PH 8-K
Parker-Hannifin Corp (PH)
8-K
2025-01-30
For: 2025-01-30
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April 02, 2026
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported): January 30, 2025
(Exact Name of Registrant as Specified in Charter)
(State or other jurisdiction of Incorporation or Organization) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||||||
(Address of Principal Executive Offices) | (Zip Code) | |||||||
Registrant's telephone number, including area code: (216 ) 896-3000
Not Applicable
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
240.14d-2(b))
240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
| Title of Each Class | Trading Symbol | Name of Each Exchange on which Registered | ||||||||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company | ||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition
On January 30, 2025, Parker-Hannifin Corporation issued a press release and presented a Webcast announcing results of operations for the quarter ended December 31, 2024. A copy of the press release is furnished as Exhibit 99.1 to this report. A copy of the Webcast presentation is furnished as Exhibit 99.2 to this report.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits:
104 Cover Page Interactive Data File (embedded within the Inline XBRL document)
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.
| PARKER-HANNIFIN CORPORATION | |||||||||||
| By: /s/ Todd M. Leombruno | |||||||||||
| Todd M. Leombruno | |||||||||||
| Executive Vice President and Chief Financial Officer | |||||||||||
| Date: | January 30, 2025 | ||||||||||
Exhibit 99.1
Parker Reports Fiscal 2025 Second Quarter Results
Record segment operating margin, EPS and YTD cash flow from operations
CLEVELAND, January 30, 2025 -- Parker Hannifin Corporation (NYSE: PH), the global leader in motion and control technologies, today reported results for the quarter ended December 31, 2024, that included the following highlights (compared with the prior year quarter):
Fiscal 2025 Second Quarter Highlights:
•Sales were $4.7 billion; organic sales growth was 1%
•Net income was $949 million, an increase of 39%, or $853 million adjusted, an increase of 6%
•EPS were $7.25, an increase of 39%, or $6.53 adjusted, an increase of 6%
•Segment operating margin was 22.1%, an increase of 100 bps, or 25.6% adjusted, an increase of 110 bps
•YTD cash flow from operations increased 24% to $1.7 billion, or 17.4% of sales
“Our performance this quarter reflects our focus on operational excellence and the strength of our balanced portfolio,” said Jenny Parmentier, Chairman and Chief Executive Officer. “We delivered record segment operating margin across all businesses, record earnings per share and year-to-date cash flow from operations. Strong cash flow from operations coupled with proceeds from previously announced divestitures allowed us to substantially reduce debt by $1.1 billion this quarter. We are encouraged to see industrial orders turn positive mainly in our longer-cycle businesses. Looking ahead, we have updated our outlook for fiscal year 2025 to reflect stronger Aerospace growth, currency headwinds and a continued delay in the expected industrial recovery. Our strong cash generation creates capital deployment optionality, and we remain committed to our strategy of actively deploying capital to drive shareholder value.”
This news release contains non-GAAP financial measures. Reconciliations of adjusted numbers and certain non-GAAP financial measures are included in the financial tables of this press release.
Outlook
Guidance for the fiscal year ending June 30, 2025 has been updated. The company expects:
•Sales growth in fiscal 2025 of (2%) to 1%, with organic sales growth of approximately 2%; divestitures of (1.5%) and unfavorable currency of (1.0%)
•Total segment operating margin of approximately 22.7%, or approximately 25.8% on an adjusted basis
•EPS of $24.46 to $25.06, or $26.40 to $27.00 on an adjusted basis
Segment Results
Diversified Industrial Segment
North America Businesses | |||||||||||||||||||||||
| $ in mm | FY25 Q2 | FY24 Q2 | Change | Organic Growth | |||||||||||||||||||
Sales | $ | 1,928 | $ | 2,110 | -8.6 | % | -5.0 | % | |||||||||||||||
Segment Operating Income | $ | 427 | $ | 462 | -7.6 | % | |||||||||||||||||
Segment Operating Margin | 22.1 | % | 21.9 | % | 20 | bps | |||||||||||||||||
| Adjusted Segment Operating Income | $ | 473 | $ | 510 | -7.2 | % | |||||||||||||||||
Adjusted Segment Operating Margin | 24.6 | % | 24.2 | % | 40 | bps | |||||||||||||||||
•Achieved record adjusted segment operating margin
•Continued softness in transportation and off-highway markets
•Delayed industrial recovery
| International Businesses | |||||||||||||||||||||||
$ in mm | FY25 Q2 | FY24 Q2 | Change | Organic Growth | |||||||||||||||||||
Sales | $ | 1,325 | $ | 1,404 | -5.7 | % | -3.0 | % | |||||||||||||||
Segment Operating Income | $ | 284 | $ | 290 | -2.2 | % | |||||||||||||||||
Segment Operating Margin | 21.4 | % | 20.7 | % | 70 | bps | |||||||||||||||||
| Adjusted Segment Operating Income | $ | 320 | $ | 323 | -1.2 | % | |||||||||||||||||
Adjusted Segment Operating Margin | 24.1 | % | 23.0 | % | 110 | bps | |||||||||||||||||
•Achieved record adjusted segment operating margin
•Broad-based softness continued in Europe
•Gradual recovery continued in Asia
Aerospace Systems Segment
$ in mm | FY25 Q2 | FY24 Q2 | Change | Organic Growth | |||||||||||||||||||
Sales | $ | 1,490 | $ | 1,306 | 14.0 | % | 14.0 | % | |||||||||||||||
Segment Operating Income | $ | 338 | $ | 263 | 28.5 | % | |||||||||||||||||
Segment Operating Margin | 22.7 | % | 20.1 | % | 260 | bps | |||||||||||||||||
| Adjusted Segment Operating Income | $ | 420 | $ | 347 | 21.2 | % | |||||||||||||||||
Adjusted Segment Operating Margin | 28.2 | % | 26.5 | % | 170 | bps | |||||||||||||||||
•Achieved record sales and adjusted segment operating margin
•Achieved 14% organic sales growth
•20%+ aftermarket and mid-single digit OEM sales growth
Order Rates
| FY25 Q2 | |||||
Parker | +5% | ||||
Diversified Industrial Segment - North America Businesses | +3% | ||||
Diversified Industrial Segment - International Businesses | +4% | ||||
Aerospace Systems Segment | +9% | ||||
•Company order rates increased across all reported businesses
•North America orders turned positive on long-cycle strength
•International order growth continued, led by Asia
•Aerospace orders accelerated against a tough prior year comparison
About Parker Hannifin
Parker Hannifin is a Fortune 250 global leader in motion and control technologies. For more than a century the company has been enabling engineering breakthroughs that lead to a better tomorrow. Learn more at www.parker.com or @parkerhannifin.
Contacts: | |||||
Media: | Financial Analysts: | ||||
Aidan Gormley | Jeff Miller | ||||
216-896-3258 | 216-896-2708 | ||||
Notice of Webcast
Parker Hannifin's conference call and slide presentation to discuss its fiscal 2025 second quarter results are available to all interested parties via live webcast today at 11:00 a.m. ET, at investors.parker.com. A replay of the webcast will be available on the site approximately one hour after the completion of the call and will remain available for one year. To register for e-mail notification of future events please visit investors.parker.com.
Note on Orders The company reported orders for the quarter ending December 31, 2024, compared with the same quarter a year ago. All comparisons are at constant currency exchange rates, with the prior year quarter restated to the current-year rates, and exclude divestitures. Diversified Industrial comparisons are on 3-month average computations and Aerospace Systems comparisons are on rolling 12-month average computations.
