Delivered Full Year GAAP EPS of $3.28, Adjusted
EPS of $4.16, Exceeding 2023 Guidance
Achieved Full Year 2023 Core Sales Growth of 4%
with Crane Currency Core Sales Growth of 8%
Crane NXT, Co. (NYSE: CXT) ("Crane NXT" or the "Company"), a
premier industrial technology company, today announced its
financial results for the fourth quarter and full year ended
December 31, 2023.
Fourth Quarter 2023 and Recent Highlights
- Core sales grew 4.1% year-over-year.
- GAAP operating profit margin was 20.3% and Adjusted operating
profit margin was 23.4%.
- GAAP earnings per diluted share (EPS) was $0.86, and Adjusted
EPS was $0.99.
- The Company repaid $70 million of its $350 million term loan
facility.
- The Company declared a first quarter 2024 dividend of $0.16 per
share, an increase of 14% over the prior year.
Full Year 2023 Highlights
- Core sales grew 4.3% year-over-year.
- GAAP operating profit margin was 20.6% and Adjusted operating
profit margin was 24.8%.
- GAAP earnings per diluted share (EPS) was $3.28, and Adjusted
EPS was $4.16.
- The Company repaid $245.0 million of its $350 million term loan
facility, reducing net leverage to 1.1x.
- Adjusted free cash flow conversion was 111%.
Full year 2024 Guidance
- Introducing 2024 guidance with Adjusted EPS of $4.10 to $4.35.
Please see the "Full Year 2024 Guidance" section in this press
release for more details.
Aaron W. Saak, Crane NXT's President, and Chief Executive
Officer stated: "We delivered a strong close to 2023, underpinned
by outstanding operational performance from both our businesses. We
achieved adjusted EPS of $4.16, exceeding the high end of our
guidance, as well as generating 4% growth in core sales, and
expanding our adjusted segment operating margins by 30 basis points
year over year."
Mr. Saak continued: "With this solid foundation in place, we are
well-positioned to execute on our strategy, both organically and
through acquisitions. We have a strong and flexible balance sheet,
ample liquidity, and a robust pipeline of opportunities for
disciplined M&A. As we look to 2024 and beyond, we have a clear
path to build on our success, expand the business, and drive
long-term, sustainable shareholder value."
Summary of Fourth Quarter 2023 Results
Three Months Ended
December 31,
Change
(unaudited, dollars in millions)
2023
2022
$
%
Net sales
$
356.9
$
338.2
$
18.7
5.5
%
Core sales
$
14.0
4.1
%
Foreign exchange
$
4.7
1.4
%
Operating profit
$
72.4
$
73.0
$
(0.6
)
(0.8
) %
Adjusted operating profit*
$
83.4
$
88.1
$
(4.7
)
(5.3
) %
Operating profit margin
20.3
%
21.6
%
(130bps)
Adjusted operating profit margin*
23.4
%
26.0
%
(260bps)
Totals may not sum due to rounding
*Please see the Non-GAAP Financial
Measures tables in this release
Fourth Quarter 2023 Results
Fourth quarter 2023 sales were $356.9 million, an increase of
$18.7 million, or 5.5%, compared with the fourth quarter of 2022.
The sales increase was comprised of core sales growth of $14.0
million, or 4.1%, and favorable foreign exchange of $4.7 million,
or 1.4%.
Fourth quarter 2023 operating profit was $72.4 million, compared
with $73.0 million in the fourth quarter of 2022. Operating profit
margin was 20.3%, compared with 21.6% last year, with the decline
driven primarily by higher transaction costs related to the
Separation and unfavorable product mix, partially offset by
favorable pricing, productivity gains, and cost saving actions.
Adjusted operating profit margin of 23.4% decreased 260 basis
points, compared with 26.0% in the prior year. (Please see the
Non-GAAP Financial Measures tables in this release for a detailed
reconciliation of reported results to adjusted measures).
Fourth quarter 2023 GAAP EPS was $0.86, and Adjusted EPS was
$0.99. (Please see the Non-GAAP Financial Measures tables in this
release for a detailed reconciliation of reported results to
adjusted measures).
Fourth Quarter 2023 Segment Results
All comparisons detailed in this section refer to operating
results for the fourth quarter 2023 versus the fourth quarter
2022.
