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Item 7. Management’s Discussion and Analysis

2025-02-07 compared with 2024-02-07 · 267 added, 241 removed, 383 unchanged (57% of the section changed)

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GAAP” or “GAAP”).

Any references to the Company’s results in this Item 7 are specifically to our continuing operations only and exclude discontinued operations, unless otherwise noted.

The following discussion and analysis also includes references to certain non-GAAP financial measures, which are defined in the “Non-GAAP Financial Measures” section below, including “Constant Currency Net Sales Growth” and “Organic Net Sales Growth”.

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Risk Factors herein, as well as the risks and uncertainties that exist with the use of forward-looking statements as described in the “Cautionary Note Regarding Forward-Looking Statements” section included herein at the beginning of this Annual Report on Form 10-K (“Annual Report”).

Amphenol is one of the world’s largest designers, manufacturers and marketers of electrical, electronic and fiber optic connectors and interconnect systems, antennas, sensors and sensor-based products and coaxial and high-speed specialty cable.

On May 20, 2024, the Company announced that its Board of Directors (the “Board”) approved a two-for-one split of the Company’s Class A Common Stock (“Common Stock”).

The stock split was effected in the form of a stock dividend paid to stockholders of record as of the close of business on May 31, 2024.

The additional shares were distributed on June 11, 2024, and the Common Stock began trading on a split-adjusted basis on June 12, 2024.

The shares of Common Stock retain a par value of $0.001 per share.

All current and prior year data impacted by the stock split and presented in this Item 7 and throughout this Annual Report herein, including, but not limited to, number of shares and per share information, earnings per share, stock-based compensation data and dividends per share amounts, among others, have been adjusted to reflect the effect of the stock split and to conform to the current year presentation.

Refer to Note 1 of the accompanying Notes to Consolidated Financial Statements for further information related to the stock split.

In 2024, approximately 65% of the Company’s sales were outside the United States.

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The Company has focused its global resources to position itself to compete effectively in this environment.

The Company believes that its global presence is an important competitive advantage, as it allows the Company to provide quality products on a timely and worldwide basis to its multinational customers, while at the same time offering a level of resiliency and diversification against local risks and challenges that may emerge in any single geography.

The Company believes that its global presence is an important competitive advantage, as it allows the Company to provide quality products on a timely and worldwide basis to its

multinational customers, while at the same time offering a level of resiliency and diversification against local risks and challenges that may emerge in any single geography.

Reportable Business Segments

The Company aligns its businesses into the following three reportable business segments:

● Harsh Environment Solutions – the Harsh Environment Solutions segment designs, manufactures and markets a broad range of ruggedized interconnect products, including connectors and interconnect systems, printed circuits and printed circuit assemblies and other products for use in the industrial, defense, commercial aerospace, automotive, mobile networks and information technology and data communications end markets.

● Communications Solutions – the Communications Solutions segment designs, manufactures and markets a broad range of connector and interconnect systems, including high speed, radio frequency, power, fiber optic and other products, together with antennas, for use in the information technology and data communications, mobile devices, industrial, mobile networks, broadband communications, automotive, commercial aerospace and defense end markets.

● Harsh Environment Solutions – the Harsh Environment Solutions segment designs, manufactures and markets a broad range of ruggedized interconnect products, including connectors and interconnect systems, specialty cable, printed circuits and printed circuit assemblies and other products for use in the industrial, defense, commercial aerospace, automotive, mobile networks and information technology and data communications end markets.

● Communications Solutions – the Communications Solutions segment designs, manufactures and markets a broad range of connector and interconnect systems, including high speed, radio frequency, power, fiber optic and other products, coaxial and high-speed cable, as well as antennas, for use in the information technology and data communications, mobile devices, industrial, mobile networks, broadband communications, automotive, commercial aerospace and defense end markets.

● Interconnect and Sensor Systems – the Interconnect and Sensor Systems segment designs, manufactures and markets a broad range of sensors, sensor-based systems, connectors and value-add interconnect systems used in the automotive, industrial, information technology and data communications, mobile networks, defense and commercial aerospace end markets.

This alignment reinforces the Company’s entrepreneurial culture and the clear accountability of each of our business unit general managers, while enhancing the scalability of Amphenol’s business for the future.

This alignment reinforces the Company’s entrepreneurial culture and enables clear accountability of each of our business unit general managers, while enhancing the scalability of Amphenol’s business for the future.

F or further details related to the Company’s reportable business segments, refer to Note 13 of the Notes to Consolidated Financial Statements herein.

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● Foster collaborative, entrepreneurial management.

In 2023 , the Company reported net sales and operating income of $12,554.7 and $2,559.6, respectively, each representing a decrease of 1% from 2022, while net income from continuing operations attributable to Amphenol Corporation of $1,928.0 represented an increase of 1% from 2022.

In 2023, the Company’s net income from continuing operations attributable to Amphenol Corporation was impacted by (a) excess tax benefits of $82.4 related to stock-based compensation resulting from stock option exercises and (b) the gain of $5.4 on a bargain purchase acquisition that closed in the second quarter of 2023, partially offset by (c) acquisition-related expenses of $34.6 ($30.2 after-tax) comprised primarily of external transaction costs, as well as the amortization of $12.4 related to the value associated with acquired backlog resulting from three of the acquisitions that closed in 2023 .

In 2022, the Company’s net income from continuing operations attributable to Amphenol Corporation was impacted by (a) excess tax benefits of $56.0 related to stock-based compensation resulting from stock option exercises, partially offset by (b) acquisition-related expenses of $21.5 ($18.4 after-tax) comprised primarily of the amortization related to the value associated with acquired backlog resulting from two acquisitions that closed in 2022, along with external transaction costs.

Excluding the effects of these items, Adjusted Operating Income decreased by 1%, while Adjusted Net Income from continuing operations attributable to Amphenol Corporation increased slightly in 2023 compared to 2022.

Adjusted Operating Income and Adjusted Net

Income from continuing operations attributable to Amphenol Corporation are both non-GAAP financial measures, each as defined in the “Non-GAAP Financial Measures” section below and reconciled within this Part II, Item 7.

In 2024 , the Company reported net sales, operating income and net income attributable to Amphenol Corporation of $15,222.7, $3,156.9, and $2,424.0, respectively, representing an increase of 21%, 23% and 26% from 2023, respectively.

In 2024, the Company’s net income attributable to Amphenol Corporation was impacted by (a) excess tax benefits of $142.6 related to stock-based compensation resulting from stock option exercises and (b) a discrete tax benefit of $18.6 related to the settlement of tax audits and associated lapses of statutes of limitation, along with a difference in a non-U.S.

tax filing position, partially offset by (c) acquisition-related expenses of $145.6 ($119.3 after-tax) comprised primarily of (i) external transaction costs associated with acquisitions and the amortization related to the value associated with acquired backlog resulting from the Carlisle Interconnect Technologies (“CIT”) acquisition (such acquisition-related expenses aggregating $127.4 are presented separately in the Consolidated Statements of Income) and (ii) the amortization of acquisition-related inventory step-up costs of $18.2 associated with the CIT acquisition (such costs are

recorded in Cost of sales in the Consolidated Statements of Income) .

In 2023, the Company’s net income attributable to Amphenol Corporation was impacted by (a) excess tax benefits of $82.4 related to stock-based compensation resulting from stock option exercises and (b) the gain of $5.4 on a bargain purchase acquisition that closed in the second quarter of 2023, partially offset by (c) acquisition-related expenses of $34.6 ($30.2 after-tax) comprised primarily of external transaction costs, as well as the amortization of $12.4 related to the value associated with acquired backlog resulting from three of the acquisitions that closed in 2023.

Excluding the effects of these items, Adjusted Operating Income and Adjusted Net Income attributable to Amphenol Corporation both increased by 27% in 2024 compared to 2023.

Adjusted Operating Income and Adjusted Net Income attributable to Amphenol Corporation are both non-GAAP financial measures, each as defined in the “Non-GAAP Financial Measures” section below and reconciled within this Part II, Item 7.

Sales and profitability trends are discussed in detail in “Results of Operations” below.

In addition, a strength of the Company has been its ability to consistently generate net cash provided by operating activities from continuing operations (“Operating Cash Flow”).

The Company uses Operating Cash Flow to fund capital expenditures and acquisitions, repurchase shares of the Company’s Class A Common Stock (“Common Stock”), pay dividends and reduce indebtedness.

In addition, a strength of the Company has been its ability to consistently generate net cash provided by operating activities (“Operating Cash Flow”).

