ESAB Corp 10-Q for FY2023 Q3

ESAB Corp (ESAB)

10-Q 2023-11-01 For: 2023-09-29

Added on April 12, 2026

About this 10-Q

ESAB Corp filed this 10-Q on November 1, 2023, covering the quarter ended September 29, 2023 (FY2023 Q3).

Headline figures

Quarter ended September 29, 2023, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $681M; up 9.8% from $620.27M a year earlier
Net income: $57.57M; up 10.0% from net income of $52.35M a year earlier
Diluted EPS: $0.94; up 9.3% from $0.86 a year earlier

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Delaware									87-0923837
(State or other jurisdiction of incorporation or organization)									(I.R.S. Employer Identification Number)

909 Rose Avenue, 8th Floor
North Bethesda, Maryland									20852
(Address of principal executive offices)									(Zip Code)


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.001 per share	ESAB	New York Stock Exchange


			Page
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements			2
Consolidated and Combined Condensed Statements of Operations			2
Consolidated and Combined Condensed Statements of Comprehensive (Loss) Income			3
Consolidated and Condensed Balance Sheets			4
Consolidated and Combined Condensed Statements of Equity			5
Consolidated and Combined Condensed Statements of Cash Flows			7
Notes to Consolidated and Combined Condensed Financial Statements			8
Note 1. Organization and Basis of Presentation			8
Note 2. Discontinued Operations			9
Note 3. Acquisition			10
Note 4. Revenue			11
Note 5. Earnings Per Share from Continuing Operations			11
Note 6. Income Taxes			12
Note 7. Inventories, Net			12
Note 8. Accrued and Other Liabilities			12
Note 9. Debt			13
Note 10. Derivatives			15
Note 11. Financial Instruments and Fair Value Measurements			17
Note 12. Equity			19
Note 13. Commitments and Contingencies			21
Note 14. Segment Information			22
Note 15. Related Party Transactions			23
Note 16. Subsequent Events			24
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			25
Item 3. Quantitative and Qualitative Disclosures About Market Risk			41
Item 4. Controls and Procedures			43

PART II - OTHER INFORMATION
Item 1. Legal Proceedings			44
Item 1A. Risk Factors			44
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			44
Item 3. Defaults Upon Senior Securities			44
Item 4. Mine Safety Disclosures			44
Item 5. Other Information			44
Item 6. Exhibits			45

SIGNATURES			46


	Three Months Ended				Nine Months Ended
	September 29, 2023		September 30, 2022		September 29, 2023		September 30, 2022

Net sales	$	680,996	$	620,265	$	2,085,418	$	1,929,353
Cost of sales	431,282		410,927		1,324,392		1,268,212
Gross profit	249,714		209,338		761,026		661,141
Selling, general and administrative expense	145,439		121,668		442,836		394,026
Restructuring and other related charges	3,129		6,676		17,742		16,629
Operating income	101,146		80,994		300,448		250,486
Pension settlement gain	—		(3,300)		—		(3,300)
Interest expense and other, net	20,502		12,165		58,831		19,516
Income from continuing operations before income taxes	80,644		72,129		241,617		234,270
Income tax expense	19,808		17,836		77,806		63,629
Net income from continuing operations	60,836		54,293		163,811		170,641
Loss from discontinued operations, net of taxes	(1,723)		(977)		(4,259)		(4,898)
Net income	59,113		53,316		159,552		165,743
Less: Income attributable to noncontrolling interest, net of taxes	1,543		962		4,506		2,703
Net income attributable to ESAB Corporation	$	57,570	$	52,354	$	155,046	$	163,040
Earnings (loss) per share – basic
Income from continuing operations	$	0.98	$	0.88	$	2.63	$	2.78
Loss on discontinued operations	$	(0.03)	$	(0.02)	$	(0.07)	$	(0.08)
Net income per share	$	0.95	$	0.86	$	2.56	$	2.70
Earnings (loss) per share – diluted
Income from continuing operations	$	0.97	$	0.88	$	2.61	$	2.77
Loss on discontinued operations	$	(0.03)	$	(0.02)	$	(0.07)	$	(0.08)
Net income per share – diluted	$	0.94	$	0.86	$	2.54	$	2.69