Crane Payment Innovations
Three Months Ended
December 31,
Change
(unaudited, dollars in millions)
2023
2022
$
%
Net sales
$
215.1
$
231.1
$
(16.0
)
(6.9
) %
Core sales
$
(16.9
)
(7.3
) %
Foreign exchange
$
0.9
0.4
%
Operating profit
$
56.5
$
61.5
$
(5.0
)
(8.1
) %
Adjusted operating profit*
$
62.3
$
73.1
$
(10.8
)
(14.8
) %
Operating profit margin
26.3
%
26.6
%
(30bps)
Adjusted operating profit margin*
29.0
%
31.6
%
(260bps)
Totals may not sum due to rounding
*Please see the Non-GAAP Financial
Measures tables in this release
Sales of $215.1 million decreased $16.0 million, or 6.9%,
compared with the fourth quarter of 2022, driven by a 7.3% decline
in core sales as favorable pricing was more than offset by lower
volumes as customers adjusted inventory levels to reflect reduced
lead times. This decline in core sales was partially offset by
favorable foreign exchange. Operating profit margin of 26.3%
decreased 30 basis points, compared with 26.6% last year, primarily
reflecting lower volumes and unfavorable product mix, partially
offset by favorable pricing, cost saving actions and productivity
gains. Adjusted operating profit margin was 29.0% compared with
31.6% in the prior year.
Crane Currency
Three Months Ended
December 31,
Change
(unaudited, dollars in
millions)
2023
2022
$
%
Net sales
$
141.8
$
107.1
$
34.7
32.4
%
Core sales
$
31.1
29.0
%
Foreign exchange
$
3.6
3.4
%
Operating profit
$
31.2
$
20.3
$
10.9
53.7
%
Adjusted operating profit*
$
34.8
$
23.8
$
11.0
46.2
%
Operating profit margin
22.0
%
19.0
%
300bps
Adjusted operating profit
margin*
24.5
%
22.2
%
230bps
Totals may not sum due to
rounding
*Please see the Non-GAAP
Financial Measures tables in this release
Sales of $141.8 million increased $34.7 million, or 32.4%,
compared with the fourth quarter of 2022, driven by 29.0% core
sales growth related to higher international sales, and favorable
foreign exchange. Operating profit margin of 22.0% increased 300
basis points, compared with 19.0% last year, primarily reflecting
higher volumes, partially offset by unfavorable product mix.
Adjusted operating profit margin was 24.5% compared with 22.2% in
the prior year.
Summary of Full Year 2023 Results
Full Year
Change
(unaudited, dollars in millions, except
per share data)
2023
2022
$
%
2023
Guidance
Net sales
$
1,391.3
$
1,339.9
$
51.4
3.8
%
Core sales
$
57.5
4.3
%
+3% to +5%
Foreign exchange
$
(6.1
)
(0.5
) %
Operating profit
$
286.8
$
301.3
$
(14.5
)
(4.8
) %
Adjusted operating profit*
$
345.2
$
343.5
$
1.7
0.5
%
Operating profit margin
20.6
%
22.5
%
(190bps)
Adjusted operating profit margin*
24.8
%
25.6
%
(80bps)
GAAP EPS
$
3.28
$
3.61
Adjusted EPS*
$
4.16
$
4.35
$4.00-$4.15
Totals may not sum due to rounding
*Please see the Non-GAAP Financial
Measures tables in this release
Full Year 2023 Results
Full year 2023 sales were $1,391.3 million, an increase of $51.4
million, or 3.8%, compared with full year 2022. The sales increase
was comprised of core sales growth of $57.5 million, or 4.3%,
partially offset by unfavorable foreign exchange of $6.1 million,
or 0.5%.
Full year 2023 operating profit was $286.8 million, compared
with $301.3 million in full year 2022. Operating profit margin was
20.6%, compared with 22.5% last year, with the decline driven
primarily by higher transaction costs related to the Separation and
unfavorable product mix, partially offset by favorable pricing,
productivity gains, and cost saving actions. Adjusted operating
profit margin of 24.8% decreased 80 basis points, compared with
25.6% in the prior year. (Please see the Non-GAAP Financial
Measures tables in this release for a detailed reconciliation of
reported results to adjusted measures).
Full year 2023 GAAP EPS was $3.28, and Adjusted EPS was $4.16.
(Please see the Non-GAAP Financial Measures tables in this release
for a detailed reconciliation of reported results to adjusted
measures).
Full Year 2023 Cash Flow and Other Financial Metrics
Cash provided by operating activities was $276.3 million in
2023, compared with $306.0 million last year. Adjusted free cash
flow was $265.8 million in 2023, compared with $284.7 million last
year. The $18.9 million, or 7%, decrease in Adjusted free cash flow
was primarily due to transaction related spend associated with the
Separation as well as higher capital expenditures to support the
U.S. currency redesign program and other capital projects. (Please
see the Non-GAAP Financial Measures tables in this release for a
detailed reconciliation of reported results to adjusted
measures).
