SNAP-ON INCORPORATED Quarterly Financial Review
First Quarter 2024
Q1-2024 Quarterly Review
© 2024 Snap-on Incorporated
Cautionary Statement
- These slides should be read in conjunction with comments from the April 18, 2024 conference call. The financial statement information included herein is unaudited.
- Statements made during the April 18, 2024 conference call and/or information included in this presentation may contain statements, including earnings projections, that are forward-looking in nature and, accordingly, are subject to risks and uncertainties regarding Snap-on's expected results; actual results may differ materially from those described or contemplated in these forward-looking statements. Factors that may cause actual results to differ materially from those contained in the forward-looking statements, including those found in Snap-on's reports filed with the Securities and Exchange Commission, and the information under "Safe Harbor" and "Risk Factors" headings in its most recent Annual Report on Form 10-K, which are incorporated herein by reference. Snap-on disclaims any responsibility to update any forward-looking statement provided during the April 18, 2024 conference call and/or included in this presentation, except as required by law.
- This presentation includes certain non-GAAP measures of financial performance, which are not meant to be considered in isolation or as a substitute for their GAAP counterparts. Additional information regarding these non-GAAP measures is included in Snap-on's April 18, 2024 press release and Form 8-K, which can be found on the company's website in the investors section at www.snapon.com.
Q1-2024 Quarterly Review | 3 |
© 2024 Snap-on Incorporated |
Nick Pinchuk
Chairman and
Chief Executive Officer
Q1-2024 Quarterly Review
© 2024 Snap-on Incorporated
Aldo Pagliari
Senior Vice President and
Chief Financial Officer
Q1-2024 Quarterly Review | 5 |
© 2024 Snap-on Incorporated |
Consolidated | Results | |||||||||||
Q1 2024 | Q1 2023 | |||||||||||
($ in millions, except per share data | - unaudited) | |||||||||||
$ | % | $ | % | Change | ||||||||
Net sales | $ 1,182.3 | $ 1,183.0 | (0.1)% | |||||||||
➢ Organic sales | (9.9) | (0.8)% | ||||||||||
➢ Acquisitions | 6.7 | 0.5 % | ||||||||||
➢ | Currency translation | 2.5 | 0.2 % | |||||||||
Gross profit | $ | 596.7 | 50.5 % | $ | 589.6 | 49.8 % | ||||||
Operating expenses | 325.8 | 27.6 % | 329.8 | 27.8 % | ||||||||
Operating earnings before financial services | $ | 270.9 | 22.9 % | $ | 259.8 | 22.0 % | 4.3 % | |||||
Financial services revenue | $ | 99.6 | $ | 92.6 | 7.6 % | |||||||
Financial services operating earnings | 68.3 | 66.3 | 3.0 % | |||||||||
Operating earnings | $ | 339.2 | 26.5 % | $ | 326.1 | 25.6 % | 4.0 % | |||||
Diluted EPS - as reported | $ | 4.91 | $ | 4.60 | 6.7 % | |||||||
- Net sales of $1,182.3 million in the first quarter represented a decrease of $0.7 million, or 0.1%, from 2023 levels, reflecting a 0.8% organic sales decline, $6.7 million of acquisition-related sales and $2.5 million of favorable foreign currency translation
- Gross margin improved 70 basis points (bps) to 50.5% from 49.8% last year primarily due to lower material and other costs, and benefits from the company's Rapid Continuous Improvement ("RCI") initiatives
- Operating expenses, operating earnings before financial services, and operating earnings include an $11.3 million benefit for payments received associated with a legal matter (the "legal payment"); net earnings includes an $8.8 million, or $0.16 per diluted share, after-tax benefit from the legal payment
- Operating expenses as a percentage of net sales improved 20 bps to 27.6% from 27.8% last year primarily reflecting the benefit from the legal payment, partially offset by increased personnel and other costs
- As a percentage of net sales, operating earnings before financial services of 22.9% compared to 22.0% last year
Q1-2024 Quarterly Review | 6 |
© 2024 Snap-on Incorporated |
Commercial & Industrial
($ in millions - unaudited) | Q1 2024 | Q1 2023 | Change | ||
Segment sales | $ | 359.9 | $ | 363.8 | (1.1)% |
➢ Organic sales | (9.2) | (2.5)% | |||
