AMETEK INC. Files 10-Q for Period Ending March 31, 2024

TL;DR

<b>AMETEK INC. filed its Q1 2024 10-Q report, detailing financial performance and operational status.</b>

AI Summary

AMETEK INC/ (AME) filed a Quarterly Report (10-Q) with the SEC on May 2, 2024. AMETEK INC. filed a 10-Q report for the period ending March 31, 2024. The filing covers the first quarter of 2024. The company's fiscal year ends on December 31st. AMETEK INC. is incorporated in Delaware. The company's principal business is Industrial Instruments for Measurement, Display, and Control.

Why It Matters

For investors and stakeholders tracking AMETEK INC/, this filing contains several important signals. This filing provides investors with the latest financial data for AMETEK INC., crucial for assessing recent performance and future outlook. Understanding the details within this 10-Q is essential for stakeholders to make informed investment decisions regarding AMETEK INC.

Risk Assessment

Risk Level: low — AMETEK INC/ shows low risk based on this filing. The filing is a standard quarterly report (10-Q) and does not contain any immediate red flags or significant negative developments.

Analyst Insight

Review the detailed financial statements and management discussion within the 10-Q to understand AMETEK INC.'s Q1 2024 performance drivers and any forward-looking statements.

Key Numbers

• 2024-03-31 — Period of Report (The 10-Q filing is for this date.)
• 2024-05-02 — Filing Date (The date the 10-Q was filed with the SEC.)
• 2024-01-01 — Quarter Start Date (Beginning of the reporting period.)
• 2023-01-01 — Prior Year Quarter Start Date (Beginning of the comparable prior year period.)

Key Players & Entities

• AMETEK INC (company) — Filer of the 10-Q report
• 2024-03-31 (date) — Period of report
• 2024-05-02 (date) — Filing date
• DE (jurisdiction) — State of incorporation
• 3823 (sic_code) — Standard Industrial Classification

FAQ

Industry Context

AMETEK INC. operates within the Industrial Instruments for Measurement, Display, and Control sector, a segment focused on specialized equipment for various industrial applications.

Regulatory Implications

The filing is a standard 10-Q, adhering to SEC regulations for quarterly financial reporting under the Securities Exchange Act of 1934.

What Investors Should Do

1. Analyze the balance sheet and income statement for Q1 2024.
2. Review any management discussion and analysis (MD&A) for insights into performance drivers.
3. Compare Q1 2024 results to prior periods presented in the filing.

Key Dates

• 2024-03-31: Period End Date — Marks the end of the reporting quarter for the 10-Q.
• 2024-05-02: Filing Date — The date AMETEK INC. submitted its 10-Q to the SEC.

Year-Over-Year Comparison

This is the initial 10-Q filing for the fiscal year 2024, providing the first set of quarterly financial data for the year.

Key Financial Figures

• $0.01 — est practicable date was: Common Stock, $0.01 Par Value, outstanding at April 29, 202

Filing Documents

• ame-20240331.htm (10-Q) — 726KB
• ame-20240331xexx311.htm (EX-31.1) — 10KB
• ame-20240331xexx312.htm (EX-31.2) — 9KB
• ame-20240331xexx321.htm (EX-32.1) — 6KB
• ame-20240331xexx322.htm (EX-32.2) — 5KB
• 0001037868-24-000030.txt (&nbsp;) — 5215KB
• ame-20240331.xsd (EX-101.SCH) — 36KB
• ame-20240331_cal.xml (EX-101.CAL) — 58KB
• ame-20240331_def.xml (EX-101.DEF) — 133KB
• ame-20240331_lab.xml (EX-101.LAB) — 524KB
• ame-20240331_pre.xml (EX-101.PRE) — 349KB
• ame-20240331_htm.xml (XML) — 773KB

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

Financial Statements

Item 1.Financial Statements Consolidated Statement of Income for the three months ended March 31, 2024 and 2023 3 Condensed Consolidated Statement of Comprehensive Income for the three months ended March 31, 2024 and 2023 4 Consolidated Balance Sheet at March 31, 2024 and December 31, 2023 5 Consolidated Statement of Stockholders' Equity for the three months ended March 31, 2024 and 2023 6 Condensed Consolidated Statement of Cash Flows for the three months ended March 31, 2024 and 2023 7

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements 8

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 2.Management's Discussion and Analysis of Financial Condition and Results of Operations 19