The Company held cash of $227.2 million as of December 31, 2023,
compared with $230.7 million as of December 31, 2022. Total debt
was $644.9 million as of December 31, 2023, compared with $844.8
million as of December 31, 2022. The Company repaid $245 million of
its term loan facility in 2023, with an outstanding balance of $105
million.
Full Year 2024 Guidance
The Company is introducing full year 2024 guidance as shown in
the table below. Growth rates below represent growth over full year
2023.
Full Year 2024 Guidance
Details
(dollars in millions, except per share
data)
CPI Core Sales Growth
-3% to +2%
Currency Core Sales Growth
+2% to +3%
Crane NXT Core Sales Growth
-1% to +2%
Adjusted EPS
$4.10 to $4.35
Adjusted Segment Margin
27% to 29%
Corporate Expense
~$53
Non-Operating Expense, Net
~$37
Adjusted Tax Rate
~21%
Adjusted Free Cash Flow Conversion
~100%
Diluted Shares
~57.6
Please see the Non-GAAP Financial Measures
definitions in this release
First Quarter 2024 Dividend
Crane NXT announced its quarterly dividend of $0.16 per share,
an increase of 14% over the prior year, for the first quarter of
2024. The dividend is payable on March 13, 2024 to shareholders of
record as of February 29, 2024.
Conference Call
Crane NXT scheduled a conference call to discuss the fourth
quarter and full year financial results, on Thursday, February 15,
2024, at 10:00 A.M. Eastern Time. The earnings call can be accessed
via the investor relations section of the Company’s website or by
dialing 877-407-6184 or +1-201-389-0877. An accompanying slide
presentation and a replay of the live event will also be available
on the Company’s website.
About Crane NXT, Co.
Crane NXT is a premier industrial technology company that
provides trusted technology solutions to secure, detect, and
authenticate what matters most to its customers. Crane NXT is a
pioneer in advanced micro-optics technology for securing physical
products, and its sophisticated electronic equipment and associated
software leverages proprietary core capabilities with detection and
sensing technologies. Crane NXT has approximately 4,000 employees
with global operations and manufacturing facilities in the United
States, the United Kingdom, Mexico, Japan, Germany, Sweden, and
Malta. For more information, visit www.cranenxt.com.
On April 3, 2023, Crane NXT, Co. (formerly Crane Holdings, Co.)
completed the separation of its wholly-owned subsidiary at that
time, Crane Company, in a tax-free distribution of Crane Company
shares to Crane NXT stockholders (the "Separation").
Historical financial measures in this release for Crane NXT are
presented on a carve-out basis.
Forward-Looking Statements Disclaimer
This press release contains forward-looking statements within
the meaning of the federal securities laws. Forward-looking
statements include all statements that are not historical
statements of fact and those regarding the Company's intent,
belief, or expectations.
Words such as “anticipate(s),” “expect(s),” “intend(s),”
“believe(s),” “plan(s),” “may,” “will,” “would,” “could,” “should,”
“seek(s),” and similar expressions, or the negative of these terms,
are intended to identify such forward-looking statements. These
statements are based on management’s current expectations and
beliefs and are subject to a number of risks and uncertainties that
could lead to actual results differing materially from those
projected, forecasted or expected. The Company assumes no (and
disclaims any) obligation to revise or update these statements to
reflect future events or circumstances. Although the Company
believes that the assumptions underlying the forward-looking
statements are reasonable, it can give no assurance that its
expectations will be attained. The Company cautions investors not
to place undue reliance on any such forward-looking statements.
Risks and uncertainties that could cause actual results to
differ materially from the Company's expectations include, but are
not limited to: changes in global economic conditions (including
inflationary pressures) and geopolitical risks, including
macroeconomic fluctuations; demand for its products, which is
variable and subject to factors beyond its control; fluctuation in
the prices of, or disruption in its ability to source, components
and raw materials, and delays in the distribution of its products;
information systems and technology networks failures, breaches in
data security, theft of personally identifiable and other
information, and non-compliance with its contractual or other legal
obligations regarding such information; risks associated with
conducting a substantial portion of its business outside the U.S.;
loss of personnel or being able to hire and retain additional
personnel needed to sustain and grow its business as planned; being
unable to identify or complete acquisitions, or to successfully
integrate the businesses the Company acquires, or complete
dispositions; being unable to successfully develop and introduce
new products, which would limit its ability to grow and maintain
its competitive position; governmental regulations and failure to
comply with those regulations; risks from litigation, claims and
investigations, including those related to product liability and
warranties, and employee, commercial, intellectual property and
environmental matters; risks related to its ability to improve
productivity, reduce costs and align manufacturing capacity with
customer demand; the ability to protect its intellectual property;
significant competition in the Company's markets; adverse impacts
from intangible asset impairment charges; additional tax expenses
or exposures; inadequate or ineffective internal controls; and
risks related to the Separation, including not obtaining the
intended tax treatment of the Separation transaction, failure of
Crane Company to perform under the various transaction agreements
and actual or potential conflicts of interest with Crane
Company.