The Company uses Operating Cash Flow to fund capital expenditures and acquisitions, repurchase shares of the Company’s Common Stock, pay dividends and reduce indebtedness.

In 2024, the Company generated Operating Cash Flow of $2,814.7 and Free Cash Flow of $2,157.1, compared to Operating Cash Flow of $2,528.7 and Free Cash Flow of $2,159.9 in 2023.

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Inflation Reduction Act of 2022

On August 16, 2022, the President of the United States signed into law the Inflation Reduction Act of 2022 (the “IRA”), a tax and spending package that introduces several tax-related provisions, including a 15% corporate alternative minimum tax (“CAMT”) on certain large corporations and a 1% excise tax on certain corporate stock repurchases.

Companies will be required to reassess their valuation allowances for certain affected deferred tax assets in the period of enactment but will not need to remeasure deferred tax balances for the related tax accounting implications of the CAMT.

The IRA provisions, which became effective for Amphenol beginning on January 1, 2023, did not have a material impact on the Company during the year ended December 31, 2023.

The Inflation Reduction Act of 2022 (the “IRA”), a tax and spending package that introduced several tax-related provisions, including a 15% corporate alternative minimum tax (“CAMT”) on certain large corporations and a 1% excise tax on certain corporate stock repurchases, was enacted into law in 2022.

Companies were required to reassess their valuation allowances for certain affected deferred tax assets in the period of enactment but did not need to remeasure deferred tax balances for the related tax accounting implications of the CAMT.

The IRA provisions, which became effective for Amphenol beginning on January 1, 2023, did not have a material impact on the Company during the years ended December 31, 2024 and 2023.

While the full impact of these provisions in the future depends on several factors, including interpretive regulatory guidance, which has not yet been released, the Company does not currently believe that the provisions of the IRA, including several other non-tax related provisions, will have a material impact on its financial condition, results of operations, liquidity and cash flows.

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This guidance lays out a common approach for adopting the global minimum tax and enacting local legislation codifying the provisions that all 142 countries in the Inclusive Framework agreed to by consensus.

The European Union (“EU”) member states have agreed to adopt these rules in two stages with the first component effective on January 1, 2024, while the second component will be effective January 1, 2025.

The European Union (“EU”) member states have agreed to adopt these rules in two stages.

The first component became effective on January 1, 2024, and the second component became effective on January 1, 2025.

Non-EU countries have enacted or are expected to enact legislation on a similar timeline.

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jurisdictions.

The Company has done a preliminary review of currently enacted legislation and does not expect the initial implementation to materially impact future results.

However, the Company will continue to evaluate the potential impact of Pillar Two on the Company and its future results, as additional countries adopt legislation and issue individual guidance on their enacted legislation.

The Company has done a preliminary review of currently enacted legislation.

The initial implementation did not have a material impact on the Company’s consolidated financial statements during the year ended December 31, 2024, and it is not currently expected to have a material impact on the Company’s operations, financial condition or cash flows in the future.

However, the Company will continue to evaluate the potential impact of Pillar Two on the Company and its results as additional countries adopt legislation and issue individual guidance on their enacted legislation.

Results of Operations

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Other income (expense), net

Income from continuing operations before income taxes

Income before income taxes

Provision for income taxes

Net income from continuing operations

Net income from continuing operations attributable to noncontrolling interests

Net income from continuing operations attributable to Amphenol Corporation

Income from discontinued operations attributable to Amphenol Corporation

Net income attributable to noncontrolling interests

Net income attributable to Amphenol Corporation

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2024 Compared to 2023

Net sales were $12,554.7 for the year ended December 31, 2023 compared to $12,623.0 for the year ended December 31, 2022, which represented a decrease of 1% in U.S.

dollars and 3% organically (excluding both currency and acquisition impacts), while flat in constant currencies compared to the prior year.

The decrease in net sales in 2023 was driven by a sales decline in the Communications Solutions segment, partially offset by growth in the Harsh Environment Solutions and Interconnect and Sensor Systems segments, as described below.

From an end market standpoint, the decrease in net sales was driven by organic declines in the information technology and data communications (“IT datacom”), mobile networks, mobile devices, industrial and broadband communications markets, partially offset by robust organic growth in the automotive, defense and commercial aerospace markets, along with contributions from the Company’s acquisition program.

Net sales to the automotive market increased approximately $310.5, reflecting broad-based strength across our global automotive markets, in particular, next-generation electronics, including electric and hybrid drive trains.

Net sales to the defense market increased approximately $237.6, driven by broad-based strength across virtually all defense applications, particularly related to naval, aircraft engines, helicopters, communications, and space-related applications, as well as contributions from acquisitions.

Net sales to the commercial aerospace market increased approximately $117.9, primarily due to increased broad-based demand across all aircraft applications, in particular larger passenger planes.

Net sales to the industrial market remained flat, as contributions from acquisitions, along with growth in medical, oil and gas, mass transit and transportation applications were offset by moderations in industrial instrumentation, battery and electric heavy vehicles, factory automation and heavy equipment applications.

Net sales to the IT datacom market decreased approximately $362.8, as we experienced moderations across a broad array of applications including networking equipment, cloud storage, transmission, consumer electronics and servers, partially offset by strong growth in artificial intelligence-related applications.

Net sales to the mobile networks market decreased approximately $163.9, driven by broad-based moderations in demand from mobile network operators and wireless equipment manufacturers, partially offset by contributions from acquisitions.

Net sales to the mobile devices market decreased approximately $161.5, driven by declines in sales in laptops, wearable devices, tablets and production-related products, partially offset by growth in smartphones.

Net sales were $15,222.7 for the year ended December 31, 2024 compared to $12,554.7 for the year ended December 31, 2023, representing an increase of 21% in both U.S.

dollars and constant currencies, as well as 13% organically (excluding both currency and acquisition impacts), compared to the prior year.

The increase in net sales in 2024 was driven by strong organic growth in the Communications Solutions segment and moderate organic growth in the Interconnect and Sensor Systems segment and Harsh Environment Solutions segment, along with contributions from the Company’s acquisition program, all as described below.

From an end market standpoint, the increase in net sales was driven by strong organic growth in the information technology and data communications (“IT datacom”), mobile devices, commercial aerospace and defense markets and moderate organic growth in the automotive and mobile networks markets, along with contributions from the Company’s acquisition program, partially offset by organic declines in the industrial and broadband communications markets.

Net sales to the IT datacom market increased approximately $1,334.2, as we experienced strong growth across a broad array of applications, in particular the continued acceleration in and strong demand for products used in next-generation artificial intelligence-related applications, along with growth in servers, networking equipment, cloud storage, and consumer electronics.

Net sales to the industrial market increased approximately $452.1, primarily driven by contributions from acquisitions, along with growth in mass transit, battery and electric heavy vehicles, alternative energy, instrumentation and medical applications, which were partially offset by moderations in factory and building automation, transportation, oil and gas, marine and heavy equipment applications.

Net sales to the commercial aerospace market increased approximately $382.9, primarily due to contributions from acquisitions, in particular the CIT acquisition, along with broad-based strength in demand from nearly all commercial aircraft manufacturers across a broad range of platforms.

Net sales to the defense market increased approximately $214.0, driven by broad-based strength across nearly all defense applications, particularly space-related, avionics, communications, airframe, and ground vehicle applications, as well as contributions from acquisitions.

Net sales to the automotive market increased approximately $168.3, reflecting strength in demand from power management, infotainment communications, safety and security systems and antenna and related assemblies, along with contributions from acquisitions, partially offset by moderations in electric and hybrid drive train platforms.

Net sales to the mobile devices market increased approximately $131.5, driven by growth in sales in most mobile device applications, including smartphones, laptops, and wearable and hearable devices, partially offset by a moderation in tablets.

Net sales to the mobile networks market increased approximately $50.2, driven primarily by contributions from acquisitions, along with growth in demand from mobile network operators and wireless equipment manufacturers.

Net sales to the broadband communications market decreased approximately $65.2, driven by moderations in demand from broadband service operators.

Net sales in the Harsh Environment Solutions segment (approximately 28% of net sales) increased 14% in U.S.

dollars, 14% in constant currencies and 9% organically, in 2023, compared to 2022.

The sales growth in 2023 was primarily driven by strong organic growth in the defense, commercial aerospace, automotive and IT datacom markets, along with contributions from the Company’s acquisition program, partially offset by organic declines in the industrial and mobile networks markets.

