Graco(US:GGG) ZACKS·2025-02-26 17:35Core Insights - Graco Inc. reported a decline in earnings and sales in its fourth quarter of 2024, with adjusted earnings of 64 cents per share missing estimates by 12 cents and a 20% year-over-year decline [2] - The company's net sales of $548.7 million also fell short of expectations, decreasing 3% year-over-year due to lower demand in the Industrial segment [2] Financial Performance - The Americas region saw a 1% decrease in sales year-over-year, while Europe, the Middle East, and Africa experienced a 2% decline, and the Asia Pacific region faced a 10% drop [3] - In the Industrial segment, net sales totaled $165.7 million, down 14% year-over-year, while the Process segment remained flat at $136.1 million [4] - The Contractor segment reported net sales of $246.9 million, up 3% year-over-year, although core sales decreased by 3% [5] - Graco's cost of sales increased by 1% to $269.4 million, leading to a 7% decrease in gross profit to $279.3 million and a decline in margin by two percentage points [6] - Operating income fell 23% year-over-year to $130 million, with the operating margin decreasing by 6.3 percentage points [7] Balance Sheet and Cash Flow - At the end of the fourth quarter, Graco had cash and cash equivalents of $675.3 million, an increase from $538 million at the end of 2023 [8] - The company generated net cash of $621.7 million from operating activities in 2024, down from $651 million in the previous year [8] - Capital expenditures for property, plant, and equipment were $106.7 million, significantly lower than $184.8 million in the year-ago period [8] Shareholder Returns - Graco paid out dividends totaling $172.1 million, an increase of 8.7% from the previous year, and repurchased shares worth $31.4 million [9] Future Outlook - The company anticipates organic net sales growth in the low single digits on a constant-currency basis for 2025 [10] - Recent estimates for Graco have been trending downward, indicating a cautious outlook [11][13]