Readers should carefully review Crane NXT, Co.’s financial
statements and the notes thereto, as well as the section entitled
“Risk Factors” in Item 1A of Crane NXT, Co.’s Annual Report on Form
10-K for the year ended December 31, 2022 and the other documents
Crane NXT, Co. and its subsidiaries file from time to time with the
SEC. These filings identify and address other important risks and
uncertainties that could cause actual events and results to differ
materially from those contained in the forward-looking
statements.
(Financial Tables Follow)
CRANE NXT, CO. AND
SUBSIDIARIES
Consolidated and Combined
Condensed Statements of Operations Data
(unaudited, in millions, except
per share data)
Three Months Ended December
31,
Twelve Months Ended December
31,
2023
2022
2023
2022
Net
sales:
Crane Payment Innovations
$
215.1
$
231.1
$
886.4
$
874.3
Crane Currency
141.8
107.1
504.9
465.6
Total net sales
$
356.9
$
338.2
$
1,391.3
$
1,339.9
Operating profit
(loss):
Crane Payment Innovations
$
56.5
$
61.5
$
242.8
$
217.1
Crane Currency
31.2
20.3
116.3
117.3
Corporate
(15.3
)
(8.8
)
(72.3
)
(33.1
)
Total operating profit
$
72.4
$
73.0
$
286.8
$
301.3
Interest income
0.4
0.1
1.1
0.2
Interest expense
(10.8
)
(10.5
)
(48.1
)
(41.9
)
Related party interest expense
—
(3.5
)
(2.5
)
(14.4
)
Miscellaneous (expense) income, net
(0.6
)
(0.2
)
2.5
3.1
Income before income taxes
61.4
58.9
239.8
248.3
Provision (benefit) for income taxes
11.9
(3.1
)
51.5
43.4
Net income attributable to common
shareholders
$
49.5
$
62.0
$
188.3
$
204.9
Earnings per diluted share1
$
0.86
$
1.09
$
3.28
$
3.61
Average diluted shares outstanding1
57.6
56.7
57.5
56.7
Average basic shares outstanding1
56.8
56.7
56.8
56.7
Supplemental
data:
Cost of sales
$
191.4
$
176.9
$
737.2
$
713.7
Selling, general and administrative
92.6
82.1
366.8
318.7
Restructuring charges
0.5
6.2
0.5
6.2
1 The shares presented for periods prior
to the Separation are those of Crane NXT, Co. at April 3, 2023. The
shares presented for the three months and twelve months ended
December 2023 are based on the average diluted and basic shares
outstanding of Crane NXT, Co. after the Separation.
CRANE NXT, CO. AND
SUBSIDIARIES
Consolidated and Combined
Condensed Balance Sheets
(unaudited, in millions)
Balance as of December
31,
2023
2022
Assets
Current assets:
Cash and cash equivalents
$
227.2
$
230.7
Accounts receivable, net
214.9
205.1
Inventories, net
157.1
145.6
Other current assets
45.2
41.9
Total current assets
644.4
623.3
Property, plant and equipment, net
261.2
261.6
Long-term deferred tax assets
2.7
6.3
Other assets
71.0
56.7
Intangible assets, net
308.9
344.9
Goodwill
841.2
836.6
Total assets
$
2,129.4
$
2,129.4
Liabilities and equity
Current liabilities:
Short-term borrowings
$
4.6
$
299.7
Accounts payable
106.5
109.6
Accrued liabilities
210.5
204.2
U.S. and foreign taxes on income
12.8
17.9
Total current liabilities
334.4
631.4
Long-term debt
640.3
545.1
Accrued pension and postretirement
benefits
22.5
21.1
Long-term deferred tax liability
104.5
109.5
Other liabilities
63.7
38.5
Total equity
964.0
783.8
Total liabilities and equity
$
2,129.4
$
2,129.4
CRANE NXT, CO. AND
SUBSIDIARIES
Consolidated and Combined
Condensed Statements of Cash Flows
(unaudited, in millions)
Three Months Ended
December 31,
Twelve Months Ended
December 31,
2023
2022
2023
2022
Operating activities:
Net income attributable to common
shareholders
$
49.5
$
62.0
$
188.3
$
204.9
Adjustments to reconcile net income to net
cash flows provided by operating activities:
Depreciation and amortization