	Three Months Ended				Nine Months Ended
	September 29, 2023		September 30, 2022		September 29, 2023		September 30, 2022
Net income	$	59,113	$	53,316	$	159,552	$	165,743
Other comprehensive (loss) income:
Foreign currency translation, net of tax expense of $2,984, $1,630, $2,546 and $2,328	(63,808)		(98,792)		(7,988)		(245,868)
Unrealized (loss) gain on derivatives designated and qualifying as cash flow hedges, net of tax (benefit) expense of $(13), $2,895, $553 and $2,894	(47)		9,960		1,903		9,960
Defined benefit pension and other post-retirement plan activity, net of tax expense of $52, $235, $183 and $710	240		766		1,404		2,322


Other comprehensive loss	(63,615)		(88,066)		(4,681)		(233,586)
Comprehensive (loss) income	(4,502)		(34,750)		154,871		(67,843)
Less: comprehensive income (loss) attributable to noncontrolling interest	853		(181)		4,377		(693)
Comprehensive (loss) income attributable to ESAB Corporation	$	(5,355)	$	(34,569)	$	150,494	$	(67,150)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


(301)			323-9099
(Registrant’s telephone number, including area code)


	September 29, 2023		December 31, 2022
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	82,833	$	72,024
Trade receivables, less allowance for credit losses of $25,664 and $23,471	388,483		374,329
Inventories, net	425,691		416,829
Prepaid expenses	62,765		56,637
Other current assets	69,967		68,851
Total current assets	1,029,739		988,670
Property, plant and equipment, net	276,295		284,226
Goodwill	1,554,004		1,529,767
Intangible assets, net	491,295		517,167
Lease assets - right of use	91,696		92,033
Other assets	313,014		342,152
Total assets	$	3,756,043	$	3,754,015

LIABILITIES AND EQUITY
CURRENT LIABILITIES:
Accounts payable	$	302,630	$	316,265
Accrued liabilities	307,727		285,310
Total current liabilities	610,357		601,575
Long-term debt	1,089,329		1,218,643
Other liabilities	515,261		545,339
Total liabilities	2,214,947		2,365,557
Equity:
Common stock - $0.001 par value - 600,000,000 shares authorized, 60,271,072 and 60,094,725 shares outstanding as of September 29, 2023 and December 31, 2022, respectively	60		60
Additional paid-in capital	1,876,335		1,865,904
Retained earnings	303,954		159,231
Accumulated other comprehensive loss	(679,540)		(674,988)
Total ESAB Corporation equity	1,500,809		1,350,207
Noncontrolling interest	40,287		38,251
Total equity	1,541,096		1,388,458
Total liabilities and equity	$	3,756,043	$	3,754,015


	Common Stock			Additional Paid in Capital		Retained Earnings		Accumulated Other Comprehensive Loss		Noncontrolling Interest		Total
	Shares	Amount
Balance at December 31, 2022	60,094,725	$	60	$	1,865,904	$	159,231	$	(674,988)	$	38,251	$	1,388,458
Net income	—	—		—		31,903		—		1,313		33,216
Dividends declared ($0.05 per share)	—	—		—		(3,033)		—		—		(3,033)
Distributions to noncontrolling owners	—	—		—		—		—		(1,359)		(1,359)
Other comprehensive gain, net of tax benefit of $934	—	—		—		—		38,279		501		38,780
Common stock-based award activity	127,538	—		2,229		—		—		—		2,229
Balance at March 31, 2023	60,222,263	$	60	$	1,868,133	$	188,101	$	(636,709)	$	38,706	$	1,458,291
Net income	—	—		—		65,573		—		1,650		67,223
Dividends declared ($0.06 per share)	—	—		—		(3,644)		—		—		(3,644)

Other comprehensive gain, net of tax expense of $1,193	—	—		—		—		20,094		60		20,154
Common stock-based award activity	37,106	—		4,701		—		—		—		4,701
Balance at June 30, 2023	60,259,369	$	60	$	1,872,834	$	250,030	$	(616,615)	$	40,416	$	1,546,725
Net income	—	—		—		57,570		—		1,543		59,113
Dividends declared ($0.06 per share)	—	—		—		(3,646)		—		—		(3,646)
Distributions to noncontrolling owners	—	—		—		—		—		(982)		(982)
Other comprehensive loss, net of tax expense of $3,023	—	—		—		—		(62,925)		(690)		(63,615)
Common stock-based award activity	11,703	—		3,501		—		—		—		3,501
Balance at September 29, 2023	60,271,072	$	60	$	1,876,335	$	303,954	$	(679,540)	$	40,287	$	1,541,096


