EPAC 8-K

Enerpac Tool Group Corp (EPAC)

8-K 2023-10-17 For: 2023-10-16

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Added on April 08, 2026

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Wisconsin	001-11288	39-0168610
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification Number)

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Class A Common Stock, par value $0.20 per share		EPAC		New York Stock Exchange

	ENERPAC TOOL GROUP CORP.

	By:	/s/ James Denis
		James Denis
		Executive Vice President, General Counsel and Secretary

Consolidated Results from Continuing Operations
(US$ in millions, except per share)
	Three Months Ended		Twelve Months Ended
	August 31, 2023	August 31, 2022	August 31, 2023	August 31, 2022
Net Sales	$160.6	$151.8	$598.2	$571.2
Net Earnings	$23.1	$10.2	$53.6	$19.6
Diluted Earnings Per Share	$0.41	$0.18	$0.94	$0.33
Adjusted Diluted Earnings Per Share	$0.42	$0.35	$1.45	$0.81

Industrial Tools & Services (IT&S)
(US$ in millions)
	Three Months Ended		Twelve Months Ended
	August 31, 2023	August 31, 2022	August 31, 2023	August 31, 2022
Net Sales	$152.9	$139.7	$555.2	$527.3
Operating Profit	$42.6	$28.9	$135.9	$78.7
Operating Profit %	27.9%	20.7%	24.5%	14.9%
Adjusted Op Profit ⁽¹⁾	$45.3	$31.9	$149.0	$86.6
Adjusted Op Profit % ⁽¹⁾	29.6%	22.8%	26.8%	16.4%

⁽¹⁾Excludes $1.4 million of restructuring charges and $1.3 million of ASCEND charges in the fourth quarter of fiscal 2023 compared to $2.2 million of restructuring charges and $0.8 million of ASCEND charges in the fourth quarter of fiscal 2022. The twelve months ended August 31, 2023, excludes $6.0 million of restructuring charges and $7.1 million of ASCEND charges, compared to $5.9 million of restructuring charges, $0.9 million of ASCEND charges, $1.1 million of impairment & divestiture charges, $0.5 million of leadership transition charges, and a gain on sale of a facility, net of transaction charges, of $0.6 million in the prior fiscal year.

EPAC 8-K

Enerpac Tool Group Reports Strong Fourth Quarter and Full-Year Results; Introduces Full-Year Fiscal 2024 Outlook

Contacts

Balance Sheet and Leverage
(US$ in millions)
	August 31, 2023	May 31, 2023	August 31, 2022
Cash Balance	$154.4	$142.0	$120.7
Debt Balance	$214.1	$234.7	$204.0
Net Debt to Adjusted EBITDA^*	0.6x	1.0x	0.9x

Enerpac Tool Group Corp.
Condensed Consolidated Balance Sheets
(In thousands)

	(Unaudited)
	August 31,			August 31,
	2023			2022
Assets
Current assets
Cash and cash equivalents	$	154,415		$	120,699
Accounts receivable, net		97,649			106,747
Inventories, net		74,765			83,672
Other current assets		28,811			31,262
Total current assets		355,640			342,380

Property, plant and equipment, net		38,968			41,372
Goodwill		266,494			257,949
Other intangible assets, net		37,338			41,507
Other long-term assets		64,157			74,104

Total assets	$	762,597		$	757,312

Liabilities and Shareholders' Equity
Current liabilities
Trade accounts payable	$	50,483		$	72,524
Accrued compensation and benefits		33,194			21,390
Current maturities of long-term debt		3,750			-
Short-term debt		-			4,000
Income taxes payable		3,771			4,594
Other current liabilities		56,922			50,680
Total current liabilities		148,120			153,188

Long-term debt, net		210,337			200,000
Deferred income taxes		5,667			7,355
Pension and postretirement benefit liabilities		10,247			11,941
Other long-term liabilities		61,606			66,217
Total liabilities		435,977			438,701

Shareholders' equity
Capital stock		16,752			16,679
Additional paid-in capital		220,472			212,986
Treasury stock		(800,506	)		(742,844	)
Retained earnings		1,011,112			966,751
Accumulated other comprehensive loss		(121,210	)		(134,961	)
Stock held in trust		(3,484	)		(3,209	)
Deferred compensation liability		3,484			3,209
Total shareholders' equity		326,620			318,611

