Financial Performance - Net sales for the fiscal year ended September 30, 2023, were $3,319.1 million, an increase of 9.4% from $3,035.8 million in the previous year[218]. - Gross profit for the same period was $891.5 million, representing a gross margin of 26.8%, up from $820.8 million and a margin of 27.0% in the prior year[218]. - Net earnings increased to $171.0 million, a rise of 10.5% compared to $155.2 million in the previous year[218]. - Basic net earnings per share rose to $5.37, up from $4.85, reflecting a 10.7% increase[218]. - Total assets as of September 30, 2023, were $3,808.0 million, compared to $3,431.8 million at the end of the previous fiscal year, marking a 10.9% increase[224]. - The company reported comprehensive income of $227.4 million for the fiscal year, significantly higher than $91.7 million in the prior year[220]. - Total shareholders' equity increased to $1,636,087,000 as of September 30, 2023, up from $1,436,813,000 a year earlier, representing a growth of 13.9%[226]. - Cash dividends per share were $1.07 for the fiscal year ended September 30, 2023, compared to $1.03 for the previous year, marking a 3.9% increase[227]. - Net cash provided by operating activities was $135,935,000 for the fiscal year ended September 30, 2023, a decrease from $246,802,000 in the prior year[232]. Backlog and Sales Composition - The twelve-month backlog as of September 30, 2023, was $2.4 billion, reflecting a 4% increase compared to October 1, 2022[17]. - As of September 30, 2023, the total backlog was $5.1 billion, representing confirmed orders expected to be recognized as revenue[63]. - Aerospace and defense OEM customers accounted for 58% of total sales in 2023, while industrial market sales represented 30%[42]. - Sales under U.S. Government contracts constituted 39% of total sales in 2023, primarily within Aircraft Controls and Space and Defense Controls segments[44]. - In 2023, sales under U.S. Government contracts represented 39% of total sales, while sales to foreign governments accounted for 8%[61]. - Net sales to the five largest customers represented approximately 32% of total sales in 2023[43]. - Aftermarket sales accounted for 13% of total sales in 2023[42]. - Sales to The Boeing Company constituted 11% of total sales in 2023, with a significant portion tied to government defense spending[62]. Research and Development - Research and development expenses were at least $107 million in each of the last three years, representing approximately 3% of sales in 2023[21]. - The company has incurred substantial expenses associated with research and development and innovation activities to maintain a leadership position in the high-performance, precision controls market[56]. - Research and development expenses for the fiscal year were $106.6 million, slightly down from $109.5 million in the previous year[218]. - Research and development costs are expensed as incurred, including salaries, benefits, consulting, material costs, depreciation, and amortization[242]. Employee and Workforce Management - The company hired over 2,000 new regular employees globally in 2023[25]. - The average voluntary attrition rate over the last five years was approximately 6%[33]. - The restructuring charge for 2023 was $6,905 for severance and $1,092 for facility closure, with potential additional costs of up to $11,000 through 2027[334]. - The restructuring accrual as of September 30, 2023, included $6,057 for the 2023 plan, indicating ongoing workforce adjustments[336]. Financial Liabilities and Assets - As of September 30, 2023, the company reported goodwill of $821 million and other intangible assets of $72 million, representing a significant portion of total assets of $3.8 billion[75]. - The company has a total long-term debt of $863,092 million as of September 30, 2023, compared to $836,872 million on October 1, 2022, an increase of approximately 3.1%[317]. - The weighted-average interest rate on outstanding credit facility borrowings is 6.93% as of September 30, 2023[317]. - The fair value of long-term debt was $812,693, compared to a carrying value of $867,500 as of September 30, 2023[332]. - Total accrued liabilities as of September 30, 2023, amounted to $211,769, a decrease of 1.4% from $215,376 on October 1, 2022[322]. Risks and Challenges - The company experienced supply chain constraints and inflated prices for raw materials, impacting manufacturing and operating profit[64]. - Future levels of defense spending are uncertain and subject to congressional debate, which could adversely impact sales and operating profit[61]. - The company faces risks from competitors with greater resources, which may impact sales and operating margins[55]. - The company relies on subcontractors and suppliers for manufacturing, which poses risks to contract performance and future business opportunities[65]. - The company faces potential liabilities from product defects, which could lead to recalls and significant damages, impacting financial results and reputation[69]. - The invalidation of the facility security clearance by the DCSA could hinder the company's ability to bid on classified contracts, affecting future business opportunities[83]. - The company is exposed to risks from foreign operations, including currency fluctuations and changes in trade policies, which could negatively impact financial results[78]. Environmental and Governance - The company is assessing its environmental, social, and governance impact across 25 countries to establish sustainability goals[39]. - Compliance with environmental laws may require significant capital expenditures, impacting operational costs[81]. - The company may incur additional costs to meet increased cybersecurity standards, which could affect financial results[67]. Inventory and Contract Management - The company recorded impairment charges on long-lived assets and inventory write-downs in 2023 due to a decline in value related to specific contracts and equipment[253]. - The company recorded $4,345 in inventory write-downs in 2023 due to a decline in business in the Industrial Systems segment[297]. - Unbilled recoverable costs and accrued profits for over-time contracts to the U.S. Government increased to $79,388 as of September 30, 2023, from $38,020 on October 1, 2022, reflecting a growth of 108.5%[278]. - Total contract assets rose to $706,601 as of September 30, 2023, compared to $614,760 on October 1, 2022, marking an increase of 14.9%[279]. - Contract liabilities include payments received in advance of the satisfaction of performance obligations, recorded until obligations are fulfilled[276].
Moog(MOG_A) - 2023 Q4 - Annual Report