Note on Non-GAAP Financial Measures
This press release contains references to non-GAAP financial information including (a) adjusted net income; (b) adjusted earnings per share; (c) adjusted operating margin and segment operating margins; (d) adjusted operating income and segment operating income and (e) organic sales growth. The adjusted net income, adjusted earnings per share, adjusted operating margin, adjusted segment operating margin, adjusted operating income, adjusted segment operating income and organic sales measures are presented to allow investors and the company to meaningfully evaluate changes in net income, earnings per share and segment operating margins on a comparable basis from period to period. Although adjusted net income, adjusted earnings per share, adjusted operating margin and segment operating margins, adjusted operating income and segment operating income, and organic sales growth are not measures of performance calculated in accordance with GAAP, we believe that they are useful to an investor in evaluating the results of this quarter versus the prior period. Comparable descriptions of record adjusted results in this release refer only to the period from the first quarter of FY2011 to the periods presented in this release. This period coincides with recast historical financial results provided in association with our FY2014 change in segment reporting. A reconciliation of non-GAAP measures is included in the financial tables of this press release.
Forward-Looking Statements
Forward-looking statements contained in this and other written and oral reports are made based on known events and circumstances at the time of release, and as such, are subject in the future to unforeseen uncertainties and risks. Often but not always, these statements may be identified from the use of forward-looking terminology such as “anticipates,” “believes,” “may,” “should,” “could,” “expects,” “targets,” “is likely,” “will,” or the negative of these terms and similar expressions, and may also include statements regarding future performance, orders, earnings projections, events or developments. Parker cautions readers not to place undue reliance on these statements. It is possible that the future performance may differ materially from expectations, including those based on past performance.
Among other factors that may affect future performance are: changes in business relationships with and orders by or from major customers, suppliers or distributors, including delays or cancellations in shipments; disputes regarding contract terms, changes in contract costs and revenue estimates for new development programs; changes in product mix; ability to identify acceptable strategic acquisition targets; uncertainties surrounding timing, successful completion or integration of acquisitions and similar transactions; ability to successfully divest businesses planned for divestiture and realize the anticipated benefits of such divestitures; the determination and ability to successfully undertake business realignment activities and the expected costs, including cost savings, thereof; ability to implement successfully business and operating initiatives, including the timing, price and execution of share repurchases and other capital initiatives; availability, cost increases of or other limitations on our access to raw materials, component products and/or commodities if associated costs cannot be recovered in product pricing; ability to manage costs related to insurance and employee retirement and health care benefits; legal and regulatory developments and other government actions, including related to environmental protection, and associated compliance costs; supply chain and labor disruptions, including as a result of tariffs and labor shortages; threats associated with international conflicts and cybersecurity risks and risks associated with protecting our intellectual property; uncertainties surrounding the ultimate resolution of outstanding legal proceedings, including the outcome of any appeals; effects on market conditions, including sales and pricing, resulting from global reactions to U.S. trade policies; manufacturing activity, air travel trends, currency exchange rates, difficulties entering new markets and economic conditions such as inflation, deflation, interest rates and credit availability; inability to obtain, or meet conditions imposed for, required governmental and regulatory approvals; changes in the tax laws in the United States and foreign jurisdictions and judicial or regulatory interpretations thereof; and large scale disasters, such as floods, earthquakes, hurricanes, industrial accidents and pandemics. Readers should also consider forward-looking statements in light of risk factors discussed in Parker’s Annual Report on Form 10-K for the fiscal year ended June 30, 2024 and other periodic filings made with the SEC.
###
Exhibit 99.1
PARKER HANNIFIN CORPORATION - DECEMBER 31, 2024
| CONSOLIDATED STATEMENT OF INCOME | ||||||||||||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||||||||||||
| (Unaudited) | December 31, | December 31, | ||||||||||||||||||||||||
| (Dollars in thousands, except per share amounts) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
| Net sales | $ | 4,742,593 | $ | 4,820,947 | $ | 9,646,577 | $ | 9,668,435 | ||||||||||||||||||
| Cost of sales | 3,022,229 | 3,101,962 | 6,119,948 | 6,199,311 | ||||||||||||||||||||||
| Selling, general and administrative expenses | 782,421 | 806,802 | 1,631,210 | 1,680,493 | ||||||||||||||||||||||
| Interest expense | 100,802 | 129,029 | 213,893 | 263,497 | ||||||||||||||||||||||
| Other income, net | (328,716) | (85,011) | (359,517) | (163,466) | ||||||||||||||||||||||
| Income before income taxes | 1,165,857 | 868,165 | 2,041,043 | 1,688,600 | ||||||||||||||||||||||
| Income taxes | 217,208 | 186,108 | 393,866 | 355,471 | ||||||||||||||||||||||
| Net income | 948,649 | 682,057 | 1,647,177 | 1,333,129 | ||||||||||||||||||||||
| Less: Noncontrolling interests | 107 | 206 | 215 | 451 | ||||||||||||||||||||||
| Net income attributable to common shareholders | $ | 948,542 | $ | 681,851 | $ | 1,646,962 | $ | 1,332,678 | ||||||||||||||||||
| Earnings per share attributable to common shareholders: | ||||||||||||||||||||||||||
| Basic earnings per share | $ | 7.37 | $ | 5.31 | $ | 12.80 | $ | 10.38 | ||||||||||||||||||
| Diluted earnings per share | $ | 7.25 | $ | 5.23 | $ | 12.60 | $ | 10.23 | ||||||||||||||||||
| Average shares outstanding during period - Basic | 128,752,836 | 128,426,247 | 128,707,962 | 128,449,398 | ||||||||||||||||||||||
| Average shares outstanding during period - Diluted | 130,758,808 | 130,367,351 | 130,716,482 | 130,314,326 | ||||||||||||||||||||||
| CASH DIVIDENDS PER COMMON SHARE | ||||||||||||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||||||||||||
| (Unaudited) | December 31, | December 31, | ||||||||||||||||||||||||
| (Amounts in dollars) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
| Cash dividends per common share | $ | 1.63 | $ | 1.48 | $ | 3.26 | $ | 2.96 | ||||||||||||||||||
| RECONCILIATION OF ORGANIC GROWTH | |||||||||||||||||||||||
| (Unaudited) | Three Months Ended | ||||||||||||||||||||||
| As Reported | Adjusted | ||||||||||||||||||||||
