Nordson Company studies file second quarter outcomes and will increase steerage for fiscal yr 2021

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WESTLAKE, Ohio – (BUSINESS WIRE) – Nordson Corporation (Nasdaq: NDSN) today announced results for its second fiscal quarter ending April 30, 2021. Revenue was $ 590 million per quarter, an 11% year-over-year increase in revenue for the second quarter of the year of $ 529 million. Robust growth in the non-permanent electronics and consumer end markets and the strengthening of the medical and industrial end markets were the main drivers of this performance. The change in revenue in the second quarter of 2021 included a 10% organic volume increase, a beneficial 4% currency translation effect offset by the adverse net impact of acquisitions and divestitures. Without the sold product line of sold screws and barrels in the previous year for comparison purposes, sales growth in the current fiscal quarter would have been 15%.

Operating profit for the quarter was $ 166 million, or 28% of sales, compared to adjusted operating profit of $ 125 million last year. This 33% increase in Adjusted Operating Income was due to the leverage of sales volume, the improved revenue mix and the benefits of the structural cost reduction measures taken in FY2020, as well as the recent divestment of the Screws and Drums product line. EBITDA for the second quarter of 2021 was $ 192 million, or 33% of sales.

Net income was $ 124 million, up 35% from adjusted income of $ 92 million last year. Diluted earnings per share for the second quarter of 2021 were $ 2.12, a 34% increase over diluted earnings per share of $ 1.58 a year earlier.

“The broader demand in the end market accelerated faster and to a higher level in the quarter than previously assumed. I am very pleased with the dedication and agility of our teams as we achieved record sales and operating results for the quarter, ”said Sundaram Nagarajan, President and Chief Executive Officer of Nordson. “Based on our order backlog and our order trend, we expect this strength to continue and are increasing our sales and earnings forecast for the full year 2021. Our priorities remain consistent – protecting the health and safety of our employees, fully participating in the market recovery by meeting the needs of our customers and implement the Ascend strategy. With this clear focus, we will continue to drive our long-term goals of delivering world-class growth with leading margins and returns. "

Second quarter segment results

Industrial Precision Solutions revenue of $ 299 million increased approximately 6% compared to the second quarter of last year. This is due to an organic increase of 8% and a favorable currency effect of 5%, which was offset by a divestment of 7%. The organic sales increase was driven by strong global demand in the non-permanent and industrial consumer end markets. Without the sale of the screws and barrels product line in the previous year for comparison purposes, sales growth in the current quarter would have been 13%. Operating profit was $ 104 million, or 35% of sales, an increase of 36% over the second quarter of last year.

Advanced Technology Solutions revenue of $ 291 million increased approximately 18% compared to the second quarter of last year. Organic sales increased 13%, while favorable currency effects increased 3% and acquisitions increased sales by approximately 2%. This strong sales growth was driven by test and inspection product lines for electronics end markets and fluid management product lines for medical and industrial end markets. Operating profit was $ 77 million, or 26% of sales, an increase of 30% over the second quarter of last year.

"The strong incremental margins and record quarterly profitability reflect the implementation of the NBS Next growth framework, including a favorable mix improvement through the divestment of the screw and cylinder product line," said Joseph Kelley, Nordson's chief financial officer. "The continued deployment and execution of the overall Ascend strategy is expected to generate revenue growth with attractive additional profit margins."

outlook

Order entry trends steadily improved across most of our product lines in the second quarter of fiscal 2021 and remain strong in the third quarter. Based on the current order backlog, the order entry trends and the correlation at the time of dispatch, we expect sales growth of around 8% to 10% for the 2021 financial year compared to the 2020 financial year, including a headwind of 3% from the sale in the second quarter of the screws and bolts Barrels. Additionally, for full year 2021, we forecast earnings per diluted share in the range of $ 7.20 to $ 7.50, a growth of 31% to 37% from last year's adjusted earnings.

Nordson management will provide additional commentary on these findings and outlook during its previously announced webcast on Tuesday, May 25, 2021 at 8:30 a.m. Eastern Time, available at https://investors.nordson.com. For people who cannot hear the live broadcast, a repetition is available 14 days after the event. For information on Nordson's investor relations and shareholder services, please contact Lara Mahoney, Vice President, Investor Relations and Corporate Communications, at (440) 204-9985 or lara.mahoney@nordson.com.

