the montratec acquisition1 73 Income tax expense 14,902 26,046 Interest and debt expense 37,957 27,942 Non-Cash Pension Settlement2 4,984 — Amortization of deferred financing costs 2,349 1,721 Stock Compensation Expense 12,039 10,425 Depreciation and amortization expense 45,945 41,947 Acquisition deal and integration costs 3,211 616 Business realignment costs 1,867 5,140 Factory and warehouse consolidation costs 744 — Garvey contingent consideration — 1,230 Headquarter relocation costs 2,059 996 Monterrey, MX new factory start-up costs 4,489 — Cost of debt repricing 1,190 — Non-Cash loss related to asset retirement — 175 Gain on Sale of Facility — (232 ) Credit Agreement Trailing Twelve Month Adjusted EBITDA $ 179,765 $ 164,435 Current portion of long-term debt and finance lease obligations $ 50,670 $ 40,604 Term loan, AR securitization facility and finance lease obligations 479,566 430,988 Total debt $ 530,236 $ 471,592 Standby Letters of Credit 15,368 14,921 Cash and cash equivalents (114,126 ) (133,176 ) Net Debt $ 431,478 $ 353,337 Net Leverage Ratio 2.40x 2.15x 1 EBITDA is normalized to include a full year of the acquired entity and assuming that deal related synergies are achieved for montratec in fiscal year 2024 and Dorner and Garvey in fiscal year 2023. 2 During the quarter ending December 31, 2023, certain employees in one of the Company's U.S. pension plans accepted an offer to settle their pension obligation with a lump sum payment. These lump sum settlements are one of the steps the Company is taking to terminate the plan by transferring the liabilities to a third-party. Net Debt is defined in the credit agreement as total debt plus standby letters of credit, net of cash and cash equivalents. Net Leverage Ratio is defined as Net Debt divided by the Credit Agreement Trailing Twelve Month Adjusted EBITDA. Credit Agreement Trailing Twelve Month Adjusted EBITDA is defined as net income adjusted for interest expense, income taxes, depreciation, amortization, and other adjustments. Net Debt, Net Leverage Ratio and Credit Agreement Trailing Twelve Month Adjusted EBITDA are not measures determined in accordance with GAAP and may not be comparable with the measures as used by other companies. Nevertheless, the Company believes that providing non-GAAP financial measures, such as Net Debt, Net Leverage Ratio and Credit Agreement Trailing Twelve Month Adjusted EBITDA are important for investors and other readers of the Company’s financial statements. View source version on businesswire.com: https://www.businesswire.com/news/home/20240529085281/en/Contacts Gregory P. Rustowicz EVP Finance and CFO Columbus McKinnon Corporation 716-689-5442 greg.rustowicz@cmco.com Kristine Moser VP IR and Treasurer Columbus McKinnon Corporation 704-322-2488 kristy.moser@cmco.com Data & News supplied by www.cloudquote.io Stock quotes supplied by Barchart Quotes delayed at least 20 minutes. By accessing this page, you agree to the following Privacy Policy and Terms and Conditions.
Columbus McKinnon Reports Record Net Sales, Gross Margin and Operating Income in Fiscal 2024 By: Columbus McKinnon Corporation via Business Wire May 29, 2024 at 06:30 AM EDT Columbus McKinnon Corporation (Nasdaq: CMCO), a leading designer, manufacturer and marketer of intelligent motion solutions for material handling, today announced financial results for its full year and fourth quarter fiscal 2024, which ended March 31, 2024. Results include the addition of montratec®, which was acquired on May 31, 2023 ("the acquisition"). Fiscal Year 2024 Highlights (compared with prior year period) Record net sales of $1.0 billion, up 8% driven by growth across all geographies including the acquisition of montratec Gross margin up 50 basis points to 37.0%; Adjusted Gross Margin1 up 80 basis points to 37.3% Net income of $46.6 million with a net margin of 4.6%; Adjusted EBITDA1 of $166.7 million, up 13% with Adjusted EBITDA Margin1 of 16.4%, up 60 basis points Generated net cash provided by operating activities of $67.2 million and Free Cash Flow1 of $42.4 million with Free Cash Flow Conversion1 of 91% Net Leverage Ratio1,2 decreased to 2.4x; Expect Net Leverage Ratio1,2 of ~2.0x target by end of year Fiscal 2025 Fourth Quarter 2024 Highlights (compared with prior year period) Delivered $265.5 million of net sales demonstrating continued momentum, up 5% driven by growth across all geographies with strength in precision conveyance, up 23% Orders increased 5% led by precision conveyance, up 25% Net income of $11.8 million with a net margin of 4.4%; Adjusted EBITDA1 of $43.0 million, up 8% with Adjusted EBITDA Margin1 of 16.2%, up 50 basis points “Our team delivered another record year of sales, gross margin, operating income, and Adjusted EBITDA Margin1 reflecting the solid progress we are making with our transformation. These results provide another proof point on the path to achieving our long-term financial objectives. Our team continues to execute on commercial and operational initiatives to improve productivity, reduce lead times, and enhance customer experience, which position us to scale our business and deliver top-tier financial results,” said David J. Wilson, President and Chief Executive Officer. “While we are taking a prudent view of our outlook for fiscal 2025, we remain cautiously optimistic given the solid momentum exiting fiscal 2024 and our encouraging pipeline of opportunities. We are focused on execution as we thoughtfully navigate this uncertain environment.” Fourth Quarter Fiscal 2024 Sales ($ in millions) Q4 FY 24 Q4 FY 23 Change % Change Net sales $ 265.5 $ 253.8 $ 11.7 4.6 % U.S. sales $ 155.0 $ 149.4 $ 5.6 3.7 % % of total 58 % 59 % Non-U.S. sales $ 110.5 $ 104.4 $ 6.1 5.8 % % of total 42 % 41 % For the quarter, sales increased $11.7 million, or 4.6%. The acquisition contributed $4.9 million, or 1.9%. In the U.S., sales were up $5.6 million, or 3.7%, driven by favorable sales volume of $3.1 million, price improvement of $2.1 million and $0.4 million of contribution from the acquisition. Sales outside the U.S. increased $6.1 million, or 5.8%, driven by $4.5 million of sales related to the acquisition and $3.6 million of price improvement offset by $3.3 million of lower sales volume. Favorable foreign currency translation was $1.3 million. Fourth Quarter Fiscal 2024 Operating Results ($ in millions) Q4 FY 24 Q4 FY 23 Change % Change Gross profit $ 94.3 $ 91.2 $ 3.1 3.4 % Gross margin 35.5 % 35.9 % (40) bps Adjusted Gross Profit1 $ 97.1 $ 91.2 $ 5.9 6.5 % Adjusted Gross Margin1 36.6 % 35.9 % 70 bps Income from operations $ 25.4 $ 27.5 $ (2.0 ) (7.4 )% Operating margin 9.6 % 10.8 % (120) bps Adjusted Operating Income1 $ 31.1 $ 29.2 $ 1.9 6.6 % Adjusted Operating Margin1 11.7 % 11.5 % 20 bps Net income $ 11.8 $ 13.9 $ (2.1 ) (15.0 )% Net income margin 4.4 % 5.5 % (110) bps Diluted EPS $ 0.41 $ 0.48 $ (0.07 ) (14.6 )% Adjusted EPS1 $ 0.75 $ 0.80 $ (0.05 ) (6.3 )% Adjusted EBITDA1 $ 43.0 $ 39.7 $ 3.2 8.2 % Adjusted EBITDA margin1 16.2 % 15.7 % 50 bps Adjusted EPS1 excludes amortization of intangible assets related to acquisitions. The Company believes this better represents its inherent earnings power and cash generation capability. Full Year and First Quarter Fiscal 2025 Guidance The Company is issuing the following guidance for the first quarter of fiscal 2025, ending June 30, 2024: Metric Q1 FY25 Net sales Low-single digit growth year-over-year Adjusted EPS3 Flat to slightly down year-over-year First quarter 2025 guidance assumes approximately $9 million of interest expense, $8 million of amortization, an effective tax rate of 25% and 29.2 million diluted average shares outstanding. The Company is issuing the following guidance for fiscal 2025, ending March 31, 2025: Metric FY25 Net sales Low-single digit growth year-over-year Adjusted EPS3 Mid to high-single digit growth year-over-year Capital Expenditures $20 million to $30 million Net Leverage Ratio3 ~2.0x Fiscal 2025 guidance assumes approximately $33 million of interest expense, $30 million of amortization, an effective tax rate of 25% and 29.4 million diluted average shares outstanding. Teleconference/Webcast Columbus McKinnon will host a conference call today at 10:00 AM Eastern Time to discuss the Company’s financial results and strategy. The conference call will be accessible through live webcast and via phone by dialing 201-493-6780. The webcast, earnings release and earnings presentation will be available at the Company's investor relations website at investors.cmco.com. A replay of the webcast will also be archived on the Company's investor relations website and available via phone by dialing 412-317-6671 and enter conference ID number 13746170 through June 5, 2024. ______________________ 1 Adjusted Gross Profit, Adjusted Gross Margin, Adjusted Operating Income, Adjusted Operating Margin, Adjusted EPS, Adjusted EBITDA, Adjusted EBITDA Margin, Free Cash Flow, Free Cash Flow Conversion and Net Leverage Ratio are non-GAAP financial measures. See accompanying discussion and reconciliation tables provided in this release for reconciliations of these non-GAAP financial measures to the closest corresponding GAAP financial measures. 