	Nine Months Ended September 29, 2023
	Balance at Beginning of Period		Charged to Expense, net		Write-Offs and Deductions		Foreign Currency Translation		Balance at End of Period
	(In thousands)
Allowance for credit losses	$	23,471	$	3,769	$	(1,455)	$	(121)	$	25,664


	September 29, 2023				December 31, 2022
	Current		Noncurrent		Current		Noncurrent
	(In thousands)
Accrued taxes and deferred tax liabilities	$	51,467	$	171,983	$	49,615	$	161,500
Compensation and related benefits	90,480		54,307		74,794		57,438
Asbestos liability	31,016		194,575		30,108		230,581
Contract liability	29,488		—		25,899		—
Lease liability	20,271		74,700		18,664		76,163
Warranty liability	13,369		—		12,946		—
Third-party commissions	16,561		—		18,315		—
Restructuring liability	4,877		47		7,533		285
Other	50,198		19,649		47,436		19,372
	$	307,727	$	515,261	$	285,310	$	545,339


	Nine Months Ended September 29, 2023
	Balance at Beginning of Period		Charges		Payments		Foreign Currency Translation		Balance at End of Period
	(In thousands)
Restructuring and other related charges:
Termination benefits(1)	$	4,910	$	7,405	$	(8,122)	$	(97)	$	4,096
Facility closure costs and other(2)	2,908		4,986		(7,321)		255		828
Subtotal	$	7,818	12,391		$	(15,443)	$	158	$	4,924
Non-cash charges(3)			5,351
Total			$	17,742


		Three Months Ended				Nine Months Ended
Derivative type	(Gain) loss recognized in the Consolidated and Combined Condensed Statements of Operations:	September 29, 2023		September 30, 2022		September 29, 2023		September 30, 2022
		(In thousands)
Interest rate swap agreements	Interest expense and other, net	$	(1,051)	$	1,045	$	(5,746)	$	1,045


	September 29, 2023				December 31, 2022
Designated as hedging instruments:	Other Liabilities		Other Assets		Other Liabilities		Other Assets
	(In thousands)
Cross currency swap agreements	$	9,645	$	—	$	10,769	$	—
Interest rate swap agreements	—		16,798		—		14,342
Total	$	9,645	$	16,798	$	10,769	$	14,342


FORM			10-Q


	Nine Months Ended
	September 29, 2023		September 30, 2022

Cash flows from operating activities:
Net income	$	159,552	$	165,743
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization, and other impairment charges	57,090		48,699

Stock-based compensation expense	11,150		9,532
Deferred income tax	756		(4,725)
Non-cash interest expense	896		1,673
Pension settlement gain	—		(3,300)
Changes in operating assets and liabilities:
Trade receivables, net	(15,170)		(7,361)
Inventories, net	(16,212)		(54,757)
Accounts payable	(17,746)		(10,916)
Other operating assets and liabilities	27,783		(21,673)
Net cash provided by operating activities	208,099		122,915
Cash flows from investing activities:
Purchases of property, plant and equipment	(28,865)		(21,996)
Proceeds from sale of property, plant and equipment	5,171		4,322
Acquisition, net of cash received	(18,665)		—
Net cash used in investing activities	(42,359)		(17,674)
Cash flows from financing activities:
Proceeds from borrowings on term credit facility	—		1,000,000
Proceeds from borrowings on revolving credit facility	454,671		495,881
Repayments of borrowings on term credit facility	(6,250)		—
Repayments of borrowings on revolving credit facility and other	(578,623)		(360,000)

Payment of deferred financing fees and other	—		(4,904)
Payment of deferred consideration	—		(1,500)
Payment of dividends	(9,702)		(3,025)
Consideration to Former Parent in connection with the Separation	—		(1,200,000)
Distributions to noncontrolling interest holders	(2,279)		(1,960)
Transfers from Former Parent, net	—		2,847
Net cash used in financing activities	(142,183)		(72,661)
Effect of foreign exchange rates on Cash and cash equivalents	(12,748)		(13,155)
Increase in Cash and cash equivalents	10,809		19,425
Cash and cash equivalents, beginning of period	72,024		41,209


	September 29, 2023		December 31, 2022
	(In thousands)
Raw materials	$	165,712	$	153,099
Work in process	46,744		44,086
Finished goods	263,823		261,902
	476,279		459,087
LIFO reserve	(5,168)		(2,168)
Less: allowance for excess, slow-moving and obsolete inventory	(45,420)		(40,090)
	$	425,691	$	416,829


