Bay Street News

Parker Reports Fiscal 2024 Fourth Quarter and Full Year Results and Issues Guidance for Fiscal 2025

CLEVELAND, Aug. 08, 2024 (GLOBE NEWSWIRE) — Parker Hannifin Corporation (NYSE: PH), the global leader in motion and control technologies, today reported results for the quarter and year ended June 30, 2024, that included the following highlights (compared with the prior year period):

Fiscal 2024 Fourth Quarter Highlights:

Fiscal 2024 Full Year Highlights:

“We delivered an exceptionally strong fourth quarter capping another year of record performance,” said Chairman and Chief Executive Officer, Jenny Parmentier. “Our ability to drive outstanding results reflects the dedication and commitment of our people, the strength and balance of our portfolio, and the power of our business system, The Win Strategy™.

“For the year, we delivered on our commitments with respect to safety and financial targets. We had record sales approaching $20 billion, record adjusted segment operating margin, which increased 200 basis points compared to the prior year, adjusted earnings per share growth of 18%, and record free cash flow of $3 billion. Parker has a very bright future ahead as indicated by our strong outlook for fiscal year 2025, which puts us on track to achieve our financial targets for fiscal year 2029.”

This news release contains non-GAAP financial measures. Reconciliations of adjusted numbers and certain non-GAAP financial measures are included in the financial tables of this press release.

Outlook

Parker issued guidance for the fiscal year ending June 30, 2025. The company expects:

Segment Results

Diversified Industrial Segment

North America Businesses                                       
$ in mm
FY24 Q4   FY23 Q4   Change   Organic Growth
Sales $ 2,228     $ 2,301     -3.2 %           -2.8 %
Segment Operating Income $ 506     $ 491     3.0 %    
Segment Operating Margin   22.7 %     21.3 %   140 bps    
Adjusted Segment Operating Income $ 558     $ 541     3.2 %    
Adjusted Segment Operating Margin   25.0 %     23.5 %   150 bps    
                       
International Businesses
$ in mm
FY24 Q4   FY23 Q4   Change   Organic Growth
Sales $ 1,430     $ 1,512     -5.4 %   -2.5 %
Segment Operating Income $ 312     $ 309     0.7 %    
Segment Operating Margin   21.8 %     20.5 %   130 bps    
Adjusted Segment Operating Income $ 342     $ 352     -2.9 %    
Adjusted Segment Operating Margin   23.9 %     23.3 %   60 bps    
                       

Aerospace Systems Segment

$ in mm FY24 Q4   FY23 Q4   Change   Organic Growth
Sales $ 1,528     $ 1,283     19.2 %   19.1 %
Segment Operating Income $ 332     $ 328     1.4 %    
Segment Operating Margin   21.7 %     25.5 %   -380 bps    
Adjusted Segment Operating Income $ 415     $ 331     25.1 %    
Adjusted Segment Operating Margin   27.1 %     25.8 %   130 bps    
                       

Order Rates

  FY24 Q4
Parker +1 %
Diversified Industrial Segment – North America Businesses 0 %
Diversified Industrial Segment – International Businesses -1 %
Aerospace Systems Segment +7 %
     

About Parker Hannifin
Parker Hannifin is a Fortune 250 global leader in motion and control technologies. For more than a century the company has been enabling engineering breakthroughs that lead to a better tomorrow. Learn more at www.parker.com or @parkerhannifin.

Notice of Webcast
Parker Hannifin’s conference call and slide presentation to discuss its fiscal 2024 fourth quarter and full year results are available to all interested parties via live webcast today at 11:00 a.m. ET, at investors.parker.com. A replay of the webcast will be available on the site approximately one hour after the completion of the call and will remain available for one year. To register for e-mail notification of future events please visit investors.parker.com.

Note on Orders The company reported orders for the quarter ending June 30, 2024, compared with the same quarter a year ago. All comparisons are at constant currency exchange rates, with the prior year quarter restated to the current-year rates. Diversified Industrial comparisons are on 3-month average computations and Aerospace Systems comparisons are on rolling 12-month average computations.

