AMETEK, Inc. (NYSE:AME) Q2 2024 Earnings Conference Call August 1, 2024 8:30 AM ET Company Participants Kevin Coleman - VP, IR and Treasurer Dave Zapico - Chairman and CEO Dalip Puri - EVP and CFO Conference Call Participants Matt Summerville - D.A. Davidson Deane Dray - RBC Capital Markets Jamie Cook - Truist Securities Jeff Sprague - Vertical Research Scott Graham - Seaport Research Rob Wertheimer - Melius Research Joe Giordano - TD Cowen Andrew Obin - Bank of America Steve Barger - KeyBanc Capital Market ...

Financial Performance - Consolidated net sales for Q2 2024 were $1,734.8 million, an increase of $88.7 million or 5.4% compared to Q2 2023's $1,646.1 million[89] - Total international sales for Q2 2024 were $790.0 million, representing 45.5% of net sales, a slight increase of $3.7 million or 0.5% from Q2 2023[89] - Orders for Q2 2024 were $1,677.2 million, an increase of $22.8 million or 1.4% compared to Q2 2023, with a backlog of unfilled orders at $3,403.0 million, down 3.7% from December 31, 2023[90] - Segment operating income for Q2 2024 was $473.0 million, an increase of $29.7 million or 6.7% from Q2 2023, with operating margins at 27.3%[91] - Consolidated operating income for Q2 2024 was a record $447.5 million, or 25.8% of net sales, up $28.7 million or 6.9% from Q2 2023[94] - Net income for Q2 2024 was $337.7 million, an increase of $13.5 million or 4.1% compared to Q2 2023's $324.2 million[95] - Diluted earnings per share for Q2 2024 were $1.45, an increase of $0.05 or 3.6% from $1.40 in Q2 2023[95] Tax and Interest - The effective tax rate for Q2 2024 was 19.0%, up from 18.2% in Q2 2023, primarily due to higher U.S. taxes on foreign sourced earnings[95] - Interest expense for Q2 2024 was $30.6 million, an increase of $11.9 million or 63.4% compared to Q2 2023, driven by higher borrowings related to acquisitions[94] Year-to-Date Performance - For the first six months of 2024, net sales were $3,471.0 million, an increase of $227.8 million or 7.0% compared to the same period in 2023[99] - EIG's net sales for the first six months of 2024 reached $2,310.4 million, a 2.6% increase from $2,251.9 million in the same period of 2023, driven by a 2% increase from acquisitions[106] - EIG's operating income increased by 13.9% to $702.8 million for the first six months of 2024, compared to $616.8 million in the first six months of 2023, with operating margins improving to 30.4% from 27.4%[106] - EMG's net sales totaled $1,160.6 million for the first six months of 2024, marking a 17.1% increase from $991.3 million in the same period of 2023, primarily due to a 22% increase from acquisitions[107] - EMG's operating income decreased by 16.7% to $213.8 million for the first six months of 2024, down from $256.7 million in the same period of 2023, with operating margins declining to 18.4% from 25.9%[108] Cash Flow and Dividends - Cash provided by operating activities increased by 9.7% to $791.7 million for the first six months of 2024, compared to $721.8 million in the same period of 2023[109] - Free cash flow for the first six months of 2024 was $742.6 million, up from $673.9 million in the same period of 2023[109] - Cash dividends paid increased to $129.4 million for the first six months of 2024, compared to $115.1 million in the same period of 2023, reflecting a 12% increase in the quarterly cash dividend[113] Debt and Liquidity - Total debt decreased to $2,651.4 million at June 30, 2024, down from $3,313.3 million at December 31, 2023, with a debt-to-capital ratio of 22.3%[111] - Cash and cash equivalents totaled $396.6 million at June 30, 2024, slightly down from $409.8 million at December 31, 2023[114] Strategic Focus - The company is focused on future acquisitions and product development, while maintaining compliance with all financial covenants[116]

AMETEK, Inc. (AME) has reported second-quarter 2024 adjusted earnings of $1.66 per share, beating the Zacks Consensus Estimate by 1.2%. The bottom line rose 6% on a year-over-year basis.Net sales of $1.73 billion increased 5% from the year-ago quarter. However, the figure missed the Zacks Consensus Estimate of $1.77 billion.Top-line growth was primarily driven by the solid performance of the Electromechanical Group (EMG) segment. Also, strength in the Electronic Instruments Group (EIG) segment contributed w ...

