01—Abstract
Summary
Summary of the 10-Q filed November 1, 2024. Cited figures are marked; the original filing is the authoritative source.
Ingersoll Rand Inc. reported third-quarter 2024 revenues of $1,861.0 milliona, up from $1,738.9 million a year earlier, and net income attributable to Ingersoll Rand Inc. of $221.6 million versus $208.3 million.
Diluted EPS was $0.54b compared with $0.51. The filing attributes the revenue increase primarily to acquisitions of $155.1 million and higher pricing of $32.3 million, partially offset by lower organic volumes of $73.2 million. Operating income rose to $356.3 million from $318.4 million, and Adjusted EBITDA increased to $532.7 million from $461.5 million, with Adjusted EBITDA margin of 28.6% versus 26.5%.
The balance sheet changed materially during the first nine months of 2024, driven by the June 3, 2024 acquisition of ILC Dover for initial cash consideration of $2,349.7 millionc. Total debt rose to $4,785.4 million at September 30, 2024 from $2,723.6 million at December 31, 2023, following the issuance of $3,300.0 million of senior notes in May 2024. Goodwill increased to $8,206.2 million and other intangible assets to $4,445.8 million.
Cash and cash equivalents declined to $1,376.9 milliond. Net cash used in investing activities was $2,872.8 million, reflecting $2,759.1 million in net cash paid for acquisitions. Other notable items include a $58.8 million pre-tax loss (or $51.2 million after tax) from the June 2024 divestiture of three subsidiaries holding asbestos liabilities, and free cash flow of $756.7 million for the nine months versus $720.2 million a year earlier.
The company also reported a $2,600.0 million unused New Revolving Credit Facility and a commercial paper program established in August 2024. Subsequent to quarter-end, on October 1, 2024, the company completed the acquisition of Air Power Systems Co., LLC for an upfront cash price of $112 million.
02—Key points
Key Highlights
- Q3 2024 revenues rose 7.0% to $1,861.0 million, driven by $155.1 million from acquisitions and $32.3 million from higher pricing, partly offset by $73.2 million of lower organic volumes.
- Q3 2024 operating income increased to $356.3 million from $318.4 million, and net income attributable to Ingersoll Rand Inc. rose to $221.6 million from $208.3 million.
- Adjusted EBITDA increased to $532.7 million from $461.5 million, with Adjusted EBITDA as a percentage of revenues at 28.6% versus 26.5%.
- Total debt increased to $4,785.4 million at September 30, 2024 from $2,723.6 million at December 31, 2023, following $3,300.0 million of new senior notes issued in May 2024.
- Acquisitions were significant in 2024, led by ILC Dover, acquired June 3, 2024 for initial cash consideration of $2,349.7 million, adding $1,310.1 million of goodwill.
- A pre-tax loss of $58.8 million was recorded on the June 2024 divestiture of three subsidiaries holding asbestos liabilities and insurance assets.
- Free cash flow for the nine months ended September 30, 2024 was $756.7 million, up from $720.2 million, and the company held $2,600.0 million of unused revolving credit availability.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q3 FY2024, Ingersoll Rand kept $0.12.
- Revenue$1.86B100.0%
- Cost of revenue−$1.05B56.2%
- Gross profit$815.0M43.8%
- Operating costs−$458.7M24.6%
- Operating income$356.3M19.1%
- Interest, other & tax−$134.7M7.2%
- Net income$221.6M11.9%
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2024filed November 1, 2024Financial Statements
Q3 FY2024 against Q3 FY2023
| Line item | Q3 FY2024Q3 FY2023 | Change |
|---|---|---|
| Revenue | $1.86B$1.74B | +7.0% |
| Cost of Revenue | $1.05B$999.60M | +4.6% |
| Gross Profit | $815.00M$739.30M | +10.2% |
| SG&A Expenses | $334.30M$315.20M | +6.1% |
| Operating Income | $356.30M$318.40M | +11.9% |
| Net Income | $221.60M$208.30M | +6.4% |
| EPS (Basic) | $0.55$0.51 | +7.8% |
| EPS (Diluted) | $0.54$0.51 | +5.9% |
| Shares Outstanding (Basic) | 403.40M404.50M | −0.3% |
| Shares Outstanding (Diluted) | 406.90M408.60M | −0.4% |
05—Questions
Frequently Asked Questions
How did Ingersoll Rand's revenue and profitability change in the third quarter of 2024?
Revenues were $1,861.0 million, up $122.1 million or 7.0% from $1,738.9 million. Net income attributable to Ingersoll Rand Inc. was $221.6 million, compared with $208.3 million, and diluted EPS was $0.54 versus $0.51. Gross profit rose to $815.0 million, and gross margin was 43.8% versus 42.5%.
What drove the large increase in debt and the change in the balance sheet?
The company issued $3,300.0 million of senior unsecured notes in May 2024 and used proceeds to repay its former senior secured credit facilities and partly fund the ILC Dover acquisition. Long-term debt, net, rose to $4,782.5 million from $2,693.0 million, and goodwill rose to $8,206.2 million.
What was the asbestos-related transaction and how did it affect results?
On June 10, 2024, the company divested three wholly-owned subsidiaries holding asbestos liabilities and related insurance assets to Onyx TopCo LLC, a subsidiary of Delticus Holdings LLC. The transaction resulted in a pre-tax loss of $58.8 million, or $51.2 million after tax, recorded in other operating expense, net. The divested subsidiaries agreed to indemnify the company for their asbestos-related liabilities.
What acquisitions occurred after the quarter ended?
On October 1, 2024, the company completed the acquisition of Air Power Systems Co., LLC for an all-cash upfront purchase price of $112 million. The business provides hydraulic and pneumatic products serving specialty work truck vehicles and will be reported within the Industrial Technologies and Services segment.
How did the company's cash position and capital returns change?
Cash and cash equivalents decreased to $1,376.9 million from $1,595.5 million at year-end 2023, largely due to $2,759.1 million of net cash paid in acquisitions. Purchases of treasury stock totaled $198.2 million for the nine months, and cash dividends were $24.2 million. Operating cash flow was $870.5 million for the nine months.
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