Note on Non-GAAP Financial Measures
This press release contains references to non-GAAP financial information including (a) adjusted net income; (b) adjusted earnings per share; (c) adjusted operating margin and segment operating margins; (d) adjusted operating income and segment operating income; (e) EBITDA margin; (f) adjusted EBITDA margin; (g) organic sales growth and (h) free cash flow. The adjusted net income, adjusted earnings per share, adjusted operating margin, adjusted segment operating margin, adjusted operating income, adjusted segment operating income and organic sales measures are presented to allow investors and the company to meaningfully evaluate changes in net income, earnings per share and segment operating margins on a comparable basis from period to period. This press release also contains references to EBITDA margin, adjusted EBITDA margin and free cash flow. EBITDA is defined as earnings before interest, taxes, depreciation and amortization. Free cash flow is defined as cash flow from operations less capital expenditures. Although adjusted net income, adjusted earnings per share, adjusted operating margin and segment operating margins, adjusted operating income and segment operating income, EBITDA margin, adjusted EBITDA margin, organic sales growth and free cash flow are not measures of performance calculated in accordance with GAAP, we believe that they are useful to an investor in evaluating the results of this quarter and fiscal year versus the prior periods. Comparable descriptions of record adjusted results in this release refer only to the period from the first quarter of FY2011 to the periods presented in this release. This period coincides with recast historical financial results provided in association with our FY2014 change in segment reporting. A reconciliation of non-GAAP measures is included in the financial tables of this press release.

Forward-Looking Statements
Forward-looking statements contained in this and other written and oral reports are made based on known events and circumstances at the time of release, and as such, are subject in the future to unforeseen uncertainties and risks. Often but not always, these statements may be identified from the use of forward-looking terminology such as “anticipates,” “believes,” “may,” “should,” “could,” “expects,” “targets,” “is likely,” “will,” or the negative of these terms and similar expressions, and may also include statements regarding future performance, orders, earnings projections, events or developments. Parker cautions readers not to place undue reliance on these statements. It is possible that the future performance may differ materially from expectations, including those based on past performance.

Among other factors that may affect future performance are: changes in business relationships with and orders by or from major customers, suppliers or distributors, including delays or cancellations in shipments; disputes regarding contract terms, changes in contract costs and revenue estimates for new development programs; changes in product mix; ability to identify acceptable strategic acquisition targets; uncertainties surrounding timing, successful completion or integration of acquisitions and similar transactions; ability to successfully divest businesses planned for divestiture and realize the anticipated benefits of such divestitures; the determination and ability to successfully undertake business realignment activities and the expected costs, including cost savings, thereof; ability to implement successfully business and operating initiatives, including the timing, price and execution of share repurchases and other capital initiatives; availability, cost increases of or other limitations on our access to raw materials, component products and/or commodities if associated costs cannot be recovered in product pricing; ability to manage costs related to insurance and employee retirement and health care benefits; legal and regulatory developments and other government actions, including related to environmental protection, and associated compliance costs; supply chain and labor disruptions, including as a result of labor shortages; threats associated with international conflicts and cybersecurity risks and risks associated with protecting our intellectual property; uncertainties surrounding the ultimate resolution of outstanding legal proceedings, including the outcome of any appeals; effects on market conditions, including sales and pricing, resulting from global reactions to U.S. trade policies; manufacturing activity, air travel trends, currency exchange rates, difficulties entering new markets and economic conditions such as inflation, deflation, interest rates and credit availability; inability to obtain, or meet conditions imposed for, required governmental and regulatory approvals; changes in the tax laws in the United States and foreign jurisdictions and judicial or regulatory interpretations thereof; and large scale disasters, such as floods, earthquakes, hurricanes, industrial accidents and pandemics. Readers should also consider forward-looking statements in light of risk factors discussed in Parker’s Annual Report on Form 10-K for the fiscal year ended June 30, 2023 and other periodic filings made with the SEC.