2 On a financial covenant basis per the Company’s Amended and Restated Credit Agreement 3 The Company has not reconciled the Adjusted EPS and Net Leverage Ratio guidance to the most comparable GAAP outlook because it is not possible to do so without unreasonable efforts due to the uncertainty and potential variability of reconciling items, which are dependent on future events and often outside of management’s control and which could be significant. Because such items cannot be reasonably predicted with the level of precision required, we are unable to provide guidance for the comparable GAAP financial measures. Forward-looking guidance regarding Adjusted EPS and Net Leverage Ratio are made in a manner consistent with the relevant definitions and assumptions noted herein. About Columbus McKinnon Columbus McKinnon is a leading worldwide designer, manufacturer and marketer of intelligent motion solutions that move the world forward and improve lives by efficiently and ergonomically moving, lifting, positioning, and securing materials. Key products include hoists, crane components, precision conveyor systems, rigging tools, light rail workstations and digital power and motion control systems. The Company is focused on commercial and industrial applications that require the safety and quality provided by its superior design and engineering know-how. Comprehensive information on Columbus McKinnon is available at www.cmco.com. Safe Harbor Statement This news release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are generally identified by the use of forward-looking terminology, including the terms “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “illustrative,” “intend,” “likely,” “may,” “opportunity,” “plan,” “possible,” “potential,” “predict,” “project,” “shall,” “should,” “target,” “will,” “would” and, in each case, their negative or other various or comparable terminology. All statements other than statements of historical facts contained in this release, including, but are not limited to, statements relating to: (i) our strategy, outlook and growth prospects and our full year and first quarter fiscal 2025 guidance; (ii) our operational and financial targets and capital distribution policy; (iii) general economic trend and trends in the industry and markets; (iv) the risk and costs associated with the integration of, and our ability to integrate acquisitions successfully to achieve synergies; (v) the effectiveness of our new facility in Monterrey, Mexico to provide cost savings and margin improvement (vi) the amount of debt to be paid down by the Company during fiscal 2025; and (vii) the competitive environment in which we operate are forward looking statements. Forward-looking statements are not based on historical facts, but instead represent our current expectations and assumptions regarding our business, the economy and other future conditions, and involve known and unknown risks, uncertainties and other factors that could cause the actual results, performance or achievements of the Company to differ materially from any future results, performance or achievements expressed or implied by the forward-looking statements. It is not possible to predict or identify all such risks. These risks include, but are not limited to, the risk factors that are described under the section titled “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended March 31, 2023 as well as in our other filings with the Securities and Exchange Commission, which are available on its website at www.sec.gov. Given these uncertainties, you should not place undue reliance on these forward-looking statements. Forward-looking statements speak only as of the date they are made. Columbus McKinnon undertakes no duty to update publicly any such forward-looking statement, whether as a result of new information, future events or otherwise, except as may be required by applicable law, regulation or other competent legal authority. Financial tables follow. COLUMBUS McKINNON CORPORATION Condensed Consolidated Income Statements - Unaudited (In thousands, except per share and percentage data) Three Months Ended March 31, 2024 March 31, 2023 Change Net sales $ 265,504 $ 253,843 4.6 % Cost of products sold 171,189 162,625 5.3 % Gross profit 94,315 91,218 3.4 % Gross profit margin 35.5 % 35.9 % Selling expenses 26,941 25,331 6.4 % % of net sales 10.1 % 10.0 % General and administrative expenses 27,353 26,353 3.8 % % of net sales 10.3 % 10.4 % Research and development expenses 7,059 5,506 28.2 % % of net sales 2.7 % 2.2 % Amortization of intangibles 7,525 6,559 14.7 % Income from operations 25,437 27,469 (7.4 )% Operating margin 9.6 % 10.8 % Interest and debt expense 9,169 7,668 19.6 % Investment (income) loss, net (547 ) (483 ) 13.3 % Foreign currency exchange loss (gain), net 752 (1,037 ) NM Other (income) expense, net 1,757 (73 ) NM Income before income tax expense 14,306 21,394 (33.1 )% Income tax expense 2,497 7,499 (66.7 )% Net income $ 11,809 $ 13,895 (15.0 )% Average basic shares outstanding 28,780 28,609 0.6 % Basic income per share $ 0.41 $ 0.49 (16.3 )% Average diluted shares outstanding 29,129 28,869 0.9 % Diluted income per share $ 0.41 $ 0.48 (14.6 )% Dividends declared per common share $ 0.14 $ 0.14 COLUMBUS McKINNON CORPORATION Condensed Consolidated Income Statements - Unaudited (In thousands, except per share and percentage data) Year Ended March 31, 2024 March 31, 2023 Change Net sales $ 1,013,540 $ 936,240 8.3 % Cost of products sold 638,702 594,141 7.5 % Gross profit 374,838 342,099 9.6 % Gross profit margin 37.0 % 36.5 % Selling expenses 105,341 102,528 2.7 % % of net sales 10.4 % 11.0 % General and administrative expenses 106,760 94,794 12.6 % % of net sales 10.5 % 10.1 % Research and development expenses 26,193 20,935 25.1 % % of net sales 2.6 % 2.2 % Amortization of intangibles 29,396 26,001 13.1 % Income from operations 107,148 97,841 9.5 % Operating margin 10.6 % 10.5 % Interest and debt expense 37,957 27,942 35.8 % Investment (income) loss, net (1,759 ) (315 ) 458.4 % Foreign currency exchange loss (gain), net 1,826 (2,189 ) NM Other (income) expense, net 7,597 (2,072 ) NM Income before income tax expense 61,527 74,475 (17.4 )% Income tax expense 14,902 26,046 (42.8 )% Net income $ 46,625 $ 48,429 (3.7 )% Average basic shares outstanding 28,728 28,600 0.4 % Basic income per share $ 1.62 $ 1.69 (4.1 )% Average diluted shares outstanding 29,026 28,818 0.7 % Diluted income per share $ 1.61 $ 1.68 (4.2 )% Dividends declared per common share $ 0.28 $ 0.28 COLUMBUS McKINNON CORPORATION Condensed Consolidated Balance Sheets - Unaudited (In thousands) March 31, 2024 March 31, 2023 ASSETS Current assets: Cash and cash equivalents $ 114,126 $ 133,176 Trade accounts receivable 171,186 151,451 Inventories 186,091 179,359 Prepaid expenses and other 42,752 32,254 Total current assets 514,155 496,240 Net property, plant, and equipment 106,395 94,360 Goodwill 