Net sales in the Communications Solutions segment (approximately 39% of net sales) decreased 13% in U.S.

dollars, 12% in constant currencies and 13% organically, in 2023, compared to 2022.

The sales decline in 2023 was primarily driven by organic declines in the IT datacom, industrial, mobile networks, mobile devices and broadband communications markets, partially offset by strong organic growth in the automotive market, along with modest contributions from the Company’s acquisition program.

Net sales in the Interconnect and Sensor Systems segment (approximately 33% of net sales) increased 6% in U.S.

dollars, 7% in constant currencies and 3% organically, in 2023, compared to 2022.

The sales growth in 2023 was primarily driven by strong organic growth in the automotive and commercial aerospace markets, and moderate growth in the industrial and defense markets, along with contributions from the Company’s acquisition program, partially offset by organic declines in the IT datacom and mobile networks markets.

Net sales in the Harsh Environment Solutions segment (approximately 29% of net sales) increased 25% in both U.S.

dollars and constant currencies, as well as 4% organically, in 2024, compared to 2023.

The sales growth in 2024 was primarily driven by contributions from the Company’s acquisition program, in particular the CIT acquisition, along with

strong organic growth in the defense, commercial aerospace and IT datacom markets, partially offset by organic declines in the automotive and industrial markets.

Net sales in the Communications Solutions segment (approximately 42% of net sales) increased 29% in both U.S.

dollars and constant currencies, as well as 27% organically, in 2024, compared to 2023.

The sales growth in 2024 was primarily driven by strong organic growth in the IT datacom, automotive, mobile devices and industrial markets and moderate growth in the mobile networks markets, along with modest contributions from the Company’s acquisition program, partially offset by an organic decline in the broadband communications market.

Net sales in the Interconnect and Sensor Systems segment (approximately 29% of net sales) increased 9% in both U.S.

dollars and constant currencies, as well as 4% organically, in 2024, compared to 2023.

The sales growth in 2024 was primarily driven by contributions from the Company’s acquisition program, along with strong organic growth in the IT datacom market and moderate growth in the automotive market, partially offset by organic declines in the industrial and defense markets.

The table below reconciles Constant Currency Net Sales Growth and Organic Net Sales Growth to the most directly comparable U.S.

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(6) Net sales by geographic area are based on the customer location to which the product is shipped.

The decrease in foreign net sales in 2023 compared to 2022 was primarily driven by sales declines in Asia.

The increase in foreign net sales in 2024 compared to 2023 was primarily driven by robust sales growth in Asia.

The comparatively stronger U.S.

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Selling, general and administrative expenses were $1,855.4, or 12.2% of net sales, for 2024, compared to $1,489.9, or 11.9% of net sales, for 2023.

The increase in Selling, general and administrative expenses as a percentage of net sales in 2023 was primarily driven by the effect of acquisitions, which currently have higher selling, general and administrative expenses as a percentage of net sales compared to the Company average.

The increase in Selling, general and administrative expenses and such expenses as a percentage of net sales in 2024 was primarily driven by the effect of acquisitions, which currently have higher selling, general and administrative expenses as a percentage of net sales compared to the Company average.

Administrative expenses increased $148.0 in 2024 and represented approximately 5.0% of net sales in 2024 and 4.8% of net sales in 2023.

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Operating income was $3,156.9, or 20.7% of net sales, in 2024, compared to $2,559.6, or 20.4% of net sales, in 2023.

Operating income in 2024 included acquisition-related expenses of $145.6, comprised primarily of (i) external transaction costs associated with acquisitions and the amortization related to the value associated with acquired backlog resulting from the CIT acquisition (such acquisition-related expenses aggregating $127.4 are presented separately in the Consolidated Statements of Income) and (ii) the amortization of acquisition-related inventory step-up costs of $18.2 associated with the CIT acquisition (such costs are recorded in Cost of sales in the Consolidated Statements of Income).

Operating income in 2023 included acquisition-related expenses of $34.6, comprised primarily of external transaction costs, as well as the amortization related to the value associated with acquired backlog resulting from three of the acquisitions that closed in 2023.

Operating income in 2022 included acquisition-related expenses of $21.5,

comprised primarily of the amortization related to the value associated with acquired backlog resulting from two acquisitions that closed in 2022, along with external transaction costs.

The acquisition-related expenses in 2023 and 2022 had the effect of decreasing net income from continuing operations by $30.2, or $0.05 per share, and $18.4, or $0.03 per share, respectively.

Acquisition-related expenses in 2023 are presented separately in the Consolidated Statements of Income.

The acquisition-related expenses in 2024 and 2023 had the effect of decreasing net income by $119.3, or $0.09 per share, and $30.2, or $0.02 per share, respectively.

Acquisition-related expenses are presented separately in the Consolidated Statements of Income.

Excluding the effect of these acquisition-related expenses, Adjusted Operating Income and Adjusted Operating Margin, each as defined in the “Non-GAAP Financial Measures” section below, were $2,594.2 and 20.7% of net sales, respectively, in 2023, and $2,607.3 and 20.7% of net sales, respectively, in 2022.

While Adjusted Operating Income decreased modestly from 2022, Adjusted Operating Margin remained flat in 2023 relative to 2022, as the benefit of pricing actions and strong operational performance were offset by the operating leverage on the lower sales volumes, along with the negative impact on operating margin related to acquisitions that are currently operating below the average operating margin of the Company.

Excluding the effect of these acquisition-related expenses, Adjusted Operating Income and Adjusted Operating Margin, each as defined below in the “Non-GAAP Financial Measures” section within this Item 7, were $3,302.5 and 21.7% of net sales, respectively, in 2024, and $2,594.2 and 20.7% of net sales, respectively, in 2023.

The increase in Adjusted Operating Income and Adjusted Operating Margin in 2024 relative to 2023 was primarily driven by strong operating performance on the higher sales volumes, partially offset by the negative impact on operating margin related to acquisitions completed within the prior 12 months that are currently operating below the average operating margin of the Company.

Operating income for the Harsh Environment Solutions segment in 2024 was $1,093.2, or 24.7% of net sales, compared to $943.9, or 26.7% of net sales in 2023.

The increase in operating margin for the Harsh Environment Solutions segment for 2023 compared to 2022 was primarily driven by normal operating leverage on the higher sales volumes and strong operational performance, combined with the benefit of pricing actions, all partially offset by the negative impact on operating margin related to acquisitions that are currently operating below the average operating margin of the Company.

The decrease in operating margin for the Harsh Environment Solutions segment for 2024 compared to 2023 was primarily driven by the negative impact on operating margin related to acquisitions completed within the prior 12 months, particularly the CIT acquisition, that are currently operating below the average operating margin of the Company.

Operating income for the Communications Solutions segment in 2024 was $1,569.6, or 24.8% of net sales, compared to $1,063.5, or 21.6% of net sales in 2023.

The decrease in operating margin for the Communications Solutions segment for 2023 compared to 2022 was primarily driven by operating leverage on the lower sales volumes, partially offset by the benefit of pricing actions and strong operational performance.

The increase in operating margin for the Communications Solutions segment for 2024 compared to 2023 was primarily driven by strong operating performance on the higher sales volumes.

Operating income for the Interconnect and Sensor Systems segment in 2024 was $825.9, or 18.4% of net sales, compared to $753.7, or 18.3% of net sales in 2023.

The modest decrease in operating margin for the Interconnect and Sensor Systems segment for 2023 compared to 2022 was primarily driven by the negative impact on operating margin related to acquisitions that are currently operating below the average operating margin of the Company, partially offset by the normal operating leverage on the higher sales volumes combined with the benefit of pricing actions.

The modest increase in operating margin for the Interconnect and Sensor Systems segment for 2024 compared to 2023 was primarily driven by strong operating performance on the higher sales volumes, partially offset by the negative impact on operating margin related to acquisitions completed within the prior 12 months that are currently operating below the average operating margin of the Company.

Interest expense was $217.0 in 2024 compared to $139.5 in 2023.

The increase in interest expense was driven by the higher interest rate environment, which primarily impacted borrowings under the Company’s U.S.

Commercial Paper Program that were outstanding throughout much of 2023.

The increase in interest expense was primarily driven by higher average borrowing levels, resulting from the issuances of new senior notes during 2024.

Refer to Note 4 of the Notes to Consolidated Financial Statements for further information related to the Company’s debt.

Other income (expense), net was $72.0 in 2024 compared to $29.3 in 2023.

