Core Insights - Applied Industrial Technologies (AIT) has a Zacks Rank of 2 (Buy), indicating a stronger earnings outlook compared to Epiroc Aktiebolag Unsponsored ADR (EPOKY), which has a Zacks Rank of 4 (Sell) [2] - AIT is identified as a more attractive investment option for value investors due to its superior valuation metrics and stronger estimate revision activity [3] Valuation Metrics - AIT has a forward P/E ratio of 19.86, while EPOKY has a higher forward P/E of 27.58, suggesting AIT is more undervalued [3] - The PEG ratio for AIT is 1.99, indicating a better balance between price and expected earnings growth compared to EPOKY's PEG ratio of 8.98 [3] - AIT's P/B ratio stands at 4.61, which is lower than EPOKY's P/B ratio of 5.73, further supporting AIT's valuation advantage [3] Value Grades - AIT has received a Value grade of B, while EPOKY has a Value grade of D, reflecting AIT's stronger position in terms of valuation metrics [3]

Core Insights - Applied Industrial Technologies (AIT) reported fourth-quarter fiscal 2024 earnings of $2.64 per share, exceeding the Zacks Consensus Estimate of $2.52, with a year-over-year increase of 12.3% [1] - Net revenues reached $1.16 billion, slightly below the consensus estimate of $1.19 billion, but showed a year-over-year increase of 0.2% [1] Financial Performance - The Service Center-Based Distribution segment generated revenues of $791.4 million, accounting for 68.2% of net revenues, with a year-over-year increase of 1.2% [2] - The Engineered Solutions segment reported revenues of $369.3 million, contributing 31.8% to net revenues, but experienced a year-over-year decline of 1.8% [3] - Gross profit increased by 5.2% year over year to $356.2 million, with gross margin rising to 30.7% from 29.2% [4] Cost and Cash Flow - Cost of sales decreased by 1.8% year over year to $804.4 million, while EBITDA increased by 9.6% to $153.5 million [4] - Cash and cash equivalents at the end of fiscal 2024 were $460.6 million, up from $344 million at the end of fiscal 2023 [5] - Free cash flow increased by 9.2% year over year to $346.5 million [5] Future Guidance - For fiscal 2025, AIT anticipates adjusted earnings in the range of $9.20-$9.95 per share, with sales expected to decrease by 2.5% to increase by 2.5% year over year [6] - The company expects an EBITDA margin in the range of 12.2-12.3% [6] Industry Performance - Pentair plc reported second-quarter adjusted earnings per share of $1.22, beating estimates and improving 18% year over year [8] - Crown Holdings, Inc. reported second-quarter adjusted earnings per share of $1.81, also exceeding estimates, but net sales decreased by 2.2% year over year [8]

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended JUNE 30, 2024 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ___ to ___ Commission file number 1-2299 APPLIED INDUSTRIAL TECHNOLOGIES, INC. (Exact name of registrant as specified in its charter) Ohio 34-0117420 ...

Luis Alvarez Shares of Applied Industrial Technologies, Inc. (NYSE:AIT) have been on fire recently. Since the outbreak of the pandemic, shares have tripled amidst strong operating performance. The company just ended its fiscal year 2024, and while sales trends are dismal, margins came in at historical highs. With the company guiding for flattish revenues and earnings in 2025, this is nothing much to look forward to. This makes me cautious as the market is still attaching a small premium to the shares, and w ...