| December 31, 2024 | Currency | Divestitures | December 31, 2024 | ||||||||||||||||||||
| Diversified Industrial Segment | (7.4) | % | (1.3) | % | (1.9) | % | (4.2) | % | |||||||||||||||
| Aerospace Systems Segment | 14.0 | % | — | % | — | % | 14.0 | % | |||||||||||||||
| Total | (1.6) | % | (0.9) | % | (1.4) | % | 0.7 | % | |||||||||||||||
| (Unaudited) | Six Months Ended | ||||||||||||||||||||||
| As Reported | Adjusted | ||||||||||||||||||||||
| December 31, 2024 | Currency | Divestitures | December 31, 2024 | ||||||||||||||||||||
| Diversified Industrial Segment | (5.9) | % | (0.8) | % | (1.0) | % | (4.1) | % | |||||||||||||||
| Aerospace Systems Segment | 15.9 | % | 0.3 | % | — | % | 15.6 | % | |||||||||||||||
| Total | (0.2) | % | (0.5) | % | (0.8) | % | 1.1 | % | |||||||||||||||
Exhibit 99.1
PARKER HANNIFIN CORPORATION - DECEMBER 31, 2024
| RECONCILIATION OF NET INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS TO ADJUSTED NET INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS | ||||||||||||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||||||||||||
| (Unaudited) | December 31, | December 31, | ||||||||||||||||||||||||
| (Dollars in thousands) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
| Net income attributable to common shareholders | $ | 948,542 | $ | 681,851 | $ | 1,646,962 | $ | 1,332,678 | ||||||||||||||||||
| Adjustments: | ||||||||||||||||||||||||||
| Acquired intangible asset amortization expense | 138,126 | 142,027 | 278,247 | 297,547 | ||||||||||||||||||||||
| Business realignment charges | 20,855 | 14,354 | 30,361 | 27,446 | ||||||||||||||||||||||
| Integration costs to achieve | 6,893 | 10,014 | 13,304 | 16,420 | ||||||||||||||||||||||
| Gain on sale of building | — | — | (10,461) | — | ||||||||||||||||||||||
| Gain on divestitures | (249,748) | (12,391) | (249,748) | (25,651) | ||||||||||||||||||||||
Tax effect of adjustments1 | (11,437) | (33,476) | (45,648) | (69,624) | ||||||||||||||||||||||
| Adjusted net income attributable to common shareholders | $ | 853,231 | $ | 802,379 | $ | 1,663,017 | $ | 1,578,816 | ||||||||||||||||||
| RECONCILIATION OF EARNINGS PER DILUTED SHARE TO ADJUSTED EARNINGS PER DILUTED SHARE | ||||||||||||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||||||||||||
| (Unaudited) | December 31, | December 31, | ||||||||||||||||||||||||
| (Amounts in dollars) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
| Earnings per diluted share | $ | 7.25 | $ | 5.23 | $ | 12.60 | $ | 10.23 | ||||||||||||||||||
| Adjustments: | ||||||||||||||||||||||||||
| Acquired intangible asset amortization expense | 1.06 | 1.09 | 2.13 | 2.28 | ||||||||||||||||||||||
| Business realignment charges | 0.16 | 0.11 | 0.23 | 0.21 | ||||||||||||||||||||||
| Integration costs to achieve | 0.05 | 0.08 | 0.10 | 0.13 | ||||||||||||||||||||||
| Gain on sale of building | — | — | (0.08) | — | ||||||||||||||||||||||
| Gain on divestitures | (1.91) | (0.10) | (1.91) | (0.20) | ||||||||||||||||||||||
Tax effect of adjustments1 | (0.08) | (0.26) | (0.33) | (0.53) | ||||||||||||||||||||||
| Adjusted earnings per diluted share | $ | 6.53 | $ | 6.15 | $ | 12.74 | $ | 12.12 | ||||||||||||||||||
1This line item reflects the aggregate tax effect of all non-tax adjustments reflected in the preceding line items of the table. We estimate the tax effect of each adjustment item by applying our overall effective tax rate for continuing operations to the pre-tax amount, unless the nature of the item and/or the tax jurisdiction in which the item has been recorded requires application of a specific tax rate or tax treatment, in which case the tax effect of such item is estimated by applying such specific tax rate or tax treatment. | ||||||||||||||||||||||||||
Exhibit 99.1
PARKER HANNIFIN CORPORATION - DECEMBER 31, 2024
| BUSINESS SEGMENT INFORMATION | ||||||||||||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||||||||||||
| (Unaudited) | December 31, | December 31, | ||||||||||||||||||||||||
| (Dollars in thousands) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
| Net sales | ||||||||||||||||||||||||||
| Diversified Industrial | $ | 3,252,806 | $ | 3,514,473 | $ | 6,708,964 | $ | 7,133,001 | ||||||||||||||||||
| Aerospace Systems | 1,489,787 | 1,306,474 | 2,937,613 | 2,535,434 | ||||||||||||||||||||||
| Total net sales | $ | 4,742,593 | $ | 4,820,947 | $ | 9,646,577 | $ | 9,668,435 | ||||||||||||||||||
| Segment operating income | ||||||||||||||||||||||||||
| Diversified Industrial | $ | 710,562 | $ | 752,334 | $ | 1,494,108 | $ | 1,559,088 | ||||||||||||||||||
| Aerospace Systems | 338,184 | 263,112 | 661,170 | 489,372 | ||||||||||||||||||||||
| Total segment operating income | 1,048,746 | 1,015,446 | 2,155,278 | 2,048,460 | ||||||||||||||||||||||
| Corporate general and administrative expenses | 56,264 | 49,902 | 105,058 | 105,558 | ||||||||||||||||||||||
| Income before interest expense and other income, net | 992,482 | 965,544 | 2,050,220 | 1,942,902 | ||||||||||||||||||||||
| Interest expense | 100,802 | 129,029 | 213,893 | 263,497 | ||||||||||||||||||||||
| Other income, net | (274,177) | (31,650) | (204,716) | (9,195) | ||||||||||||||||||||||
| Income before income taxes | $ | 1,165,857 | $ | 868,165 | $ | 2,041,043 | $ | 1,688,600 | ||||||||||||||||||
Exhibit 99.1
PARKER HANNIFIN CORPORATION - DECEMBER 31, 2024
| RECONCILIATION OF SEGMENT OPERATING MARGINS TO ADJUSTED SEGMENT OPERATING MARGINS | ||||||||||||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||||||||||||
| (Unaudited) | December 31, | December 31, | ||||||||||||||||||||||||
| (Dollars in thousands) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
| Diversified Industrial Segment sales | $ | 3,252,806 | $ | 3,514,473 | $ | 6,708,964 | $ | 7,133,001 | ||||||||||||||||||
| Diversified Industrial Segment operating income | $ | 710,562 | $ | 752,334 | $ | 1,494,108 | $ | 1,559,088 | ||||||||||||||||||
| Adjustments: | ||||||||||||||||||||||||||
| Acquired intangible asset amortization | 62,570 | 67,309 | 127,834 | 135,260 | ||||||||||||||||||||||
| Business realignment charges | 19,343 | 13,285 | 28,243 | 25,924 | ||||||||||||||||||||||
| Integration costs to achieve | 627 | 871 | 1,405 | 2,010 | ||||||||||||||||||||||
| Adjusted Diversified Industrial Segment operating income | $ | 793,102 | $ | 833,799 | $ | 1,651,590 | $ | 1,722,282 | ||||||||||||||||||
| Diversified Industrial Segment operating margin | 21.8 | % | 21.4 | % | 22.3 | % | 21.9 | % | ||||||||||||||||||
| Adjusted Diversified Industrial Segment operating margin | 24.4 | % | 23.7 | % | 24.6 | % | 24.1 | % | ||||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||||||||||||
| (Unaudited) | December 31, | December 31, | ||||||||||||||||||||||||
| (Dollars in thousands) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
| Aerospace Systems Segment sales | $ | 1,489,787 | $ | 1,306,474 | $ | 2,937,613 | $ | 2,535,434 | ||||||||||||||||||
| Aerospace Systems Segment operating income | $ | 338,184 | $ | 263,112 | $ | 661,170 | $ | 489,372 | ||||||||||||||||||
| Adjustments: | ||||||||||||||||||||||||||
| Acquired intangible asset amortization | 75,556 | 74,718 | 150,413 | 162,287 | ||||||||||||||||||||||
| Business realignment charges | 386 | (123) | 394 | 330 | ||||||||||||||||||||||
| Integration costs to achieve | 6,266 | 9,143 | 11,899 | 14,410 | ||||||||||||||||||||||