	Nine Months Ended
	September 29, 2023		September 30, 2022
	(In thousands)
Warranty liability, beginning of period	$	12,946	$	14,954
Accrued warranty expense	4,448		4,367
Changes in estimates related to pre-existing warranties	2,710		2,190
Cost of warranty service work performed	(7,891)		(6,815)
Acquisition-related liability	1,278		—
Foreign exchange translation effect	(122)		(975)
Warranty liability, end of period	$	13,369	$	13,721


	September 29, 2023				December 31, 2022
Not designated as hedging instruments:	Accrued Liabilities		Other Current Assets		Accrued Liabilities		Other Current Assets
	(In thousands)
Foreign currency contracts	$	2,345	$	—	$	2,166	$	3,682


	September 29, 2023
	Level One		Level Two		Level Three		Total
	(In thousands)
Assets:
Cash equivalents	$	2,301	$	—	$	—	$	2,301
Foreign currency contracts - not designated as hedges	—		612		—		612
Interest rate swap agreements	—		16,798		—		16,798
Deferred compensation plans	—		3,205		—		3,205
	$	2,301	$	20,615	$	—	$	22,916

Liabilities:
Foreign currency contracts - not designated as hedges	$	—	$	2,957	$	—	$	2,957
Cross currency swap agreements	—		9,645		—		9,645
Deferred compensation plans	—		3,205		—		3,205
	$	—	$	15,807	$	—	$	15,807


	Accumulated Other Comprehensive Loss Components
	Net Unrecognized Pension and Other Post-Retirement Benefit Cost		Foreign Currency Translation Adjustment		Net Investment Hedges		Cash Flow Hedges		Total
	(In thousands)
Balance at December 31, 2022	$	(63,847)	$	(613,907)	$	(8,336)	$	11,102	$	(674,988)
Other comprehensive income (loss) before reclassifications:
Net actuarial loss	(2)		—		—		—		(2)
Foreign currency translation adjustment	(108)		31,276		(2,086)		—		29,082
Gain on long-term intra-entity foreign currency transactions	—		12,501		—		—		12,501
Unrealized loss on cash flow hedges	—		—		—		(2,051)		(2,051)
Other comprehensive (loss) income before reclassifications	(110)		43,777		(2,086)		(2,051)		39,530
Amounts reclassified from Accumulated other comprehensive loss(1)(2)	279		—		—		(1,530)		(1,251)
Net current period Other comprehensive (loss) income	169		43,777		(2,086)		(3,581)		38,279
Balance at March 31, 2023	$	(63,678)	$	(570,130)	$	(10,422)	$	7,521	$	(636,709)
Other comprehensive income (loss) before reclassifications:
Net actuarial loss	(2)		—		—		—		(2)
Foreign currency translation adjustment	(49)		(6,381)		(3,036)		—		(9,466)
Gain on long-term intra-entity foreign currency transactions	—		23,142		—		—		23,142
Unrealized gain on cash flow hedges	—		—		—		7,640		7,640
Other comprehensive income (loss) before reclassifications	(51)		16,761		(3,036)		7,640		21,314
Amounts reclassified from Accumulated other comprehensive loss(1)(2)	889		—		—		(2,109)		(1,220)
Net current period Other comprehensive (loss) income	838		16,761		(3,036)		5,531		20,094
Balance at June 30, 2023	$	(62,840)	$	(553,369)	$	(13,458)	$	13,052	$	(616,615)
Other comprehensive income (loss) before reclassifications:
Net actuarial gain	4		—		—		—		4
Foreign currency translation adjustment	161		(79,233)		5,992		—		(73,080)
Gain on long-term intra-entity foreign currency transactions	—		9,962		—		—		9,962
Unrealized gain on cash flow hedges	—		—		—		767		767
Other comprehensive income (loss) before reclassifications	165		(69,271)		5,992		767		(62,347)
Amounts reclassified from Accumulated other comprehensive loss(1)(2)	236		—		—		(814)		(578)
Net current period Other comprehensive (loss) income	401		(69,271)		5,992		(47)		(62,925)
Balance at September 29, 2023	$	(62,439)	$	(622,640)	$	(7,466)	$	13,005	$	(679,540)


	Three Months Ended September 29, 2023									Nine Months Ended September 29, 2023
	Americas			EMEA & APAC			Total			Americas			EMEA & APAC			Total
	(Dollars in millions)(1)
Net income from continuing operations (GAAP)							$	60.8								$	163.8
Income tax expense							19.8									77.8
Interest expense and other, net							20.5									58.8