Total liabilities and shareholders' equity	$	762,597		$	757,312

Enerpac Tool Group Corp.
Condensed Consolidated Statements of Earnings
(In thousands, except per share amounts)
(Unaudited)

	Three Months Ended						Twelve Months Ended
	August 31,			August 31,			August 31,			August 31,
	2023			2022			2023			2022
Net sales	$	160,609		$	151,827		$	598,204		$	571,223
Cost of products sold		81,701			78,093			303,165			305,835
Gross profit		78,908			73,734			295,039			265,388

Selling, general and administrative expenses		50,948			54,634			205,064			216,874
Amortization of intangible assets		1,037			1,628			5,112			7,306
Restructuring charges		876			3,049			7,096			8,135
Impairment & divestiture (benefit) charges		(6,155	)		1,297			(6,155	)		2,413
Operating profit		32,202			13,126			83,922			30,660

Financing costs, net		3,219			1,719			12,389			4,386
Other expense, net		688			1,278			2,635			2,282
Earnings before income tax expense		28,295			10,129			68,898			23,992

Income tax expense (benefit)		5,190			(95	)		15,249			4,401
Net earnings from continuing operations		23,105			10,224			53,649			19,591
Loss from discontinued operations, net of income taxes		(874	)		(190	)		(7,088	)		(3,905	)
Net earnings	$	22,231		$	10,034		$	46,561		$	15,686

Earnings per share from continuing operations
Basic	$	0.41		$	0.18		$	0.95		$	0.33
Diluted		0.41			0.18			0.94			0.33

Loss per share from discontinued operations
Basic	$	(0.02	)	$	(0.00	)	$	(0.13	)	$	(0.07	)
Diluted		(0.02	)		(0.00	)		(0.12	)		(0.07	)

Earnings per share*
Basic	$	0.40		$	0.17		$	0.82		$	0.26
Diluted		0.40			0.17			0.82			0.26

Weighted average common shares outstanding
Basic		55,740			57,524			56,680			59,538
Diluted		56,219			57,963			57,117			59,909

*The total of earnings per share from continuing operations and loss per share from discontinued operations may not equal earnings per share due to rounding.

Enerpac Tool Group Corp.
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)

	Three Months Ended						Twelve Months Ended
	August 31,			August 31,			August 31,			August 31,
	2023			2022			2023			2022
Operating Activities
Cash provided by operating activities - continuing operations	$	54,012		$	44,731		$	78,573		$	52,246
Cash used in operating activities - discontinued operations		(3,440	)		(191	)		(970	)		(510	)
Cash provided by operating activities	$	50,572		$	44,540		$	77,603		$	51,736

Investing Activities
Capital expenditures		(1,009	)		(1,447	)		(9,400	)		(8,417	)
Proceeds from sale of property, plant and equipment		90			18			685			1,176
Proceeds from sale of business, net of transaction costs		20,057			-			20,057			-
Cash provided by (used in) investing activities - continuing operations	$	19,138		$	(1,429	)	$	11,342		$	(7,241	)
Cash provided by (used in) investing activities	$	19,138		$	(1,429	)	$	11,342		$	(7,241	)

Financing Activities
Borrowings on revolving credit facility		9,000			40,000			69,000			85,000
Principal repayments on revolving credit facility		(29,000	)		(45,000	)		(53,000	)		(60,000	)
Principal repayments on term loan		(625	)		-			(1,250	)		-
Proceeds from issuance of term loan		-			-			200,000			-
Payment for redemption of revolver		-			-			(200,000	)		-
Swingline borrowings/repayments, net		-			4,000			(4,000	)		4,000
Payment of debt issuance costs		-			-			(2,486	)		-
Purchase of treasury shares		(36,831	)		(38,817	)		(57,662	)		(75,112	)
Stock options, taxes paid related to the net share settlement of equity awards & other		3			(520	)		(1,458	)		(3,681	)
Payment of cash dividend		-			-			(2,274	)		(2,409	)
Cash used in financing activities - continuing operations	$	(57,453	)	$	(40,337	)	$	(53,130	)	$	(52,202	)
Cash used in financing activities	$	(57,453	)	$	(40,337	)	$	(53,130	)	$	(52,202	)