| Adjusted Aerospace Systems Segment operating income | $ | 420,392 | $ | 346,850 | $ | 823,876 | $ | 666,399 | ||||||||||||||||||
| Aerospace Systems Segment operating margin | 22.7 | % | 20.1 | % | 22.5 | % | 19.3 | % | ||||||||||||||||||
| Adjusted Aerospace Systems Segment operating margin | 28.2 | % | 26.5 | % | 28.0 | % | 26.3 | % | ||||||||||||||||||
| RECONCILIATION OF SEGMENT OPERATING MARGINS TO ADJUSTED SEGMENT OPERATING MARGINS | ||||||||||||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||||||||||||
| (Unaudited) | December 31, | December 31, | ||||||||||||||||||||||||
| (Dollars in thousands) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
| Total net sales | $ | 4,742,593 | $ | 4,820,947 | $ | 9,646,577 | $ | 9,668,435 | ||||||||||||||||||
| Total segment operating income | $ | 1,048,746 | $ | 1,015,446 | $ | 2,155,278 | $ | 2,048,460 | ||||||||||||||||||
| Adjustments: | ||||||||||||||||||||||||||
| Acquired intangible asset amortization | 138,126 | 142,027 | 278,247 | 297,547 | ||||||||||||||||||||||
| Business realignment charges | 19,729 | 13,162 | 28,637 | 26,254 | ||||||||||||||||||||||
| Integration costs to achieve | 6,893 | 10,014 | 13,304 | 16,420 | ||||||||||||||||||||||
| Adjusted total segment operating income | $ | 1,213,494 | $ | 1,180,649 | $ | 2,475,466 | $ | 2,388,681 | ||||||||||||||||||
| Total segment operating margin | 22.1 | % | 21.1 | % | 22.3 | % | 21.2 | % | ||||||||||||||||||
| Adjusted total segment operating margin | 25.6 | % | 24.5 | % | 25.7 | % | 24.7 | % | ||||||||||||||||||
Exhibit 99.1
PARKER HANNIFIN CORPORATION - DECEMBER 31, 2024
| CONSOLIDATED BALANCE SHEET | ||||||||||||||
| (Unaudited) | December 31, | June 30, | ||||||||||||
| (Dollars in thousands) | 2024 | 2024 | ||||||||||||
| Assets | ||||||||||||||
| Current assets: | ||||||||||||||
| Cash and cash equivalents | $ | 395,507 | $ | 422,027 | ||||||||||
| Trade accounts receivable, net | 2,445,845 | 2,865,546 | ||||||||||||
| Non-trade and notes receivable | 304,829 | 331,429 | ||||||||||||
| Inventories | 2,806,983 | 2,786,800 | ||||||||||||
| Prepaid expenses | 246,467 | 252,618 | ||||||||||||
| Other current assets | 148,831 | 140,204 | ||||||||||||
| Total current assets | 6,348,462 | 6,798,624 | ||||||||||||
| Property, plant and equipment, net | 2,800,992 | 2,875,668 | ||||||||||||
| Deferred income taxes | 87,400 | 92,704 | ||||||||||||
| Investments and other assets | 1,232,636 | 1,207,232 | ||||||||||||
| Intangible assets, net | 7,444,670 | 7,816,181 | ||||||||||||
| Goodwill | 10,357,303 | 10,507,433 | ||||||||||||
| Total assets | $ | 28,271,463 | $ | 29,297,842 | ||||||||||
| Liabilities and equity | ||||||||||||||
| Current liabilities: | ||||||||||||||
| Notes payable and long-term debt payable within one year | $ | 2,373,286 | $ | 3,403,065 | ||||||||||
| Accounts payable, trade | 1,794,884 | 1,991,639 | ||||||||||||
| Accrued payrolls and other compensation | 420,477 | 581,251 | ||||||||||||
| Accrued domestic and foreign taxes | 364,143 | 354,659 | ||||||||||||
| Other accrued liabilities | 1,034,501 | 982,695 | ||||||||||||
| Total current liabilities | 5,987,291 | 7,313,309 | ||||||||||||
| Long-term debt | 6,667,955 | 7,157,034 | ||||||||||||
| Pensions and other postretirement benefits | 409,873 | 437,490 | ||||||||||||
| Deferred income taxes | 1,394,882 | 1,583,923 | ||||||||||||
| Other liabilities | 684,401 | 725,193 | ||||||||||||
| Shareholders' equity | 13,118,553 | 12,071,972 | ||||||||||||
| Noncontrolling interests | 8,508 | 8,921 | ||||||||||||
| Total liabilities and equity | $ | 28,271,463 | $ | 29,297,842 | ||||||||||
Exhibit 99.1
PARKER HANNIFIN CORPORATION - DECEMBER 31, 2024
| CONSOLIDATED STATEMENT OF CASH FLOWS | ||||||||||||||
| Six Months Ended | ||||||||||||||
| (Unaudited) | December 31, | |||||||||||||
| (Dollars in thousands) | 2024 | 2023 | ||||||||||||
| Cash flows from operating activities: | ||||||||||||||
| Net income | $ | 1,647,177 | $ | 1,333,129 | ||||||||||
| Depreciation and amortization | 454,869 | 468,165 | ||||||||||||
| Stock incentive plan compensation | 106,472 | 108,061 | ||||||||||||
| Gain on sale of businesses | (250,373) | (25,964) | ||||||||||||
| (Gain) loss on property, plant and equipment and intangible assets | (6,975) | 5,097 | ||||||||||||
| Net change in receivables, inventories and trade payables | 70,981 | (42,804) | ||||||||||||
| Net change in other assets and liabilities | (405,002) | (407,366) | ||||||||||||
| Other, net | 61,584 | (86,331) | ||||||||||||
| Net cash provided by operating activities | 1,678,733 | 1,351,987 | ||||||||||||
| Cash flows from investing activities: | ||||||||||||||
| Capital expenditures | (216,493) | (204,117) | ||||||||||||
| Proceeds from sale of property, plant and equipment | 13,259 | 1,360 | ||||||||||||
| Proceeds from sale of businesses | 622,182 | 74,595 | ||||||||||||
| Other, net | (6,941) | (2,954) | ||||||||||||
| Net cash provided by (used in) investing activities | 412,007 | (131,116) | ||||||||||||
| Cash flows from financing activities: | ||||||||||||||
| Net payments for common stock activity | (189,681) | (136,394) | ||||||||||||
| Acquisition of noncontrolling interests | — | (2,883) | ||||||||||||
| Net payments for debt | (1,494,484) | (784,847) | ||||||||||||
| Dividends paid | (420,061) | (381,115) | ||||||||||||
| Net cash used in financing activities | (2,104,226) | (1,305,239) | ||||||||||||
| Effect of exchange rate changes on cash | (13,034) | (7,999) | ||||||||||||
| Net decrease in cash and cash equivalents | (26,520) | (92,367) | ||||||||||||
| Cash and cash equivalents at beginning of year | 422,027 | 475,182 | ||||||||||||
| Cash and cash equivalents at end of period | $ | 395,507 | $ | 382,815 | ||||||||||
Exhibit 99.1
PARKER HANNIFIN CORPORATION - DECEMBER 31, 2024
| RECONCILIATION OF FORECASTED ORGANIC GROWTH | ||||||||
| (Unaudited) | ||||||||
| (Amounts in percentages) | Fiscal Year 2025 | |||||||
| Forecasted net sales | (2%) to 1% | |||||||
| Adjustments: | ||||||||
| Currency | 1.0% | |||||||
| Divestitures | 1.5% | |||||||
| Adjusted forecasted net sales | 0.5% to 3.5% | |||||||
| RECONCILIATION OF FORECASTED SEGMENT OPERATING MARGIN TO ADJUSTED FORECASTED SEGMENT OPERATING MARGIN | ||||||||
| (Unaudited) | ||||||||
| (Amounts in percentages) | Fiscal Year 2025 | |||||||
| Forecasted segment operating margin | ~ 22.7% | |||||||
| Adjustments: | ||||||||
| Business realignment charges | 0.2% | |||||||
| Costs to achieve | 0.1% | |||||||
| Acquisition-related intangible asset amortization expense | 2.8% | |||||||
| Adjusted forecasted segment operating margin | ~ 25.8% | |||||||
| RECONCILIATION OF FORECASTED EARNINGS PER DILUTED SHARE TO ADJUSTED FORECASTED EARNINGS PER DILUTED SHARE | ||||||||
| (Unaudited) | ||||||||
| (Amounts in dollars) | Fiscal Year 2025 | |||||||
| Forecasted earnings per diluted share | $24.46 to $25.06 | |||||||
| Adjustments: | ||||||||
| Business realignment charges | 0.39 | |||||||
| Costs to achieve | 0.15 | |||||||
| Acquisition-related intangible asset amortization expense | 4.22 | |||||||
| Net gain on divestitures | (1.91) | |||||||
| Gain on sale of building | (0.08) | |||||||
Tax effect of adjustments1 | (0.83) | |||||||
| Adjusted forecasted earnings per diluted share | $26.40 to $27.00 | |||||||
