IDEX(IEX) - 2024 Q4 - Annual Report

Financial Performance - For the year ended December 31, 2024, Fluid & Metering Technologies (FMT) contributed 38% to net sales and 42% to Adjusted EBITDA, consistent with 2023 figures[18]. - Health & Science Technologies (HST) accounted for 39% of net sales and 36% of Adjusted EBITDA in 2024, compared to 40% and 37% respectively in 2023[18]. - Fire & Safety/Diversified Products (FSDP) represented 23% of net sales and 22% of Adjusted EBITDA in 2024, slightly up from 22% and 21% in 2023[18]. - In 2024, the company reported net sales of $3,268.8 million, flat overall and down 2% organically compared to 2023[145]. - Diluted earnings per share (EPS) attributable to the company were$ 6.64, down 15% from $7.85 in 2023[148]. - Adjusted EBITDA for 2024 was reported at$ 874.3 million, compared to $899.6 million in 2023, indicating a decrease in operational performance[195]. - Adjusted net income attributable to IDEX for 2024 was$ 598.5 million, a decrease from $623.6 million in 2023[194]. - The net income margin for 2024 was 15.4%, compared to 18.2% in 2023, reflecting a decline in profitability[195]. Acquisitions and Growth Strategy - The company acquired Mott Corporation in September 2024, enhancing its capabilities in fluidic applications across various markets[30]. - The company aims to continue developing new products to drive organic growth, as failure to do so could limit sales growth[77]. - The growth strategy includes acquisitions to expand into new markets and enhance positions in existing markets[78]. - The acquisition of Mott Corporation occurred within the twelve months ended December 31, 2024, contributing approximately 8% to total assets and 2% to net sales of the consolidated financial statements[210]. Operational Efficiency and Corporate Strategy - IDEX's diverse business segments focus on organic growth, strategic acquisitions, and capital allocation priorities to improve operational efficiency[16]. - The company emphasizes the importance of its reporting units as leaders in their respective markets, contributing to strong financial performance[19]. - IDEX maintains a philosophy of "The IDEX Difference," focusing on customer service and operational excellence across its subsidiaries[15]. Employee Engagement and Workforce - The company reported a stable employee engagement index of 81%, which is above the manufacturing industry average, reflecting a positive work environment[58]. - Approximately 4% of the company's 9,000 employees are covered by collective bargaining agreements, with no agreements expiring in 2025, suggesting stable labor relations[51]. - 78% of employees feel a strong sense of belonging according to the 2024 employee engagement survey[61]. - The company invests in employee development, offering a Tuition Reimbursement program that covers up to$ 5,250 per year for eligible U.S. employees[56]. - The company maintains a diverse workforce, with a focus on fostering a culture of inclusion and innovation, which is foundational to its business strategy[59]. - The company offers competitive pay and benefits, including performance-based pay packages and equity-based long-term incentives for senior leaders[62]. Financial Position and Capital Management - The Company maintains a Credit Agreement with a revolving credit facility of $800 million, which may be adversely affected by significant increases in interest rates[102]. - The company maintained a current ratio of 2.5 to 1 and had cash and cash equivalents of$ 620.8 million as of December 31, 2024[166]. - The company was in compliance with financial covenants, with an interest coverage ratio of 16.09 to 1 and a leverage ratio of 2.20 to 1[178]. - The quarterly cash dividend increased by 8% from $0.64 to$ 0.69 per share, with total dividend payments rising to $205.3 million in 2024[177]. Risks and Challenges - The company faces risks related to competition, which could reduce sales and profit margins[81]. - The availability and pricing of raw materials and components are critical, with potential adverse effects on financial condition[82]. - Cybersecurity threats and data privacy laws are increasing, requiring the company to strengthen compliance and information security measures[84]. - The company has experienced a rise in cyberattacks targeting confidential business information, particularly in the manufacturing industry[85]. - Increased public awareness regarding environmental risks may lead to new regulations that could increase the Company's expenses and adversely affect its operating results[90]. - The Company faces risks related to catastrophic weather events and public health threats, which could disrupt operations and negatively impact financial results[95][96]. - The unpredictability of cybersecurity risks may result in material adverse effects on the Company's financial condition[87]. - The Company may face legal and regulatory challenges related to intellectual property, which could adversely impact its competitive position and financial condition[106]. Internal Controls and Reporting - Internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting[213]. - The company's management is responsible for maintaining effective internal control over financial reporting[211]. - Limitations exist in internal control over financial reporting, which may not prevent or detect misstatements[214]. - The audit report expressed an unqualified opinion on the financial statements for the year ended December 31, 2024[209].