Effect of exchange rate changes on cash		157			(5,780	)		(2,099	)		(11,946	)

Net cash increase (decrease) from continuing operations		15,854			(2,815	)		34,686			(19,143	)
Net cash decrease from discontinued operations		(3,440	)		(191	)		(970	)		(510	)
Net increase (decrease) from cash and cash equivalents	$	12,414		$	(3,006	)	$	33,716		$	(19,653	)
Cash and cash equivalents - beginning of period		142,001			123,705			120,699			140,352
Cash and cash equivalents - end of period	$	154,415		$	120,699		$	154,415		$	120,699

Enerpac Tool Group Corp.
Supplemental Unaudited Data
Reconciliation of GAAP Measures to Non-GAAP Measures
(In thousands)	Fiscal 2022															Fiscal 2023
	Q1			Q2			Q3			Q4			TOTAL			Q1			Q2			Q3			Q4			TOTAL
Net Sales
Industrial Tools & Services Segment	$	121,313		$	125,940		$	140,395		$	139,694		$	527,342		$	127,297		$	130,904		$	144,126		$	152,851		$	555,178
Other		9,590			10,659			11,499			12,133			43,881			12,085			11,056			12,127			7,758			43,026
Total	$	130,903		$	136,599		$	151,894		$	151,827		$	571,223		$	139,382		$	141,960		$	156,253		$	160,609		$	598,204

% Net Sales Growth
Industrial Tools & Services Segment		8	%		12	%		5	%		4	%		7	%		5	%		4	%		3	%		9	%		5	%
Other		32	%		35	%		18	%		14	%		23	%		26	%		4	%		5	%		-36	%		-2	%
Total		10	%		13	%		6	%		4	%		8	%		6	%		4	%		3	%		6	%		5	%

Adjusted Operating Profit from Continuing Operations
Operating profit	$	6,407		$	4,484		$	6,643		$	13,126		$	30,660		$	12,309		$	13,972		$	25,439		$	32,202		$	83,922
Impairment & divestiture charges (benefit)		-			1,116			-			1,297			2,413			-			-			-			(6,155	)		(6,155	)
Restructuring charges (1)		2,737			1,832			517			3,049			8,135			982			2,987			2,252			1,461			7,681
Gain on sale of facility, net of transaction charges		-			-			(585	)		-			(585	)		-			-			-			-			-
Leadership transition charges (benefit) (2)		3,759			1,747			2,800			(37	)		8,269			400			202			90			90			783
Business review charges		-			2,500			502			-			3,002			-			-			-			-			-
M&A charges		-			-			-			-			-			-			196			166			653			1,015
ASCEND transformation program charges		-			-			3,856			9,760			13,616			9,419			11,372			5,947			8,681			35,419
Adjusted operating profit	$	12,903		$	11,679		$	13,733		$	27,195		$	65,510		$	23,110		$	28,729		$	33,894		$	36,932		$	122,665

Adjusted Operating Profit by Segment
Industrial Tools & Services Segment	$	19,646		$	15,654		$	19,421		$	31,878		$	86,600		$	29,099		$	34,836		$	39,814		$	45,269		$	149,019
Other		(1,257	)		334			1,017			1,853			1,947			1,424			1,156			1,965			254			4,799
Corporate / General		(5,486	)		(4,309	)		(6,705	)		(6,536	)		(23,037	)		(7,413	)		(7,263	)		(7,885	)		(8,591	)		(31,153	)
Adjusted operating profit	$	12,903		$	11,679		$	13,733		$	27,195		$	65,510		$	23,110		$	28,729		$	33,894		$	36,932		$	122,665

Adjusted Operating Profit %
Industrial Tools & Services Segment		16.2	%		12.4	%		13.8	%		22.8	%		16.4	%		22.9	%		26.6	%		27.6	%		29.6	%		26.8	%
Other		-13.1	%		3.1	%		8.8	%		15.3	%		4.4	%		11.8	%		10.5	%		16.2	%		3.3	%		11.2	%
Adjusted Operating Profit %		9.9	%		8.5	%		9.0	%		17.9	%		11.5	%		16.6	%		20.2	%		21.7	%		23.0	%		20.5	%