1This line item reflects the aggregate tax effect of all non-tax adjustments reflected in the preceding line items of the table. We estimate the tax effect of each adjustment item by applying our overall effective tax rate for continuing operations to the pre-tax amount, unless the nature of the item and/or the tax jurisdiction in which the item has been recorded requires application of a specific tax rate or tax treatment, in which case the tax effect of such item is estimated by applying such specific tax rate or tax treatment. | ||||||||
Note: Totals may not foot due to rounding | ||||||||
Exhibit 99.1
PARKER HANNIFIN CORPORATION - DECEMBER 31, 2024
SUPPLEMENTAL INFORMATION
| BUSINESS SEGMENT INFORMATION | ||||||||||||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||||||||||||
| (Unaudited) | December 31, | December 31, | ||||||||||||||||||||||||
| (Dollars in thousands) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
| Net sales | ||||||||||||||||||||||||||
| Diversified Industrial: | ||||||||||||||||||||||||||
| North America businesses | $ | 1,928,008 | $ | 2,110,203 | $ | 4,028,332 | $ | 4,340,109 | ||||||||||||||||||
| International businesses | 1,324,798 | 1,404,270 | 2,680,632 | 2,792,892 | ||||||||||||||||||||||
| Segment operating income | ||||||||||||||||||||||||||
| Diversified Industrial: | ||||||||||||||||||||||||||
| North America businesses | $ | 426,567 | $ | 461,850 | $ | 911,130 | $ | 967,903 | ||||||||||||||||||
| International businesses | 283,995 | 290,484 | 582,978 | 591,185 | ||||||||||||||||||||||
| RECONCILIATION OF ORGANIC GROWTH | |||||||||||||||||||||||
| (Unaudited) | Three Months Ended | ||||||||||||||||||||||
| As Reported | Adjusted | ||||||||||||||||||||||
| December 31, 2024 | Currency | Divestitures | December 31, 2024 | ||||||||||||||||||||
| Diversified Industrial Segment: | |||||||||||||||||||||||
| North America businesses | (8.6) | % | (0.4) | % | (3.2) | % | (5.0) | % | |||||||||||||||
| International businesses | (5.7) | % | (2.7) | % | — | % | (3.0) | % | |||||||||||||||
| (Unaudited) | Six Months Ended | ||||||||||||||||||||||
| As Reported | Adjusted | ||||||||||||||||||||||
| December 31, 2024 | Currency | Divestitures | December 31, 2024 | ||||||||||||||||||||
| Diversified Industrial Segment: | |||||||||||||||||||||||
| North America businesses | (7.2) | % | (0.5) | % | (1.7) | % | (5.0) | % | |||||||||||||||
| International businesses | (4.0) | % | (1.3) | % | — | % | (2.7) | % | |||||||||||||||
Exhibit 99.1
PARKER HANNIFIN CORPORATION - DECEMBER 31, 2024
SUPPLEMENTAL INFORMATION
| RECONCILIATION OF SEGMENT OPERATING MARGINS TO ADJUSTED SEGMENT OPERATING MARGINS | ||||||||||||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||||||||||||
| (Unaudited) | December 31, | December 31, | ||||||||||||||||||||||||
| (Dollars in thousands) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
| Diversified Industrial Segment: | ||||||||||||||||||||||||||
| North America businesses sales | $ | 1,928,008 | $ | 2,110,203 | $ | 4,028,332 | $ | 4,340,109 | ||||||||||||||||||
| North America businesses operating income | $ | 426,567 | $ | 461,850 | $ | 911,130 | $ | 967,903 | ||||||||||||||||||
| Adjustments: | ||||||||||||||||||||||||||
| Acquired intangible asset amortization | 40,985 | 44,699 | 83,960 | 89,382 | ||||||||||||||||||||||
| Business realignment charges | 5,444 | 3,250 | 8,888 | 5,834 | ||||||||||||||||||||||
| Integration costs to achieve | 445 | 562 | 1,050 | 1,507 | ||||||||||||||||||||||
| Adjusted North America businesses operating income | $ | 473,441 | $ | 510,361 | $ | 1,005,028 | $ | 1,064,626 | ||||||||||||||||||
| North America businesses operating margin | 22.1 | % | 21.9 | % | 22.6 | % | 22.3 | % | ||||||||||||||||||
| Adjusted North America businesses operating margin | 24.6 | % | 24.2 | % | 24.9 | % | 24.5 | % | ||||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||||||||||||
| (Unaudited) | December 31, | December 31, | ||||||||||||||||||||||||
| (Dollars in thousands) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
| Diversified Industrial Segment: | ||||||||||||||||||||||||||
| International businesses sales | $ | 1,324,798 | $ | 1,404,270 | $ | 2,680,632 | $ | 2,792,892 | ||||||||||||||||||
| International businesses operating income | $ | 283,995 | $ | 290,484 | $ | 582,978 | $ | 591,185 | ||||||||||||||||||
| Adjustments: | ||||||||||||||||||||||||||
| Acquired intangible asset amortization | 21,585 | 22,610 | 43,874 | 45,878 | ||||||||||||||||||||||
| Business realignment charges | 13,899 | 10,035 | 19,355 | 20,090 | ||||||||||||||||||||||
| Integration costs to achieve | 182 | 309 | 355 | 503 | ||||||||||||||||||||||
| Adjusted International businesses operating income | $ | 319,661 | $ | 323,438 | $ | 646,562 | $ | 657,656 | ||||||||||||||||||
| International businesses operating margin | 21.4 | % | 20.7 | % | 21.7 | % | 21.2 | % | ||||||||||||||||||
| Adjusted International businesses operating margin | 24.1 | % | 23.0 | % | 24.1 | % | 23.5 | % | ||||||||||||||||||
Parker Hannifin Corporation Fiscal 2025 Second Quarter Earnings Presentation January 30, 2025 Exhibit 99.2
Forward-Looking Statements and Non-GAAP Financial Measures Forward-looking statements contained in this and other written and oral reports are made based on known events and circumstances at the time of release, and as such, are subject in the future to unforeseen uncertainties and risks. Often but not always, these statements may be identified from the use of forward-looking terminology such as “anticipates,” “believes,” “may,” “should,” “could,” “expects,” “targets,” “is likely,” “will,” or the negative of these terms and similar expressions, and may also include statements regarding future performance, orders, earnings projections, events or developments. Parker cautions readers not to place undue reliance on these statements. It is possible that the future performance may differ materially from expectations, including those based on past performance. Among other factors that may affect future performance are: changes in business relationships with and orders by or from major customers, suppliers or distributors, including delays or cancellations in shipments; disputes regarding contract terms, changes in contract costs and revenue estimates for new development programs; changes in product mix; ability to identify acceptable strategic acquisition targets; uncertainties surrounding timing, successful completion or integration of acquisitions and similar transactions; ability to successfully divest businesses planned for divestiture and realize the anticipated benefits of such divestitures; the determination and ability to successfully undertake business realignment activities and the expected costs, including cost savings, thereof; ability to implement successfully business and operating initiatives, including the timing, price and execution of share repurchases and other capital initiatives; availability, cost increases of or other limitations on our access to raw materials, component products and/or commodities if associated costs cannot be recovered in product pricing; ability to manage costs related to insurance and employee retirement and health care benefits; legal and regulatory developments