01—Abstract
Summary
Summary of the 8-K filed July 25, 2024. Cited figures are marked; the original filing is the authoritative source.
Veralto Corporation (NYSE: VLTO) reported results for the second quarter ended June 28, 2024, in a press release furnished as Exhibit 99.1 to this Form 8-K under Item 2.02.
Sales rose 2.8% year-over-year to $1,288 milliona, with non-GAAP core sales growth of 3.8%. Net earnings were $203 million, or $0.81 per diluted share, compared with $209 million, or $0.85 per diluted share, in the prior-year quarter. Non-GAAP adjusted net earnings were $213 million, or $0.85 per diluted share.
Operating cash flow was $251 millionb and non-GAAP free cash flow was $240 million. Management highlighted core sales growth across both Water Quality and Product Quality and Innovation (PQI) segments, driven by positive volume and price increases in line with historical levels, along with margin expansion from operational leverage, productivity and cost optimization. The company raised its full-year 2024 adjusted diluted EPS guidance to $3.37 to $3.45, from $3.25 to $3.34, and raised its adjusted operating profit margin expansion target to approximately 75 basis points, from 50 to 75 basis points.
It maintained its low-single-digit core sales growth target and its 100% to 110% free cash flow conversion target. For the third quarter of 2024, Veralto anticipates low-to-mid single-digit non-GAAP core sales growth, an adjusted operating profit margin of approximately 23.5%, and adjusted diluted EPS of $0.82 to $0.86c.
02—Key points
Key Highlights
- Sales of $1,288 million, up 2.8% year-over-year, with non-GAAP core sales growth of 3.8%
- GAAP operating profit margin of 23.2% and non-GAAP adjusted operating profit margin of 24.0%
- Net earnings of $203 million ($0.81 per diluted share) versus $209 million ($0.85 per diluted share) a year earlier; adjusted net earnings of $213 million ($0.85 per diluted share)
- Operating cash flow of $251 million and non-GAAP free cash flow of $240 million
- Full-year 2024 adjusted diluted EPS guidance raised to $3.37 to $3.45 from $3.25 to $3.34
- Full-year adjusted operating profit margin expansion target raised to approximately 75 basis points from 50 to 75 basis points; core sales growth target maintained at low single digits
- Third-quarter 2024 guidance: low-to-mid single-digit core sales growth, adjusted operating profit margin of approximately 23.5%, and adjusted diluted EPS of $0.82 to $0.86
03—Questions
Frequently Asked Questions
Why did Veralto raise its full-year 2024 guidance?
The company said the raise reflects stronger operational execution and an incrementally more positive view of its end markets. Management cited strong commercial and operational execution, expanded margins at both segments, and continued progress with the Veralto Enterprise System.
How did net earnings compare with the prior-year quarter?
GAAP net earnings were $203 million, or $0.81 per diluted share, versus $209 million, or $0.85 per diluted share, in the second quarter of 2023. Non-GAAP adjusted net earnings were $213 million, or $0.85 per diluted share, compared with $196 million, or $0.80 per diluted share, a year earlier.
What drove sales growth in the quarter?
Total sales grew 2.8% year-over-year to $1,288 million. Core sales growth was 3.8%, with Water Quality at 4.0% and Product Quality and Innovation at 3.4%. Management cited positive volume and price increases in line with historical levels, along with strong secular growth in industrial water markets, steady municipal demand, and recovery in consumer-packaged goods markets.
What is the outlook for the third quarter of 2024?
Veralto anticipates non-GAAP core sales growth in the low-to-mid single-digit range year-over-year, an adjusted operating profit margin of approximately 23.5%, and adjusted diluted EPS of $0.82 to $0.86 per share.
04—Continue