18.6
19.4
77.6
78.7
Stock-based compensation expense
2.9
2.5
10.3
9.3
Defined benefit plans and postretirement
credit
(0.5
)
(0.3
)
(1.1
)
(0.3
)
Deferred income taxes
2.8
(41.4
)
7.6
(28.4
)
Cash provided by operating working
capital
12.2
34.8
—
39.3
Other
(7.0
)
(1.9
)
(6.4
)
2.5
Total provided by operating activities
$
78.5
$
75.1
$
276.3
$
306.0
Investing activities:
Capital expenditures
(15.0
)
(9.1
)
(31.1
)
(21.3
)
Total used for investing activities
$
(15.0
)
$
(9.1
)
$
(31.1
)
$
(21.3
)
Financing activities:
Dividends paid
(7.9
)
—
(23.7
)
—
Stock options exercised, net of shares
reacquired
2.3
—
4.4
—
Debt issuance costs
(0.4
)
—
(5.7
)
—
Repayment of long-term debt
—
—
(300.0
)
—
Proceeds from revolving credit
facility
—
—
20.0
—
Repayments of revolving credit
facility
—
—
(20.0
)
—
Proceeds from term loan
—
—
350.0
—
Repayment of term loan
(70.0
)
—
(245.0
)
—
Net transfers to Crane
—
(46.4
)
(32.5
)
(135.0
)
Total used for financing activities
$
(76.0
)
$
(46.4
)
$
(252.5
)
$
(135.0
)
Effect of exchange rate on cash and cash
equivalents
10.7
14.8
3.8
(20.2
)
(Decrease) increase in cash and cash
equivalents
(1.8
)
34.4
(3.5
)
129.5
Cash and cash equivalents at beginning of
period
229.0
196.3
230.7
101.2
Cash and cash equivalents at end of
period
$
227.2
$
230.7
$
227.2
$
230.7
CRANE NXT, CO. AND
SUBSIDIARIES
Order Backlog
(unaudited, in millions)
December 31,
2023
September 30, 2023
June 30,
2023
March 31,
2023
December 31,
2022
Crane Payment Innovations
$
216.8
$
231.6
$
300.7
$
348.7
$
372.9
Currency
$
243.0
$
223.3
$
184.4
$
207.3
$
192.7
Total backlog
$
459.8
$
454.9
$
485.1
$
556.0
$
565.6
CRANE NXT, CO. AND
SUBSIDIARIES
Non-GAAP Financial
Measures
(unaudited, in millions, except
per share data)
Three Months Ended December
31,
2023
2022
Adjusted Operating Profit and Adjusted
Operating Profit Margin
$
Per Share
$
Per Share
Net sales (GAAP)
$
356.9
$
338.2
Operating profit (GAAP)
$
72.4
$
73.0
Operating profit margin (GAAP)
20.3
%
21.6
%
Special items impacting operating
profit:
Intangible asset amortization
8.9
8.9
Stock-based compensation adjustment1
0.4
—
Restructuring charges
0.5
6.2
Transaction related expenses1
1.2
—
Adjusted operating profit (Non-GAAP)
$
83.4
$
88.1
Adjusted operating profit margin
(Non-GAAP)
23.4
%
26.0
%
Adjusted Net Income and Adjusted Net
Income per Share
Net income attributable to common
shareholders (GAAP)
$
49.5
$
0.86
$
62.0
$
1.09
Intangible asset amortization
8.9
0.15
8.9
0.16
Stock-based compensation adjustment1
0.4
0.01
—
—
Restructuring charges
0.5
0.01
6.2
0.11
Transaction related expenses1
2.6
0.05
—
—
Impact of pension curtailments and
settlements
(0.4
)
(0.01
)
—
—
Interest adjustment2
—
—
3.5
0.06
Tax adjustments
(4.5
)
(0.08
)
(4.8
)
(0.08
)
Adjusted net income (Non-GAAP)
$
57.0
$
0.99
$
75.8
$
1.34
Adjusted EBITDA and Adjusted EBITDA
margin
Net income attributable to common
shareholders (GAAP)
$
49.5
$
62.0
Net income margin (GAAP)
13.9
%
18.3
%
Adjustments to net income attributable to
common shareholders:
Income tax expense (benefit)
11.9
(3.1
)
Interest expense, net
10.4
13.9
Depreciation
9.0
10.4
Intangible asset amortization
8.9
8.9
Stock-based compensation adjustment1
0.4
—
Restructuring charges
0.5
6.2
Transaction related expenses1
2.6
—
Impact of pension curtailments and
settlements
(0.4
)
—
Adjusted EBITDA (Non-GAAP)
$
92.8
$
98.3
Adjusted EBITDA Margin (Non-GAAP)
26.0
%
29.1
%
Totals may not sum due to rounding
1 Related to the Separation.
2 Related party interest with Crane
Company incurred prior to the Separation.