and other government actions, including related to environmental protection, and associated compliance costs; supply chain and labor disruptions, including as a result of tariffs and labor shortages; threats associated with international conflicts and cybersecurity risks and risks associated with protecting our intellectual property; uncertainties surrounding the ultimate resolution of outstanding legal proceedings, including the outcome of any appeals; effects on market conditions, including sales and pricing, resulting from global reactions to U.S. trade policies; manufacturing activity, air travel trends, currency exchange rates, difficulties entering new markets and economic conditions such as inflation, deflation, interest rates and credit availability; inability to obtain, or meet conditions imposed for, required governmental and regulatory approvals; changes in the tax laws in the United States and foreign jurisdictions and judicial or regulatory interpretations thereof; and large scale disasters, such as floods, earthquakes, hurricanes, industrial accidents and pandemics. Readers should also consider forward-looking statements in light of risk factors discussed in Parker’s Annual Report on Form 10-K for the fiscal year ended June 30, 2024 and other periodic filings made with the SEC. This presentation contains references to non-GAAP financial information including adjusted net income, organic sales, adjusted earnings per share, adjusted segment operating margin for Parker and by segment, EBITDA, EBITDA margin, adjusted EBITDA, adjusted EBITDA margin, free cash flow, and free cash flow margin. As used in this presentation, EBITDA is defined as earnings before interest, taxes, depreciation and amortization. Adjusted EBITDA is defined as EBITDA before business realignment, integration costs to achieve, acquisition related expenses, and other one-time items. Free cash flow is defined as cash flow from operations less capital expenditures. Although adjusted net income, organic sales, adjusted earnings per share, adjusted segment operating margin for Parker and by segment, EBITDA, EBITDA margin, adjusted EBITDA, adjusted EBITDA margin, free cash flow, and free cash flow margin are not measures of performance calculated in accordance with GAAP, we believe that they are useful to an investor in evaluating the company performance for the periods presented. Detailed reconciliations of these non-GAAP financial measures to the comparable GAAP financial measures have been included in the appendix to this presentation. Please visit investors.parker.com for more information. 2
3 FY25 Q2 Highlights $4.7B Sales (1.6%) Reported +0.7% Organic1 25.6% Adjusted Segment Operating Margin1 +110 bps 26.8% Adjusted EBITDA Margin1 +110 bps $1.7B YTD CFOA +24.2% Growth Top quartile safety performance Strength of our balanced portfolio Continued strong Aerospace aftermarket Record Adjusted Segment Operating Margin1 of 25.6% Record YTD Cash Flow from Operations of $1.7B Longer cycle businesses drive positive orders Operational Excellence Delivers Record Performance 19% Reduction in Recordable Incidents 1. Includes certain non-GAAP adjustments and financial measures. See Appendix for additional details and reconciliations. Note: FY25 Q2 As Reported: Segment Operating Margin of 22.1%, EBITDA Margin of 31.5%, Net Income of $949M, EPS growth of 39%. 6% Adjusted EPS Growth1
Our Business System Drives Operational Excellence 4
5 The Parker Lean System is Fundamental to our Culture
The Win Strategy Drives Performance through the Cycle FY25 YTD ResultsWin Strategy ExecutionBackground A North American Filtration division example Diverse exposure across industrial market verticals Balanced OEM / Aftermarket Safety The Parker Lean System Simple by Design Strategic Supply Chain 1st Quartile Safety 50 bps Adj. Division Margin Expansion1 52% Improvement in RPPM (Rejected Parts per Million) 6 (MSD%) Sales Growth 1. Includes certain non-GAAP adjustments and financial measures. See slide 22 in the Appendix for additional details and reconciliations.
A Transformed Portfolio: Strong Long-Cycle Orders 5% 3% 2% 3% 2% 2% 0% 1% 1% 5% FY23 Q1 Q2 Q3 Q4 FY24 Q1 Q2 Q3 Q4 FY25 Q1 Q2 Order rates increased across all reported businesses Aerospace order strength continued in both Aftermarket and OEM Industrial North America orders turned positive on long-cycle strength Industrial International order growth continued, led by Asia Parker Order Rates Note: All comparisons are at constant currency exchange rates; with the prior year quarter restated to the current-year rates and exclude divestitures. Diversified Industrial orders are rolling 3- month average computations and Aerospace Systems are rolling 12-month average computations. 7
Key Market Verticals % of Sales Previous FY25 Guidance Commentary Current FY25 Guidance Current vs. Previous Guidance Aerospace & Defense 33% ~10% Aftermarket strength continues Gradual OEM rate increase ~11% In-Plant & Industrial 20% LSD Continued delays in expected industrial recovery Distribution expecting recovery LSD Transportation 15% LSD Automotive market weakness Work truck demand remains strong Neutral Off-Highway 15% (HSD) OEM destocking continues Ag weakness persists (Mid-Teens) Energy 8% Neutral Projects & CapEx delays continue Neutral HVAC/R 4% LSD Refrigerant changes driving growth MSD 8 FY25 Sales Growth Forecast by Key Market Verticals FY25 Organic Forecast: ~2%
Summary of Fiscal 2025 2nd Quarter Highlights
FY25 Q2 Financial Summary 1. Sales figures As Reported. Includes certain non-GAAP adjustments and financial measures. See Appendix for additional details and reconciliations. Note: FY24 Q2 As Reported: Segment Operating Margin of 21.1%, EBITDA Margin of 25.4%, Net Income of $682M, EPS of $5.23. 10 $ Millions, except per share amounts FY25 Q2 FY25 Q2 FY24 Q2 YoY Change As Reported Adjusted¹ Adjusted¹ Adjusted Sales $4,743 $4,743 $4,821 (1.6%) Segment Operating Margin 22.1% 25.6% 24.5% +110 bps EBITDA Margin 31.5% 26.8% 25.7% +110 bps Net Income $949 $853 $802 +6.3% EPS $7.25 $6.53 $6.15 +6.2%
FY25 Q2 Adjusted Earnings per Share Bridge 1. FY24 Q2 As Reported EPS of $5.23. FY25 Q2 As Reported EPS of $7.25. Includes certain non-GAAP adjustments and financial measures. See Appendix for additional details and reconciliations. 11 $5.16 $6.13 $4.74 $5.96 $0.17 ($0.03) $0.20 $0.03 $0.03 ($0.02) FY24 Q2 Adjusted EPS¹ Segment Operating Income Interest Expense Income Tax Other Expense Corp G&A Share Count FY25 Q2 Adjusted EPS¹ $6.15 $6.53
FY25 Q2 Segment Performance Sales As Reported $ Organic %1 Segment Operating Margin As Reported Segment Operating Margin Adjusted1 Order Rates2 Commentary D iv er si fie d In du st ria l North America Businesses $1,928M (5.0%) Organic 22.1% 24.6% +40 bps YoY +3% Record adjusted segment operating margins Continued softness in transportation and off-highway Delayed industrial recovery International Businesses $1,325M (3.0%) Organic 21.4% 24.1% +110 bps YoY +4% Record adjusted segment operating margins Broad-based softness remains in Europe Gradual recovery continues in Asia Aerospace Systems $1,490M +14.0% Organic 22.7% 28.2% +170 bps YoY +9% Record sales and adjusted segment operating margin Achieved 14% organic sales growth 20%+ MRO and mid-single digit OEM sales growth Parker $4,743M +0.7% Organic 22.1% 25.6% +110 bps YoY +5% Operational excellence & transformed portfolio Record adjusted segment operating margins Longer cycle businesses drive order growth 1. Includes certain non-GAAP adjustments and financial measures. See Appendix for additional details and reconciliations. 2. All comparisons are at constant currency exchange rates; with the prior year quarter restated to the current-year rates and exclude divestitures. Diversified Industrial orders are rolling 3-month average computations and Aerospace Systems are rolling 12-month average computations. 12