CONSOLIDATED STATEMENT OF INCOME              
(Unaudited)   Three Months Ended June 30,   Twelve Months Ended June 30,
(Dollars in thousands, except per share amounts)   2024       2023       2024       2023  
Net sales   $ 5,186,815     $ 5,095,943     $ 19,929,606     $ 19,065,194  
Cost of sales     3,322,855       3,262,860       12,801,816       12,635,892  
Selling, general and administrative expenses   818,347       834,940       3,315,177       3,354,103  
Interest expense     119,266       157,176       506,495       573,894  
Other income, net     (59,613 )     (62,228 )     (288,485 )     (178,359 )
Income before income taxes     985,960       903,195       3,594,603       2,679,664  
Income taxes     200,887       194,117       749,667       596,128  
Net income     785,073       709,078       2,844,936       2,083,536  
Less: Noncontrolling interests     110       122       721       600  
Net income attributable to common shareholders $ 784,963     $ 708,956     $ 2,844,215     $ 2,082,936  
                 
Earnings per share attributable to common shareholders:              
Basic earnings per share   $ 6.10     $ 5.52     $ 22.13     $ 16.23  
Diluted earnings per share   $ 6.01     $ 5.44     $ 21.84     $ 16.04  
                 
Average shares outstanding during period – Basic   128,627,781       128,440,007       128,507,352       128,367,842  
Average shares outstanding during period – Diluted   130,643,758       130,222,542       130,239,737       129,822,085  
                 
                 
CASH DIVIDENDS PER COMMON SHARE              
(Unaudited)   Three Months Ended June 30,   Twelve Months Ended June 30,
(Amounts in dollars)     2024       2023       2024       2023  
Cash dividends per common share $ 1.63     $ 1.48     $ 6.07     $ 5.47  
                 
RECONCILIATION OF ORGANIC GROWTH                
(Unaudited) Three Months Ended
  As Reported               Adjusted
  June 30, 2024   Currency   Divestitures   Acquisitions   June 30, 2024
Diversified Industrial Segment (4.1)%   (1.2)%   (0.2)%   %   (2.7)%
Aerospace Systems Segment 19.2 %   0.1 %   %   %   19.1 %
Total 1.8 %   (0.8)%   (0.2)%   %   2.8 %
                   
(Unaudited) Twelve Months Ended
  As Reported               Adjusted
  June 30, 2024   Currency   Divestitures   Acquisitions   June 30, 2024
Diversified Industrial Segment (1.7)%   (0.2)%   (0.2)%   0.8 %   (2.1)%
Aerospace Systems Segment 25.5 %   0.4 %   (0.9)%   8.8 %   17.2 %
Total 4.5 %   (0.1)%   (0.3)%   2.6 %   2.3 %
                         
RECONCILIATION OF NET INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS TO ADJUSTED NET INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS
(Unaudited)   Three Months Ended June 30,   Twelve Months Ended June 30,
(Dollars in thousands)     2024       2023       2024       2023  
Net income attributable to common shareholders $ 784,963     $ 708,956     $ 2,844,215     $ 2,082,936  
Adjustments:              
Acquired intangible asset amortization expense   139,232       126,296       577,995       500,713  
Business realignment charges   17,542       9,226       53,456       26,706  
Integration costs to achieve     8,597       18,786       38,273       95,439  
Acquisition-related expenses         2,754             166,294  
Loss on deal-contingent forward contracts                     389,992  
Net gain on divestitures               (25,651 )     (362,003 )
Amortization of inventory step-up to fair value         (57,992 )           109,981  
Meggitt early debt retirement           9,999             9,999  
Tax effect of adjustments1     (39,358 )     (26,613 )     (147,761 )     (222,379 )
Discrete Tax Benefit2     (27,068 )           (27,068 )      
Adjusted net income attributable to common shareholders $ 883,908     $ 791,412     $ 3,313,459     $ 2,797,678  
                 
