Veralto (VLTO) - 2024 Q4 - Annual Results

Sales Performance - Fourth quarter sales increased by 4.4% year-over-year to $1,345 million, with non-GAAP core sales growth of 4.6%[6] - Full year sales rose 3.4% year-over-year to$ 5,193 million, with non-GAAP core sales growth of 3.7%[6] - Total sales for the three-month period ended December 31, 2024, reached $1,345 million, a 4.4% increase compared to$ 1,288 million in the same period of 2023[22] - For the year ended December 31, 2024, total sales were $5,193 million, a 3.4% increase from$ 5,021 million in 2023[26] - Core sales growth (non-GAAP) for the total company was 4.6% for the three-month period ended December 31, 2024, compared to the same period in 2023[32] - The impact of currency exchange rates contributed positively by 0.5% to total sales growth for the three-month period ended December 31, 2024[32] - Forecasted core sales growth for the three-month period ending April 4, 2025, is expected to be in the low-to-mid single digits compared to the comparable 2024 period[36] Earnings and Profitability - Adjusted diluted earnings per share for the fourth quarter were $0.95, compared to$ 0.81 in the same period last year[6] - The company reported a diluted net earnings per share of $0.91 for Q4 2024, up from$ 0.81 in Q4 2023[24] - The company is targeting adjusted diluted earnings per share in the range of $3.60 to$ 3.70 for the full year 2025[6] - Adjusted diluted net earnings per share for the year ending December 31, 2025, is forecasted to be between $3.60 and$ 3.70, with a range of $0.84 to$ 0.88 for the three-month period ending April 4, 2025[36] Cash Flow and Investments - The company generated operating cash flow of $875 million for the full year 2024, with non-GAAP free cash flow of$ 820 million[6] - Net cash provided by operating activities for the three-month period ended December 31, 2024, was $285 million, an increase of approximately 8.5% from$ 263 million in 2023[38] - Free cash flow for the three-month period ended December 31, 2024, was $263 million, reflecting a year-over-year increase of approximately 9.0% from$ 241 million in 2023[38] - Total cash used in investing activities for the year ended December 31, 2024, was $(434) million, compared to$ (55) million in 2023[38] - The operating cash flow to net earnings conversion ratio for the three-month period ended December 31, 2024, was 1.26, compared to 1.32 in 2023[38] - Free cash flow to net earnings conversion ratio is expected to be between 90% and 100% for the year ending December 31, 2025[36] Operating Margins - Operating profit margin for the fourth quarter was 22.9%, with non-GAAP adjusted operating profit margin at 23.8%[6] - Operating profit for the same period was $308 million, reflecting an increase from$ 286 million year-over-year, resulting in an operating profit margin of 22.9%[22] - Adjusted (Non-GAAP) operating profit for the year ended December 31, 2024, was $1,251 million, with an adjusted operating profit margin of 24.1%[26] - The Water Quality segment's operating profit margin improved to 24.5% for the year ended December 31, 2024, compared to 24.0% in 2023[22] - Adjusted operating profit margin for the year ending December 31, 2025, is projected to increase by 25 to 50 basis points compared to the comparable 2024 period, reaching 24.0% to 24.5% for the three-month period ending April 4, 2025[36] - The company expects margin expansion of 25 to 50 basis points year-over-year for 2025[6] Strategic Initiatives - Veralto completed the acquisition of TraceGains, contributing to robust cash generation and strategic priorities[4] - Management emphasizes the importance of non-GAAP measures to provide additional insights into the company's operating and financial performance[40] - Exclusions from non-GAAP measures include amortization of intangible assets, restructuring charges, and other adjustments to facilitate consistent comparisons of operating results over time[42] Asset Management - Veralto's total assets increased to$ 6,406 million as of December 31, 2024, up from $5,693 million in 2023[13]