Nordson Corporation Reports Fourth Quarter Results
Nordson Corporation (NASDAQ: NDSN) has revealed its financial results for the fiscal fourth quarter that ended on October 31, 2024. The company reported sales totaling $744 million, marking a 4% increase from the previous year's sales of $719 million during the same quarter. This growth was driven by the positive impact of acquisitions as well as favorable currency translations, mostly offset by a decline in organic sales of 3%.
In terms of profitability, the net income for the fourth quarter reached $122 million, translating to earnings of $2.12 per diluted share— a slight decrease from the $128 million or $2.22 per diluted share reported in the prior year. In terms of adjusted figures, the net income was $160 million, showing an increase from last year's adjusted net income of $156 million. Adjusted earnings per diluted share also rose to $2.78, compared to $2.71 in the previous year.
The company’s earnings before interest, taxes, depreciation, and amortization (EBITDA) for the fourth quarter stood at $241 million, which makes up 32% of total sales. This is a 4% increase from an EBITDA of $227 million in the previous year, keeping the percentage of revenue steady at 32%.
Quarterly Insights from Management
Nordson's President and Chief Executive Officer, Sundaram Nagarajan, reflected positively on the fourth-quarter achievements, stating, “I applaud our team's unwavering focus and dedication to delivering solid results even beyond our expected guidance for the quarter. Notably, our Advanced Technology Solutions (ATS) segment exhibited year-over-year sales growth driven by rising demand in electronics as fiscal year-end approaches. During a downturn in the electronics sector, our ATS division effectively utilized the NBS Next growth framework to be adaptable and meet customer requirements while maximizing operational performance.”
Segment Performance Overview
Breaking down the segment performances gives further insights into Nordson's business areas. In the Industrial Precision Solutions segment, sales were reported at $392 million, which was a 3% drop from the previous year's fourth quarter. This decline resulted from a 5% decrease in organic sales, which was countered somewhat by a 1% gain from acquisitions and a 1% favorable impact from currency translations. This segment’s operating profit fell to $126 million, or 32% of its sales, down 4% compared to the operating profit in the same quarter last year.
The Medical and Fluid Solutions segment performed notably well, reporting sales of $200 million, a substantial increase of 19% from the prior year's fourth quarter. This growth was primarily driven by the acquisition of Atrion. However, it still faced a slight organic sales decline of 3%. Operating profit in this segment stood at $44 million, which equates to 22% of its sales, reflecting a decrease of 8% related to last year's figures. Nevertheless, EBITDA for the segment rose to $72 million, representing 36% of its sales, compared to $62 million from last year, down marginally from 37% of sales in the prior year.
The Advanced Technology Solutions segment reported $152 million in sales, reflecting a 5% increase year-over-year. This growth stems from a 4% rise in organic sales and a 1% currency impact, which led to an operating profit of $33 million or 22% of sales, showing a 6% improvement from the previous year's operating profits. The EBITDA increased by 17% to reach $41 million, now at 27% of sales, a notable rise from last year's EBITDA of $35 million.
Full Year 2024 Summary
For the entire fiscal year 2024, Nordson reported record sales of $2.7 billion, marking a 2% increase from the previous year. This growth was primarily driven by a 5% favorable impact from acquisitions, though there was a 3% decline in organic volume. Net income for the entire fiscal year was reported at $467 million, or $8.11 per diluted share, which is a slight decrease from last year’s $487 million. Adjusted net income was $561 million, down from the prior year's $567 million, with adjusted earnings per diluted share decreasing slightly from $9.85 to $9.73.
During this year, Nordson maintained an EBITDA of $849 million, which was 32% of its overall sales, slightly better than the $819 million or 31% from the previous year. Their free cash flow for the complete year was an impressive $492 million, which translates to a remarkable conversion rate of 105% of net income.
Looking Ahead: Fiscal 2025 Guidance
Nordson anticipates entering fiscal 2025 with an approximate backlog of $580 million, which presents a strong position as they aim for continued growth. Based on order entries, current exchange rates, and market conditions, the company projects sales to be within the range of $2.75 to $2.87 billion for fiscal 2025. Additionally, anticipated adjusted earnings per diluted share are forecasted to range from $9.70 to $10.50.
The first quarter of fiscal 2025 is expected to see sales within $615 to $655 million, with adjusted earnings ranging from $1.95 to $2.15 per diluted share. Nagarajan noted that while long-term fundamentals remain strong, there will be a cautious approach due to current macroeconomic variables, particularly noting the seasonal impacts on business operations during the first quarter.
Company Overview
Founded in 1954, Nordson Corporation is a precision technology company widely recognized for implementing a scalable growth framework and delivering excellence in engineering and product innovation. With a robust direct sales model, Nordson serves over 35 countries focusing on various end markets including medical, electronics, and industrial applications. This diverse market presence enables the company to adapt their strategies effectively in an evolving industry landscape.
Frequently Asked Questions
What major factors influenced Nordson's revenue growth in Q4 2024?
Sales growth was mainly driven by acquisitions and currency translations, despite an organic sales decrease.
What was the net income for Nordson in Q4 2024?
The net income for Q4 2024 was reported at $122 million, corresponding to $2.12 earnings per diluted share.
Will Nordson maintain its growth strategy in the upcoming fiscal year?
Yes, Nordson plans to continue leveraging its NBS Next growth framework while entering fiscal 2025 with a strong backlog.
What are the projected sales for fiscal 2025?
Projected sales for fiscal 2025 are estimated to be in the range of $2.75 to $2.87 billion.
Can you provide a brief overview of Nordson Corporation?
Nordson Corporation specializes in precision technology and operates in over 35 countries, focusing on various critical applications.