CRANE NXT, CO. AND
SUBSIDIARIES
Non-GAAP Financial
Measures
(unaudited, in millions, except
per share data)
Twelve Months Ended December
31,
2023
2022
Adjusted Operating Profit and Adjusted
Operating Profit Margin
$
Per Share
$
Per Share
Net sales (GAAP)
$
1,391.3
$
1,339.9
Operating profit (GAAP)
$
286.8
$
301.3
Operating profit margin (GAAP)
20.6
%
22.5
%
Special items impacting operating
profit:
Intangible asset amortization
35.9
36.0
Stock-based compensation adjustment1
1.1
—
Restructuring charges
0.5
6.2
Transaction related expenses1
20.9
—
Adjusted operating profit (Non-GAAP)
$
345.2
$
343.5
Adjusted operating profit margin
(Non-GAAP)
24.8
%
25.6
%
Adjusted Net Income and Adjusted Net
Income per Share
Net income attributable to common
shareholders (GAAP)
$
188.3
$
3.28
$
204.9
$
3.61
Intangible asset amortization
35.9
0.62
36.0
0.63
Stock-based compensation adjustment1
1.1
0.02
—
—
Restructuring charges
0.5
0.01
6.2
0.11
Transaction related expenses1
22.3
0.39
—
—
Impact of pension curtailments and
settlements
(0.4
)
(0.01
)
—
—
Interest adjustment2
2.5
0.04
14.4
0.25
Tax adjustments
(10.9
)
(0.19
)
(14.6
)
(0.26
)
Adjusted net income (Non-GAAP)
$
239.3
$
4.16
$
246.9
$
4.35
Adjusted EBITDA and Adjusted EBITDA
margin
Net income attributable to common
shareholders (GAAP)
$
188.3
$
204.9
Net income margin (GAAP)
13.5
%
15.3
%
Adjustments to net income attributable to
common shareholders:
Income tax expense
51.5
43.4
Interest expense, net
49.5
56.1
Depreciation
39.6
42.2
Intangible asset amortization
35.9
36.0
Stock-based compensation adjustment1
1.1
—
Restructuring charges
0.5
6.2
Transaction related expenses1
22.3
—
Impact of pension curtailments and
settlements
(0.4
)
—
Adjusted EBITDA (Non-GAAP)
$
388.3
$
388.8
Adjusted EBITDA Margin (Non-GAAP)
27.9
%
29.0
%
Totals may not sum due to rounding
1 Related to the Separation.
2 Related party interest with Crane
Company incurred prior to the Separation.
CRANE NXT, CO. AND
SUBSIDIARIES
Non-GAAP Financial Measures by
Segment
(unaudited, in millions)
Three Months Ended December 31,
2023
Crane Payment
Innovations
Crane Currency
Corporate
Total Company
Net sales
$
215.1
$
141.8
$
—
$
356.9
Operating profit (loss) (GAAP)
$
56.5
$
31.2
$
(15.3
)
$
72.4
Operating profit margin (GAAP)
26.3
%
22.0
%
20.3
%
Special items impacting operating profit
(loss):
Intangible asset amortization
5.3
3.6
—
8.9
Stock-based compensation adjustment1
—
—
0.4
0.4
Restructuring charges
0.5
—
—
0.5
Transaction related expenses1
—
—
1.2
1.2
Adjusted operating profit (loss)
(non-GAAP)
$
62.3
$
34.8
$
(13.7
)
$
83.4
Adjusted operating profit margin
(non-GAAP)
29.0
%
24.5
%
23.4
%
Three Months Ended December 31,
2022
Crane Payment
Innovations
Crane Currency
Corporate
Total Company
Net sales
$
231.1
$
107.1
$
—
$
338.2
Operating profit (loss) (GAAP)
$
61.5
$
20.3
$
(8.8
)
$
73.0
Operating profit margin (GAAP)
26.6
%
19.0
%
21.6
%
Special items impacting operating profit
(loss):
Intangible asset amortization
5.4
3.5
—
8.9
Restructuring charges
6.2
—
—
6.2
Adjusted operating profit (loss)
(non-GAAP)
$
73.1
$
23.8
$
(8.8
)
$
88.1
Adjusted operating profit margin
(non-GAAP)