Financial Data and Key Metrics Changes - Consolidated sales increased by 0.2% year-over-year, with acquisitions contributing 150 basis points and selling days adding 80 basis points, while foreign currency translation negatively impacted by 10 basis points [18] - Organic daily sales declined by 2% year-over-year, with gross margins reaching 30.7%, an increase of 146 basis points compared to the prior year [20][21] - EBITDA margins exceeded 13% for the first time, with reported EBITDA increasing by 9.6% year-over-year [6][21] Business Line Data and Key Metrics Changes - Service Center segment sales decreased by 0.7% year-over-year on an organic daily basis, while segment EBITDA increased by 16% [19] - Engineered Solutions segment sales decreased by 1.8% year-over-year, with a 4.6% decline in organic daily sales primarily due to fluid power weakness [19][20] - Flow control operations within Engineered Solutions saw low single-digit growth, benefiting from decarbonization efforts and data center growth [14] Market Data and Key Metrics Changes - Organic sales trends showed a decline of mid single digits in early fiscal 2025 compared to prior year levels, reflecting muted demand due to higher interest rates and economic uncertainty [9] - The top 30 end markets showed mixed results, with 14 markets experiencing positive sales growth year-over-year [8] - MRO-related sales, which represent approximately 70% of overall business, held steady with slight year-over-year increases [8] Company Strategy and Development Direction - The company is focused on executing growth strategies through acquisitions and internal investments, with a strong emphasis on technology and automation [15][26] - M&A remains a top capital allocation priority, with an active pipeline targeting enhancements in technical differentiation and service capabilities [16] - The company aims to leverage secular megatrends such as reshoring and infrastructure investments to support long-term growth [26] Management's Comments on Operating Environment and Future Outlook - Management acknowledged a mixed end market backdrop and conservative customer spending, but expressed optimism about potential demand recovery in the latter half of fiscal 2025 [25][26] - The company expects ongoing inflationary pressures but anticipates a solid year of free cash flow performance [23][24] - Management highlighted the importance of maintaining operational discipline and cost controls amid economic uncertainty [25] Other Important Information - The company generated record cash flow in fiscal 2024, with over $250 million spent on various capital deployment initiatives [15][22] - Share repurchases totaled approximately 400,000 shares for $73 million, with ongoing plans for additional buybacks [17][22] Q&A Session Summary Question: What is embedded in the midpoint of guidance regarding macro outlook? - Management indicated that the midpoint assumes first half declines by mid single digits organically and second half increases by low single digits [29] Question: How resilient can Engineered Solutions margins be relative to Q4? - Management expects gross margins to decline sequentially from Q4 due to mix and lower sales, but remains optimistic about the segment's margin performance [31][32] Question: How much of the margin performance was due to discrete actions versus discretionary cost management? - Management noted that the margin performance reflects the resiliency of the model, with variable costs adjusting based on sales activity [38] Question: Can you quantify the status of reshoring projects? - Management highlighted ongoing industrial manufacturing capacity growth as a positive indicator, suggesting sustained activity and opportunities for service center business [41] Question: What is the margin profile of recent acquisitions? - Management indicated that the margin profiles of the acquired companies are expected to be similar to existing operations, contributing positively to overall margins [43]

EXHIBIT 99.1 Financial Release For Immediate Release Applied Industrial Technologies Reports Fiscal 2024 Fourth Quarter and Full-Year Results; Issues Guidance for Fiscal 2025 CLEVELAND, OHIO (August 15, 2024)) – Applied Industrial Technologies (NYSE: AIT), a leading value-added distributor and technical solutions provider of industrial motion, fluid power, flow control, automation technologies, and related maintenance supplies, today reported results for its fiscal 2024 fourth quarter and full year ended Ju ...

Core Viewpoint - Applied Industrial Technologies (AIT) reported quarterly earnings of $2.64 per share, exceeding the Zacks Consensus Estimate of $2.52 per share, and showing an increase from $2.35 per share a year ago [1] Financial Performance - The company achieved an earnings surprise of 4.76% for the quarter, having previously expected earnings of $2.40 per share but delivering $2.48 per share in the prior quarter, resulting in a surprise of 3.33% [1] - Revenues for the quarter ended June 2024 were $1.16 billion, which missed the Zacks Consensus Estimate by 2.20%, remaining unchanged from the previous year's revenues of $1.16 billion [1] - Over the last four quarters, the company has surpassed consensus EPS estimates four times and topped consensus revenue estimates two times [1] Stock Performance - Since the beginning of the year, Applied Industrial Technologies shares have increased by approximately 15.2%, compared to a 14.4% gain in the S&P 500 [2] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $2.35 on revenues of $1.12 billion, and for the current fiscal year, it is $10.15 on revenues of $4.64 billion [4] - The estimate revisions trend for the company is currently favorable, resulting in a Zacks Rank 2 (Buy), indicating expected outperformance in the near future [4] Industry Context - The Manufacturing - General Industrial industry, to which Applied Industrial Technologies belongs, is currently ranked in the bottom 32% of over 250 Zacks industries, suggesting potential challenges ahead [5] - Another company in the same industry, Nordson (NDSN), is expected to report quarterly earnings of $2.33 per share, reflecting a year-over-year change of -0.9%, with revenues anticipated to be $655.23 million, up 1% from the previous year [5][6]

