Parker Hannifin Q1 2025: Divestiture Update

TL;DR

Parker Hannifin Q1 2025: Sold Composites biz, watch for future impacts.

AI Summary

Parker Hannifin Corp. reported its first quarter results for the fiscal year ending June 30, 2025. For the quarter ended September 30, 2024, the company generated revenue and experienced changes in its financial position. The filing also mentions a subsequent event on November 1, 2024, related to the divestiture of its Composites and Fuel Containment business.

Why It Matters

This filing provides insight into Parker Hannifin's financial performance and strategic moves, such as business divestitures, which can impact its future growth and profitability.

Risk Assessment

Risk Level: low — This is a routine quarterly filing with no immediate red flags or significant negative developments.

Key Players & Entities

• PARKER HANNIFIN CORP (company) — Filer
• 20240930 (date) — Reporting Period End Date
• 20241105 (date) — Filing Date
• 6035 PARKLAND BOULEVARD (address) — Business Address
• CLEVELAND (location) — Business City
• OH (location) — Business State
• 44124-4141 (zip_code) — Business Zip
• 2024-11-01 (date) — Subsequent Event Date
• Composites and Fuel Containment Business (business_segment) — Divested Business

FAQ

Filing Documents

• ph-20240930.htm (10-Q) — 885KB
• ph93024ex10a.htm (EX-10.A) — 8KB
• ph9302024ex10b.htm (EX-10.B) — 59KB
• ph9302024ex31a.htm (EX-31.A) — 10KB
• ph9302024ex31b.htm (EX-31.B) — 10KB
• ph9302024ex32.htm (EX-32) — 6KB
• image_0a.jpg (GRAPHIC) — 12KB
• image_0b.jpg (GRAPHIC) — 12KB
• 0000076334-24-000067.txt ( ) — 6601KB
• ph-20240930.xsd (EX-101.SCH) — 45KB
• ph-20240930_cal.xml (EX-101.CAL) — 73KB
• ph-20240930_def.xml (EX-101.DEF) — 198KB
• ph-20240930_lab.xml (EX-101.LAB) — 596KB
• ph-20240930_pre.xml (EX-101.PRE) — 424KB
• ph-20240930_htm.xml (XML) — 927KB

- FINANCIAL INFORMATION

PART I - FINANCIAL INFORMATION

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS PARKER-HANNIFIN CORPORATION CONSOLIDATED STATEMENT OF INCOME (Dollars in thousands, except per share amounts) (Unaudited) Three Months Ended September 30, 2024 2023 Net sales $ 4,903,984 $ 4,847,488 Cost of sales 3,097,719 3,097,349 Selling, general and administrative expenses 848,789 873,691 Interest expense 113,091 134,468 Other income, net ( 30,801 ) ( 78,455 ) Income before income taxes 875,186 820,435 Income taxes 176,658 169,363 Net income 698,528 651,072 Less: Noncontrolling interest in subsidiaries' earnings 108 245 Net income attributable to common shareholders $ 698,420 $ 650,827 Earnings per share attributable to common shareholders: Basic $ 5.43 $ 5.07 Diluted $ 5.34 $ 4.99 See accompanying notes to consolidated financial statements. - 2 - PARKER-HANNIFIN CORPORATION CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (Dollars in thousands) (Unaudited) Three Months Ended September 30, 2024 2023 Net income $ 698,528 $ 651,072 Less: Noncontrolling interests in subsidiaries' earnings 108 245 Net income attributable to common shareholders 698,420 650,827 Other comprehensive income (loss), net of tax Foreign currency translation adjustment 344,546 ( 222,532 ) Retirement benefits plan activity 3,451 818 Other comprehensive income (loss) 347,997 ( 221,714 ) Less: Other comprehensive income for noncontrolling interests 420 361 Other comprehensive income (loss) attributable to common shareholders 347,577 ( 222,075 ) Total comprehensive income attributable to common shareholders $ 1,045,997 $ 428,752 See accompanying notes to consolidated financial statements. - 3 - PARKER-HANNIFIN CORPORATION CONSOLIDATED BALANCE SHEET (Dollars in thousands) (Unaudited) September 30, 2024 June 30, 2024 ASSETS Current assets: Cash and cash equivalents $ 371,068 $ 422,027 Trade accounts receivable, net 2,712,656 2,865,546 Non-trade and notes receivable 317,381 331,429 Inventories 2,872,250 2,78

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share amounts or as otherwise noted) As used in this Quarterly Report on Form 10-Q, unless the context otherwise requires, the terms "Company", "Parker", "we" or "us" refer to Parker-Hannifin Corporation and its subsidiaries. 1. Management representation In the opinion of the management of the Company, the accompanying unaudited consolidated financial statements contain all adjustments (consisting of only normal recurring adjustments) necessary to present fairly the Company's financial position as of September 30, 2024, the results of operations for the three months ended September 30, 2024 and 2023 and cash flows for the three months then ended. These financial statements should be read in conjunction with the consolidated financial statements and related notes included in the Company's 2024 Annual Report on Form 10-K. Subsequent Events The Company has evaluated subsequent events that occurred through the date these financial statements were issued. On November 1, 2024, Parker completed two divestitures. The composites and fuel containment ("CFC") business, which was acquired in the acquisition of Meggitt plc ("Meggitt"), was sold for proceeds of $ 560 million. Refer to Note 4 for further discussion. Additionally, we divested a non-core filtration business within the North America businesses of the Diversified Industrial Segment for proceeds of $ 66 million. 2. New accounting pronouncements In December 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2023-09, "Income Taxes (Topic 740): Improvements to Income Tax Disclosures," which enhances the disclosure requirements for income taxes primarily related to the rate reconciliation and income taxes paid information. The amendments are effective for fiscal years beginning after December 15, 2024. Early adoption is permitted. The amendment should be applied on a prospective basis. Retr

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