31.6
%
22.2
%
26.0
%
Totals may not sum due to rounding
1 Related to the Separation.
CRANE NXT, CO. AND
SUBSIDIARIES
Non-GAAP Financial Measures by
Segment
(unaudited, in millions)
Twelve Months Ended December 31,
2023
Crane Payment
Innovations
Crane Currency
Corporate
Total Company
Net sales
$
886.4
$
504.9
$
—
$
1,391.3
Operating profit (loss) (GAAP)
$
242.8
$
116.3
$
(72.3
)
$
286.8
Operating profit margin (GAAP)
27.4
%
23.0
%
20.6
%
Special items impacting operating profit
(loss):
Intangible asset amortization
21.7
14.2
—
35.9
Stock-based compensation adjustment1
—
—
1.1
1.1
Restructuring charges
0.5
—
—
0.5
Transaction related expenses1
—
—
20.9
20.9
Adjusted operating profit (loss)
(non-GAAP)
$
265.0
$
130.5
$
(50.3
)
$
345.2
Adjusted operating profit margin
(non-GAAP)
29.9
%
25.8
%
24.8
%
Twelve Months Ended December 31,
2022
Crane Payment
Innovations
Crane Currency
Corporate
Total Company
Net sales
$
874.3
$
465.6
$
—
$
1,339.9
Operating profit (loss) (GAAP)
$
217.1
$
117.3
$
(33.1
)
$
301.3
Operating profit margin (GAAP)
24.8
%
25.2
%
22.5
%
Special items impacting operating profit
(loss):
Intangible asset amortization
21.8
14.2
—
36.0
Restructuring charges
6.2
—
—
—
6.2
Adjusted operating profit (loss)
(non-GAAP)
$
245.1
$
131.5
$
(33.1
)
$
343.5
Adjusted operating profit margin
(non-GAAP)
28.0
%
28.2
%
25.6
%
Totals may not sum due to rounding
1 Related to the Separation.
CRANE NXT, CO. AND
SUBSIDIARIES
Free Cash Flow, Adjusted Free
Cash Flow and Adjusted Free Cash Flow Conversion
(unaudited, in millions)
Three Months Ended
December 31,
Twelve Months Ended
December 31,
Cash Flow Items
2023
2022
2023
2022
Cash provided by operating activities
(GAAP)
$
78.5
$
75.1
$
276.3
$
306.0
Less: Capital expenditures
(15.0
)
(9.1
)
(31.1
)
(21.3
)
Free cash flow
$
63.5
$
66.0
$
245.2
$
284.7
Transaction related expenses1
1.3
—
20.6
—
Adjusted free cash flow (non-GAAP)
$
64.8
$
66.0
$
265.8
$
284.7
Adjusted net income (non-GAAP)*
$
57.0
$
75.8
$
239.3
$
246.9
Adjusted free cash flow conversion
(non-GAAP)
114
%
87
%
111
%
115
%
1 Represents cash paid for transaction
related expenses associated with the Separation.
*Please see the Non-GAAP Financial
Measures tables in this release.
Net Leverage Ratio
(unaudited, in millions, except
net leverage ratio)
December 31, 2023
Total debt (excluding deferred financing
costs of $10.1 million)
$
655.0
Less: Cash
(227.2
)
Net debt
$
427.8
TTM Adjusted EBITDA (non-GAAP)*
$
388.3
Net leverage ratio
1.1
*Please see the Non-GAAP Financial
Measures tables in this release.
Crane NXT reports its financial results in accordance with U.S.
generally accepted accounting principles (“GAAP”). This press
release includes certain non-GAAP financial measures, including
Adjusted operating profit, Adjusted operating margin, Adjusted EPS,
free cash flow, and Adjusted free cash flow, that are not prepared
in accordance with GAAP. These non-GAAP measures are an addition,
and not a substitute for or superior to, measures of financial
performance prepared in accordance with GAAP and should not be
considered as an alternative to operating income, net income or any
other performance measures derived in accordance with GAAP. The
Company's management believes that these non-GAAP measures of
financial results (including on a forward-looking or projected
basis) provide useful supplemental information to investors about
Crane NXT. However, there are a number of limitations related to
the use of these non-GAAP measures and their nearest GAAP
equivalents. For example, other companies may calculate non-GAAP
measures differently or may use other measures to calculate their
financial performance, and therefore the Company's non-GAAP
measures may not be directly comparable to similarly titled
measures of other companies.
Reconciliations of certain forward-looking and projected
non-GAAP measures, including Adjusted segment margin and Adjusted
EPS, to the closest corresponding GAAP measure are not available
without unreasonable efforts due to the high variability,
complexity and low visibility with respect to the charges excluded
from these non-GAAP measures, which could have a potentially
significant impact on Crane NXT's future GAAP results. Crane NXT
calculates Adjusted segment margin and Adjusted EPS as described
below.