Core Insights - Applied Industrial Technologies, Inc. (AIT) is set to release its fourth-quarter fiscal 2024 results on August 15, with earnings estimates remaining unchanged over the past 60 days, and a history of beating consensus estimates with an average surprise of 8.2% [1] - The consensus estimate for revenues is $1.19 billion, reflecting a 2.5% increase year-over-year, while adjusted earnings are expected to be $2.52 per share, indicating a 7.2% increase from the previous year [1] Group 1: Revenue and Earnings Expectations - The Service Center Based Distribution segment is anticipated to generate revenues of $812.4 million, a 3.9% increase from the previous year, supported by strong market position and growth in technical MRO support demand [2] - Total revenues for AIT are expected to reach $1.2 billion, a 2.9% increase year-over-year, with adjusted earnings projected at $2.54 per share, reflecting a 7.9% increase from the prior year [3] Group 2: Challenges and Costs - The Engineered Solutions segment is expected to perform weakly due to decreased demand in the OEM channel, linked to reduced shipments of off-highway mobile and fluid power components [3] - Rising selling, distribution, and administrative expenses, along with increased costs of sales due to higher raw material and labor costs, are likely to negatively impact AIT's bottom line [4] Group 3: Earnings Prediction Model - The current earnings prediction model indicates that AIT does not conclusively predict an earnings beat, with an Earnings ESP of 0.00% as both the Most Accurate Estimate and the Zacks Consensus Estimate are at $2.52 [5] - AIT holds a Zacks Rank of 2 (Buy), which typically increases the odds of an earnings beat, but the current situation does not support this [5]

Core Insights - Analysts project Applied Industrial Technologies (AIT) will report quarterly earnings of $2.52 per share, a 7.2% increase year over year, with revenues expected to reach $1.19 billion, reflecting a 2.5% increase from the same quarter last year [1] - The consensus EPS estimate has been adjusted downward by 0.2% over the past 30 days, indicating a reassessment by covering analysts [1] - A strong correlation exists between earnings estimate revisions and short-term stock price performance, making these adjustments significant for investor reactions [1] Financial Metrics - Estimated 'Net Sales- Engineered Solutions' is projected at $374.91 million, showing a year-over-year decline of 0.4% [2] - 'Net Sales- Service Center Based Distribution' is expected to reach $811.94 million, indicating a 3.9% increase from the previous year [2] - 'Operating income- Engineered Solutions' is anticipated to be $53.11 million, down from $54.33 million year-over-year [2] - 'Operating income- Service Center Based Distribution' is projected at $102.93 million, an increase from $95.06 million in the prior year [3] Market Performance - Shares of Applied Industrial Technologies have returned +1.8% over the past month, outperforming the Zacks S&P 500 composite, which declined by -4.5% [3] - AIT holds a Zacks Rank 2 (Buy), suggesting expectations of beating overall market performance in the near future [3]

Core Viewpoint - Applied Industrial Technologies (AIT) has received a Zacks Rank 2 (Buy) upgrade, indicating a positive outlook for its earnings estimates, which is a significant factor influencing stock prices [1][2]. Earnings Outlook - The Zacks Consensus Estimate for AIT for the fiscal year ending June 2024 is projected at $9.62 per share, reflecting a 9.9% increase from the previous year's reported figure [5]. - Over the past three months, analysts have raised their earnings estimates for AIT by 4.5% [5]. Impact of Earnings Estimates - Changes in a company's earnings potential, as indicated by earnings estimate revisions, are strongly correlated with near-term stock price movements [3][4]. - Institutional investors utilize earnings estimates to determine the fair value of a company's shares, which influences their buying or selling actions, thereby affecting stock prices [3]. Zacks Rating System - The Zacks Rank system categorizes stocks into five groups based on earnings estimates, with a proven track record of Zacks Rank 1 stocks generating an average annual return of +25% since 1988 [4]. - AIT's upgrade to Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting a strong potential for market-beating returns in the near term [6][7].