[Second Quarter 2024 Financial Results](index=1&type=section&id=AMETEK%20Announces%20Second%20Quarter%20Results) AMETEK reported strong Q2 2024 results, with sales up 5% to $1.73 billion and adjusted diluted EPS of $1.66 [Q2 2024 Consolidated Financial Highlights](index=1&type=section&id=Q2%202024%20Consolidated%20Financial%20Highlights) Consolidated financial highlights for Q2 2024, including sales, operating income, and cash flow Q2 2024 Consolidated Financial Highlights (YoY Change) | Metric | Q2 2024 Value | YoY Change | | :----------------------- | :------------ | :--------- | | Sales | $1.73 billion | +5% | | Operating Income | $447.5 million | +7% | | Operating Margins | 25.8% | +40 bps | | Operating Cash Flow | $381.4 million | +14% | | GAAP Diluted EPS | $1.45 | - | | Adjusted Diluted EPS | $1.66 | +6% | | Free Cash Flow | $360.0 million | +17% | | Free Cash Flow Conversion | 107% | +12% | - AMETEK achieved strong operating performance with outstanding core margin expansion, **record operating income and EBITDA**, and **earnings growth** exceeding expectations, alongside **excellent cash flows**[2](index=2&type=chunk) [Electronic Instruments Group (EIG) Performance](index=1&type=section&id=Electronic%20Instruments%20Group%20(EIG)) EIG delivered strong Q2 2024 performance with increased sales and robust margin expansion EIG Q2 2024 Performance (YoY Change) | Metric | Q2 2024 Value | YoY Change | | :-------------------- | :------------ | :--------- | | Sales | $1.15 billion | +2% | | Operating Income | $349.9 million | +14% | | Operating Income Margins | 30.3% | +320 bps | - EIG delivered strong results with **excellent operating performance**, leading to **outstanding profit growth** and **robust margin expansion**, positioning its businesses well across diverse market segments[3](index=3&type=chunk) [Electromechanical Group (EMG) Performance](index=2&type=section&id=Electromechanical%20Group%20(EMG)) EMG faced inventory normalization headwinds but achieved solid operating performance with sequential margin gains EMG Q2 2024 Performance (YoY Change) | Metric | Q2 2024 Value | YoY Change | | :-------------------- | :------------ | :--------- | | Sales | $581.2 million | +14% | | Operating Income | $123.1 million | - | | Operating Income Margins | 21.2% | - | - EMG experienced headwinds from **inventory normalization** across its OEM customer base but delivered **solid operating performance** with **sequential margins improving 50 basis points** versus the first quarter's adjusted margins[5](index=5&type=chunk) [2024 Business Outlook and Guidance](index=2&type=section&id=2024%20Outlook) AMETEK adjusted full-year 2024 sales and earnings guidance due to inventory normalization and customer caution [Full Year 2024 Guidance](index=2&type=section&id=Full%20Year%202024%20Guidance) AMETEK's updated full-year 2024 guidance reflects anticipated sales and adjusted diluted EPS ranges - The company expects **inventory normalization** within its OEM customer base to continue through the balance of 2024, with **customers becoming more cautious**, leading to some **short-term delays in project spending**[6](index=6&type=chunk) Full Year 2024 Guidance (YoY Change) | Metric | Range | YoY Change | | :-------------------- | :---------------- | :--------- | | Overall Sales | Up 5% to 7% | +5% to +7% | | Adjusted Diluted EPS | $6.70 to $6.80 | +5% to +7% | [Third Quarter 2024 Guidance](index=2&type=section&id=Third%20Quarter%202024%20Guidance) AMETEK's specific guidance for Q3 2024 includes expected sales growth and adjusted diluted EPS Third Quarter 2024 Guidance (YoY Change) | Metric | Range | YoY Change | | :-------------------- | :---------------- | :--------- | | Overall Sales | Up mid-single digits | - | | Adjusted Diluted EPS | $1.60 to $1.62 | -1% to -2% | [Company Information](index=2&type=section&id=About%20AMETEK) Overview of AMETEK as a global industrial technology solutions provider, detailing its growth model and financial objectives [About AMETEK](index=2&type=section&id=About%20AMETEK) AMETEK is a global industrial technology solutions provider, driven by a strategic growth model and financial objectives - AMETEK is a leading global provider of industrial technology solutions, serving diverse niche markets with annual sales of approximately **$7.0 billion**[9](index=9&type=chunk) - The AMETEK Growth Model integrates **Four Growth Strategies**: **Operational Excellence**, **New Product Development**, **Global and Market Expansion**, and **Strategic Acquisitions**, with a disciplined focus on **cash generation** and **capital deployment**[9](index=9&type=chunk)[10](index=10&type=chunk) - AMETEK's objective is **double-digit