$1.1B $1.5B CFOA $1.4B $1.7B CFOA FY25 Q2 YTD Cash Flow Performance 1. Includes certain non-GAAP adjustments and financial measures. See Appendix for additional details and reconciliations. 13 Free Cash Flow1 11.9% 15.2% Cash Flow from Operations 14.0% 17.4% FY24 FY25 % to sales $1.7B Cash Flow from Operations +24.2% growth 17.4% Cash Flow from Operations Margin 15.2% Free Cash Flow Margin1 $1.5B Free Cash Flow1 +27.4% growth $1.5B YTD Debt Reduction (includes $0.6B proceeds from divestitures) Cash Flow Highlights FY25FY24
FY25 Guidance Update EPS Midpoint: $24.76 As Reported, $26.70 Adjusted 1. Includes certain non-GAAP adjustments and financial measures. See Appendix for additional details and reconciliations. 14 Guidance Metric FY25 Full Year Full Year Assumptions FY25 Q3 Midpoint Reported Sales (2%) - 1% Currency unfavorable (~1%) Divestitures impact (~1.5%) ~$4.9B Organic Sales Growth1 ~2% Raised Aerospace organic growth to 11% Continued delays in expected industrial recovery ~1.5% Adj. Operating Margin1 ~25.8% All segments expected to expand margins 90 bps margin expansion vs. prior year ~25.6% Adj. EPS1 $26.40 - $27.00 Full year tax rate ~22% Split: 1H: 48% | 2H: 52% $6.65 Free Cash Flow1 $3.0B - $3.3B CapEx: ~2% of sales FCF Conversion >100% - -
What Drives Parker Safety, Engagement, Ownership Living up to Our Purpose Top Quartile Performance Great Generators & Deployers of Cash 15
Upcoming Event Calendar FY25 Q3 Earnings Release May 1, 2025 FY25 Q4 Earnings Release August 7, 2025
Appendix FY25 Guidance Details Reconciliation of Organic Growth Adjusted Amounts Reconciliation – Consolidated Statement of Income Adjusted Amounts Reconciliation – Segment Operating Income Reconciliation of North American Filtration Division Margin to North American Filtration Division Adjusted Margin Reconciliation of EBITDA to Adjusted EBITDA Reconciliation of Free Cash Flow Margin Supplemental Sales Information – Global Technology Platforms Reconciliation of Q3 FY25 Guidance Reconciliation of FY25 Guidance 17
FY25 Guidance Details Sales Growth vs. Prior Year As Reported Organic1 Diversified Industrial Segment North America Businesses (8%) – (5%) (4%) – (1%) International Businesses (4%) – (1%) (1.5%) – 1.5% Aerospace Systems Segment 9.5% – 12.5% 9.5% – 12.5% Parker (2%) – 1% 0.5% – 3.5% Segment Operating Margins As Reported Adjusted1 Diversified Industrial Segment North America Businesses ~23.2% ~25.4% International Businesses ~21.9% ~24.1% Aerospace Systems Segment ~22.8% ~28.0% Parker ~22.7% ~25.8% Earnings Per Share As Reported Adjusted1 Midpoint $24.76 $26.70 Range $24.46 - $25.06 $26.40 - $27.00 1. Includes certain non-GAAP adjustments and financial measures. Detail of Pre-Tax Adjustments to: Segment Margins Below Segment Acquired Intangible Asset Amortization ~$550M — Business Realignment Charges ~$50M ~$1.7M Integration Costs to Achieve ~$20M — Gain on Sale of Building __ (~$10.5M) Gain on Divestitures — (~$250M) Additional Items As Reported Adjusted1 Corporate G&A ~$215M ~$215M Interest Expense ~$405M ~$405M Other (Income) Expense (~$215M) ~$45M Tax Rate ~21% ~22% Diluted Shares Outstanding ~130.7M 18
(Dollars in thousands) (Unaudited) Quarter-to-Date As Reported Adjusted As Reported Net Sales December 31, 2024 December 31, 2024 December 31, 2023 Diversified Industrial 3,252,806$ 46,362$ 67,385$ 3,366,553$ 3,514,473$ Aerospace Systems 1,489,787 (58) - 1,489,729 1,306,474 Total Parker Hannifin 4,742,593$ 46,304$ 67,385$ 4,856,282$ 4,820,947$ As reported Currency Divestitures Organic Diversified Industrial (7.4)% (1.3)% (1.9)% (4.2)% Aerospace Systems 14.0 % 0.0 % 0.0 % 14.0 % Total Parker Hannifin (1.6)% (0.9)% (1.4)% 0.7 % Supplemental Information: As Reported Adjusted As Reported Net Sales December 31, 2024 December 31, 2024 December 31, 2023 Diversified Industrial: North America businesses 1,928,008$ 8,913$ 67,385$ 2,004,306$ 2,110,203$ International businesses Europe 697,997 10,175 - 708,172 772,351 Asia Pacific 552,813 14,609 - 567,422 553,076 Latin America 73,988 12,665 - 86,653 78,843 International businesses 1,324,798$ 37,449$ -$ 1,362,247$ 1,404,270$ As reported Currency Divestitures Organic Diversified Industrial: North America businesses (8.6)% (0.4)% (3.2)% (5.0)% International businesses Europe (9.6)% (1.3)% 0.0 % (8.3)% Asia Pacific (0.0)% (2.6)% 0.0 % 2.6 % Latin America (6.2)% (16.1)% 0.0 % 9.9 % International businesses (5.7)% (2.7)% 0.0 % (3.0)% Currency Divestitures Currency Divestitures Reconciliation of Organic Growth 19
(Dollars in thousands, except per share data) (Unaudited) Quarter-to-Date FY 2025 Acquired Business Meggitt As Reported Intangible Asset Realignment Costs to Gain on Adjusted December 31, 2024 % of Sales Amortization Charges Achieve Divestitures December 31, 2024 % of Sales Net sales 4,742,593$ 100.0 % -$ -$ -$ -$ 4,742,593$ 100.0 % Cost of sales 3,022,229 63.7 % 23,068 10,590 154 - 2,988,417 63.0 % Selling, general and admin. expenses 782,421 16.5 % 115,058 9,714 6,739 - 650,910 13.7 % Interest expense 100,802 2.1 % - - - - 100,802 2.1 % Other (income) expense, net (328,716) (6.9)% - 551 - (249,748) (79,519) (1.7)% Income before income taxes 1,165,857 24.6 % (138,126) (20,855) (6,893) 249,748 1,081,983 22.8 % Income taxes 217,208 4.6 % 31,769 4,797 1,585 (26,714) 228,645 4.8 % Net income 948,649 20.0 % (106,357) (16,058) (5,308) 223,034 853,338 18.0 % Less: Noncontrolling interests 107 0.0 % - - - - 107 0.0 % Net income - common shareholders 948,542$ 20.0 % (106,357)$ (16,058)$ (5,308)$ 223,034$ 853,231$ 18.0 % Diluted earnings per share 7.25$ (0.81)$ (0.13)$ (0.04)$ 1.70$ 6.53$ Quarter-to-Date FY 2024 Acquired Business Meggitt As Reported Intangible Asset Realignment Costs to Gain on Adjusted December 31, 2023 % of Sales Amortization Charges Achieve Divestiture December 31, 2023 % of Sales Net sales 4,820,947$ 100.0 % -$ -$ -$ -$ 4,820,947$ 100.0 % Cost of sales 3,101,962 64.3 % 27,227 8,467 855 - 3,065,413 63.6 % Selling, general and admin. Expenses 806,802 16.7 % 114,800 4,695 9,159 - 678,148 14.1 % Interest expense 129,029 2.7 % - - - - 129,029 2.7 % Other (income) expense, net (85,011) (1.8)% - 1,192 - (12,391) (73,812) (1.5)% Income before income taxes 868,165 18.0 % (142,027) (14,354) (10,014) 12,391 1,022,169 21.2 % Income taxes 186,108 3.9 % 33,660 3,402 2,373 (5,959) 219,584 4.6 % Net income 682,057 14.1 % (108,367) (10,952) (7,641) 6,432 802,585 16.6 % Less: Noncontrolling interests 206 0.0 % - - - - 206 0.0 % Net income - common shareholders 681,851$ 14.1 % (108,367)$ (10,952)$ (7,641)$ 6,432$ 802,379$ 16.6 % Diluted earnings per share 5.23$ (0.83)$ (0.08)$ (0.06)$ 0.05$ 6.15$ Adjusted Amounts Reconciliation Consolidated Statement of Income 20