710,334 644,629 Other intangibles, net 385,634 362,537 Marketable securities 11,447 10,368 Deferred taxes on income 1,797 2,035 Other assets 96,183 88,286 Total assets $ 1,825,945 $ 1,698,455 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities: Trade accounts payable $ 83,118 $ 76,736 Accrued liabilities 127,973 124,317 Current portion of long-term debt and finance lease obligations 50,670 40,604 Total current liabilities 261,761 241,657 Term loan, AR securitization facility and finance lease obligations 479,566 430,988 Other non-current liabilities 202,555 192,013 Total liabilities 943,882 864,658 Shareholders’ equity: Common stock 288 286 Treasury Stock (1,001 ) (1,001 ) Additional paid-in capital 527,125 515,797 Retained earnings 395,328 356,758 Accumulated other comprehensive loss (39,677 ) (38,043 ) Total shareholders’ equity 882,063 833,797 Total liabilities and shareholders’ equity $ 1,825,945 $ 1,698,455 COLUMBUS McKINNON CORPORATION Condensed Consolidated Statements of Cash Flows - Unaudited (In thousands) Year Ended March 31, 2024 March 31, 2023 Operating activities: Net income $ 46,625 $ 48,429 Adjustments to reconcile net income to net cash provided by (used for) operating activities: Depreciation and amortization 45,945 41,947 Deferred income taxes and related valuation allowance (15,786 ) (300 ) Net loss (gain) on sale of real estate, investments and other (1,431 ) (54 ) Stock-based compensation 12,039 10,425 Amortization of deferred financing costs 2,349 1,721 Loss (gain) on hedging instruments (1,366 ) (438 ) Cost of debt repricing 958 — Loss on retirement of fixed asset — 175 Non-cash pension settlement 4,984 — Gain on sale of building — (232 ) Non-cash lease expense 9,735 7,867 Changes in operating assets and liabilities, net of effects of business acquisitions: Trade accounts receivable (14,428 ) (4,858 ) Inventories (1,314 ) (9,087 ) Prepaid expenses and other (8,555 ) 6,667 Other assets 537 (123 ) Trade accounts payable 4,748 (13,964 ) Accrued liabilities (9,583 ) 9,150 Non-current liabilities (8,259 ) (13,689 ) Net cash provided by (used for) operating activities 67,198 83,636 Investing activities: Proceeds from sales of marketable securities 3,526 3,651 Purchases of marketable securities (4,076 ) (4,021 ) Capital expenditures (24,813 ) (12,632 ) Proceeds from sale of building, net of transaction costs — 373 Purchases of businesses, net of cash acquired (108,145 ) (1,616 ) Dividend received from equity method investment 144 313 Net cash provided by (used for) investing activities (133,364 ) (13,932 ) Financing activities: Proceeds from issuance of common stock 1,600 713 Purchases of treasury stock — (1,001 ) Fees paid for debt repricing (958 ) — Repayment of debt (60,604 ) (40,550 ) Proceeds from issuance of long-term debt 120,000 — Cash inflows from hedging activities 24,057 24,495 Cash outflows from hedging activities (22,687 ) (24,221 ) Fees paid for borrowing on long-term debt (2,859 ) — Payment of dividends (8,044 ) (8,008 ) Other (2,304 ) (1,415 ) Net cash provided by (used for) financing activities 48,201 (49,987 ) Effect of exchange rate changes on cash (1,085 ) (1,931 ) Net change in cash and cash equivalents (19,050 ) 17,786 Cash, cash equivalents, and restricted cash at beginning of year 133,426 115,640 Cash, cash equivalents, and restricted cash at end of year $ 114,376 $ 133,426 COLUMBUS McKINNON CORPORATION Q4 FY 2024 Sales Bridge Quarter Year ($ in millions) $ Change % Change $ Change % Change Fiscal 2023 Sales $ 253.8 $ 936.2 Acquisition 4.9 1.9 % 32.6 3.5 % Volume (0.2 ) (0.1 )% (0.4 ) — % Pricing 5.7 2.3 % 33.8 3.6 % Foreign currency translation 1.3 0.5 % 11.3 1.2 % Total change $ 11.7 4.6 % $ 77.3 8.3 % Fiscal 2024 Sales $ 265.5 $ 1,013.5 COLUMBUS McKINNON CORPORATION Q4 FY 2024 Gross Profit Bridge ($ in millions) Quarter Year Fiscal 2023 Gross Profit $ 91.2 $ 342.1 Acquisition 0.8 13.8 Price, net of manufacturing cost changes (incl. inflation) 1.0 16.9 Foreign currency translation 0.4 3.8 Current year business realignment costs — (0.4 ) Monterrey, MX new factory start-up costs (2.6 ) (3.0 ) Factory and warehouse consolidation costs (0.2 ) (0.2 ) Sales volume & mix 3.7 0.9 Product liability — 0.9 Total change 3.1 32.7 Fiscal 2024 Gross Profit $ 94.3 $ 374.8 U.S. Shipping Days by Quarter Q1 Q2 Q3 Q4 Total FY 25 64 63 60 62 249 FY 24 63 62 61 62 248 FY 23 63 64 60 63 250 COLUMBUS McKINNON CORPORATION Additional Data1 (Unaudited) Period Ended March 31, 2024 December 31, 2023 March 31, 2023 ($ in millions) Backlog $ 280.8 $ 298.4 $ 308.7 Long-term backlog Expected to ship beyond 3 months $ 144.6 $ 151.3 $ 142.0 Long-term backlog as % of total backlog 51.5 % 50.7 % 46.0 % Debt to total capitalization percentage 37.5 % 38.5 % 36.1 % Debt, net of cash, to net total capitalization 32.0 % 33.7 % 28.9 % Working capital as a % of sales 2 19.1 % 20.6 % 17.3 % Three Months Ended March 31, 2024 December 31, 2023 March 31, 2023 ($ in millions) Trade accounts receivable Days sales outstanding 58.7 days 62.1 days 54.3 days Inventory turns per year (based on cost of products sold) 3.7 turns 3.1 turns 3.6 turns Days' inventory 98.6 days 117.7 days 101.4 days Trade accounts payable Days payables outstanding 50.9 days 50.1 days 53.3 days Net cash provided by (used for) operating activities $ 38.6 $ 29.1 $ 66.7 Capital expenditures $ 8.5 $ 6.0 $ 3.1 Free Cash Flow 3 $ 30.1 $ 23.1 $ 63.6 1 Additional Data: This data is provided to help investors understand financial and operational metrics that management uses to measure the Company’s financial performance and identify trends affecting the business. These measures may not be comparable with or defined in the same manner as other companies. Components may not add due to rounding. 2 March 31, 2024 and December 31, 2023 exclude the impact of the acquisition of montratec. 3 Free Cash Flow is a non-GAAP financial measures. See accompanying discussion and reconciliation tables provided in this release for reconciliations of these non-GAAP financial measures to the closest corresponding GAAP financial measures. NON-GAAP FINANCIAL MEASURES The following information provides definitions and reconciliations of the non-GAAP financial measures presented in this earnings release to the most directly comparable financial measures calculated and presented in accordance with generally accepted accounting principles (GAAP). The Company has provided this non-GAAP financial information, which is not calculated or presented in accordance with GAAP, as information supplemental and in addition to the financial measures presented in this earnings release that are calculated and presented in accordance with GAAP. Such non-GAAP financial measures should not be considered superior to, as a substitute for or alternative to, and should be considered in conjunction with, the GAAP financial measures presented in this earnings release. The non-GAAP financial measures in this earnings release may differ from similarly titled measures used by other companies. COLUMBUS McKINNON CORPORATION Reconciliation of Gross Profit to Adjusted Gross Profit ($ in thousands) Three Months Ended March 31, Year Ended March 31, 2024 2023 2024 2023 GAAP gross profit $ 94,315 $ 91,218 $ 374,838 $ 342,099 Add back (deduct): Business realignment costs — — 346 — Monterrey, MX new factory start-up costs 2,552 — 2,987 — Factory and warehouse consolidation costs 262 — 262 — Non-GAAP adjusted gross profit $ 97,129 $ 91,218 $ 378,433 $ 342,099 Net Sales $ 265,504 $ 253,843 $ 1,013,540 $ 936,240 Gross margin 35.5 % 35.9 % 37.0 % 36.5 % Adjusted Gross Margin 36.6 % 35.9 % 37.3 % 36.5 % Adjusted Gross Profit is defined as gross profit as reported, adjusted for certain items. Adjusted Gross Profit Margin is defined as Adjusted Gross Profit divided by net sales. Adjusted Gross Profit and Adjusted Gross Margin are not measures determined in accordance with GAAP and may not be comparable with Adjusted Gross Profit and Adjusted Gross Profit Margin as used by other companies. Nevertheless, Columbus McKinnon believes that providing