percentage growth in earnings per share** over the business cycle and a **superior return on total capital**[10](index=10&type=chunk) [Forward-Looking Statements](index=3&type=section&id=Forward-looking%20Information) This section outlines the inherent risks and uncertainties associated with AMETEK's forward-looking statements - Statements regarding future events and financial performance are **forward-looking** and subject to **various factors and uncertainties**, including **risks related to acquisitions, international operations, supply chain disruptions, new product development, raw material prices, government regulations, competition, liquidity, and general economic conditions**[11](index=11&type=chunk) - AMETEK **disclaims any intention or obligation to update or revise** any forward-looking statements[11](index=11&type=chunk) [Investor Relations Contact](index=3&type=section&id=Contact) Contact information for investor inquiries is provided, directing stakeholders to the Vice President of Investor Relations - For investor inquiries, contact **Kevin Coleman, Vice President, Investor Relations and Treasurer**, at kevin.coleman@ametek.com or Phone: 610.889.5247[12](index=12&type=chunk) [Financial Statements and Reconciliations](index=4&type=section&id=Consolidated%20Statement%20of%20Income) AMETEK's unaudited consolidated financial statements, including income, segment information, balance sheet, and GAAP to non-GAAP reconciliations [Consolidated Statement of Income](index=4&type=section&id=Consolidated%20Statement%20of%20Income) AMETEK's unaudited consolidated statement of income details revenues, expenses, and net income for specified periods Consolidated Statement of Income (Unaudited, In thousands, except per share amounts) | Metric | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :---------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net sales (in thousands) | $1,734,834 | $1,646,111 | $3,471,014 | $3,243,228 | | Cost of sales (in thousands) | 1,110,425 | 1,053,190 | 2,255,106 | 2,075,715 | | Selling, general and administrative (in thousands) | 176,895 | 174,130 | 351,178 | 343,181 | | Total operating expenses (in thousands) | 1,287,320 | 1,227,320 | 2,606,284 | 2,418,896 | | Operating income (in thousands) | 447,514 | 418,791 | 864,730 | 824,332 | | Interest expense (in thousands) | (30,590) | (18,723) | (65,844) | (39,292) | | Other (expense) income, net (in thousands) | 86 | (3,684) | (547) | (9,057) | | Income before income taxes (in thousands) | 417,010 | 396,384 | 798,339 | 775,983 | | Provision for income taxes (in thousands) | 79,327 | 72,142 | 149,713 | 146,029 | | Net income (in thousands) | $337,683 | $324,242 | $648,626 | $629,954 | | Diluted earnings per share | $1.45 | $1.40 | $2.79 | $2.72 | | Basic earnings per share | $1.46 | $1.41 | $2.80 | $2.74 | | Weighted average common shares outstanding: Diluted shares (in thousands) | 232,304 | 231,261 | 232,170 | 231,245 | | Weighted average common shares outstanding: Basic shares (in thousands) | 231,437 | 230,478 | 231,267 | 230,302 | | Dividends per share | $0.28 | $0.25 | $0.56 | $0.50 | [Information by Business Segment](index=4&type=section&id=Information%20by%20Business%20Segment) AMETEK's net sales and operating income are broken down by Electronic Instruments and Electromechanical segments Information by Business Segment (Unaudited, In thousands) | Metric | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :---------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | **Net sales (in thousands):** | | | | | | Electronic Instruments (in thousands) | $1,153,613 | $1,134,646 | $2,310,392 | $2,251,893 | | Electromechanical (in thousands) | 581,221 | 511,465 | 1,160,622 | 991,335 | | Consolidated net sales (in thousands) | $1,734,834 | $1,646,111 | $3,471,014 | $3,243,228 | | **Operating income (in thousands):** | | | | | | Segment operating income: Electronic Instruments (in thousands) | $349,857 | $307,052 | $702,797 | $616,799 | | Segment operating income: Electromechanical (in thousands) | 123,102 | 136,215 | 213,793 | 256,719 | | Total segment operating income (in thousands) | 472,959 | 443,267 | 916,590 | 873,518 | | Corporate administrative expenses (in thousands) | (25,445) | (24,476) | (51,860) | (49,186) | | Consolidated operating income (in thousands) | $447,514 | $418,791 | $864,730 | $824,332 | [Condensed Consolidated Balance Sheet](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheet) AMETEK's condensed consolidated balance sheet details assets, liabilities, and stockholders' equity at specific dates Condensed Consolidated Balance Sheet (In thousands) | Metric | June 30, 2024 (Unaudited, in thousands) | December 