- "Adjusted segment margin" is calculated as Adjusted segment
profit divided by sales. Adjusted segment profit is calculated as
segment profit excluding intangible asset amortization,
restructuring charges, stock-based compensation adjustment
resulting from the Separation and transaction related expenses such
as tax charges, professional fees, and incremental costs related to
the Separation.
- "Adjusted EPS" is calculated as Adjusted net income divided by
diluted shares. Adjusted net income is calculated as net income
excluding intangible asset amortization, restructuring charges,
impact of pension curtailments and settlements, stock-based
compensation adjustment resulting from the Separation, transaction
related expenses such as tax charges, professional fees, and
incremental costs related to the Separation, and including the tax
effect of these adjustments and other discrete tax items.
The Company's management believes that each of the following
non-GAAP measures provides useful information to investors
regarding the Company’s financial conditions and operations:
- "Adjusted operating profit" and "Adjusted operating margin" add
back to operating profit items which are outside of the Company's
core performance, some of which may or may not be non-recurring,
and which management believes may complicate the interpretation of
the Company’s underlying earnings and operational performance.
These items include income and expense such as: intangible asset
amortization, restructuring charges, stock-based compensation
adjustment resulting from the Separation and transaction related
expenses. These items are not incurred in all periods, the size of
these items is difficult to predict, and none of these items are
indicative of the operations of the underlying businesses.
Management believes that non-GAAP financial measures that exclude
these items provide investors with an alternative metric that can
assist in predicting future earnings and profitability that are
complementary to GAAP metrics.
- "Adjusted net income" and "Adjusted EPS" exclude items which
are outside of the Company's core performance, some of which may or
may not be non-recurring, and which management believes may
complicate the presentation of the Company’s underlying earnings
and operational performance. These measures include income and
expense items that impacted operating profit such as: intangible
asset amortization, restructuring charges, impact of pension
curtailments and settlements, stock-based compensation adjustment
resulting from the Separation, transaction related expenses related
to the Separation, the tax effect of these items and other discrete
tax items. Additionally, these non-GAAP financial measures exclude
income and expense items that impacted net income and earnings per
diluted share such as pre-Separation related party interest
expense. These items are not incurred in all periods, the size of
these items is difficult to predict, and none of these items are
indicative of the operations of the underlying businesses.
Management believes that non-GAAP financial measures that exclude
these items provide investors with an alternative metric that can
assist in predicting future earnings and profitability that are
complementary to GAAP metrics.
- “Free cash flow,” “Adjusted free cash flow” and "Adjusted free
cash flow conversion” provide supplemental information to assist
management and investors in analyzing the Company’s ability to
generate liquidity from its operating activities. The measure of
free cash flow does not take into consideration certain other
non-discretionary cash requirements such as, for example, mandatory
principal payments on the Company’s long-term debt. Free cash flow
is calculated as cash provided by operating activities less capital
spending. Adjusted free cash flow is calculated as free cash flow
adjusted for certain cash items which management believes may
complicate the interpretation of the Company’s underlying free cash
flow performance such as certain transaction related cash flow
items associated with the Separation. Adjusted free cash flow
conversion is calculated as Adjusted free cash flow divided by
Adjusted net income. These items are not incurred in all periods,
the size of these items is difficult to predict, and none of these
items are indicative of the operations of the underlying
businesses. Management believes that non-GAAP financial measures
that exclude these items provide investors with an alternative
metric that can assist in predicting future cash flows that are
complementary to GAAP metrics.
- "Adjusted EBITDA" and "Adjusted EBITDA margin" exclude net
interest expense, tax expense and depreciation and amortization
expense from net income, as well as Special items such as
restructuring charges, impact of pension curtailments and
settlements, stock-based compensation adjustment resulting from the
Separation and transaction related expenses. Management believes
that non-GAAP financial measures that exclude these items provide
investors with an alternative metric that can assist in predicting
future earnings and profitability that are complementary to GAAP
metrics.
- "Net leverage ratio" refers to Net debt divided by trailing
twelve months (TTM) Adjusted EBITDA. "Net debt" represents total
debt (excluding deferred financing costs) less cash and cash
equivalents. Management believes that these non-GAAP financial
measures provide useful information about our ability to satisfy
our debt obligation with currently available funds.
- "Core sales," exclude currency effects and, where applicable,
the first-year impacts of acquisitions and divestitures from sales.
Management believes that non-GAAP financial measures that exclude
these items provide investors with an alternative metric that can
assist in identifying underlying growth trends in our business and
facilitate comparison of our sales performance with prior and
future periods that are complementary to GAAP metrics.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240214389708/en/
Rima Hyder Vice President, Investor Relations +1-781-755-6886
rima.hyder@cranenxt.com
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