On August 1, 2024, IDEX Corp (IEX, Financial) released its 8-K filing for the second quarter of 2024. IDEX Corp, a manufacturer of pumps, flow meters, valves, and fluidic systems, reported a mixed performance with a decline in sales but an increase in earnings per share (EPS).
Company Overview
IDEX Corp (IEX, Financial) manufactures pumps, flow meters, valves, and fluidic systems for various end markets, including industrial, fire and safety, life science, and water. The company operates through three segments: fluid and metering technologies, health and science technologies, and fire and safety and diversified products. Based in Lake Forest, Illinois, IDEX has manufacturing operations in over 20 countries and employs over 7,000 people. In 2023, the company generated $3.3 billion in revenue.
Q2 2024 Financial Performance
For the second quarter of 2024, IDEX Corp reported:
- Sales of $807 million, down 5% overall and 4% organically compared to Q2 2023.
- Reported diluted EPS of $1.86, up 2% from the previous year.
- Adjusted diluted EPS of $2.06, down 6% but exceeding analyst expectations of $1.79.
- Operating cash flow of $134 million, down 5% year-over-year.
- Free cash flow of $118 million, down 2% year-over-year.
Segment Performance
The performance across IDEX Corp's segments varied:
| Segment | Net Sales (2024) | Net Sales (2023) | Change | Adjusted EBITDA Margin (2024) | Adjusted EBITDA Margin (2023) |
|---|---|---|---|---|---|
| Fluid & Metering Technologies | $319.4 million | $325.1 million | -1.8% | 33.7% | 35.1% |
| Health & Science Technologies | $303.8 million | $339.5 million | -10.5% | 27.7% | 27.6% |
| Fire & Safety/Diversified Products | $185.4 million | $184.8 million | 0.3% | 29.0% | 29.4% |
Key Financial Metrics
Important metrics from the income statement, balance sheet, and cash flow statement include:
- Gross profit of $366.8 million, down from $378.0 million in Q2 2023.
- Net income attributable to IDEX of $141.3 million, up from $138.6 million in Q2 2023.
- Adjusted EBITDA of $224.2 million, down from $240.7 million in Q2 2023.
- Gross margin of 45.4%, up 70 basis points from the previous year.
- Net income margin of 17.5%, up 110 basis points from the previous year.
Challenges and Achievements
IDEX Corp faced several challenges, including a 4% decline in organic net sales primarily driven by lower volumes in the Health & Science Technologies segment. However, the company managed to offset some of these declines through price capture across all segments. The gross margin increased due to strong price/cost management and favorable operational productivity.
"IDEX teams delivered strong execution in the second quarter, expanding margins sequentially despite stronger uncertainty-fueled macro headwinds," said Eric D. Ashleman, IDEX Corporation Chief Executive Officer and President.
Outlook
IDEX Corp revised its full-year and third-quarter 2024 outlook:
- Full-year organic sales growth is projected to decline 1% to 2%, down from previous guidance of 0% to 2% growth.
- Full-year GAAP diluted EPS is expected to be between $6.85 and $6.95, with adjusted diluted EPS between $7.80 and $7.90, down from previous guidance.
- Third-quarter GAAP diluted EPS is projected to be between $1.61 and $1.66, with adjusted diluted EPS between $1.85 and $1.90.
For more detailed information, visit the 8-K filing.
Explore the complete 8-K earnings release (here) from IDEX Corp for further details.