non-GAAP financial measures, such as Adjusted Gross Profit and Adjusted Gross Profit Margin, are important for investors and other readers of the Company’s financial statements and assists in understanding the comparison of the current quarter’s and current year's gross profit and gross profit margin to the historical periods' gross profit, as well as facilitates a more meaningful comparison of the Company’s gross profit and gross profit margin to that of other companies. COLUMBUS McKINNON CORPORATION Reconciliation of Income from Operations to Adjusted Operating Income ($ in thousands) Three Months Ended March 31, Year Ended March 31, 2024 2023 2024 2023 Income from operations $ 25,437 $ 27,469 $ 107,148 $ 97,841 Add back (deduct): Acquisition deal and integration costs 3 173 3,211 616 Business realignment costs — 848 1,867 5,140 Factory and warehouse consolidation costs 545 — 744 — Garvey contingent consideration — — — 1,230 Headquarter relocation costs 175 681 2,059 996 Monterrey, MX new factory start-up costs 3,734 — 4,489 — Cost of debt repricing 1,190 — 1,190 — Adjusted Operating Income $ 31,084 $ 29,171 $ 120,708 $ 105,823 Net Sales $ 265,504 $ 253,843 $ 1,013,540 $ 936,240 Operating margin 9.6 % 10.8 % 10.6 % 10.5 % Adjusted Operating Margin 11.7 % 11.5 % 11.9 % 11.3 % Adjusted Operating Income is defined as income from operations as reported, adjusted for certain items. Adjusted Operating Margin is defined as Adjusted Operating Income divided by net sales. Adjusted Operating Income and Adjusted Operating Margin are not measures determined in accordance with GAAP and may not be comparable with Adjusted Operating Income and Adjusted Operating Margin as used by other companies. Nevertheless, Columbus McKinnon believes that providing non-GAAP financial measures, such as Adjusted Operating Income and Adjusted Operating Margin, are important for investors and other readers of the Company’s financial statements and assists in understanding the comparison of the current quarter’s and current year's income from operations to the historical periods' income from operations and operating margin, as well as facilitates a more meaningful comparison of the Company’s income from operations and operating margin to that of other companies. COLUMBUS McKINNON CORPORATION Reconciliation of Net Income and Diluted Earnings per Share to Adjusted Net Income and Adjusted Earnings per Diluted Share ($ in thousands, except per share data) Three Months Ended March 31, Year Ended March 31, 2024 2023 2024 2023 Net income $ 11,809 $ 13,895 $ 46,625 $ 48,429 Add back (deduct): Amortization of intangibles 7,525 6,559 29,396 26,001 Acquisition deal and integration costs 3 173 3,211 616 Business realignment costs — 848 1,867 5,140 Factory and warehouse consolidation costs 545 — 744 — Garvey contingent consideration — — — 1,230 Headquarter relocation costs 175 681 2,059 996 Monterrey, MX new factory start-up costs 3,734 — 4,489 — Cost of debt repricing 1,190 — 1,190 — Non-cash pension settlement expense 385 — 4,984 — Tax indemnification payment owed1 1,192 — 1,192 — Normalize tax rate2 (4,767 ) 975 (12,763 ) 2,185 Adjusted Net Income $ 21,791 $ 23,131 $ 82,994 $ 84,597 Average diluted shares outstanding 29,129 28,869 29,026 28,818 Diluted income per share $ 0.41 $ 0.48 $ 1.61 $ 1.68 Adjusted EPS per diluted share $ 0.75 $ 0.80 $ 2.86 $ 2.94 1 Represents tax indemnification payment owed to the former owner of STAHL for a tax refund received by CMCO in the quarter ended March 31, 2024 for periods prior to the acquisition of STAHL by CMCO. 2 Applies a normalized tax rate of 25% in fiscal 2024 and 22% in fiscal 2023 to GAAP pre-tax income and non-GAAP adjustments above, which are each pre-tax. Adjusted Net Income and Adjusted Diluted EPS are defined as net income and diluted EPS as reported, adjusted for certain items, including amortization of intangibles, and also adjusted for a normalized tax rate. Adjusted Net Income and Adjusted Diluted EPS are not measures determined in accordance with GAAP and may not be comparable with the measures used by other companies. Nevertheless, Columbus McKinnon believes that providing non-GAAP financial measures, such as Adjusted Net Income and Adjusted Diluted EPS, are important for investors and other readers of the Company’s financial statements and assists in understanding the comparison of the current quarter’s and current year's net income and diluted EPS to the historical periods' net income and diluted EPS, as well as facilitates a more meaningful comparison of the Company’s net income and diluted EPS to that of other companies. The Company believes that presenting Adjusted Diluted EPS provides a better understanding of its earnings power inclusive of adjusting for the non-cash amortization of intangible assets, reflecting the Company’s strategy to grow through acquisitions as well as organically. COLUMBUS McKINNON CORPORATION Reconciliation of Net Income to Adjusted EBITDA ($ in thousands) Three Months Ended March 31, Year Ended March 31, 2024 2023 2024 2023 Net income $ 11,809 $ 13,895 $ 46,625 $ 48,429 Add back (deduct): Income tax expense 2,497 7,499 14,902 26,046 Interest and debt expense 9,169 7,668 37,957 27,942 Investment (income) loss, net (547 ) (483 ) (1,759 ) (315 ) Foreign currency exchange loss (gain), net 752 (1,037 ) 1,826 (2,189 ) Other (income) expense, net 1,757 (73 ) 7,597 (2,072 ) Depreciation and amortization expense 11,893 10,567 45,945 41,947 Acquisition deal and integration costs 3 173 3,211 616 Business realignment costs — 848 1,867 5,140 Factory and warehouse consolidation costs 545 — 744 — Garvey contingent consideration — — — 1,230 Headquarter relocation costs 175 681 2,059 996 Monterrey, MX new factory start-up costs 3,734 — 4,489 — Cost of debt repricing 1,190 — 1,190 — Adjusted EBITDA $ 42,977 $ 39,738 $ 166,653 $ 147,770 Net Sales $ 265,504 $ 253,843 $ 1,013,540 $ 936,240 Net income margin 4.4 % 5.5 % 4.6 % 5.2 % Adjusted EBITDA Margin 16.2 % 15.7 % 16.4 % 15.8 % Adjusted EBITDA is defined as net income before interest expense, income taxes, depreciation, amortization, and other adjustments. Adjusted EBITDA Margin is defined as Adjusted EBITDA divided by net sales. Adjusted EBITDA and Adjusted EBITDA Margin are not measures determined in accordance with GAAP and may not be comparable with Adjusted EBITDA and Adjusted EBITDA Margin as used by other companies. Nevertheless, Columbus McKinnon believes that providing non-GAAP financial measures, such as Adjusted EBITDA and Adjusted EBITDA Margin, are important for investors and other readers of the Company’s financial statements. COLUMBUS McKINNON CORPORATION Reconciliation of Net Leverage Ratio ($ in thousands) Year Ended March 31, 2024 2023 Net income $ 46,625 $ 48,429 Add back (deduct): Annualize EBITDA for the montratec acquisition1 1,331 Annualize synergies for the montratec acquisition1 73 Income tax expense 14,902 26,046 Interest and debt expense 37,957 27,942 Non-Cash Pension Settlement2 4,984 — Amortization of deferred financing costs 2,349 1,721 Stock Compensation Expense 12,039 10,425 Depreciation and amortization expense 45,945 41,947 Acquisition deal and integration costs 3,211 616 Business realignment costs 1,867 5,140 Factory and warehouse consolidation costs 744 — Garvey contingent consideration — 1,230 Headquarter relocation costs 2,059 996 Monterrey, MX new factory start-up costs 4,489 — Cost of debt repricing 1,190 — Non-Cash loss related to asset retirement — 175 Gain on Sale of Facility — (232 ) Credit Agreement Trailing Twelve Month Adjusted EBITDA $ 179,765 $ 164,435 Current portion of long-term debt and finance lease obligations $ 50,670 $ 40,604 Term loan, AR securitization facility and finance lease obligations 479,566 430,988 Total debt $ 530,236 $ 471,592 Standby Letters of Credit 15,368 14,921 Cash and cash equivalents (114,126 ) (133,176 ) Net Debt $ 431,478 $ 353,337 Net Leverage Ratio 2.40x 2.15x 1 EBITDA is normalized to include a full year of the acquired entity and assuming that deal related synergies are achieved for montratec in fiscal year 2024 and Dorner and Garvey in fiscal year 2023. 