The increase was primarily driven by interest income earned on cash and cash equivalents on hand, resulting from increased levels of cash on hand partially driven by the issuance of the new October Senior Notes (defined below) in the fourth quarter of 2024 in anticipation of the acquisition of CommScope’s Mobile Networks Business (as defined and discussed below within this Item 7 and in Note 15 of the accompanying Notes to Consolidated Financial Statements herein) which closed on January 31, 2025, along with increased interest rates.

Provision for income taxes was at an effective rate of 18.9% in 2024 and 20.7% in 2023.

Provision for income taxes in 2023 included excess tax benefits of $82.4 from stock option exercises as well as the effect of the gain from the bargain purchase acquisition that closed in the second quarter of 2023, all of which were partially offset by the tax effects related to acquisition-related expenses during the year.

These items had the aggregate effect of decreasing the effective tax rate and increasing earnings per share by the amounts noted in the table below.

Provision for income taxes in 2022 included excess tax benefits of $56.0 from stock option exercises, partially offset by the tax effects related to acquisition-related expenses during the year.

These items had the aggregate effect of decreasing the effective tax rate and increasing earnings per share by the amounts noted in the table below.

Excluding the effect of these items, the Adjusted Effective Tax Rate, a non-GAAP financial measure as defined in the “Non-GAAP Financial Measures” section below within this Item 7, was 24.0% and 24.5% for 2023 and 2022, respectively, as reconciled in the table below to the comparable effective tax rate based on GAAP results.

For additional details related to the reconciliation between the U.S.

Provision for income taxes in 2024 included (i) excess tax benefits of $142.6 from stock option exercises, (ii) a discrete tax benefit related to the settlement of tax audits and associated lapses of statutes of limitation, along with a difference in a non-U.S.

tax filing position, and (iii) the tax effects of the aforementioned acquisition-related expenses during the year.

Provision for income taxes in 2023 included (i) excess tax benefits of $82.4 from stock option exercises, (ii) the effect of the gain from the bargain purchase acquisition that closed in the second quarter of 2023, and (iii) the tax effects related to acquisition-related expenses during the year.

These items incurred in 2024 and 2023 had the aggregate effect of decreasing the effective tax rate and increasing earnings per share by the amounts noted in the table below.

Excluding the effect of these items, the Adjusted Effective Tax Rate, a non-GAAP financial measure as defined in the “Non-GAAP Financial Measures” section below within this Item 7, was 24.0% for both 2024 and 2023, as reconciled in the table below to the comparable effective tax rate based on GAAP results.

For additional details related to the reconciliation between the

statutory federal tax rate and the Company’s effective tax rate for these years, refer to Note 6 of the Notes to Consolidated Financial Statements.

Net income from continuing operations attributable to Amphenol Corporation and Net income from continuing operations per common share attributable to Amphenol Corporation-Diluted (“Diluted EPS”) were $1,928.0 and $3.11, respectively, for 2023, compared to $1,902.3 and $3.06, respectively, for 2022.

Excluding the effect of the items discussed above, Adjusted Net Income from continuing operations attributable to Amphenol Corporation and Adjusted Diluted EPS, non-GAAP financial measures as defined in the “Non-GAAP Financial Measures” section below within this Item 7, were $1,870.4 and $3.01, respectively, for 2023, compared to $1,864.7 and $3.00, respectively, for 2022.

The following table reconciles Adjusted Operating Income, Adjusted Operating Margin, Adjusted Net Income from continuing operations attributable to Amphenol Corporation, Adjusted Effective Tax Rate and Adjusted Diluted EPS (all on a continuing operations basis only, each as defined in the “Non-GAAP Financial Measures” section below) to the most directly comparable U.S.

Net income attributable to Amphenol Corporation and Net income attributable to Amphenol Corporation per common share - Diluted (“Diluted EPS”) were $2,424.0 and $1.92, respectively, for 2024, compared to $1,928.0 and $1.55, respectively, for 2023.

Excluding the effect of the items listed in the table below, Adjusted Net Income attributable to Amphenol Corporation and Adjusted Diluted EPS, non-GAAP financial measures as defined in the “Non-GAAP Financial Measures” section below within this Item 7, were $2,382.1 and $1.89, respectively, for 2024, compared to $1,870.4 and $1.51, respectively, for 2023.

The following table reconciles Adjusted Operating Income, Adjusted Operating Margin, Adjusted Net Income attributable to Amphenol Corporation, Adjusted Effective Tax Rate and Adjusted Diluted EPS (each as defined in the “Non-GAAP Financial Measures” section below) to the most directly comparable U.S.

GAAP financial measures for the years ended December 31, 2024 and 2023:

Reported (GAAP)

Amortization of acquisition-related inventory step-up costs

Acquisition-related expenses

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Excess tax benefits related to stock-based compensation

Discrete tax items

Adjusted (non-GAAP) (2)

All data in the tables above are on a continuing operations basis only and exclude results associated with discontinued operations.

(1) While the terms “operating margin” and “effective tax rate” are not considered U.S.

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2023 Compared to 2022

Net sales were $12,623.0 for the year ended December 31, 2022 compared to $10,876.3 for the year ended December 31, 2021, which represented an increase of 16% in U.S.

dollars, 19% in constant currencies and 15% organically (excluding both currency and acquisition impacts) compared to the prior year.

The increase in net sales in 2022 was driven by robust growth across all three reportable business segments, as described below.

From an end market standpoint, the increase in net sales was driven by robust organic growth across most end markets, including the automotive, IT datacom, industrial, broadband communications and commercial aerospace markets, moderate organic growth in the defense, mobile networks and mobile devices markets, and contributions from the Company’s acquisition program.

Net sales to the automotive market increased approximately $470.1, reflecting broad-based growth across our global automotive market, including the Company’s strength in next-generation electronics, in particular electric and hybrid drive trains, power management, infotainment communications, antenna and antenna assemblies, charging stations, and safety and security systems.

Net sales to the IT datacom market increased approximately $414.6, as we continue to benefit from our strong technology solutions and leading position across a broad array of applications as customers continue to support higher demand for increased bandwidth and cloud storage, along with contributions from acquisitions.

Net sales to the industrial market increased approximately $399.7, with broad-based growth across nearly all market segments of the global industrial market, with particular strength in e-mobility applications primarily in heavy and commercial vehicles, along with strong growth in factory automation, alternative energy, medical, and transportation applications, as well as contributions from acquisitions.

Net sales to the broadband communications market increased approximately $241.2, driven by increased overall demand from broadband service operators related to data network upgrades and expansions, along with contributions from acquisitions.

Net sales to the commercial aerospace market increased approximately $85.6, primarily due to the continued recovery in travel and demand for aircraft, along with contributions from acquisitions.

Net sales to the defense market increased approximately $47.9, driven by strength in space-related applications, unmanned aerial vehicles, ground vehicles, and avionics, as well as contributions from acquisitions.

Net sales to the mobile networks market increased approximately $46.4, driven by continued recovery in demand from mobile networks equipment manufacturers and mobile operators, along with contributions from acquisitions.

Net sales to the mobile devices market increased approximately $41.2, driven by growth in products incorporated into smartphones and wearable devices, partially offset by moderations in sales of tablets, hearable devices and laptops.

Net sales were $12,554.7 for the year ended December 31, 2023 compared to $12,623.0 for the year ended December 31, 2022, which represented a decrease of 1% in U.S.

dollars and 3% organically (excluding both currency and acquisition impacts), while flat in constant currencies compared to the prior year.

From an end market standpoint, the decrease in net sales was driven by organic declines in the IT datacom, mobile networks, mobile devices, industrial and broadband communications markets, partially offset by robust organic growth in the automotive, defense and commercial aerospace markets, along with contributions from the Company’s acquisition program.

Net sales to the commercial aerospace market increased approximately $117.9, primarily due to increased broad-based demand across all aircraft applications, in particular larger passenger planes.

Net sales to the IT datacom market decreased approximately $362.8, as we experienced moderations across a broad array of applications, including networking equipment, cloud storage, transmission, consumer electronics and servers, partially offset by strong growth in artificial intelligence-related applications.

Net sales to the mobile networks market decreased approximately $163.9, driven by

broad-based moderations in demand from mobile network operators and wireless equipment manufacturers, partially offset by contributions from acquisitions.

Net sales to the broadband communications market decreased approximately $46.4, driven by moderations in demand from broadband service operators.

Net sales in the Harsh Environment Solutions segment (approximately 28% of net sales) increased 14% in U.S.

dollars, 14% in constant currencies and 9% organically, in 2023, compared to 2022.