31, 2023 (in thousands) | | :----------------------------------------------------------------- | :------------------------ | :------------------ | | **ASSETS** | | | | Current assets: Cash and cash equivalents (in thousands) | $396,573 | $409,804 | | Current assets: Receivables, net (in thousands) | 976,442 | 1,012,932 | | Current assets: Inventories, net (in thousands) | 1,101,719 | 1,132,471 | | Current assets: Other current assets (in thousands) | 292,510 | 269,461 | | Total current assets (in thousands) | 2,767,244 | 2,824,668 | | Property, plant and equipment, net (in thousands) | 861,577 | 891,293 | | Right of use asset, net (in thousands) | 217,469 | 229,723 | | Goodwill (in thousands) | 6,453,513 | 6,447,629 | | Other intangibles, investments and other assets (in thousands) | 4,496,063 | 4,630,220 | | Total assets (in thousands) | $14,795,866 | $15,023,533 | | **LIABILITIES AND STOCKHOLDERS' EQUITY** | | | | Current liabilities: Short-term borrowings and current portion of long-term debt, net (in thousands) | $827,967 | $1,417,915 | | Current liabilities: Accounts payable and accruals (in thousands) | 1,375,080 | 1,464,658 | | Total current liabilities (in thousands) | 2,203,047 | 2,882,573 | | Long-term debt, net (in thousands) | 1,823,410 | 1,895,432 | | Deferred income taxes and other long-term liabilities (in thousands) | 1,517,005 | 1,515,337 | | Stockholders' equity (in thousands) | 9,252,404 | 8,730,191 | | Total liabilities and stockholders' equity (in thousands) | $14,795,866 | $15,023,533 | [Reconciliations of GAAP to Non-GAAP Financial Measures](index=6&type=section&id=Reconciliations%20of%20GAAP%20to%20Non-GAAP%20Financial%20Measures) Reconciliations of GAAP to non-GAAP financial measures, including diluted EPS, cash flow, and forecasted EPS Reconciliation of Diluted EPS (GAAP to Non-GAAP) (In thousands, except per share amounts) | Metric | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | | :-------------------------------------------------------------------------- | :------------------------------- | :------------------------------- | | Diluted earnings per share (GAAP) | $1.45 | $1.40 | | Pretax amortization of acquisition-related intangible assets | 0.27 | 0.22 | | Income tax benefit on amortization of acquisition-related intangible assets | (0.06) | (0.05) | | Adjusted Diluted earnings per share (Non-GAAP) | $1.66 | $1.57 | Reconciliation of Cash Flow (GAAP to Non-GAAP) (In thousands) | Metric | Three Months Ended June 30, 2024 (in thousands) | Three Months Ended June 30, 2023 (in thousands) | | :-------------------------------------------------------------------------- | :------------------------------- | :------------------------------- | | Cash provided by operating activities (GAAP) | $381,435 | $335,247 | | Deduct: Capital expenditures | (21,416) | (27,829) | | Free cash flow (Non-GAAP) | $360,019 | $307,418 | | Free Cash Flow Conversion (Free cash flow divided by net income) | 107% | 95% | Forecasted Diluted EPS (GAAP to Non-GAAP) (In thousands, except per share amounts) | Metric | Three Months Ended September 30, 2024 (Low) | Three Months Ended September 30, 2024 (High) | Year Ended December 31, 2024 (Low) | Year Ended December 31, 2024 (High) | | :-------------------------------------------------------------------------- | :------------------------------------------ | :------------------------------------------- | :--------------------------------- | :--------------------------------- | | Diluted earnings per share (GAAP) | $1.39 | $1.41 | $5.78 | $5.88 | | Paragon integration costs | — | — | 0.13 | 0.13 | | Income tax benefit on Paragon integration costs | — | — | (0.03) | (0.03) | | Pretax amortization of acquisition-related intangible assets | 0.27 | 0.27 | 1.08 | 1.08 | | Income tax benefit on amortization of acquisition-related intangible assets | (0.06) | (0.06) | (0.26) | (0.26) | | Adjusted Diluted earnings per share (Non-GAAP) | $1.60 | $1.62 | $6.70 | $6.80 | [Use of Non-GAAP Financial Information](index=6&type=section&id=Use%20of%20Non-GAAP%20Financial%20Information) The rationale for using non-GAAP financial measures is explained, highlighting their utility for investors - The company supplements GAAP financial statements with non-GAAP information to provide investors with **greater insight, increased transparency**, and a **more comprehensive understanding** of management's financial and operational decision-making[20](index=20&type=chunk) - Non-GAAP measures help investors better understand **long-term profitability trends**, **facilitate comparisons** to prior and future periods, and to peers, when reconciled to comparable GAAP measures[21](index=21&type=chunk)