2 During the quarter ending December 31, 2023, certain employees in one of the Company's U.S. pension plans accepted an offer to settle their pension obligation with a lump sum payment. These lump sum settlements are one of the steps the Company is taking to terminate the plan by transferring the liabilities to a third-party. Net Debt is defined in the credit agreement as total debt plus standby letters of credit, net of cash and cash equivalents. Net Leverage Ratio is defined as Net Debt divided by the Credit Agreement Trailing Twelve Month Adjusted EBITDA. Credit Agreement Trailing Twelve Month Adjusted EBITDA is defined as net income adjusted for interest expense, income taxes, depreciation, amortization, and other adjustments. Net Debt, Net Leverage Ratio and Credit Agreement Trailing Twelve Month Adjusted EBITDA are not measures determined in accordance with GAAP and may not be comparable with the measures as used by other companies. Nevertheless, the Company believes that providing non-GAAP financial measures, such as Net Debt, Net Leverage Ratio and Credit Agreement Trailing Twelve Month Adjusted EBITDA are important for investors and other readers of the Company’s financial statements. View source version on businesswire.com: https://www.businesswire.com/news/home/20240529085281/en/Contacts Gregory P. Rustowicz EVP Finance and CFO Columbus McKinnon Corporation 716-689-5442 greg.rustowicz@cmco.com Kristine Moser VP IR and Treasurer Columbus McKinnon Corporation 704-322-2488 kristy.moser@cmco.com
Columbus McKinnon Corporation (Nasdaq: CMCO), a leading designer, manufacturer and marketer of intelligent motion solutions for material handling, today announced financial results for its full year and fourth quarter fiscal 2024, which ended March 31, 2024. Results include the addition of montratec®, which was acquired on May 31, 2023 ("the acquisition"). Fiscal Year 2024 Highlights (compared with prior year period) Record net sales of $1.0 billion, up 8% driven by growth across all geographies including the acquisition of montratec Gross margin up 50 basis points to 37.0%; Adjusted Gross Margin1 up 80 basis points to 37.3% Net income of $46.6 million with a net margin of 4.6%; Adjusted EBITDA1 of $166.7 million, up 13% with Adjusted EBITDA Margin1 of 16.4%, up 60 basis points Generated net cash provided by operating activities of $67.2 million and Free Cash Flow1 of $42.4 million with Free Cash Flow Conversion1 of 91% Net Leverage Ratio1,2 decreased to 2.4x; Expect Net Leverage Ratio1,2 of ~2.0x target by end of year Fiscal 2025 Fourth Quarter 2024 Highlights (compared with prior year period) Delivered $265.5 million of net sales demonstrating continued momentum, up 5% driven by growth across all geographies with strength in precision conveyance, up 23% Orders increased 5% led by precision conveyance, up 25% Net income of $11.8 million with a net margin of 4.4%; Adjusted EBITDA1 of $43.0 million, up 8% with Adjusted EBITDA Margin1 of 16.2%, up 50 basis points “Our team delivered another record year of sales, gross margin, operating income, and Adjusted EBITDA Margin1 reflecting the solid progress we are making with our transformation. These results provide another proof point on the path to achieving our long-term financial objectives. Our team continues to execute on commercial and operational initiatives to improve productivity, reduce lead times, and enhance customer experience, which position us to scale our business and deliver top-tier financial results,” said David J. Wilson, President and Chief Executive Officer. “While we are taking a prudent view of our outlook for fiscal 2025, we remain cautiously optimistic given the solid momentum exiting fiscal 2024 and our encouraging pipeline of opportunities. We are focused on execution as we thoughtfully navigate this uncertain environment.” Fourth Quarter Fiscal 2024 Sales ($ in millions) Q4 FY 24 Q4 FY 23 Change % Change Net sales $ 265.5 $ 253.8 $ 11.7 4.6 % U.S. sales $ 155.0 $ 149.4 $ 5.6 3.7 % % of total 58 % 59 % Non-U.S. sales $ 110.5 $ 104.4 $ 6.1 5.8 % % of total 42 % 41 % For the quarter, sales increased $11.7 million, or 4.6%. The acquisition contributed $4.9 million, or 1.9%. In the U.S., sales were up $5.6 million, or 3.7%, driven by favorable sales volume of $3.1 million, price improvement of $2.1 million and $0.4 million of contribution from the acquisition. Sales outside the U.S. increased $6.1 million, or 5.8%, driven by $4.5 million of sales related to the acquisition and $3.6 million of price improvement offset by $3.3 million of lower sales volume. Favorable foreign currency translation was $1.3 million. Fourth Quarter Fiscal 2024 Operating Results ($ in millions) Q4 FY 24 Q4 FY 23 Change % Change Gross profit $ 94.3 $ 91.2 $ 3.1 3.4 % Gross margin 35.5 % 35.9 % (40) bps Adjusted Gross Profit1 $ 97.1 $ 91.2 $ 5.9 6.5 % Adjusted Gross Margin1 36.6 % 35.9 % 70 bps Income from operations $ 25.4 $ 27.5 $ (2.0 ) (7.4 )% Operating margin 9.6 % 10.8 % (120) bps Adjusted Operating Income1 $ 31.1 $ 29.2 $ 1.9 6.6 % Adjusted Operating Margin1 11.7 % 11.5 % 20 bps Net income $ 11.8 $ 13.9 $ (2.1 ) (15.0 )% Net income margin 4.4 % 5.5 % (110) bps Diluted EPS $ 0.41 $ 0.48 $ (0.07 ) (14.6 )% Adjusted EPS1 $ 0.75 $ 0.80 $ (0.05 ) (6.3 )% Adjusted EBITDA1 $ 43.0 $ 39.7 $ 3.2 8.2 % Adjusted EBITDA margin1 16.2 % 15.7 % 50 bps Adjusted EPS1 excludes amortization of intangible assets related to acquisitions. The Company believes this better represents its inherent earnings power and cash generation capability. Full Year and First Quarter Fiscal 2025 Guidance The Company is issuing the following guidance for the first quarter of fiscal 2025, ending June 30, 2024: Metric Q1 FY25 Net sales Low-single digit growth year-over-year Adjusted EPS3 Flat to slightly down year-over-year First quarter 2025 guidance assumes approximately $9 million of interest expense, $8 million of amortization, an effective tax rate of 25% and 29.2 million diluted average shares outstanding. The Company is issuing the following guidance for fiscal 2025, ending March 31, 2025: Metric FY25 Net sales Low-single digit growth year-over-year Adjusted EPS3 Mid to high-single digit growth year-over-year Capital Expenditures $20 million to $30 million Net Leverage Ratio3 ~2.0x Fiscal 2025 guidance assumes approximately $33 million of interest expense, $30 million of amortization, an effective tax rate of 25% and 29.4 million diluted average shares outstanding. Teleconference/Webcast Columbus McKinnon will host a conference call today at 10:00 AM Eastern Time to discuss the Company’s financial results and strategy. The conference call will be accessible through live webcast and via phone by dialing 201-493-6780. The webcast, earnings release and earnings presentation will be available at the Company's investor relations website at investors.cmco.com. A replay of the webcast will also be archived on the Company's investor relations website and available via phone by dialing 412-317-6671 and enter conference ID number 13746170 through June 5, 2024. ______________________ 1 Adjusted Gross Profit, Adjusted Gross Margin, Adjusted Operating Income, Adjusted Operating Margin, Adjusted EPS, Adjusted EBITDA, Adjusted EBITDA Margin, Free Cash Flow, Free Cash Flow Conversion and Net Leverage Ratio are non-GAAP financial measures. See accompanying discussion and reconciliation tables provided in this release for reconciliations of these non-GAAP financial measures to the closest corresponding GAAP financial measures. 