Certain statements contained in this press release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by words such as “may,” “will,” “should,” “could”. "Expects", "anticipates", "believes", "projects", "projections", "prospects", "guidelines", "proceeding", "goals" or the negative of such terms or comparable terminology. These statements reflect management's current expectations and involve a number of risks and uncertainties. These risks and uncertainties include, but are not limited to, economic conditions in the United States and internationally. Financial and market conditions; Exchange rates and devaluations; potential acquisitions, including the company's ability to successfully integrate acquisitions; the company's ability to successfully dispose or dispose of companies that are deemed inconsistent with its strategic plan; the impact of changes in US trade policy and trade agreements; the effects of changes in tax law; and the potential impact of events beyond our control, such as political unrest, acts of terrorism, natural disasters and pandemics, including the current coronavirus pandemic (COVID-19) and the other factors discussed in Item 1A (Risk Factors) recently filed Annual Report on Form 10-K and on its Forms 10-Q filed with the Securities and Exchange Commission, which should be carefully examined. The company assumes no obligation to update or revise any forward-looking statements contained in this press release.

Nordson Corporation is a global designer and manufacturer of innovative precision technologies for critical customer applications in the consumer, medical, electronics and industrial sectors. The company's products are supported by application expertise and direct global sales and service. Founded in 1954 and headquartered in Westlake, Ohio, the company has offices and support offices in over 35 countries. Visit Nordson on the web at www.nordson.com, www.twitter.com/Nordson_Corp, or www.facebook.com/nordson.

NORDSON CORPORATION

CONSOLIDATED INCOME STATEMENTS (unaudited)

(Dollars in thousands excluding amounts per share)

Three months ended

Six months ended

April 30, 2021

April 30, 2020

April 30, 2021

April 30, 2020

sales

$

589,538

$

529.478

$

1,116,104

$

1,024,394

Cost of sales

251,839

239,880

488,445

471,602

Gross income

337.699

289,598

627.659

552.792

Gross margin%

57.3

%.

54.7

%.

56.2

%.

54.0

%.

Selling and administrative expenses

171,308

164,569

352.243

352.670

Operating profit

166.391

125.029

275.416

200.122

Interest expense – net

(6,690

)

(8.015

)

(13.242

)

(17.167

)

Other expenses – net

(3.843

)

(429

)

(8,504

)

(3.275

)

Earnings before taxes

155.858

116,585

253,670

179,680

Income tax

31,714

24,506

51,944

35,597

Net income

$

124.144

$

92.079

$

201,726

$

144.083

Weighted Average Ordinary Shares Outstanding:

basic

58,068

57,677

58,063

$

57,672

Diluted

58,652

58,260

58,703

58.392

Earnings per share:

Basic income

$

2.14

$

1.60

$

3.47

$

2.50

Diluted earnings

$

2.12

$

1.58

$

3.44

$

2.47

NORDSON CORPORATION

CONSOLIDATED BALANCE SHEETS (unaudited)

(Dollars in thousands)

April 30, 2021

October 31, 2020

Cash and cash equivalents

$

133.320

$

208.293

Receivables – net

470.622

471.873

Inventories – net

295,841

277.033

Other current assets

49,642

43,798

Assets held for sale

– –

19,615

Total current assets

949,425

1,020,612

Property, plant and equipment – net

362.622

358.618

Goodwill

1,720,990

1,713,354

Other assets

561,873

582.072

$

3,594,910

$

3,674,656

Current maturities of long-term debt

$

38.043

$

38.043

Trade payables and provisions

347.224

311,898

Liabilities held for sale

– –

13,148

Total short-term liabilities

385.267

363.089

Long-term liabilities

829.044

1,067,952

Other liabilities

430.242

484.624

Total equity

1,950,357

1,758,991

$

3,594,910

$

3,674,656

NORDSON CORPORATION

CONSOLIDATED DECLARATION OF CASH FLOWS (unaudited)

(Dollars in thousands)

Six months ended

April 30, 2021

April 30, 2020

The cash flow from operating activities:

Net income

$

201,726

$

144.083

Depreciation

51,336

55.664

Other non-cash items

14,858

2.504

Changes in working capital

31,244

4,276

Other long-term assets and liabilities

(51.450

)

11,652

Cash generated from operations

247.714

218.179

Cash flow from investing activities:

Additions to property, plant and equipment

(18.743

)

(25.835

)