(Dollars in thousands) (Unaudited) Quarter-to-Date FY 2025 Acquired Business Meggitt As Reported Intangible Asset Realignment Costs to Gain on Adjusted December 31, 2024 % of Sales Amortization Charges Achieve Divestitures December 31, 2024 % of Sales2 Diversified Industrial1 710,562$ 21.8% 62,570$ 19,343$ 627$ -$ 793,102$ 24.4% Aerospace Systems1 338,184 22.7% 75,556 386 6,266 - 420,392 28.2% Total segment operating income 1,048,746 22.1% (138,126) (19,729) (6,893) - 1,213,494 25.6% Corporate administration 56,264 1.2% - 575 - - 55,689 1.2% Income before interest and other 992,482 20.9% (138,126) (20,304) (6,893) - 1,157,805 24.4% Interest expense 100,802 2.1% - - - - 100,802 2.1% Other (income) expense (274,177) -5.8% - 551 - (249,748) (24,980) -0.5% Income before income taxes 1,165,857$ 24.6% (138,126)$ (20,855)$ (6,893)$ 249,748$ 1,081,983$ 22.8% Supplemental Information: Diversified Industrial: North America businesses1 426,567$ 22.1% 40,985$ 5,444$ 445$ -$ 473,441$ 24.6% International businesses1 283,995 21.4% 21,585 13,899 182 - 319,661 24.1% Quarter-to-Date FY 2024 Acquired Business Meggitt As Reported Intangible Asset Realignment Cost to Gain on Adjusted December 31, 2023 % of Sales Amortization Charges Achieve Divestiture December 31, 2023 % of Sales2 Diversified Industrial1 752,334$ 21.4% 67,309$ 13,285$ 871$ -$ 833,799$ 23.7% Aerospace Systems1 263,112 20.1% 74,718 (123) 9,143 - 346,850 26.5% Total segment operating income 1,015,446 21.1% (142,027) (13,162) (10,014) - 1,180,649 24.5% Corporate administration 49,902 1.0% - - - - 49,902 1.0% Income before interest and other 965,544 20.0% (142,027) (13,162) (10,014) - 1,130,747 23.5% Interest expense 129,029 2.7% - - - - 129,029 2.7% Other (income) expense (31,650) -0.7% - 1,192 - (12,391) (20,451) -0.4% Income before income taxes 868,165$ 18.0% (142,027)$ (14,354)$ (10,014)$ 12,391$ 1,022,169$ 21.2% Supplemental Information: Diversified Industrial: North America businesses1 461,850$ 21.9% 44,699$ 3,250$ 562$ -$ 510,361$ 24.2% International businesses1 290,484 20.7% 22,610 10,035 309 - 323,438 23.0% Adjusted Amounts Reconciliation Segment Operating Income 1. Segment operating income as a percent of sales is calculated on segment sales. 2. Adjusted amounts as a percent of sales are calculated on as reported sales. 21
Reconciliation of North American Filtration Division Margin to North American Filtration Division Adjusted Margin 22 (Unaudited) (Amounts in percentages) 6 Months ended 12/31/23 6 Months ended 12/31/24 North American Filtration Division Margin 22.3% 22.5% Adjustments: Acquisition-related intangible asset amortization expense 2.9% 3.0% Business realignment charges 0.0% 0.2% North American Filtration Division Adjusted Margin 25.2% 25.7%
Reconciliation of EBITDA to Adjusted EBITDA (Dollars in thousands) Three Months Ended (Unaudited) December 31, 2024 % of Sales 2023 % of Sales Net sales $ 4,742,593 100.0% $ 4,820,947 100.0% Net income $ 948,649 20.0% $ 682,057 14.1% Income taxes 217,208 4.6% 186,108 3.9% Depreciation 87,697 1.8% 85,751 1.8% Amortization 138,126 2.9% 142,027 2.9% Interest expense 100,802 2.1% 129,029 2.7% EBITDA 1,492,482 31.5% 1,224,972 25.4% Adjustments: Business realignment charges 20,855 0.4% 14,354 0.3% Meggitt costs to achieve 6,893 0.1% 10,014 0.2% Gain on divestitures (249,748) -5.3% (12,391) -0.3% EBITDA - Adjusted $ 1,270,482 26.8% $ 1,236,949 25.7% EBITDA margin 31.5 % 25.4 % EBITDA margin - Adjusted 26.8 % 25.7 % 23
Reconciliation of Free Cash Flow Margin (Unaudited) (Dollars in thousands) 2024 2023 Net Sales 9,646,577$ 9,668,435$ Cash Flow from Operations 1,678,733$ 1,351,987$ Capital Expenditures (216,493) (204,117) Free Cash Flow 1,462,240$ 1,147,870$ Free Cash Flow Margin 15.2% 11.9% Six Months Ended December 31, 24
Supplemental Sales Information Global Technology Platforms 25 (Unaudited) (Dollars in thousands) 2024 2023 Net sales Diversified Industrial: Motion Systems $ 804,462 $ 917,966 Flow and Process Control 1,059,614 1,122,400 Filtration and Engineered Materials 1,388,730 1,474,107 Aerospace Systems 1,489,787 1,306,474 Total $ 4,742,593 $ 4,820,947 Three Months Ended December 31,
RECONCILIATION OF FORECASTED EARNINGS PER SHARE (Unaudited) (Amounts in dollars) Q3 Fiscal Year 2025 Forecasted earnings per diluted share ~$5.71 Adjustments: Business realignment charges 0.10 Costs to achieve 0.03 Acquisition-related intangible asset amortization expense 1.05 Tax effect of adjustments1 (0.24) Adjusted forecasted earnings per diluted share ~$6.65 Reconciliation of Q3 FY25 Guidance 1. This line item reflects the aggregate tax effect of all non-tax adjustments reflected in the preceding line items of the table. We estimate the tax effect of each adjustment item by applying our overall effective tax rate for continuing operations to the pre-tax amount, unless the nature of the item and/or the tax jurisdiction in which the item has been recorded requires application of a specific tax rate or tax treatment, in which case the tax effect of such item is estimated by applying such specific tax rate or tax treatment. *Totals may not foot due to rounding 26
Reconciliation of FY25 Guidance 1. This line item reflects the aggregate tax effect of all non-tax adjustments reflected in the preceding line items of the table. We estimate the tax effect of each adjustment item by applying our overall effective tax rate for continuing operations to the pre-tax amount, unless the nature of the item and/or the tax jurisdiction in which the item has been recorded requires application of a specific tax rate or tax treatment, in which case the tax effect of such item is estimated by applying such specific tax rate or tax treatment. *Totals may not foot due to rounding 27 RECONCILIATION OF CASH FLOW FROM OPERATIONS TO FREE CASH FLOW (Unaudited) (Dollars in millions) Fiscal Year 2025 Cash flow from operations $3,400 to $3,700 Less: Capital Expenditures ~(400) Free cash flow $3,000 to $3,300 RECONCILIATION OF OPERATING INCOME TO ADJUSTED OPERATING INCOME (Unaudited) Fiscal Year 2025 (Amounts in percentages) Forecasted Segment Operating Margin Business Realignment Charges Costs to Achieve Acquisition-Related Intangible Asset Amortization Expense Adjusted Forecasted Segment Operating Margin Diversified Industrial North America Businesses ~23.2% ~0.2% - ~2.0% ~25.4% International Businesses ~21.9% ~0.6% - ~1.6% ~24.1% Aerospace Systems ~22.8% - ~0.3% ~4.9% ~28.0% Parker ~22.7% ~0.2% ~0.1% ~2.8% ~25.8% RECONCILIATION OF ORGANIC GROWTH (Unaudited) Fiscal Year 2025 (Amounts in percentages) Forecasted Net Sales Currency Divestitures Adjusted Forecasted Net Sales Diversified Industrial North America Businesses (8.0%) to (5.0%) ~0.5% ~3.5% (4.0%) to (1.0%) International Businesses (4.0%) to (1.0%) ~2.5% - (1.5%) to 1.5% Aerospace Systems 9.5% to 12.5% ~0.0% - 9.5% to 12.5% Parker (2.0%) to 1.0% ~1.0% ~1.5% 0.5% to 3.5% RECONCILIATION OF FORECASTED EARNINGS PER SHARE (Unaudited) (Amounts in dollars) Fiscal Year 2025 Forecasted earnings per diluted share $24.46 to $25.06 Adjustments: Business realignment charges 0.39 Costs to achieve 0.15 Acquisition-related intangible asset amortization expense 4.22 Net gain on divestitures (1.91) Gain on sale of building (0.08) Tax effect of adjustments1 (0.83) Adjusted forecasted earnings per diluted share $26.40 to $27.00