Controls and Procedures

Item 4.Controls and Procedures 22

OTHER INFORMATION

PART II. OTHER INFORMATION

Unregistered Sales of Equity Securities and Use of Proceeds

Item 2.Unregistered Sales of Equity Securities and Use of Proceeds 23

Other Information

Item 5. Other Information 23

SIGNATURES

SIGNATURES 25 2 Table of Contents

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements AMETEK, Inc. Consolidated Statement of Income (In thousands, except per share amounts) (Unaudited) Three Months Ended March 31, 2024 2023 Net sales $ 1,736,180 $ 1,597,117 Cost of sales 1,144,681 1,022,525 Selling, general and administrative 174,283 169,051 Total operating expenses 1,318,964 1,191,576 Operating income 417,216 405,541 Interest expense ( 35,254 ) ( 20,569 ) Other (expense) income, net ( 633 ) ( 5,373 ) Income before income taxes 381,329 379,599 Provision for income taxes 70,386 73,887 Net income $ 310,943 $ 305,712 Basic earnings per share $ 1.35 $ 1.33 Diluted earnings per share $ 1.34 $ 1.32 Weighted average common shares outstanding: Basic shares 231,097 230,126 Diluted shares 232,035 231,229 Dividends declared and paid per share $ 0.28 $ 0.25 See accompanying notes. 3 Table of Contents AMETEK, Inc. Condensed Consolidated Statement of Comprehensive Income (In thousands) (Unaudited) Three Months Ended March 31, 2024 2023 Total comprehensive income $ 285,557 $ 223,639 See accompanying notes. 4 Table of Contents AMETEK, Inc. Consolidated Balance Sheet (In thousands) March 31, 2024 December 31, 2023 (Unaudited) ASSETS Current assets: Cash and cash equivalents $ 373,765 $ 409,804 Receivables, net 983,893 1,012,932 Inventories, net 1,127,328 1,132,471 Other current assets 290,516 269,461 Total current assets 2,775,502 2,824,668 Property, plant and equipment, net 877,420 891,293 Right of use assets, net 219,887 229,723 Goodwill 6,438,675 6,447,629 Other intangibles, net 4,080,603 4,165,317 Investments and other assets 472,894 464,903 Total assets $ 14,864,981 $ 15,023,533 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Short-term borrowings and current portion of long-term debt, net $ 1,055,406 $ 1,417,915 Accounts payable 517,352 516,588 Customer advanced payments 391,873 375,513 Income taxes payable 85,843 69,567 Accrued liabilities and other 45

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements March 31, 2024 (Unaudited) 1. Basis of Presentation The accompanying consolidated financial statements are unaudited. AMETEK, Inc. (the "Company") believes that all adjustments (which primarily consist of normal recurring accruals) necessary for a fair presentation of the consolidated financial position of the Company at March 31, 2024, the consolidated results of its operations for the three months ended March 31, 2024 and 2023 and its cash flows for the three months ended March 31, 2024 and 2023 have been included. Quarterly results of operations are not necessarily indicative of results for the full year. The accompanying consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes presented in the Company's Annual Report on Form 10-K for the year ended December 31, 2023 as filed with the U.S. Securities and Exchange Commission. 2. Recent Accounting Pronouncements Recent Accounting Pronouncements In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures ("ASU 2023-07"), which requires disclosure of significant segment expenses and other segment items on an annual and interim basis under ASC 280. ASU 2023-07 is effective for annual periods beginning after December 15, 2023, and for interim periods beginning after December 15, 2024. Early adoption is permitted and the amendments in this ASU should be applied on a retrospective basis to all periods presented. The Company has not determined the impact ASU 2023-07 may have on the Company's financial statement disclosures. In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures ("ASU 2023-09"), which improves income tax disclosures by requiring (1) consistent categories and greater disaggregation of information in the rate reconciliation and (2) income taxes paid disa

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements March 31, 2024 (Unaudited) The remaining performance obligations not expected to be completed within one year as of March 31, 2024 and December 31, 2023 were $ 596.3 million and $ 607.5 million, respectively. Remaining performance obligations represent the transaction price of firm, non-cancelable orders, with expected delivery dates to customers greater than one year from the balance sheet date, for which the performance obligation is unsatisfied or partially unsatisfied. These performance obligations will be substantially satisfied within two to three years . Geographic Areas Net sales were attributed to geographic areas based on the location of the customer. Information about the Company's operations in different geographic areas was as follows for the three months ended March 31: Three months ended March 31, 2024 EIG EMG Total (In thousands) United States $ 568,897 $ 343,860 $ 912,757 International (1) : United Kingdom 26,707 28,192 54,899 European Union countries 142,242 114,986 257,228 Asia 298,045 50,199 348,244 Other foreign countries 120,888 42,164 163,052 Total international 587,882 235,541 823,423 Consolidated net sales $ 1,156,779 $ 579,401 $ 1,736,180 ________________ (1) Includes U.S. export sales of $ 473.8 million for the three months ended March 31, 2024. Three months ended March 31, 2023 EIG EMG Total (In thousands) United States $ 561,896 $ 247,119 $ 809,015 International (1) : United Kingdom 28,038 31,062 59,100 European Union countries 135,658 116,807 252,465 Asia 283,892 50,905 334,797 Other foreign countries 107,763 33,977 141,740 Total international 555,351 232,751 788,102 Consolidated net sales $ 1,117,247 $ 479,870 $ 1,597,117 ______________ (1) Includes U.S. export sales of $ 434.2 million for the three months ended March 31, 2023. 9 Table of Contents AMETEK, Inc.