RECONCILIATION OF EARNINGS PER DILUTED SHARE TO ADJUSTED EARNINGS PER DILUTED SHARE
(Unaudited)   Three Months Ended June 30,   Twelve Months Ended June 30,
(Amounts in dollars)     2024       2023       2024       2023  
Earnings per diluted share $ 6.01     $ 5.44     $ 21.84     $ 16.04  
Adjustments:              
Acquired intangible asset amortization expense   1.07       0.97       4.43       3.85  
Business realignment charges   0.13       0.07       0.40       0.20  
Integration costs to achieve   0.07       0.14       0.30       0.73  
Acquisition-related expenses         0.02             1.29  
Loss on deal-contingent forward contracts                     3.00  
Net gain on divestitures               (0.20 )     (2.78 )
Amortization of inventory step-up to fair value         (0.45 )           0.84  
Meggitt early debt retirement           0.08             0.08  
Tax effect of adjustments1     (0.30 )     (0.19 )     (1.12 )     (1.70 )
Discrete Tax Benefit2     (0.21 )           (0.21 )      
Adjusted earnings per diluted share $ 6.77     $ 6.08     $ 25.44     $ 21.55  
                 
1This line item reflects the aggregate tax effect of all non-tax adjustments reflected in the preceding line items of the table. We estimate the tax effect of each adjustment item by applying our overall effective tax rate for continuing operations to the pre-tax amount, unless the nature of the item and/or the tax jurisdiction in which the item has been recorded requires application of a specific tax rate or tax treatment, in which case the tax effect of such item is estimated by applying such specific tax rate or tax treatment.
2 A recent Swiss tax law change resulted in the recording of a deferred tax asset.
 
RECONCILIATION OF EBITDA TO ADJUSTED EBITDA        
(Unaudited)   Three Months Ended June 30,   Twelve Months Ended June 30,
(Dollars in thousands)     2024       2023       2024       2023  
Net sales   $ 5,186,815     $ 5,095,943     $ 19,929,606     $ 19,065,194  
                 
Net income   $ 785,073     $ 709,078     $ 2,844,936     $ 2,083,536  
Income taxes     200,887       194,117       749,667       596,128  
Depreciation     91,436       82,767       349,136       317,416  
Amortization     139,232       126,296       577,995       500,713  
Interest expense     119,266       157,176       506,495       573,894  
EBITDA     1,335,894       1,269,434       5,028,229       4,071,687  
Adjustments:                
Business realignment charges     17,542       9,226       53,456       26,706  
Integration costs to achieve   8,597       18,786       38,273       95,439  
Acquisition-related expenses           2,754             166,294  
Loss on deal-contingent forward contracts                       389,992  
Net gain on divestitures                 (25,651 )     (362,003 )
Amortization of inventory step-up to fair value           (57,992 )           109,981  
Adjusted EBITDA   $ 1,362,033     $ 1,242,208     $ 5,094,307     $ 4,498,096  
                 
EBITDA margin     25.8 %     24.9 %     25.2 %     21.4 %
Adjusted EBITDA margin     26.3 %     24.4 %     25.6 %     23.6 %
                                 
BUSINESS SEGMENT INFORMATION              
(Unaudited)   Three Months Ended June 30,   Twelve Months Ended June 30,
(Dollars in thousands)     2024       2023       2024       2023
Net sales                
Diversified Industrial   $ 3,658,502     $ 3,813,431     $ 14,457,146     $ 14,705,693
Aerospace Systems     1,528,313       1,282,512       5,472,460       4,359,501
Total net sales   $ 5,186,815     $ 5,095,943     $ 19,929,606     $ 19,065,194
Segment operating income                
Diversified Industrial   $ 817,085     $ 800,196     $ 3,176,384     $ 3,071,410
Aerospace Systems     332,035       327,595       1,110,746       562,444
Total segment operating income   1,149,120       1,127,791       4,287,130       3,633,854
Corporate general and administrative expenses   55,972       83,336       218,312       229,677
Income before interest expense and other (income) expense, net   1,093,148       1,044,455       4,068,818       3,404,177
Interest expense     119,266       157,176       506,495       573,894
Other (income) expense, net     (12,078 )     (15,916 )     (32,280 )     150,619
Income before income taxes   $ 985,960     $ 903,195     $ 3,594,603     $ 2,679,664
                 