For the quarter ended June 2024, Ametek (AME) reported revenue of $1.73 billion, up 5.4% over the same period last year. EPS came in at $1.66, compared to $1.57 in the year-ago quarter.The reported revenue compares to the Zacks Consensus Estimate of $1.77 billion, representing a surprise of -2.23%. The company delivered an EPS surprise of +1.22%, with the consensus EPS estimate being $1.64.While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street expectatio ...

Ametek (AME) came out with quarterly earnings of $1.66 per share, beating the Zacks Consensus Estimate of $1.64 per share. This compares to earnings of $1.57 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 1.22%. A quarter ago, it was expected that this maker of electronic instruments and electromechanical devices would post earnings of $1.59 per share when it actually produced earnings of $1.64, delivering a surprise of 3.14% ...

BERWYN, Pa., Aug. 1, 2024 /PRNewswire/ -- AMETEK, Inc. (NYSE: AME) today announced its financial results for the second quarter ended June 30, 2024.AMETEK's second quarter 2024 sales were $1.73 billion, a 5% increase over the second quarter of 2023. Operating income increased 7% to a record $447.5 million and operating margins were 25.8%, up 40 basis points from the second quarter of 2023. Operating cash flow in the quarter was $381.4 million, up 14% versus the prior year.On a GAAP basis, second quarter ear ...

Core Viewpoint - AMETEK, Inc. is expected to report second-quarter 2024 results on August 1, with anticipated sales growth in the mid to high-single digits and adjusted earnings growth of 4-5% from the previous year [1][2]. Group 1: Financial Expectations - The Zacks Consensus Estimate for AMETEK's sales is $1.77 billion, indicating a 7.8% increase from the year-ago quarter [1]. - Adjusted earnings are expected to be between $1.63 and $1.65 per share, with a consensus estimate of $1.64 per share, reflecting a growth of 4.5% from the prior-year quarter [1][2]. Group 2: Segment Performance - The Electromechanical Group (EMG) segment is projected to show strong performance, with sales estimated at $603.96 million, representing an 18.1% growth year-over-year [2]. - The Electronic Instruments Group (EIG) segment is also expected to perform well, with sales estimated at $1.17 billion, indicating a 3.2% growth from the previous year [2]. Group 3: Market Dynamics - Increasing demand in high-growth markets such as medical technology, clean energy, and electrification is anticipated to positively impact AMETEK's performance [3]. - The company's execution of core growth strategies, including operational excellence and global market expansion, is expected to contribute to its second-quarter results [3]. Group 4: Challenges - High goodwill from aggressive acquisition strategies and rising geopolitical tensions are expected to pose challenges for AMETEK [3]. - Macroeconomic uncertainties and unfavorable foreign exchange fluctuations are also anticipated concerns [3]. Group 5: Earnings Prediction Model - According to the Zacks model, AMETEK currently has an Earnings ESP of -0.61% and a Zacks Rank of 3, indicating lower odds of an earnings beat [4].

- Earnings to be released before market opens on Thursday, August 1, 2024 -BERWYN, Pa., July 15, 2024 /PRNewswire/ -- AMETEK, Inc. (NYSE: AME) will issue its second quarter 2024 earnings release before the market opens on Thursday, August 1, 2024.AMETEK will webcast its second quarter 2024 investor conference call on Thursday, August 1, 2024, beginning at 8:30 AM ET. The live audio webcast can be accessed by clicking on the Events & Presentations link in the "Investors" section of www.ametek.com. A replay o ...

Core Insights - AMETEK, Inc. has appointed Keith J. Kowalski as Vice President and General Manager of the AMS Division, highlighting his strong leadership and track record of growth within the company [1] - Kowalski has a long history with AMETEK, having joined in 1995 and held various roles, including Vice President of Technology and Divisional Vice President for different business units [1][2] - AMETEK reported annualized sales of approximately $7.0 billion and aims for double-digit percentage growth in earnings per share over the business cycle [3] Company Overview - AMETEK is a leading global provider of industrial technology solutions, serving diverse niche markets [3] - The company integrates four growth strategies: Operational Excellence, New Product Development, Global and Market Expansion, and Strategic Acquisitions, with a focus on cash generation and capital deployment [3] - Founded in 1930, AMETEK has been listed on the NYSE for over 90 years and is a component of the S&P 500 [3]