The sales growth in 2022 was driven by strong organic growth in the industrial, automotive and commercial aerospace markets, and moderate organic

growth in the defense, mobile networks and IT datacom markets, along with contributions from the Company’s acquisition program.

Net sales in the Communications Solutions segment (approximately 45% of net sales) increased 17% in U.S.

Net sales in the Communications Solutions segment (approximately 39% of net sales) decreased 13% in U.S.

dollars, 12% in constant currencies and 13% organically, in 2023, compared to 2022.

The sales growth in 2022 was driven by strong organic growth across several end markets, in particular the IT datacom, broadband communications and automotive markets, and moderate organic growth in the mobile devices, industrial and mobile networks markets, along with contributions from the Company’s acquisition program.

Net sales in the Interconnect and Sensor Systems segment (approximately 33% of net sales) increased 6% in U.S.

dollars, 7% in constant currencies and 3% organically, in 2023, compared to 2022.

The sales growth in 2022 was primarily driven by strong organic growth in the automotive, industrial, IT datacom, defense and commercial aerospace markets, along with contributions from the Company’s acquisition program, partially offset by a moderate decline in the mobile networks market.

The table below reconciles Constant Currency Net Sales Growth and Organic Net Sales Growth to the most directly comparable U.S.

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(6) Net sales by geographic area are based on the customer location to which the product is shipped.

The increase in foreign net sales in 2022 compared to 2021 was driven by strong growth in both Europe and Asia.

The decrease in foreign net sales in 2023 compared to 2022 was primarily driven by sales declines in Asia.

The comparatively stronger U.S.

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Selling, general and administrative expenses were $1,489.9, or 11.9% of net sales, for 2023, compared to $1,420.9, or 11.3% of net sales, for 2022.

Selling, general and administrative expenses as a percentage of net sales in 2022 remained flat as the leverage on the higher sales volumes during the year was offset by the Sensors business (“MTS Sensors”) of MTS Systems Corporation (“MTS”), acquired in early 2021, having higher selling, general and administrative expenses as a percentage of net sales compared to the Company average.

The increase in Selling, general and administrative expenses as a percentage of net sales

in 2023 was primarily driven by the effect of acquisitions, which currently have higher selling, general and administrative expenses as a percentage of net sales compared to the Company average.

Administrative expenses increased $26.2 in 2023 and represented approximately 4.8% of net sales in 2023 and 4.6% of net sales in 2022.

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Operating income was $2,559.6, or 20.4% of net sales, in 2023, compared to $2,585.8, or 20.5% of net sales, in 2022.

Operating income in 2022 included acquisition-related expenses of $21.5, comprised primarily of the amortization related to the value associated with acquired backlog resulting from two acquisitions that closed in 2022, along with external transaction costs.

Operating income in 2021 included acquisition-related expenses of $70.4, comprised primarily of transaction, severance, restructuring and certain non-cash purchase accounting costs related to the acquisition of MTS in the second quarter of 2021, along with external transaction costs and certain non-cash purchase accounting costs related to the acquisition of Halo Technology Limited (“Halo”) in the fourth quarter of 2021.

The acquisition-related expenses in 2022 and 2021 had the effect of decreasing net income from continuing operations by $18.4, or $0.03 per share, and $57.3, or $0.09 per share, respectively.

Acquisition-related expenses are presented separately in the Consolidated Statements of Income.

Excluding the effect of these acquisition-related expenses, Adjusted Operating Income and Adjusted Operating Margin, each as defined in the “Non-GAAP Financial Measures” section below, were $2,607.3 and 20.7% of net sales, respectively, in 2022, and $2,175.5 and 20.0% of net sales, respectively, in 2021.

The increases in Adjusted Operating Income and Adjusted Operating Margin in 2022 relative to 2021 was driven by all three segments, as described below.

The acquisition-related expenses in 2023 and 2022 had the effect of decreasing net income by $30.2, or $0.02 per share, and $18.4, or $0.01 per share, respectively.

Acquisition-related expenses in 2023 and 2022 were presented separately in the Consolidated Statements of Income.

Excluding the effect of these acquisition-related expenses, Adjusted Operating Income and Adjusted Operating Margin, each as defined below in the “Non-GAAP Financial Measures” section within this Item 7, were $2,594.2 and 20.7% of net sales, respectively, in 2023, and $2,607.3 and 20.7% of net sales, respectively, in 2022.

Operating income for the Harsh Environment Solutions segment in 2023 was $943.9, or 26.7% of net sales, compared to $801.6, or 25.8% of net sales in 2022.

The slight increase in operating margin for the Harsh Environment Solutions segment for 2022 compared to 2021 was primarily driven by normal operating leverage on the higher sales volumes, combined with the benefit of pricing actions, which were largely offset by the impact of the more challenging cost environment experienced in 2022.

Operating income for the Communications Solutions segment in 2023 was $1,063.5, or 21.6% of net sales, compared to $1,245.7, or 22.0% of net sales in 2022.

The increase in operating margin for the Communications Solutions segment for 2022 compared to 2021 was primarily driven by normal operating leverage on the higher sales volumes, combined with the benefit of pricing actions, partially offset by the impact of the more challenging cost environment experienced in 2022.

Operating income for the Interconnect and Sensor Systems segment in 2023 was $753.7, or 18.3% of net sales, compared to $716.5, or 18.5% of net sales in 2022.

The increase in operating margin for the Interconnect and Sensor Systems segment for 2022 compared to 2021 was primarily driven by normal operating leverage on the higher sales volumes, combined with the benefit of pricing actions, partially offset by the impact of the more challenging cost environment experienced in 2022.

Interest expense was $139.5 in 2023 compared to $128.4 in 2022.

The increase in interest expense was driven by the higher interest rate environment and its impact on the balance outstanding under the Company’s U.S.

Commercial Paper Program.

The increase in interest expense was driven by the higher interest rate environment, which primarily impacted borrowings under the Company’s U.S.

Commercial Paper Program that were outstanding throughout much of 2023.

Refer to Note 4 of the Notes to Consolidated Financial Statements for further information related to the Company’s debt.

Provision for income taxes was at an effective rate of 20.7% in 2023 and 22.3% in 2022.

Provision for income taxes in 2022 included excess tax benefits of $56.0 from stock option exercises, partially offset by the tax effects related to acquisition-related expenses during the year.

These items had the aggregate effect of decreasing the effective tax rate and increasing earnings per share by the amounts noted in the table below.

Provision for income taxes in 2021 included (i) excess tax benefits of $63.4 from stock option exercises and (ii) a discrete tax benefit of $14.9 related to the settlement of uncertain tax positions in certain non-U.S.

jurisdictions, all of which were partially offset by the tax effects related to acquisition-related expenses during the year.

These items had the aggregate effect of decreasing the effective tax rate and increasing earnings per share by the amounts noted in the table below.

Provision for income taxes in 2022 included (i) excess tax benefits of $56.0 from stock option exercises, and (ii) the tax effects related to acquisition-related expenses during the year.

These items incurred in 2023 and 2022 had the aggregate effect of decreasing the effective tax rate and increasing earnings per share by the amounts noted in the table below.

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statutory federal tax rate and the Company’s effective tax rate for these years, refer to Note 6 of the Notes to Consolidated Financial Statements.

Net income from continuing operations attributable to Amphenol Corporation and Diluted EPS were $1,902.3 and $3.06, respectively, for 2022, compared to $1,569.4 and $2.51, respectively, for 2021.

Excluding the effect of the items discussed above, Adjusted Net Income from continuing operations attributable to Amphenol Corporation and Adjusted Diluted EPS, non-GAAP financial measures as defined in the “Non-GAAP Financial Measures” section below within this Item 7, were $1,864.7 and $3.00, respectively, for 2022, compared to $1,548.4 and $2.48, respectively, for 2021.

Net income attributable to Amphenol Corporation and Diluted EPS were $1,928.0 and $1.55, respectively, for 2023, compared to $1,902.3 and $1.53, respectively, for 2022.

Excluding the effect of the items listed in the table below, Adjusted Net Income attributable to Amphenol Corporation and Adjusted Diluted EPS, non-GAAP financial measures as defined in the “Non-GAAP Financial Measures” section below within this Item 7, were $1,870.4 and $1.51, respectively, for 2023, compared to $1,864.7 and $1.50, respectively, for 2022.

GAAP financial measures for the years ended December 31, 2023 and 2022:

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Acquisition-related expenses

Gain on bargain purchase acquisition

Excess tax benefits related to stock-based compensation

Discrete tax item

Adjusted (non-GAAP) (2)

All data in the tables above are on a continuing operations basis only and exclude results associated with discontinued operations.