RECONCILIATION OF SEGMENT OPERATING MARGINS TO ADJUSTED SEGMENT OPERATING MARGINS
(Unaudited)   Three Months Ended June 30,   Twelve Months Ended June 30,
(Dollars in thousands)     2024       2023       2024       2023  
Diversified Industrial Segment sales   $ 3,658,502     $ 3,813,431     $ 14,457,146     $ 14,705,693  
                 
Diversified Industrial Segment operating income   $ 817,085     $ 800,196     $ 3,176,384     $ 3,071,410  
Adjustments:                
Acquired intangible asset amortization     64,550       82,073       266,219       267,779  
Business realignment charges     17,198       9,177       50,075       23,641  
Integration costs to achieve     628       1,235       3,930       8,511  
Adjusted Diversified Industrial Segment operating income   $ 899,461     $ 892,681     $ 3,496,608     $ 3,371,341  
                 
Diversified Industrial Segment operating margin     22.3 %     21.0 %     22.0 %     20.9 %
Adjusted Diversified Industrial Segment operating margin     24.6 %     23.4 %     24.2 %     22.9 %
                 
(Unaudited)   Three Months Ended June 30,   Twelve Months Ended June 30,
(Dollars in thousands)     2024       2023       2024       2023  
Aerospace Systems Segment sales   $ 1,528,313     $ 1,282,512     $ 5,472,460     $ 4,359,501  
                 
Aerospace Systems Segment operating income   $ 332,035     $ 327,595     $ 1,110,746     $ 562,444  
Adjustments:                
Acquired intangible asset amortization     74,682       44,223       311,776       232,934  
Business realignment charges     1       49       319       3,065  
Integration costs to achieve     7,969       17,551       34,343       86,928  
Amortization of inventory step-up to fair value           (57,992 )           109,981  
Adjusted Aerospace Systems Segment operating income   $ 414,687     $ 331,426     $ 1,457,184     $ 995,352  
                 
Aerospace Systems Segment operating margin     21.7 %     25.5 %     20.3 %     12.9 %
Adjusted Aerospace Systems Segment operating margin     27.1 %     25.8 %     26.6 %     22.8 %
                 
(Unaudited)   Three Months Ended June 30,   Twelve Months Ended June 30,
(Dollars in thousands)     2024       2023       2024       2023  
Total net sales   $ 5,186,815     $ 5,095,943     $ 19,929,606     $ 19,065,194  
                 
Total segment operating income   $ 1,149,120     $ 1,127,791     $ 4,287,130     $ 3,633,854  
Adjustments:                
Acquired intangible asset amortization     139,232       126,296       577,995       500,713  
Business realignment charges     17,199       9,226       50,394       26,706  
Integration costs to achieve     8,597       18,786       38,273       95,439  
Amortization of inventory step-up to fair value           (57,992 )           109,981  
Adjusted total segment operating income   $ 1,314,148     $ 1,224,107     $ 4,953,792     $ 4,366,693  
                 
Total segment operating margin     22.2 %     22.1 %     21.5 %     19.1 %
Adjusted total segment operating margin     25.3 %     24.0 %     24.9 %     22.9 %
                                 
CONSOLIDATED BALANCE SHEET      
(Unaudited)   June 30,   June 30,
(Dollars in thousands)   2024   2023
Assets        
Current assets:        
Cash and cash equivalents   $ 422,027   $ 475,182
Trade accounts receivable, net     2,865,546     2,827,297
Non-trade and notes receivable     331,429     309,167
Inventories     2,786,800     2,907,879
Prepaid expenses and other     392,822     314,704
Total current assets     6,798,624     6,834,229
Property, plant and equipment, net     2,875,668     2,865,030
Deferred income taxes     92,704     81,429
Investments and other assets     1,207,232     1,104,576
Intangible assets, net     7,816,181     8,450,614
Goodwill     10,507,433     10,628,594
Total assets   $ 29,297,842   $ 29,964,472
         