Other – net

5.062

(1,896

)

Cash flow from investing activities

(13.681

)

(27.731

)

Cash flow from financing activities:

Issuance (repayment) of long-term debt

(250, 101)

)

39,822

Repayment of finance lease obligations

(3,399

)

(3.548

)

Dividends paid out

(45.342

)

(43.878

)

Issue of common shares

18,783

18,547

Purchase of own shares

(30.274

)

(41.930

)

Cash outflow from financing activities

(310.333

)

(30.987

)

Effect of Changes in Exchange Rates on Cash

1.327

(4,370)

)

Net change in cash and cash equivalents

(74.973

)

155.091

Cash and cash equivalents:

Beginning of the period

208.293

151.164

End of the period

$

133.320

$

306.255

NORDSON CORPORATION

SALE BY GEOGRAPHICAL SEGMENT (unaudited)

(Dollars in thousands)

Three months ended

Sales variance

April, 30th,

2021

April, 30th,

2020

Bio

Acquisitions /

Divestments

currency

total

SALE BY SEGMENT

Industrial precision solutions

$

298.775

$

282.274

8.3

%.

(7.3

)%

4.8

%.

5.8

%.

Advanced technology solutions

290,763

247.204

12.7

%.

2.4

%.

2.5

%.

17.6

%.

Total sales

$

589,538

$

529.478

10.4

%.

(2.8

)%

3.7

%.

11.3

%.

SALE BY GEOGRAPHICAL REGION

United States

$

202.924

$

188.933

12.1

%.

(4.7

)%

– –

%.

7.4

%.

America

44,914

36.673

15.1

%.

5.4

%.

2.0

%.

22.5

%.

Europe

156.451

136.056

8.3

%.

(2.3

)%

9.0

%.

15.0

%.

Japan

27,852

31,575

(8.5

)%

(4.0

)%

0.7

%.

(11.8

)%

Asia Pacific

157.397

136.241

13.6

%.

(2.5

)%

4.4

%.

15.5

%.

Total sales

$

589,538

$

529.478

10.4

%.

(2.8

)%

3.7

%.

11.3

%.

Six months ended

Sales variance

April, 30th,

2021

April, 30th,

2020

Bio

Acquisitions /

Divestments

currency

total

SALE BY SEGMENT

Industrial precision solutions

$

587.191

$

546.073

8.0

%.

(4.7

)%

4.2

%.

7.5

%.

Advanced technology solutions

528.913

478,321

6.0

%.

2.3

%.

2.3

%.

10.6

%.

Total sales

$

1,116,104

$

1,024,394

7.0

%.

(1.3

)%

3.3

%.

9.0

%.

SALE BY GEOGRAPHICAL REGION

United States

$

388.240

$

377,433

5.0

%.

(2.1

)%

– –

%.

2.9

%.

America

81.052

67,756

13.8

%.

6.3

%.

(0.5

)%

19.6

%.

Europe

291,602

262,447

4.8

%.

(1.6

)%

7.9

%.

11.1

%.

Japan

54,967

59.127

(6.7

)%

(2.9

)%

2.6

%.

(7.0

)%

Asia Pacific

300.243

257.631

13.5

%.

(1.4

)%

4.4

%.

16.5

%.

Total sales

$

1,116,104

$

1,024,394

7.0

%.

(1.3

)%

3.3

%.

9.0

%.

NORDSON CORPORATION

ALIGNMENT OF NON-GAAP MEASURES – ADJUSTED OPERATING PROFIT AND EBITDA (unaudited)

(Dollars in thousands)

Three months ended

Six months ended

April 30, 2021

April 30, 2020

April 30, 2021

April 30, 2020

SALE BY SEGMENT

Industrial precision solutions

$

298.775

$

282.274

$

587.191

$

546.073

Advanced technology solutions

290,763

247.204

528.913

478,321

Total sales

$

589,538

$

529.478

$

1,116,104

$

1,024,394

OPERATING RESULT

Industrial precision solutions

$

104.283

$

76.454

$

187.686

$

132,858

Advanced technology solutions

76,585

58,689

123.786

90.976

Corporate

(14.477

)

(10.114

)

(36.056

)

(23.712

)

Total operating profit

$

166.391

$

125.029

$

275.416

$

200.122

OPERATING PROFIT ADJUSTMENTS (1)

Industrial precision solutions

$

– –

$

364

$

– –

$

664

Advanced technology solutions

– –

– –

– –

2,970

Corporate

– –

– –

– –

– –

Overall adjustments

$

– –

$

364

$

– –

$

3,634

ADJUSTED OPERATING PROFIT (NON-GAAP) (2)

% of

sales

% of

sales

% of

sales

% of

sales

Industrial precision solutions

$

104.283

35

%.