(1) While the terms “operating margin” and “effective tax rate” are not considered U.S.

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Liquidity and Cash Requirements

At December 31, 2023 and 2022, the Company had cash, cash equivalents and short-term investments of $1,660.2 and $1,434.2, respectively, with the majority of the Company’s cash, cash equivalents and short-term investments on hand located outside of the United States.

At December 31, 2024 and 2023, the Company had cash, cash equivalents and short-term investments of $3,335.4 and $1,660.2, respectively.

As of December 31, 2024, more than half of the Company’s cash, cash equivalents and short-term investments on hand was located in the United States, primarily as a result of the proceeds from the issuance of the October Senior Notes in 2024.

As of December 31, 2023, the majority of the Company’s cash, cash equivalents and short-term investments on hand was located outside of the United States.

The Company’s primary sources of liquidity are internally generated cash provided by operating activities, our cash, cash equivalents and short-term investments on hand, as well as availability under the U.S.

Commercial Paper Program, the Euro Commercial Paper Program, the Revolving Credit Facility, and the Term Loan (all of which are defined and discussed in more detail below within this Item 7).

The Company believes that these sources of liquidity, along with access to capital markets (which the Company accessed in March 2023 in connection with the issuance of the 2026 Senior Notes, as defined and discussed in more detail below within this Item 7), provide adequate liquidity to meet both its short-term (next 12 months) and reasonably foreseeable long-term requirements and obligations.

Commercial Paper Program, th e Euro Commercial Paper Program, and the Revolving Credit Facility.

The Company believes that these sources of liquidity, along with a ccess to capital markets (which the Company accessed in 2024 in connection with the issuances of both the April Senior Notes and October Senior Notes), provide adequate liquidity to meet both its short-term (next 12 months) and reasonably foreseeable long-term requirements and obligations.

The Company’s debt instruments are defined and discussed in more detail below within this Item 7.

Cash Requirements from Known Contractual and Other Obligations

The Company’s primary ongoing cash requirements will be for operating and working capital needs, capital expenditures, product development activities, repurchases of our Common Stock, dividends, debt service, payments associated with the one-time tax on the deemed repatriation of all of the Company’s pre-2018 accumulated unremitted earnings and profits of foreign subsidiaries (“Transition Tax”), which is payable in annual installments until 2025, taxes due upon the repatriation of foreign earnings (which will be payable upon the repatriation of such earnings) , funding of pension obligations, and other contractual obligations and commitments (refer to the table below for the Company’s material cash requirements from known contractual and other obligations).

The Company may also use cash to fund all or part of the cost of future acquisitions, as was the case with our 2023 acquisitions.

The Company expects that capital expenditures in 2024 will be in a range of 3% to 4% of net sales.

The Company’s debt service requirements primarily consist of principal and interest on the Company’s Senior Notes, and to the extent of any amounts outstanding, the Revolving Credit Facility, Commercial Paper Programs and the Term Loan (all as defined below).

As of December 31, 2023, the Company had no borrowings outstanding under the Revolving Credit Facility, Term Loan, U.S.

The Company’s primary ongoing cash requirements will be for operating and working capital needs, capital expenditures, product development activities, repurchases of our Common Stock, dividends, debt service, payments associated with the one-time tax on the deemed repatriation of all of the Company’s pre-2018 accumulated unremitted earnings and profits of foreign subsidiaries (“Transition Tax”), of which the last annual installment will be paid in the second quarter of 2025, taxes due upon the repatriation of foreign earnings (which will be payable upon the repatriation of such earnings) , funding of pension obligations, and other contractual obligations and commitments (refer to the table below for the Company’s material cash requirements from known contractual and other obligations).

The Company may also use cash to fund all or part of the cost of future acquisitions, as has been the case in recent years with the Company’s various acquisitions, including CIT in May 2024, as well as the acquisition of CommScope’s Mobile Networks Business, which closed on January 31, 2025.

Capital expenditures are typically in the range of 3% to 4% of

net sales, although spending in 2025 is expected to continue to be slightly elevated to support the significant growth we are experiencing related to artificial intelligence applications in our IT datacom market.

The Company’s debt service requirements primarily consist of principal and interest on the Company’s Senior Notes, and to the extent of any amounts outstanding, the Revolving Credit Facility and Commercial Paper Programs (all as defined below).

As of December 31, 2024 and 2023, the Company had no borrowings outstanding under the Revolving Credit Facility, U.S.

Commercial Paper Program and Euro Commercial Paper Pro gram.

However , the Company borrowed under the U.S.

Commercial Paper Program throughout much of 2023, the proceeds of which were used for general corporate purposes, and the Company may make additional borrowings under any of its debt instruments in the future.

As a result of increases in the federal funds rate by the U.S.

Federal Reserve beginning in early 2022 and through the middle of 2023, the floating interest rates related to our U.S.

Commercial Paper Program (as well as our Revolving Credit Facility and Term Loan, to the extent either are drawn upon in the future) have increased substantially over this same period, a trend that could continue into 2024 and potentially beyond.

To the extent that interest rates related to this floating rate debt increase

further and the Company borrows under any of these floating interest rate instruments in the future, interest expense and interest payments would increase.

Commercial Paper Program throughout much of 2024, the proceeds of which were used for general corporate purposes, including, but not limited to, partially funding the acquisition of CIT in May 2024, as discussed later within this Item 7.

Although all such borrowings were repaid before the end of 2024, the Company may make additional borrowings under any of its debt instruments from time to time in the future.

To the extent that interest rates change related to floating rate debt and the Company borrows under any of our floating rate debt instruments in the future (Commercial Paper Programs as well as our Revolving Credit Facility), our interest expense and interest payments will be impacted accordingly.

Although the Company does not expect changes in interest rates to have a material effect on income or cash flows in 2025, there can be no assurance that interest rates will not change significantly from current levels.

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Transition tax (5)

(1) The Company has excluded expected interest payments on the Revolving Credit Facility, Term Loan, U.S.

(1) The Company has excluded expected interest payments on the Revolving Credit Facility, U.S.

Commercial Paper Program and Euro Commercial Paper Program from the above table, as this calculation is largely dependent on average debt levels during each of the years presented.

The actual interest payments made related to the Company’s Revolving Credit Facility, Term Loan and both Commercial Paper Programs combined, in 2023, were approximately $17.5.

The actual interest payments made related to the Company’s Revolving Credit Facility and both Commercial Paper Programs combined, in 2024, were approximately $25.8.

Expected debt levels, and therefore expected interest payments, are difficult to predict, as they are significantly impacted by items such as future acquisitions, repurchases of Common Stock and dividend payments, as well as payments or additional borrowings made to reduce or increase the underlying revolver balance.

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Over the past several years, there has been no minimum requirement for Company contributions to our defined benefit pension plans in the United States (“U.S.

Plans”) due to prior contributions made in excess of minimum requirements, and as a result, there was no anticipated minimum required contribution included in the table above related to the U.S.

Plans for 2024.

Pension Plans”) due to prior contributions made in excess of minimum requirements, and as a result, there was no anticipated minimum required contribution included in the table above related to the U.S.

Pension Plans for 2025.

The Company did not make any voluntary contributions to its U.S.

Plans in 2023 and 2022.

Pension Plans in 2024 and 2023.

It is not possible to reasonably estimate expected required contributions in the above table after 2025, since several assumptions are required to calculate minimum required contributions, such as the discount rate and expected returns on pension assets.

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tax expense for the Transition Tax, which was adjusted and finalized in 2018.

The Transition Tax is to be paid in annual installments over the eight-year period until 2025, as permitted under the Tax Act.

The seventh installment of the Transition Tax was paid in the second quarter of 2024, and the Company will pay the balance of the Transition Tax, net of applicable tax credits and deductions, in the second quarter of 2025, as permitted under the Tax Act.

The table above reflects the remaining amounts associated with the Transition Tax, which is net of applicable tax credits and deductions.

The sixth installment of the Transition Tax was paid in the second quarter of 2023.

(6) As of December 31, 2024, the Company has recorded net liabilities of approximately $209.7 related to unrecognized tax benefits.

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The Company intends to distribute certain 2024 foreign earnings and, as of December 31, 2024, has accrued foreign and U.S.

state and local taxes, where applicable, on those foreign earnings that it intends to repatriate, and intends to indefinitely reinvest the remaining 2023 foreign earnings.

state and local taxes, where applicable, associated with the foreign earnings that it intends to

repatriate, and intends to indefinitely reinvest the remaining 2024 foreign earnings.