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements March 31, 2024 (Unaudited) Major Products and Services The Company's major products and services in the reportable segments were as follows: Three months ended March 31, 2024 EIG EMG Total (In thousands) Process and analytical instrumentation $ 791,538 $ — $ 791,538 Aerospace and power 365,241 152,452 517,693 Automation and engineered solutions — 426,949 426,949 Consolidated net sales $ 1,156,779 $ 579,401 $ 1,736,180 Three months ended March 31, 2023 EIG EMG Total (In thousands) Process and analytical instrumentation $ 794,433 $ — $ 794,433 Aerospace and power 322,814 143,050 465,864 Automation and engineered solutions — 336,820 336,820 Consolidated net sales $ 1,117,247 $ 479,870 $ 1,597,117 Timing of Revenue Recognition Three months ended March 31, 2024 EIG EMG Total (In thousands) Products transferred at a point in time $ 945,998 $ 503,585 $ 1,449,583 Products and services transferred over time 210,781 75,816 286,597 Consolidated net sales $ 1,156,779 $ 579,401 $ 1,736,180 Three months ended March 31, 2023 EIG EMG Total (In thousands) Products transferred at a point in time $ 935,308 $ 413,601 $ 1,348,909 Products and services transferred over time 181,939 66,269 248,208 Consolidated net sales $ 1,117,247 $ 479,870 $ 1,597,117 Product Warranties The Company provides limited warranties in connection with the sale of its products. The warranty periods for products sold vary among the Company's operations, but the majority do not exceed one year. The Company calculates its warranty expense provision based on its historical warranty experience and adjustments are made periodically to reflect actual warranty expenses. Product warranty obligations are reported as a component of Accrued liabilities and other in the consolidated balance sheet. 10 Table of Contents AMETEK, Inc.

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements March 31, 2024 (Unaudited) Changes in the accrued product warranty obligation were as follows: Three Months Ended March 31, 2024 2023 (In thousands) Balance at the beginning of the period $ 37,087 $ 26,487 Accruals for warranties issued during the period 4,867 3,411 Settlements made during the period ( 5,761 ) ( 3,224 ) Warranty accruals related to acquired businesses and other during the period 32 133 Balance at the end of the period $ 36,225 $ 26,807 Accounts Receivable The Company maintains allowances for estimated losses resulting from the inability of customers to meet their financial obligations to the Company. The Company recognizes an allowance for credit losses, on all accounts receivable and contract assets, which considers risk of future credit losses based on factors such as historical experience, contract terms, as well as general and market business conditions, country, and political risk. Balances are written off when determined to be uncollectible. At March 31, 2024, the Company had $ 983.9 million of accounts receivable, net of allowances of $ 13.3 million. Changes in the allowance were not material for the three months ended March 31, 2024. 4. Earnings Per Share The calculation of basic earnings per share is based on the weighted average number of common shares considered outstanding during the periods. The calculation of diluted earnings per share reflects the effect of all potentially dilutive securities (principally outstanding stock options and restricted stock grants). The number of weighted average shares used in the calculation of basic earnings per share and diluted earnings per share was as follows: Three Months Ended March 31, 2024 2023 (In thousands) Weighted average shares: Basic shares 231,097 230,126 Equity-based compensation plans 938 1,103 Diluted shares 232,035 231,229 The calculation of diluted earnings per share for the three months ended March 31, 2024 exc

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements March 31, 2024 (Unaudited) to measure assets and liabilities at fair value. A financial asset or liability's classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement. The following table provides the Company's assets that are measured at fair value on a recurring basis, consistent with the fair value hierarchy, at March 31, 2024 and December 31, 2023: March 31, 2024 Total Level 1 Level 2 Level 3 (In thousands) Mutual fund investments $ 12,427 $ 12,427 $ — $ — Foreign currency forward contracts ( 733 ) — ( 733 ) — December 31, 2023 Total Level 1 Level 2 Level 3 (In thousands) Mutual fund investments $ 11,922 $ 11,922 $ — $ — Foreign currency forward contracts 2,035 — 2,035 — The fair value of mutual fund investments is based on quoted market prices. The mutual fund investments are shown as a component of investments and other assets on the consolidated balance sheet. For the three months ended March 31, 2024 and 2023, gains and losses on the investments noted above were not significant. No transfers between level 1 and level 2 investments occurred during the three months ended March 31, 2024 and 2023. Foreign Currency At March 31, 2024, the Company had a Euro forward contract for a total notional value of 50.0 million Euros. The foreign currency forward contract is valued as a level 2 liability as it is corroborated by foreign currency exchange rates and shown as a component of other current liabilities on the consolidated balance sheet. For the three months ended March 31, 2024, realized and unrealized gains and losses on the foreign currency forward contracts were not significant. Financial Instruments Cash, cash equivalents and mutual fund investments are recorded at fair value at March 31, 2024 and December 31, 2023 in the accompanying consolidated balance sheet. The following table provides the estimated fair values of th