2 On a financial covenant basis per the Company’s Amended and Restated Credit Agreement 3 The Company has not reconciled the Adjusted EPS and Net Leverage Ratio guidance to the most comparable GAAP outlook because it is not possible to do so without unreasonable efforts due to the uncertainty and potential variability of reconciling items, which are dependent on future events and often outside of management’s control and which could be significant. Because such items cannot be reasonably predicted with the level of precision required, we are unable to provide guidance for the comparable GAAP financial measures. Forward-looking guidance regarding Adjusted EPS and Net Leverage Ratio are made in a manner consistent with the relevant definitions and assumptions noted herein. About Columbus McKinnon Columbus McKinnon is a leading worldwide designer, manufacturer and marketer of intelligent motion solutions that move the world forward and improve lives by efficiently and ergonomically moving, lifting, positioning, and securing materials. Key products include hoists, crane components, precision conveyor systems, rigging tools, light rail workstations and digital power and motion control systems. The Company is focused on commercial and industrial applications that require the safety and quality provided by its superior design and engineering know-how. Comprehensive information on Columbus McKinnon is available at www.cmco.com. Safe Harbor Statement This news release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are generally identified by the use of forward-looking terminology, including the terms “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “illustrative,” “intend,” “likely,” “may,” “opportunity,” “plan,” “possible,” “potential,” “predict,” “project,” “shall,” “should,” “target,” “will,” “would” and, in each case, their negative or other various or comparable terminology. All statements other than statements of historical facts contained in this release, including, but are not limited to, statements relating to: (i) our strategy, outlook and growth prospects and our full year and first quarter fiscal 2025 guidance; (ii) our operational and financial targets and capital distribution policy; (iii) general economic trend and trends in the industry and markets; (iv) the risk and costs associated with the integration of, and our ability to integrate acquisitions successfully to achieve synergies; (v) the effectiveness of our new facility in Monterrey, Mexico to provide cost savings and margin improvement (vi) the amount of debt to be paid down by the Company during fiscal 2025; and (vii) the competitive environment in which we operate are forward looking statements. Forward-looking statements are not based on historical facts, but instead represent our current expectations and assumptions regarding our business, the economy and other future conditions, and involve known and unknown risks, uncertainties and other factors that could cause the actual results, performance or achievements of the Company to differ materially from any future results, performance or achievements expressed or implied by the forward-looking statements. It is not possible to predict or identify all such risks. These risks include, but are not limited to, the risk factors that are described under the section titled “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended March 31, 2023 as well as in our other filings with the Securities and Exchange Commission, which are available on its website at www.sec.gov. Given these uncertainties, you should not place undue reliance on these forward-looking statements. Forward-looking statements speak only as of the date they are made. Columbus McKinnon undertakes no duty to update publicly any such forward-looking statement, whether as a result of new information, future events or otherwise, except as may be required by applicable law, regulation or other competent legal authority. Financial tables follow. COLUMBUS McKINNON CORPORATION Condensed Consolidated Income Statements - Unaudited (In thousands, except per share and percentage data) Three Months Ended March 31, 2024 March 31, 2023 Change Net sales $ 265,504 $ 253,843 4.6 % Cost of products sold 171,189 162,625 5.3 % Gross profit 94,315 91,218 3.4 % Gross profit margin 35.5 % 35.9 % Selling expenses 26,941 25,331 6.4 % % of net sales 10.1 % 10.0 % General and administrative expenses 27,353 26,353 3.8 % % of net sales 10.3 % 10.4 % Research and development expenses 7,059 5,506 28.2 % % of net sales 2.7 % 2.2 % Amortization of intangibles 7,525 6,559 14.7 % Income from operations 25,437 27,469 (7.4 )% Operating margin 9.6 % 10.8 % Interest and debt expense 9,169 7,668 19.6 % Investment (income) loss, net (547 ) (483 ) 13.3 % Foreign currency exchange loss (gain), net 752 (1,037 ) NM Other (income) expense, net 1,757 (73 ) NM Income before income tax expense 14,306 21,394 (33.1 )% Income tax expense 2,497 7,499 (66.7 )% Net income $ 11,809 $ 13,895 (15.0 )% Average basic shares outstanding 28,780 28,609 0.6 % Basic income per share $ 0.41 $ 0.49 (16.3 )% Average diluted shares outstanding 29,129 28,869 0.9 % Diluted income per share $ 0.41 $ 0.48 (14.6 )% Dividends declared per common share $ 0.14 $ 0.14 COLUMBUS McKINNON CORPORATION Condensed Consolidated Income Statements - Unaudited (In thousands, except per share and percentage data) Year Ended March 31, 2024 March 31, 2023 Change Net sales $ 1,013,540 $ 936,240 8.3 % Cost of products sold 638,702 594,141 7.5 % Gross profit 374,838 342,099 9.6 % Gross profit margin 37.0 % 36.5 % Selling expenses 105,341 102,528 2.7 % % of net sales 10.4 % 11.0 % General and administrative expenses 106,760 94,794 12.6 % % of net sales 10.5 % 10.1 % Research and development expenses 26,193 20,935 25.1 % % of net sales 2.6 % 2.2 % Amortization of intangibles 29,396 26,001 13.1 % Income from operations 107,148 97,841 9.5 % Operating margin 10.6 % 10.5 % Interest and debt expense 37,957 27,942 35.8 % Investment (income) loss, net (1,759 ) (315 ) 458.4 % Foreign currency exchange loss (gain), net 1,826 (2,189 ) NM Other (income) expense, net 7,597 (2,072 ) NM Income before income tax expense 61,527 74,475 (17.4 )% Income tax expense 14,902 26,046 (42.8 )% Net income $ 46,625 $ 48,429 (3.7 )% Average basic shares outstanding 28,728 28,600 0.4 % Basic income per share $ 1.62 $ 1.69 (4.1 )% Average diluted shares outstanding 29,026 28,818 0.7 % Diluted income per share $ 1.61 $ 1.68 (4.2 )% Dividends declared per common share $ 0.28 $ 0.28 COLUMBUS McKINNON CORPORATION Condensed Consolidated Balance Sheets - Unaudited (In thousands) March 31, 2024 March 31, 2023 ASSETS Current assets: Cash and cash equivalents $ 114,126 $ 133,176 Trade accounts receivable 171,186 151,451 Inventories 186,091 179,359 Prepaid expenses and other 42,752 32,254 Total current assets 514,155 496,240 Net property, plant, and equipment 106,395 94,360 Goodwill 710,334 644,629 Other intangibles, net 385,634 362,537 Marketable securities 11,447 10,368 Deferred taxes on income 1,797 2,035 Other assets 96,183 88,286 Total assets $ 1,825,945 $ 1,698,455 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities: Trade accounts payable $ 83,118 $ 76,736 Accrued liabilities 127,973 124,317 Current portion of long-term debt and finance lease obligations 50,670 40,604 Total current liabilities 261,761 241,657 Term loan, AR securitization facility and finance lease obligations 479,566 430,988 Other non-current liabilities 202,555 192,013 Total liabilities 943,882 864,658 Shareholders’ equity: Common stock 288 286 Treasury Stock (1,001 ) (1,001 ) Additional paid-in capital 527,125 515,797 Retained earnings 395,328 356,758 Accumulated other comprehensive loss (39,677 ) (38,043 ) Total shareholders’ equity 882,063 833,797 Total liabilities and shareholders’ equity $ 1,825,945 $ 1,698,455 COLUMBUS McKINNON CORPORATION Condensed Consolidated Statements of Cash Flows - Unaudited (In thousands) Year Ended March 31, 2024 March 31, 2023 Operating activities: Net income $ 46,625 $ 48,429 Adjustments to reconcile net income to net cash provided by (used for) operating activities: Depreciation and amortization 45,945 41,947 Deferred income taxes and related valuation allowance (15,786 ) (300 ) Net loss (gain) on sale of real estate, investments and other (1,431 ) (54 ) Stock-based compensation 12,039 10,425 Amortization of deferred financing costs 2,349 1,721 Loss (gain) on hedging instruments (1,366 ) (438 ) Cost of debt repricing 958 — Loss on retirement of fixed asset — 175 Non-cash pension settlement 4,984 — Gain on sale of building — (232 ) Non-cash lease expense 9,735 7,867 Changes in operating assets and liabilities, net of effects of business acquisitions: Trade accounts receivable (14,428 ) (4,858 ) Inventories (1,314 ) (9,087 ) Prepaid expenses and other (8,555 ) 6,667 Other assets 537 (123 ) Trade accounts payable 4,748 (13,964 ) Accrued liabilities (9,583 ) 9,150 Non-current liabilities (8,259 ) (13,689 ) Net cash provided by (used for) operating activities 67,198 83,636 Investing activities: Proceeds from sales of marketable securities 3,526 3,651 Purchases of marketable securities (4,076 ) (4,021 ) Capital expenditures (24,813 ) (12,632 ) Proceeds from sale of building, net of transaction costs — 373 Purchases of businesses, net of cash acquired (108,145 ) (1,616 ) Dividend received from equity method investment 144 313 Net cash provided by (used for) investing activities (133,364 ) (13,932 ) Financing activities: Proceeds from issuance of common stock 1,600 713 Purchases of treasury stock — (1,001 ) Fees paid for debt repricing (958 ) — Repayment of debt (60,604 ) (40,550 ) Proceeds from issuance of long-term debt 120,000 — Cash inflows from hedging activities 24,057 24,495 Cash outflows from hedging activities (22,687 ) (24,221 ) Fees paid for borrowing on long-term debt (2,859 ) — Payment of dividends (8,044 ) (8,008 ) Other (2,304 ) (1,415 ) Net cash provided by (used for) financing activities 48,201 (49,987 ) Effect of exchange rate changes on cash (1,085 ) (1,931 ) Net change in cash and cash equivalents (19,050 ) 17,786 Cash, cash equivalents, and restricted cash at beginning of year 133,426 115,640 Cash, cash equivalents, and restricted cash at end of year $ 114,376 $ 133,426 COLUMBUS McKINNON CORPORATION Q4 FY 2024 Sales Bridge Quarter Year ($ in millions) $ Change % Change $ Change % Change Fiscal 2023 Sales $ 253.8 $ 936.2 Acquisition 4.9 1.9 % 32.6 3.5 % Volume (0.2 ) (0.1 )% (0.4 ) — % Pricing 5.7 2.3 % 33.8 3.6 % Foreign currency translation 1.3 0.5 % 11.3 1.2 % Total change $ 11.7 4.6 % $ 77.3 8.3 % Fiscal 2024 Sales $ 265.5 $ 1,013.5 COLUMBUS McKINNON CORPORATION Q4 FY 2024 Gross Profit Bridge ($ in millions) Quarter Year Fiscal 2023 Gross Profit $ 91.2 $ 342.1 Acquisition 0.8 13.8 Price, net of manufacturing cost changes (incl. inflation) 1.0 16.9 Foreign currency translation 0.4 3.8 Current year business realignment costs — (0.4 ) Monterrey, MX new factory start-up costs (2.6 ) (3.0 ) Factory and warehouse consolidation costs (0.2 ) (0.2 ) Sales volume & mix 3.7 0.9 Product liability — 0.9 Total change 3.1 32.7 Fiscal 2024 Gross Profit $ 94.3 $ 374.8 U.S. Shipping Days by Quarter Q1 Q2 Q3 Q4 Total FY 25 64 63 60 62 249 FY 24 63 62 61 62 248 FY 23 63 64 60 63 250 COLUMBUS McKINNON CORPORATION Additional Data1 (Unaudited) Period Ended March 31, 2024 December 31, 2023 March 31, 2023 ($ in millions) Backlog $ 280.8 $ 298.4 $ 308.7 Long-term backlog Expected to ship beyond 3 months $ 144.6 $ 151.3 $ 142.0 Long-term backlog as % of total backlog 51.5 % 50.7 % 46.0 % Debt to total capitalization percentage 37.5 % 38.5 % 36.1 % Debt, net of cash, to net total capitalization 32.0 % 33.7 % 28.9 % Working capital as a % of sales 2 19.1 % 20.6 % 17.3 % Three Months Ended March 31, 2024 December 31, 2023 March 31, 2023 ($ in millions) Trade accounts receivable Days sales outstanding 58.7 days 62.1 days 54.3 days Inventory turns per year (based on cost of products sold) 3.7 turns 3.1 turns 3.6 turns Days' inventory 98.6 days 117.7 days 101.4 days Trade accounts payable Days payables outstanding 50.9 days 50.1 days 53.3 days Net cash provided by (used for) operating activities $ 38.6 $ 29.1 $ 66.7 Capital expenditures $ 8.5 $ 6.0 $ 3.1 Free Cash Flow 3 $ 30.1 $ 23.1 $ 63.6 1 Additional Data: This data is provided to help investors understand financial and operational metrics that management uses to measure the Company’s financial performance and identify trends affecting the business. These measures may not be comparable with or defined in the same manner as other companies. Components may not add due to rounding. 2 March 31, 2024 and December 31, 2023 exclude the impact of the acquisition of montratec. 3 Free Cash Flow is a non-GAAP financial measures. See accompanying discussion and reconciliation tables provided in this release for reconciliations of these non-GAAP financial measures to the closest corresponding GAAP financial measures. NON-GAAP FINANCIAL MEASURES The following information provides definitions and reconciliations of the non-GAAP financial measures presented in this earnings release to the most directly comparable financial measures calculated and presented in accordance with generally accepted accounting principles (GAAP). The Company has provided this non-GAAP financial information, which is not calculated or presented in accordance with GAAP, as information supplemental and in addition to the financial measures presented in this earnings release that are calculated and presented in accordance with GAAP. Such non-GAAP financial measures should not be considered superior to, as a substitute for or alternative to, and should be considered in conjunction with, the GAAP financial measures presented in this earnings release. The non-GAAP financial measures in this earnings release may differ from similarly titled measures used by other companies. COLUMBUS McKINNON CORPORATION Reconciliation of Gross Profit to Adjusted Gross Profit ($ in thousands) Three Months Ended March 31, Year Ended March 31, 2024 2023 2024 2023 GAAP gross profit $ 94,315 $ 91,218 $ 374,838 $ 342,099 Add back (deduct): Business realignment costs — — 346 — Monterrey, MX new factory start-up costs 2,552 — 2,987 — Factory and warehouse consolidation costs 262 — 262 — Non-GAAP adjusted gross profit $ 97,129 $ 91,218 $ 378,433 $ 342,099 Net Sales $ 265,504 $ 253,843 $ 1,013,540 $ 936,240 Gross margin 35.5 % 35.9 % 37.0 % 36.5 % Adjusted Gross Margin 36.6 % 35.9 % 37.3 % 36.5 % Adjusted Gross Profit is defined as gross profit as reported, adjusted for certain items. Adjusted Gross Profit Margin is defined as Adjusted Gross Profit divided by net sales. Adjusted Gross Profit and Adjusted Gross Margin are not measures determined in accordance with GAAP and may not be comparable with Adjusted Gross Profit and Adjusted Gross Profit Margin as used by other companies. Nevertheless, Columbus McKinnon believes that providing non-GAAP financial measures, such as Adjusted Gross Profit and Adjusted Gross Profit Margin, are important for investors and other readers of the Company’s financial statements and assists in understanding the comparison of the current quarter’s and current year's gross profit and gross profit margin to the historical periods' gross profit, as well as facilitates a more meaningful comparison of the Company’s gross profit and gross profit margin to that of other companies. COLUMBUS McKINNON CORPORATION Reconciliation of Income from Operations to Adjusted Operating Income ($ in thousands) Three Months Ended March 31, Year Ended March 31, 2024 2023 2024 2023 Income from operations $ 25,437 $ 27,469 $ 107,148 $ 97,841 Add back (deduct): Acquisition deal and integration costs 3 173 3,211 616 Business realignment costs — 848 1,867 5,140 Factory and warehouse consolidation costs 545 — 744 — Garvey contingent consideration — — — 1,230 Headquarter relocation costs 175 681 2,059 996 Monterrey, MX new factory start-up costs 3,734 — 4,489 — Cost of debt repricing 1,190 — 1,190 — Adjusted Operating Income $ 31,084 $ 29,171 $ 120,708 $ 105,823 Net Sales $ 265,504 $ 253,843 $ 1,013,540 $ 936,240 Operating margin 9.6 % 10.8 % 10.6 % 10.5 % Adjusted Operating Margin 11.7 % 11.5 % 11.9 % 11.3 % Adjusted Operating Income is defined as income from operations as reported, adjusted for certain items. Adjusted Operating Margin is defined as Adjusted Operating Income divided by net sales. Adjusted Operating Income and Adjusted Operating Margin are not measures determined in accordance with