The Company intends to (i) evaluate certain post-2024 earnings for repatriation, and will accrue for those distributions where appropriate, and (ii) indefinitely reinvest all other foreign earnings.

In addition, the Company paid its sixth annual installment of the Transition Tax, net of applicable tax credits and deductions, in the second quarter of 2023, and will pay the balance of the Transition Tax, net of applicable tax credits and deductions, in annual installments over the remainder of the eight-year period ending 2025, as permitted under the Tax Act.

In addition, the Company paid its seventh annual installment of the Transition Tax, net of applicable tax credits and deductions, in the second quarter of 2024, and will pay the balance of the Transition Tax, net of applicable tax credits and deductions, in 2025, as permitted under the Tax Act.

As of December 31, 2024, the Company has not provided for deferred income taxes on undistributed foreign earnings of approximately $1,550 related to certain geographies, as it is the Company’s intention to permanently reinvest such earnings outside the United States.

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Year Ended December 31,

Net cash provided by operating activities from continuing operations

Net cash used in investing activities from continuing operations

Net cash used in financing activities from continuing operations

Net cash change from discontinued operations

Net cash provided by operating activities

Net cash used in investing activities

Net cash provided by (used in) financing activities

Effect of exchange rate changes on cash and cash equivalents

Net increase (decrease) in cash and cash equivalents

Net cash change from discontinued operations in the table above, during the year ended December 31, 2021, includes the proceeds from the sale of the Divested MTS business, as defined and discussed in further detail in Note 11 of the Notes to Consolidated Financial Statements.

Net increase in cash and cash equivalents

Operating Activities

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Operating Cash Flow was $2,814.7 in 2024, compared to $2,528.7 in 2023 and $2,174.6 in 2022.

The increase in Operating Cash Flow in 2023 compared to 2022 is primarily due to an overall decrease in the net components of working capital in 2023, as discussed in more detail below.

The increase in Operating Cash Flow in 2022 compared to 2021 was primarily due to both an increase in net income from continuing operations and a lower usage of cash related to the change in working capital as discussed below.

The increase in Operating Cash Flow in 2024 compared to 2023 is primarily due to the increase in net income, partially offset by a higher usage of cash related to the change in working capital, as discussed below.

The increase in Operating Cash Flow in 2023 compared to 2022 was primarily due to an overall decrease in the net components of working capital in 2023, as discussed in more detail below.

In 2024, the components of working capital as presented on the accompanying Consolidated Statements of Cash Flow increased $210.5, excluding the impact of acquisitions and foreign currency translation, primarily due to increases in accounts receivable of $586.8, inventories of $200.1 and prepaid expenses and other current assets of $106.8, partially offset by increases in accounts payable of $423.1 and accrued liabilities, including income taxes, of $260.1.

In 2023, the components of working capital as presented on the accompanying Consolidated Statements of Cash Flow decreased $149.8, excluding the impact of acquisitions and foreign currency translation, primarily due to decreases in accounts receivable of $146.4 and inventories of $71.4, partially offset by a decrease in accounts payable of $34.6 and an increase in prepaid expenses and other current assets of $34.1.

In 2022, the components of working capital as presented on the accompanying Consolidated Statements of Cash Flow increased $193.1, excluding the impact of acquisitions and foreign currency translation, primarily due to increases in inventories of $278.5 and accounts receivable of $273.1, partially offset by increases in accrued liabilities, including income taxes, of $246.3 and accounts payable of $62.5, and a decrease in prepaid expenses and other current assets of $49.7.

In 2021, the components of working capital as presented on the accompanying Consolidated Statements of Cash Flow increased $496.4, excluding the impact of acquisitions and foreign currency translation, primarily due to increases in accounts receivable, inventories, and prepaid expenses and other current assets of $398.4, $263.0 and $20.2, respectively, partially offset by increases in accounts payable of $131.7 and accrued liabilities, including income taxes, of $53.5.

The following describes the significant changes in the amounts as presented on the accompanying Consolidated Balance Sheets at December 31, 2024 compared to December 31, 2023.

Accounts receivable decreased $12.9 to $2,618.4, driven by the decrease in days sales outstanding as noted below, which was largely offset by the impact of the 10 acquisitions (collectively, the “2023 Acquisitions”) that closed during 2023 and the effect of translation from exchange rate changes (“Translation”) at December 31, 2023 compared to December 31, 2022.

Accounts receivable increased $669.5 to $3,287.9, primarily driven by higher sales in the fourth quarter of 2024 relative to the fourth quarter of 2023, along with the impact of the two acquisitions (the “2024 Acquisitions”) that closed during 2024, partially offset by the effect of translation from exchange rate changes (“Translation”) at December 31, 2024 compared to December 31, 2023.

Days sales outstanding at December 31, 2024 and 2023 were 68 days and 70 days, respectively.

Inventories increased $73.5 to $2,167.1, which was primarily driven by the impact of the 2023 Acquisitions.

Inventories increased $378.6 to $2,545.7, primarily driven by the impact of the 2024 Acquisitions, along with the impact of higher sales in 2024 relative to the prior year, partially offset by Translation.

Inventory days at December 31, 2024 and 2023 were 80 days and 85 days, respectively.

Prepaid expenses and other current assets increased $127.4 to $517.0, primarily due to increases in various prepaid expenses and other current receivables, along with the impact of the 2024 Acquisitions.

Property, plant and equipment, net, increased $110.4 to $1,314.7, primarily due to capital expenditures of $372.8, the impact of the 2023 Acquisitions and Translation, partially offset by depreciation of $313.7 and disposals.

Goodwill increased $646.3 to $7,092.4, primarily driven by goodwill recognized as a result of the 2023 Acquisitions, along with Translation.

Other intangible assets, net, increased $100.7 to $834.8, primarily due to the recognition of certain intangible assets related to the 2023 Acquisitions, partially offset by amortization of $86.0 associated with the Company’s current intangible assets.

Accounts payable increased $41.8 to $1,350.9, primarily due to the impact of the 2023 Acquisitions.

Property, plant and equipment, net, increased $397.1 to $1,711.8, primarily due to capital expenditures of $665.4 and the impact of the 2024 Acquisitions, partially offset by depreciation of $390.6, disposals and Translation.

Goodwill increased $1,143.8 to $8,236.2, primarily driven by goodwill recognized from the 2024 Acquisitions, in particular the

CIT acquisition, partially offset by Translation.

Other intangible assets, net, increased $390.3 to $1,225.1, primarily due to the recognition of certain intangible assets related to the 2024 Acquisitions, in particular the CIT acquisition, partially offset by amortization of $154.7 associated with the Company’s current intangible assets as well as measurement period adjustments related to certain intangible assets associated with acquisitions that closed late in 2023.

Other long-term assets increased $131.9 to $581.1, primarily due to an increase in operating lease right-of-use assets resulting from both new and renewed lease agreements entered into during 2024 and acquired leases resulting from acquisitions.

Accounts payable increased $468.5 to $1,819.4, primarily due to increased purchasing activity related to the higher sales levels in 2024, along with the impact of the 2024 Acquisitions, partially offset by Translation.

Payable days at December 31, 2024 and 2023 were 58 days and 55 days, respectively.

Total accrued expenses, including accrued income taxes, increased $83.7 to $1,448.0, primarily due to the impact of the 2023 Acquisitions and increases in certain other accrued expenses, partially offset by modest decreases in accrued salaries, wages and employee benefits and accrued income taxes.

Accrued pension and postretirement benefit obligations increased $15.1 to $143.0.

Total accrued expenses, including accrued income taxes, increased $414.7 to $1,862.7, primarily as a result of increases in accrued salaries, wages and employee benefits, accrued income taxes, and various other accrued expenses, along with the impact of the 2024 Acquisitions.

Accrued pension and postretirement benefit obligations decreased $13.2 to $129.8, primarily due to the impact of higher discount rates used to calculate our projected benefit obligation and funded status of our defined benefit pension plans.

Other long-term liabilities, including deferred tax liabilities, increased $65.4 to $886.1, primarily as a result of an increase in long-term lease liabilities resulting from both new and renewed lease agreements entered into during 2024, along with acquired leases resulting from acquisitions.

In addition to Operating Cash Flow, the Company also considers Free Cash Flow, a non-GAAP financial measure defined in the “Non-GAAP Financial Measures” section below, as a key metric in measuring the Company’s ability to generate cash.

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GAAP financial measure for the years ended December 31, 2024, 2023 and 2022.