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements March 31, 2024 (Unaudited) translation gains or losses on the net investment due to changes in the British pound and Euro exchange rates. These net investment hedges are evidenced by management's contemporaneous documentation supporting the hedge designation. Any gain or loss on the hedging instruments (the debt) following hedge designation is reported in accumulated other comprehensive income in the same manner as the translation adjustment on the hedged investment based on changes in the spot rate, which is used to measure hedge effectiveness. At March 31, 2024, the Company had $ 284.3 million of British-pound-denominated loans, which were designated as a hedge against the net investment in British pound functional currency foreign subsidiaries. At March 31, 2024, the Company had $ 558.3 million in Euro-denominated loans, which were designated as a hedge against the net investment in Euro functional currency foreign subsidiaries. As a result of the British-pound- and Euro-denominated loans designated and 100 % effective as net investment hedges, $ 16.2 million of pre-tax currency remeasurement gains have been included in the foreign currency translation component of other comprehensive income for the three months ended March 31, 2024. 7. Inventories, net March 31, 2024 December 31, 2023 (In thousands) Finished goods and parts $ 147,747 $ 136,003 Work in process 167,751 165,914 Raw materials and purchased parts 811,830 830,554 Total inventories, net $ 1,127,328 $ 1,132,471 8. Leases The Company has commitments under operating leases for certain facilities, vehicles and equipment used in its operations. Cash used in operations for operating leases was not materially different from operating lease expense for the three months ended March 31, 2024 and 2023. The Company's leases have a weighted average remaining lease term of approximately 7 years. Certain lease agreements contain provisions for future rent i

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements March 31, 2024 (Unaudited) Maturities of lease liabilities as of March 31, 2024 were as follows: Lease Liability Maturity Analysis Operating Leases (In thousands) Remaining 2024 $ 45,287 2025 49,818 2026 40,043 2027 28,987 2028 21,126 Thereafter 85,921 Total lease payments 271,182 Less: imputed interest 37,313 $ 233,869 The Company does not have any significant leases that have not yet commenced. 9. Acquisitions The initial accounting for the December 2023 Paragon Medical acquisition is being finalized, including the measurement of the acquired tangible and intangible assets and liabilities, as well as, the associated income tax considerations. All amounts could change, potentially materially, as there is significant additional information that the Company must obtain to finalize the valuations of the assets acquired and liabilities assumed, and to finalize the value of the intangible assets. The Company finalized its measurements of tangible and intangible assets and liabilities for its August 2023 acquisition of United Electronic Industries, which had no material impact to the consolidated statement of income and balance sheet. The Company is in the process of finalizing the measurement of the intangible assets and tangible assets and liabilities, including accounting for income taxes, for its October 2023 acquisition of Amplifier Research Corp. 10. Goodwill The changes in the carrying amounts of goodwill by segment were as follows: EIG EMG Total (In millions) Balance at December 31, 2023 $ 4,365.0 $ 2,082.6 $ 6,447.6 Purchase price allocation adjustments and other 11.8 0.6 12.4 Foreign currency translation adjustments ( 16.0 ) ( 5.3 ) ( 21.3 ) Balance at March 31, 2024 $ 4,360.8 $ 2,077.9 $ 6,438.7 11. Income Taxes At March 31, 2024, the Company had gross uncertain tax benefits of $ 244.1 million, of which $ 195.1 million, if recognized, would impact the effective tax rate. The fol

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements March 31, 2024 (Unaudited) The additions above primarily reflect the tax positions for foreign tax planning initiatives. The Company recognizes interest and penalties accrued related to uncertain tax positions in income tax expense. The amounts recognized in income tax expense for interest and penalties during the three months ended March 31, 2024 and 2023 were not significant. The effective tax rate for the three months ended March 31, 2024 was 18.5 %, compared with 19.5 % for the three months ended March 31, 2023. The lower effective tax rate in the first quarter of 2024 is primarily due to lower foreign and state taxes compared to the first quarter of 2023. 12. Share-Based Compensation The Company's share-based

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