EBITDA from Continuing Operations (3)
Earnings from continuing operations	$	3,185		$	2,121		$	4,061		$	10,224		$	19,591		$	6,409		$	7,158		$	16,976		$	23,105		$	53,649
Financing costs, net		961			755			951			1,719			4,386			2,815			3,105			3,250			3,219			12,389
Income tax expense (benefit)		1,781			1,337			1,377			(95	)		4,401			2,383			2,988			4,688			5,190			15,249
Depreciation & amortization		5,175			4,986			4,822			4,617			19,600			4,193			4,226			4,084			3,810			16,313
EBITDA	$	11,102		$	9,199		$	11,211		$	16,465		$	47,978		$	15,800		$	17,477		$	28,998		$	35,324		$	97,600

Adjusted EBITDA from Continuing Operations (3)
EBITDA	$	11,102		$	9,199		$	11,211		$	16,465		$	47,978		$	15,800		$	17,477		$	28,998		$	35,324		$	97,600
Impairment & divestiture charges (benefit)		-			1,116			-			1,297			2,413			-			-			-			(6,155	)		(6,155	)
Restructuring charges (1)		2,737			1,832			517			3,049			8,135			982			2,987			2,252			1,461			7,681
Gain on sale of facility, net of transaction charges		-			-			(585	)		-			(585	)		-			-			-			-			-
Leadership transition charges (benefit) (2)		3,759			1,747			2,800			(37	)		8,269			400			202			90			90			783
Business review charges		-			2,500			502			-			3,002			-			-			-			-			-
M&A charges		-			-			-			-			-			-			196			166			653			1,015
ASCEND transformation program charges		-			-			3,856			9,760			13,616			9,419			11,372			5,947			8,681			35,419
Adjusted EBITDA	$	17,598		$	16,394		$	18,301		$	30,534		$	82,828		$	26,601		$	32,234		$	37,453		$	40,054		$	136,343

Adjusted EBITDA by Segment
Industrial Tools & Services Segment	$	22,996		$	19,260		$	22,853		$	34,154		$	99,263		$	31,698		$	37,458		$	42,525		$	47,952		$	159,633
Other		(263	)		1,225			1,912			2,741			5,615			2,316			2,050			2,855			739			7,961
Corporate / General		(5,135	)		(4,091	)		(6,464	)		(6,361	)		(22,050	)		(7,413	)		(7,274	)		(7,927	)		(8,637	)		(31,251	)
Adjusted EBITDA	$	17,598		$	16,394		$	18,301		$	30,534		$	82,828		$	26,601		$	32,234		$	37,453		$	40,054		$	136,343

Adjusted EBITDA %
Industrial Tools & Services Segment		19.0	%		15.3	%		16.3	%		24.4	%		18.8	%		24.9	%		28.6	%		29.5	%		31.4	%		28.8	%
Other		-2.7	%		11.5	%		16.6	%		22.6	%		12.8	%		19.2	%		18.5	%		23.5	%		9.5	%		18.5	%
Adjusted EBITDA %		13.4	%		12.0	%		12.0	%		20.1	%		14.5	%		19.1	%		22.7	%		24.0	%		24.9	%		22.8	%

Notes:
(1) Approximately $0.6 million of the Q4 fiscal 2023 restructuring charges were recorded in cost of products sold.
(2) Caption updated from "Leadership transition & board search charges (benefit)" used during Fiscal 2022, costs included have not been altered.
(3) EBITDA represents net earnings from continuing operations before financing costs, net, income tax expense (benefit), and depreciation & amortization. Neither EBITDA nor adjusted EBITDA are calculated based upon generally accepted accounting principles ("GAAP"). The amounts included in the EBITDA and adjusted EBITDA calculation, however, are derived from amounts included in the Condensed Consolidated Statements of Earnings. EBITDA and adjusted EBITDA should not be considered as alternatives to net earnings, operating profit or operating cash flows. The Company has presented EBITDA and adjusted EBITDA because it regularly reviews these performance measures. In addition, EBITDA and adjusted EBITDA are used by many of our investors and lenders, and are presented as a convenience to them. The EBITDA and adjusted EBITDA measures presented may not always be comparable to similarly titled measures reported by other companies due to differences in the components of the calculation.