Liabilities and equity        
Current liabilities:        
Notes payable and long-term debt payable within one year   $ 3,403,065   $ 3,763,175
Accounts payable, trade     1,991,639     2,050,934
Accrued payrolls and other compensation     581,251     651,319
Accrued domestic and foreign taxes     354,659     374,571
Other accrued liabilities     982,695     895,371
Total current liabilities     7,313,309     7,735,370
Long-term debt     7,157,034     8,796,284
Pensions and other postretirement benefits     437,490     551,510
Deferred income taxes     1,583,923     1,649,674
Other liabilities     725,193     893,355
Shareholders’ equity     12,071,972     10,326,888
Noncontrolling interests     8,921     11,391
Total liabilities and equity   $ 29,297,842   $ 29,964,472
         
CONSOLIDATED STATEMENT OF CASH FLOWS        
(Unaudited)   Twelve Months Ended June 30,
(Dollars in thousands)     2024       2023  
Cash flows from operating activities:        
Net income   $ 2,844,936     $ 2,083,536  
Depreciation and amortization     927,131       818,129  
Stock incentive plan compensation     155,175       142,720  
Gain on sale of businesses     (23,979 )     (366,345 )
Loss on property, plant and equipment and intangible assets     12,382       3,819  
Gain on marketable securities and other investments     (5,708 )     (6,176 )
Net change in receivables, inventories and trade payables     (28,135 )     128,000  
Net change in other assets and liabilities     (516,854 )     13,211  
Other, net     19,381       163,036  
Net cash provided by operating activities     3,384,329       2,979,930  
Cash flows from investing activities:        
Acquisitions (net of cash of $89,704 in 2023)           (7,146,110 )
Capital expenditures     (400,112 )     (380,747 )
Proceeds from sale of property, plant and equipment     9,065       13,244  
Proceeds from sale of businesses     77,666       473,207  
Purchases of marketable securities and other investments     (17,186 )     (37,791 )
Maturities and sales of marketable securities and other investments     24,292       56,786  
Payments of deal-contingent forward contracts           (1,405,418 )
Other     7,687       250,017  
Net cash used in investing activities     (298,588 )     (8,176,812 )
Cash flows from financing activities:        
Net payments for common stock activity     (328,449 )     (293,847 )
Acquisition of noncontrolling interests     (2,883 )      
Net (payments for) proceeds from debt     (2,001,519 )     40,470  
Financing fees paid           (13,605 )
Dividends paid     (782,048 )     (704,054 )
Net cash used in financing activities     (3,114,899 )     (971,036 )
Effect of exchange rate changes on cash     (23,997 )     (4,776 )
Net decrease in cash, cash equivalents and restricted cash     (53,155 )     (6,172,694 )
Cash, cash equivalents and restricted cash at beginning of year     475,182       6,647,876  
Cash and cash equivalents at end of period   $ 422,027     $ 475,182  
         
     
RECONCILIATION OF CASH FLOW FROM OPERATIONS TO FREE CASH FLOW
(Unaudited)   Twelve Months Ended
(Dollars in thousands)   June 30, 2024
As reported cash flow from operations   $ 3,384,329  
Capital expenditures     (400,112 )
Free cash flow   $ 2,984,217  
         
RECONCILIATION OF FORECASTED ORGANIC GROWTH  
(Unaudited)    
(Amounts in percentages)   Fiscal Year 2025
Forecasted net sales   1.5% to 4.5%
Adjustments:    
Currency   0.5%
Divestitures   %
Adjusted forecasted net sales   2.0% to 5.0%
     
RECONCILIATION OF FORECASTED SEGMENT OPERATING MARGIN TO ADJUSTED FORECASTED SEGMENT OPERATING MARGIN
     
(Unaudited)    
(Amounts in percentages)   Fiscal Year 2025
Forecasted segment operating margin 22.1% to 22.5%
Adjustments:  
Business realignment charges 0.2%
Costs to achieve   0.1%
Acquisition-related intangible asset amortization expense   2.7%
Adjusted forecasted segment operating margin 25.2% to 25.6%
     
Note: Totals may not foot due to rounding
 
RECONCILIATION OF FORECASTED EARNINGS PER DILUTED SHARE TO ADJUSTED FORECASTED EARNINGS PER DILUTED SHARE
     
(Unaudited)    
(Amounts in dollars)   Fiscal Year 2025
Forecasted earnings per diluted share $22.65 to $23.35
Adjustments:  
Business realignment charges 0.38
Costs to achieve   0.11
Acquisition-related intangible asset amortization expense   4.25
Tax effect of adjustments1   (1.09)
Adjusted forecasted earnings per diluted share $26.30 to $27.00
     