Operating income (GAAP)	46.5			54.7			101.1			132.4			168.0			300.4

Adjusted to add (deduct)
Restructuring and other related charges(2)	1.6			1.6			3.1			5.4			12.3			17.7
Acquisition-amortization and other related charges(3)	5.2			4.0			9.3			16.0			11.9			27.8
Depreciation and other amortization	3.9			5.0			9.0			11.1			15.5			26.6
Adjusted EBITDA (non-GAAP)	$	57.2		$	65.3		$	122.5		$	164.9		$	207.7		$	372.6
Adjusted EBITDA attributable to Russia (non-GAAP)(4)	—			4.7			4.7			—			15.7			15.7
Core adjusted EBITDA (non-GAAP)	$	57.2		$	60.6		$	117.8		$	164.9		$	192.0		$	356.9
Adjusted EBITDA margin (non-GAAP)	18.7		%	17.4		%	18.0		%	18.2		%	17.6		%	17.9		%
Core adjusted EBITDA margin (non-GAAP)(5)	18.7		%	17.9		%	18.3		%	18.2		%	18.1		%	18.1		%


	Three Months Ended September 30, 2022									Nine Months Ended September 30, 2022
	Americas			EMEA & APAC			Total			Americas			EMEA & APAC			Total
	(Dollars in millions)(1)
Net income from continuing operations (GAAP)							$	54.3								$	170.6
Income tax expense							17.8									63.6
Interest expense and other, net							12.2									19.6
Pension settlement gain							(3.3)									(3.3)
Operating income (GAAP)	36.6			44.4			81.0			102.6			147.9			250.5
Adjusted to add (deduct):
Restructuring and other related charges(2)	1.9			4.8			6.7			9.1			7.6			16.6
Separation costs(3)(4)	0.8			1.0			1.8			4.6			4.3			8.9
Acquisition-amortization and other related charges(5)	4.0			3.3			7.2			12.3			10.2			22.5
Depreciation and other amortization	3.2			5.1			8.3			10.1			16.1			26.2
Other(6)	—			—			—			0.3			(0.2)			0.1
Adjusted EBITDA (non-GAAP)	$	46.4		$	58.6		$	105.0		$	138.9		$	185.9		$	324.8
Adjusted EBITDA attributable to Russia (non-GAAP)(7)	—			9.5			9.5			—			23.4			23.4
Core adjusted EBITDA (non-GAAP)	$	46.4		$	49.2		$	95.5		$	138.9		$	162.5		$	301.4
Adjusted EBITDA margin (non-GAAP)	16.5		%	17.3		%	16.9		%	16.4		%	17.1		%	16.8		%
Core adjusted EBITDA margin (non-GAAP)(8)	16.5		%	16.6		%	16.6		%	16.4		%	16.7		%	16.6		%


	Three Months Ended				Nine Months Ended
	Core Sales(4)		Change %		Core Sales(4)		Change %
	(Dollars in millions)
For the three and nine months ended September 30, 2022	$	577.0			$	1,815.7
Components of Change:
Existing businesses (core organic sales growth)(1)	38.0		6.6	%	118.8		6.5	%
Acquisitions(2)	21.3		3.7	%	59.7		3.3	%
Foreign currency translation(3)	7.8		1.3	%	(23.1)		(1.3)	%
Total core sales growth	67.1		11.6	%	155.3		8.6	%
For the three and nine months ended September 29, 2023	$	644.1			$	1,971.0


Exhibit No.			Exhibit Description





















































31.01			Certification of Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.02			Certification of Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.01			Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.02			Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

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101.CAL			Inline XBRL Extension Calculation Linkbase Document.

101.DEF			Inline XBRL Taxonomy Extension Definition Linkbase Document.

101.LAB			Inline XBRL Taxonomy Extension Label Linkbase Document.

101.PRE			Inline XBRL Taxonomy Extension Presentation Linkbase Document.

104			Cover Page Interactive Data File - The cover page from this Quarterly Report on Form 10-Q for the quarter ended September 29, 2023 is formatted in Inline XBRL (included as Exhibit 101).


1.			I have reviewed this quarterly report on Form 10-Q of ESAB Corporation;


2.			Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;


3.			Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;


4.			The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:


			(a)			Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;


			(b)			Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;


			(c)			Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and


			(d)			Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and


			(a)			All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and


			(b)			Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.


/s/ Shyam P. Kambeyanda
Shyam P. Kambeyanda President and Chief Executive Officer (Principal Executive Officer)


/s/ Kevin Johnson
Kevin Johnson Chief Financial Officer (Principal Financial Officer)