Enerpac Tool Group Corp.
Supplemental Unaudited Data
Reconciliation of GAAP To Non-GAAP Guidance
(In millions)
	Fiscal 2024
	Low			High
Reconciliation of Continued Operations GAAP Operating Profit
To Adjusted EBITDA (7)
GAAP Operating profit	$	113		$	130
ASCEND transformation program charges		10			7
Restructuring charges		5			3
Adjusted operating profit	$	128		$	140
Other expense, net		(1	)		(1	)
Depreciation & amortization		15			13
Adjusted EBITDA	$	142		$	152

Reconciliation of GAAP Cash Flow From Operations to Free Cash Flow (7)
Cash provided by operating activities	$	72		$	87
Capital expenditures		(12	)		(17	)
Other		-			-
Free Cash Flow Guidance	$	60		$	70

Notes continued:
(7) Management does not provide guidance on GAAP financial measures as we are unable to predict and estimate with certainty items such as potential impairments, refinancing costs, business divestiture gains/losses, discrete tax adjustments, or other items impacting GAAP financial metrics. As a result, we have included above only those items about which we are aware and are reasonably likely to occur during the guidance period covered.

Enerpac Tool Group Corp.
Supplemental Unaudited Data
Reconciliation of GAAP Measures to Non-GAAP Measures
(In thousands)	Fiscal 2022															Fiscal 2023
	Q1			Q2			Q3			Q4			TOTAL			Q1			Q2			Q3			Q4			TOTAL
Net Sales by Segment
Industrial Tools & Services Segment	$	121,313		$	125,940		$	140,395		$	139,694		$	527,342		$	127,297		$	130,904		$	144,126		$	152,851		$	555,178
Other		9,590			10,659			11,499			12,133			43,881			12,085			11,056			12,127			7,758			43,026
Total	$	130,903		$	136,599		$	151,894		$	151,827		$	571,223		$	139,382		$	141,960		$	156,253		$	160,609		$	598,204

Fx Impact on Net Sales
Industrial Tools & Services Segment	$	(7,075	)	$	(3,189	)	$	(2,028	)	$	1,294		$	(10,998	)	$	-		$	-		$	-		$	-		$	-
Other		-			-			-			-			-			-			-			-			-			-
Total	$	(7,075	)	$	(3,189	)	$	(2,028	)	$	1,294		$	(10,998	)	$	-		$	-		$	-		$	-		$	-

Impact from Divestitures or Acquisitions on Net Sales
Industrial Tools & Services Segment	$	-		$	-		$	-		$	-		$	-		$	-		$	-		$	-		$	-		$	-
Other		-			-			-			(5,556	)		(5,556	)		-			-			-			(121	)		(121	)
Total	$	-		$	-		$	-		$	(5,556	)	$	(5,556	)	$	-		$	-		$	-		$	(121	)	$	(121	)

Core Sales by Segment (4)
Industrial Tools & Services Segment	$	114,238		$	122,751		$	138,367		$	140,988		$	516,344		$	127,297		$	130,904		$	144,126		$	152,851		$	555,178
Other		9,590			10,659			11,499			6,577			38,325			12,085			11,056			12,127			7,637			42,905
Total	$	123,828		$	133,410		$	149,866		$	147,565		$	554,669		$	139,382		$	141,960		$	156,253		$	160,488		$	598,083

Core Sales Growth (Decline) %
Industrial Tools & Services Segment																	11	%		7	%		4	%		8	%		8	%
Other																	26	%		4	%		5	%		16	%		12	%
Total																	13	%		6	%		4	%		9	%		8	%

Net Sales by Product Line
Product	$	101,939		$	108,157		$	121,414		$	122,616		$	454,126		$	111,002		$	115,251		$	129,995		$	134,379		$	490,629
Service		28,964			28,442			30,480			29,211			117,097			28,380			26,709			26,258			26,230			107,575
Total	$	130,903		$	136,599		$	151,894		$	151,827		$	571,223		$	139,382		$	141,960		$	156,253		$	160,609		$	598,204

Fx Impact on Net Sales
Product	$	(5,555	)	$	(2,628	)	$	(1,615	)	$	762		$	(9,035	)	$	-		$	-		$	-		$	-		$	-
Service		(1,520	)		(561	)		(413	)		532			(1,962	)		-			-			-			-			-
Total	$	(7,075	)	$	(3,189	)	$	(2,028	)	$	1,294		$	(10,998	)	$	-		$	-		$	-		$	-		$	-