GAAP and may not be comparable with Adjusted Operating Income and Adjusted Operating Margin as used by other companies. Nevertheless, Columbus McKinnon believes that providing non-GAAP financial measures, such as Adjusted Operating Income and Adjusted Operating Margin, are important for investors and other readers of the Company’s financial statements and assists in understanding the comparison of the current quarter’s and current year's income from operations to the historical periods' income from operations and operating margin, as well as facilitates a more meaningful comparison of the Company’s income from operations and operating margin to that of other companies. COLUMBUS McKINNON CORPORATION Reconciliation of Net Income and Diluted Earnings per Share to Adjusted Net Income and Adjusted Earnings per Diluted Share ($ in thousands, except per share data) Three Months Ended March 31, Year Ended March 31, 2024 2023 2024 2023 Net income $ 11,809 $ 13,895 $ 46,625 $ 48,429 Add back (deduct): Amortization of intangibles 7,525 6,559 29,396 26,001 Acquisition deal and integration costs 3 173 3,211 616 Business realignment costs — 848 1,867 5,140 Factory and warehouse consolidation costs 545 — 744 — Garvey contingent consideration — — — 1,230 Headquarter relocation costs 175 681 2,059 996 Monterrey, MX new factory start-up costs 3,734 — 4,489 — Cost of debt repricing 1,190 — 1,190 — Non-cash pension settlement expense 385 — 4,984 — Tax indemnification payment owed1 1,192 — 1,192 — Normalize tax rate2 (4,767 ) 975 (12,763 ) 2,185 Adjusted Net Income $ 21,791 $ 23,131 $ 82,994 $ 84,597 Average diluted shares outstanding 29,129 28,869 29,026 28,818 Diluted income per share $ 0.41 $ 0.48 $ 1.61 $ 1.68 Adjusted EPS per diluted share $ 0.75 $ 0.80 $ 2.86 $ 2.94 1 Represents tax indemnification payment owed to the former owner of STAHL for a tax refund received by CMCO in the quarter ended March 31, 2024 for periods prior to the acquisition of STAHL by CMCO. 2 Applies a normalized tax rate of 25% in fiscal 2024 and 22% in fiscal 2023 to GAAP pre-tax income and non-GAAP adjustments above, which are each pre-tax. Adjusted Net Income and Adjusted Diluted EPS are defined as net income and diluted EPS as reported, adjusted for certain items, including amortization of intangibles, and also adjusted for a normalized tax rate. Adjusted Net Income and Adjusted Diluted EPS are not measures determined in accordance with GAAP and may not be comparable with the measures used by other companies. Nevertheless, Columbus McKinnon believes that providing non-GAAP financial measures, such as Adjusted Net Income and Adjusted Diluted EPS, are important for investors and other readers of the Company’s financial statements and assists in understanding the comparison of the current quarter’s and current year's net income and diluted EPS to the historical periods' net income and diluted EPS, as well as facilitates a more meaningful comparison of the Company’s net income and diluted EPS to that of other companies. The Company believes that presenting Adjusted Diluted EPS provides a better understanding of its earnings power inclusive of adjusting for the non-cash amortization of intangible assets, reflecting the Company’s strategy to grow through acquisitions as well as organically. COLUMBUS McKINNON CORPORATION Reconciliation of Net Income to Adjusted EBITDA ($ in thousands) Three Months Ended March 31, Year Ended March 31, 2024 2023 2024 2023 Net income $ 11,809 $ 13,895 $ 46,625 $ 48,429 Add back (deduct): Income tax expense 2,497 7,499 14,902 26,046 Interest and debt expense 9,169 7,668 37,957 27,942 Investment (income) loss, net (547 ) (483 ) (1,759 ) (315 ) Foreign currency exchange loss (gain), net 752 (1,037 ) 1,826 (2,189 ) Other (income) expense, net 1,757 (73 ) 7,597 (2,072 ) Depreciation and amortization expense 11,893 10,567 45,945 41,947 Acquisition deal and integration costs 3 173 3,211 616 Business realignment costs — 848 1,867 5,140 Factory and warehouse consolidation costs 545 — 744 — Garvey contingent consideration — — — 1,230 Headquarter relocation costs 175 681 2,059 996 Monterrey, MX new factory start-up costs 3,734 — 4,489 — Cost of debt repricing 1,190 — 1,190 — Adjusted EBITDA $ 42,977 $ 39,738 $ 166,653 $ 147,770 Net Sales $ 265,504 $ 253,843 $ 1,013,540 $ 936,240 Net income margin 4.4 % 5.5 % 4.6 % 5.2 % Adjusted EBITDA Margin 16.2 % 15.7 % 16.4 % 15.8 % Adjusted EBITDA is defined as net income before interest expense, income taxes, depreciation, amortization, and other adjustments. Adjusted EBITDA Margin is defined as Adjusted EBITDA divided by net sales. Adjusted EBITDA and Adjusted EBITDA Margin are not measures determined in accordance with GAAP and may not be comparable with Adjusted EBITDA and Adjusted EBITDA Margin as used by other companies. Nevertheless, Columbus McKinnon believes that providing non-GAAP financial measures, such as Adjusted EBITDA and Adjusted EBITDA Margin, are important for investors and other readers of the Company’s financial statements. COLUMBUS McKINNON CORPORATION Reconciliation of Net Leverage Ratio ($ in thousands) Year Ended March 31, 2024 2023 Net income $ 46,625 $ 48,429 Add back (deduct): Annualize EBITDA for the montratec acquisition1 1,331 Annualize synergies for the montratec acquisition1 73 Income tax expense 14,902 26,046 Interest and debt expense 37,957 27,942 Non-Cash Pension Settlement2 4,984 — Amortization of deferred financing costs 2,349 1,721 Stock Compensation Expense 12,039 10,425 Depreciation and amortization expense 45,945 41,947 Acquisition deal and integration costs 3,211 616 Business realignment costs 1,867 5,140 Factory and warehouse consolidation costs 744 — Garvey contingent consideration — 1,230 Headquarter relocation costs 2,059 996 Monterrey, MX new factory start-up costs 4,489 — Cost of debt repricing 1,190 — Non-Cash loss related to asset retirement — 175 Gain on Sale of Facility — (232 ) Credit Agreement Trailing Twelve Month Adjusted EBITDA $ 179,765 $ 164,435 Current portion of long-term debt and finance lease obligations $ 50,670 $ 40,604 Term loan, AR securitization facility and finance lease obligations 479,566 430,988 Total debt $ 530,236 $ 471,592 Standby Letters of Credit 15,368 14,921 Cash and cash equivalents (114,126 ) (133,176 ) Net Debt $ 431,478 $ 353,337 Net Leverage Ratio 2.40x 2.15x 1 EBITDA is normalized to include a full year of the acquired entity and assuming that deal related synergies are achieved for montratec in fiscal year 2024 and Dorner and Garvey in fiscal year 2023. 2 During the quarter ending December 31, 2023, certain employees in one of the Company's U.S. pension plans accepted an offer to settle their pension obligation with a lump sum payment. These lump sum settlements are one of the steps the Company is taking to terminate the plan by transferring the liabilities to a third-party. Net Debt is defined in the credit agreement as total debt plus standby letters of credit, net of cash and cash equivalents. Net Leverage Ratio is defined as Net Debt divided by the Credit Agreement Trailing Twelve Month Adjusted EBITDA. Credit Agreement Trailing Twelve Month Adjusted EBITDA is defined as net income adjusted for interest expense, income taxes, depreciation, amortization, and other adjustments. Net Debt, Net Leverage Ratio and Credit Agreement Trailing Twelve Month Adjusted EBITDA are not measures determined in accordance with GAAP and may not be comparable with the measures as used by other companies. Nevertheless, the Company believes that providing non-GAAP financial measures, such as Net Debt, Net Leverage Ratio and Credit Agreement Trailing Twelve Month Adjusted EBITDA are important for investors and other readers of the Company’s financial statements. View source version on businesswire.com: https://www.businesswire.com/news/home/20240529085281/en/
Gregory P. Rustowicz EVP Finance and CFO Columbus McKinnon Corporation 716-689-5442 greg.rustowicz@cmco.com Kristine Moser VP IR and Treasurer Columbus McKinnon Corporation 704-322-2488 kristy.moser@cmco.com