$

76,818

27

%.

$

187.686

32

%.

$

133,522

24

%.

Advanced technology solutions

76,585

26th

%.

58,689

24

%.

123.786

23

%.

93,946

20th

%.

Corporate

(14.477

)

(10.114

)

(36.056

)

(23.712

)

Total operating profit – adjusted

$

166.391

28

%.

$

125.393

24

%.

$

275.416

25th

%.

$

203,756

20th

%.

Depreciation & amortization

Industrial precision solutions

$

6.468

$

9.296

$

13,451

$

19,125

Advanced technology solutions

16,421

15,245

32,965

31,565

Corporate

2,427

2.505

4,920

4,974

Total depreciation

$

25,316

$

27,046

$

51,336

$

55.664

EBITDA (NON-GAAP) (2)

Industrial precision solutions

$

110.751

37

%.

$

86.114

31

%.

$

201.137

34

%.

$

152.647

28

%.

Advanced technology solutions

93.006

32

%.

73.934

30th

%.

156.751

30th

%.

125,511

26th

%.

Corporate

(12.050

)

(7.609

)

(31, 136

)

(18,738

)

Total EBITDA

$

191.707

33

%.

$

152,439

29

%.

$

326,752

29

%.

$

259.420

25th

%.

(1)

Represents costs and adjustments related to measures to simplify the cost structure.

(2)

Adjusted Income from Operations and Adjusted EBITDA are non-GAAP measures that management uses to evaluate the company's ongoing operations. Adjusted profit from operations is defined as profit from operations plus certain adjustments, e.g. B. Measures to simplify the cost structure. EBITDA is defined as adjusted operating profit plus depreciation.

NORDSON CORPORATION

Reconciliation of Non-GAAP Measures – Profitability (Unaudited)

(Dollars in thousands)

Three months ended

Six months ended

April 30, 2021

April 30, 2020

April 30, 2021

April 30, 2020

GAAP AS REPORTED

Operating profit

$

166.391

$

125.029

$

275.416

$

200.122

Other / interest expenses – net

(10,533

)

(8.444

)

(21,746

)

(20,442

)

Net income

124.144

92.079

201,726

144.083

Diluted earnings per share

$

2.12

$

1.58

$

3.44

$

2.47

Shares outstanding – diluted

58,652

58,260

58,703

58.392

OPERATING PROFIT ADJUSTMENTS

Severance pay and others

$

– –

$

364

– –

3,634

Adjustments after taxes

$

– –

$

287

$

– –

$

2.860

Other discrete tax items

$

– –

$

(138

)

$

– –

$

(2.675

)

EPS effect of adjustments and other discrete tax items

$

– –

$

– –

$

– –

$

– –

NON-GAAP MEASURES ADJUSTED PROFITABILITY

Operating profit (1)

$

166.391

$

125.393

$

275.416

$

203,756

Operating profit% of sales

28.2

%.

23.7

%.

24.7

%.

19.9

%.

Net income (2)

$

124.144

$

92.228

$

201,726

$

144.268

Diluted earnings per share (3)

$

2.12

$

1.58

$

3.44

$

2.47

(1)

Adjusted profit from operations is defined as profit from operations plus certain adjustments, e.g. B. Measures to simplify the cost structure. Adjusted operating income as a percentage of sales is defined as adjusted operating income divided by sales.

(2)

Adjusted net income is defined as net income plus tax adjustments and other discrete tax items.

(3)

Adjusted earnings per share are defined as GAAP EPS adjusted for tax adjustments and other discrete tax items.

Management uses these non-GAAP measures internally to make strategic decisions, forecast future results, and evaluate the company's current performance. Given the management's use of these non-GAAP measures, the Company believes that these measures are important for investors to understand in order to understand the current and future results of the company from a management perspective. In addition, management believes these non-GAAP measures will be useful for investors to better understand changes in the company's core business over different time periods. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with non-GAAP financial measures of other companies, even if they have similar names. Amounts may not be added due to rounding.