1This line item reflects the aggregate tax effect of all non-tax adjustments reflected in the preceding line items of the table. We estimate the tax effect of each adjustment item by applying our overall effective tax rate for continuing operations to the pre-tax amount, unless the nature of the item and/or the tax jurisdiction in which the item has been recorded requires application of a specific tax rate or tax treatment, in which case the tax effect of such item is estimated by applying such specific tax rate or tax treatment.
 
SUPPLEMENTAL INFORMATION              
BUSINESS SEGMENT INFORMATION              
(Unaudited)   Three Months Ended June 30,   Twelve Months Ended June 30,
(Dollars in thousands)     2024     2023     2024     2023
Net sales                
Diversified Industrial:                
North America businesses   $ 2,228,449   $ 2,301,159   $ 8,800,036   $ 8,916,194
International businesses     1,430,053     1,512,272     5,657,110     5,789,499
                 
Segment operating income              
Diversified Industrial:                
North America businesses   $ 505,521   $ 490,823   $ 1,963,876   $ 1,853,079
International businesses     311,564     309,373     1,212,508     1,218,331
                         
RECONCILIATION OF ORGANIC GROWTH            
(Unaudited) Three Months Ended
  As Reported               Adjusted
  June 30, 2024   Currency   Divestitures   Acquisitions   June 30, 2024
Diversified Industrial Segment:                  
North America businesses (3.2)%   %   (0.4)%   %   (2.8)%
International businesses (5.4)%   (2.9)%   %   %   (2.5)%
                   
(Unaudited) Twelve Months Ended
  As Reported               Adjusted
  June 30, 2024   Currency   Divestitures   Acquisitions   June 30, 2024
Diversified Industrial Segment:                  
North America businesses (1.3)%   0.3 %   (0.3)%   0.9 %   (2.2)%
International businesses (2.3)%   (1.0)%   %   0.7 %   (2.0)%
                     
RECONCILIATION OF SEGMENT OPERATING MARGINS TO ADJUSTED SEGMENT OPERATING MARGINS
(Unaudited)   Three Months Ended June 30,   Twelve Months Ended June 30,
(Dollars in thousands)     2024       2023       2024       2023  
Diversified Industrial Segment:                
North America businesses sales   $ 2,228,449     $ 2,301,159     $ 8,800,036     $ 8,916,194  
                 
North America businesses operating income   $ 505,521     $ 490,823     $ 1,963,876     $ 1,853,079  
Adjustments:                
Acquired intangible asset amortization     43,010       47,138       176,337       181,954  
Business realignment charges     8,857       1,792       17,749       4,024  
Integration costs to achieve     295       877       2,643       4,636  
Adjusted North America businesses operating income   $ 557,683     $ 540,630     $ 2,160,605     $ 2,043,693  
                 
North America businesses operating margin     22.7 %     21.3 %     22.3 %     20.8 %
Adjusted North America businesses operating margin     25.0 %     23.5 %     24.6 %     22.9 %
                 
(Unaudited)   Three Months Ended June 30,   Twelve Months Ended June 30,
(Dollars in thousands)     2024       2023       2024       2023  
Diversified Industrial Segment:                
International businesses sales   $ 1,430,053     $ 1,512,272     $ 5,657,110     $ 5,789,499  
                 
International businesses operating income   $ 311,564     $ 309,373     $ 1,212,508     $ 1,218,331  
Adjustments:                
Acquired intangible asset amortization     21,540       34,935       89,882       85,825  
Business realignment charges     8,341       7,385       32,326       19,617  
Integration costs to achieve     333       358       1,287       3,875  
Adjusted International businesses operating income   $ 341,778     $ 352,051     $ 1,336,003     $ 1,327,648  
                 
International businesses operating margin     21.8 %     20.5 %     21.4 %     21.0 %
Adjusted International businesses operating margin     23.9 %     23.3 %     23.6 %     22.9 %


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