➢ Acquisition | 6.7 | 1.8 % | |||
➢ Currency translation | (1.4) | (0.4)% | |||
Gross profit | $ | 146.7 | $ | 141.3 | |
% of sales | 40.8 % | 38.8 % | |||
Operating expenses | $ | 91.3 | $ | 85.5 | |
% of sales | 25.4 % | 23.5 % | |||
Operating earnings | $ | 55.4 | $ | 55.8 | |
% of sales | 15.4 % | 15.3 % | 10 bps | ||
- Organic sales decline of $9.2 million, or 2.5%, primarily due to a double-digit reduction in the segment's power tools business and a high single-digit decline in the segment's Asia-Pacific operations, partially offset by a mid single-digit gain in sales to customers in critical industries
- Gross margin improved 200 bps from 2023 primarily reflecting increased sales volumes in the higher-gross-margin critical industry sector, lower material and other costs, savings from RCI initiatives, and 50 bps of benefits from acquisitions
- Operating expenses as a percentage of sales rose 190 bps from last year primarily due to the effects of lower sales volumes, increased personnel and other costs, and a 70 bps impact from acquisitions
- Operating earnings of $55.4 million compared to $55.8 million in 2023; the operating margin of 15.4% compared to 15.3% last year
Q1-2024 Quarterly Review | 7 |
© 2024 Snap-on Incorporated |
Snap-on Tools | ||||||
($ in millions - unaudited) | Q1 2024 | Q1 2023 | Change | |||
Segment sales | $ | 500.1 | $ | 537.0 | (6.9)% | |
➢ Organic sales | (37.5) | (7.0)% | ||||
➢ Currency translation | 0.6 | 0.1 % | ||||
Gross profit | $ | 241.1 | $ | 253.9 | ||
% of sales | 48.2 % | 47.3 % | ||||
Operating expenses | $ | 123.8 | $ | 122.2 | ||
% of sales | 24.7 % | 22.8 % | ||||
Operating earnings | $ | 117.3 | $ | 131.7 | ||
% of sales | 23.5 % | 24.5 % | (100) bps | |||
- Organic sales decline of $37.5 million, or 7.0%, reflecting a high single-digit decline in the U.S., partially offset by a mid single-digit gain in the segment's international operations
- Gross margin improved 90 bps from last year primarily reflecting decreased sales of lower-gross-margin products
- Operating expenses as a percentage of sales rose 190 bps compared to 2023 primarily due to the lower sales volumes
- Operating earnings of $117.3 million compared to $131.7 million last year; the operating margin of 23.5% compared to 24.5% last year
Q1-2024 Quarterly Review | 8 |
© 2024 Snap-on Incorporated |
Repair Systems & Information
($ in millions - unaudited) | Q1 2024 | Q1 2023 | Change | ||
Segment sales | $ | 463.8 | $ | 446.6 | 3.9 % |
➢ Organic sales | 14.7 | 3.3 % | |||
➢ Currency translation | 2.5 | 0.6 % | |||
Gross profit | $ | 208.9 | $ | 194.4 | |
% of sales | 45.0 % | 43.5 % | |||
Operating expenses | $ | 96.0 | $ | 89.8 | |
% of sales | 20.7 % | 20.1 % | |||
Operating earnings | $ | 112.9 | $ | 104.6 | |
% of sales | 24.3 % | 23.4 % | 90 bps | ||
- Organic sales gain of $14.7 million, or 3.3%, reflecting a high single-digit increase in activity with OEM dealerships and low single-digit gains in sales of undercar equipment
- Gross margin improved 150 bps from last year primarily due to lower material and other costs, and savings from RCI initiatives
- Operating expenses as a percentage of sales rose 60 bps from 2023 primarily reflecting increased personnel and other costs
- Operating earnings of $112.9 million reflected an increase of $8.3 million, or 7.9%, from $104.6 million in 2023; the operating margin of 24.3% compared to 23.4% last year
Q1-2024 Quarterly Review | 9 |
© 2024 Snap-on Incorporated |
Financial | Services | ||||||
($ in millions - | unaudited) | Q1 2024 | Q1 2023 | Change | |||
Segment revenue | $ | 99.6 | $ | 92.6 | 7.6 % | ||
Operating earnings | $ | 68.3 | $ | 66.3 | 3.0 % | ||
Originations | $ | 301.7 | $ | 300.9 | 0.3 % | ||
- Originations increased $0.8 million or 0.3%
- Average yield on finance receivables was 17.7% in both periods
- Average yields on contract receivables were 9.0% and 8.7% in 2024 and 2023, respectively
Q1-2024 Quarterly Review | 10 |
© 2024 Snap-on Incorporated |
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Snap On Inc. published this content on 17 April 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 18 April 2024 10:45:07 UTC.
