On February 4, 2025, IDEX Corp (IEX, Financial) released its 8-K filing detailing its financial performance for the fourth quarter and full year of 2024. IDEX Corp, a manufacturer of pumps, flow meters, valves, and fluidic systems, operates across various segments including fluid and metering technologies, health and science technologies, and fire and safety and diversified products. Headquartered in Lake Forest, Illinois, the company has a global presence with operations in over 20 countries and employs more than 7,000 people.

Performance Overview: Q4 2024

IDEX Corp reported record sales of $863 million for the fourth quarter of 2024, marking a 9% increase from the same period in 2023, with a 3% organic growth. The reported diluted EPS was $1.62, a 13% increase, while the adjusted diluted EPS was $2.04, up 11%. However, the reported EPS fell short of the analyst estimate of $1.69. The company's operating cash flow was $173 million, down 14%, and free cash flow was $157 million, down 12% from the previous year.

Full Year 2024 Financial Highlights

For the full year, IDEX Corp's sales remained flat at $3.3 billion, with a 2% decline in organic sales. The reported diluted EPS was $6.64, a 15% decrease, while the adjusted diluted EPS was $7.89, down 4%. The company's operating cash flow was $668 million, a 7% decrease, and free cash flow was $603 million, down 4% from 2023.

Segment Performance and Challenges

The Fluid & Metering Technologies segment saw flat net sales at $299.3 million, with a 3% organic growth driven by price capture. The Health & Science Technologies segment experienced a 19% increase in net sales to $373.2 million, largely due to the acquisition of Mott Corporation. The Fire & Safety/Diversified Products segment reported an 8% increase in net sales to $192.9 million, driven by organic growth and recovery in fire OEM markets.

Despite these achievements, IDEX Corp faced challenges such as higher employee-related costs, unfavorable mix, and increased discretionary spending, which impacted gross margins. The geopolitical and economic uncertainties also pose potential risks for the company moving forward.

Financial Metrics and Analysis

Key financial metrics include a gross margin of 42.5% for Q4 2024, slightly down from 42.7% in Q4 2023. The adjusted gross margin improved to 43.1%. The net income margin increased to 14.3% from 13.7% in the previous year. The adjusted EBITDA margin was 26.4%, up from 25.8% in Q4 2023.

IDEX teams drove a strong finish to the year and continued to deliver on their commitments to customers in an increasingly uncertain environment," said Eric D. Ashleman, IDEX Corporation Chief Executive Officer and President.

Conclusion

IDEX Corp's performance in 2024 reflects a mix of growth and challenges. While the company achieved record sales and EPS growth, it fell short of some analyst estimates and faced operational hurdles. The company's strategic acquisitions and focus on organic growth initiatives are expected to drive future performance, despite the uncertainties in the global market. Value investors may find IDEX Corp's strategic positioning and diversified portfolio appealing as the company navigates through these challenges.

Explore the complete 8-K earnings release (here) from IDEX Corp for further details.