The increases in Free Cash Flow in 2023 compared to 2022, as well as in 2022 compared to 2021, were driven by the increase in Operating Cash Flow in each respective year, as described above.

The following table is on a continuing operations basis only and excludes any cash flows related to discontinued operations:

Free Cash Flow decreased modestly in 2024 compared to 2023, as the increase in capital expenditures was largely offset by the increase in Operating Cash Flow, as described above.

The increase in Free Cash Flow in 2023 compared to 2022 was driven by the increase in Operating Cash Flow, as described above.

Operating Cash Flow (GAAP)

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Cash flows from investing activities primarily consist of cash flows associated with capital expenditures, proceeds from disposals of property, plant and equipment , net, purchases (sales and maturities) of short- and long-term investments, and acquisitions.

Net cash used in investing activities from continuing operations was $1,393.7 in 2023, compared to $731.1 in 2022 and $2,604.4 in 2021.

In 2023, net cash used in investing activities from continuing operations was primarily driven by the use of $970.4 to fund acquisitions, capital expenditures (net of disposals) of $368.8, and net purchases of short-term investments of $59.4.

In 2022, net cash used in investing activities from continuing operations was primarily driven by capital expenditures (net of disposals) of $378.2, the use of $288.2 to fund acquisitions, net purchases of long-term investments of $56.0, and net purchases of short-term investments of $25.2.

In 2021, net cash used in investing activities from continuing operations was primarily driven by the use of $2,225.4 to fund acquisitions, capital expenditures (net of disposals) of $356.7, and net purchases of short-term investments of $8.6.

Net cash used in investing activities was $2,648.6 in 2024, compared to $1,393.7 in 2023 and $731.1 in 2022.

In 2024, net cash used in investing activities was primarily driven by the use of $2,156.4 to fund acquisitions and capital expenditures (net of disposals) of $657.6, partially offset by net sales and maturities of short-term investments of $163.5.

In 2023, net cash used in investing activities was primarily driven by the use of $970.4 to fund acquisitions, capital expenditures (net of disposals) of $368.8, and net purchases of short-term investments of $59.4.

In 2022, net cash used in investing activities was primarily driven by capital expenditures (net of disposals) of $378.2, the use of $288.2 to fund acquisitions, net purchases of long-term investments of $56.0, and net purchases of short-term investments of $25.2.

The elevated capital expenditures in 2024, in particular in the second half of the year, were driven by investments, primarily in support of the growth in our IT datacom and defense markets.

We currently expect this elevated level of capital spending to continue into 2025 to support the significant growth we are experiencing related to artificial intelligence applications in our IT datacom market.

Financing Activities

Cash flows from financing activities primarily consist of cash flows associated with borrowings and repayments of the Company’s credit facilities and other long-term debt, repurchases of Common Stock, proceeds from stock option exercises, dividend payments, and distributions to and purchases of noncontrolling interests.

Net cash used in financing activities from continuing operations was $1,012.4 in 2023, compared to $1,196.7 in 2022 and $145.1 in 2021.

In 2023, net cash used in financing activities from continuing operations was primarily driven by (i) net repayments of $632.6 related to the Company’s commercial paper programs, primarily the U.S.

Commercial Paper Program, (ii) repurchases of the Company’s Common Stock of $585.1, (iii) dividend payments of $500.6, (iv) distributions to and purchases of noncontrolling interests of $24.0, (v) other debt repayments of $15.7, (vi) payments of $2.3 related to debt financing costs associated with the Company’s $350.0 principal amount of unsecured 4.750% Senior Notes due March 30, 2026 (the “2026 Senior Notes”), and (vii) payment of $1.5 associated with the deferred purchase price related to an acquisition, partially offset by (a) cash proceeds of $394.5 from the exercise of stock options and (b) net cash proceeds from borrowings of $354.9, primarily related to the issuance of the 2026 Senior Notes.

In 2022, net cash used in financing activities from continuing operations was primarily driven by (i) repurchases of the Company’s Common Stock of $730.5, (ii) dividend payments of $477.4, (iii) net repayments of $159.3, primarily under the U.S.

Net cash provided by financing activities was $1,729.9 in 2024, compared to net cash used in financing activities of $1,012.4 in 2023 and $1,196.7 in 2022.

In 2024, net cash provided by financing activities was primarily driven by (i) net

cash proceeds from borrowings of $2,991.3, primarily related to the issuances of the April Senior Notes and October Senior Notes, each as defined below, and (ii) cash proceeds of $447.4 from the exercise of stock options, partially offset by (a) repurchases of the Company’s Common Stock of $689.3, (b) dividend payments of $595.1, (c) debt repayments of $364.4, primarily related to the redemption of the 3.20% Senior Notes in the second quarter of 2024, (d) distributions to and purchases of noncontrolling interests of $33.0, and (e) payments of $28.4 related to debt financing costs associated with the Company’s amended and restated revolving credit facility in March 2024 as well as the issuances of the April Senior Notes and October Senior Notes, each as defined below.

In 2023, net cash used in financing activities was primarily driven by (i) net repayments of $632.6 related to the Company’s commercial paper programs, primarily the U.S.

Commercial Paper Program, (ii) repurchases of the Company’s Common Stock of $585.1, (iii) dividend payments of $500.6, (iv) distributions to and purchases of noncontrolling interests of $24.0, (v) other debt repayments of $15.7, (vi) payments of $2.3 related to debt financing costs associated with the Company’s $350.0 aggregate principal amount of unsecured 4.750% Senior Notes due March 30, 2026 (the “2026 Senior Notes”), and (vii) payment of $1.5 associated with the deferred purchase price related to an acquisition, partially offset by (a) cash proceeds of $394.5 from the exercise of stock options and (b) net cash proceeds from borrowings of $354.9, primarily related to the issuance of the 2026 Senior Notes.

In 2022, net cash used in financing activities was primarily driven by (i) repurchases of the Company’s Common Stock of $730.5, (ii) dividend payments of $477.4, (iii) net repayments of $159.3, primarily under the U.S.

Commercial Paper Program, (iv) other debt repayments of $55.2, primarily related to short-term debt, and (v) distributions to and purchases of noncontrolling interests of $9.9, partially offset by (a) cash proceeds of $185.3 from the exercise of stock options and (b) proceeds of $50.7 primarily related to short-term borrowings.

In 2021, net cash used in financing activities from continuing operations was primarily driven by (i) debt repayments of $912.6, primarily related to the repayment of the assumed then-outstanding MTS senior notes in the second quarter of 2021 as well as the redemption of the 3.125% Senior Notes (the “2021 Senior Notes”) in the third quarter of 2021 and the redemption of the 4.00% Senior Notes (the “2022 Senior Notes”) in the fourth quarter of 2021, (ii) repurchases of the Company’s Common Stock of $661.7, (iii) dividend payments of $346.7, (iv) a cash transfer of $28.7 made by the Company’s continuing operations to its discontinued operations in order to fund the September 2021 payment of contingent consideration assumed as part of the MTS acquisition, (v) distributions to and purchases of noncontrolling interests of $18.9,

(vi) payments of $9.3 related to debt financing costs associated with the Company’s $750.0 principal amount of unsecured 2.200% Senior Notes due September 15, 2031 (the “2031 Senior Notes”), and (vii) payments of $4.1 associated with the deferred purchase price related to acquisitions, partially offset by (a) net borrowings of $796.3 primarily under the U.S.

Commercial Paper Program, the majority of the proceeds of which were used to fund acquisitions, including MTS, and to redeem the 2021 Senior Notes and the 2022 Senior Notes, (b) net cash proceeds of $752.1, primarily related to the September 2021 issuance of the 2031 Senior Notes, and (c) cash proceeds of $288.5 from the exercise of stock options.

The Company has significant flexibility to meet its financial commitments.

The Company uses debt financing to lower the overall cost of capital and increase return on stockholders’ equity.

The Company’s debt financing includes the use of Commercial Paper Programs, the Revolving Credit Facility, the Term Loan, and senior notes as part of its overall cash management strategy.

The Company has an amended and restated $2,500.0 unsecured revolving credit facility (the “Revolving Credit Facility”).

The Revolving Credit Facility matures in November 2026 and gives the Company the ability to borrow, in various currencies, at a spread that varies, based on the Company’s debt rating, over certain currency-specific benchmark rates, which benchmark rates in the case of U.S.

The Company’s debt financing includes the use of the Commercial Paper Programs, the Revolving Credit Facility, and senior notes as part of its overall cash management strategy.

On March 21, 2024, the Company entered into a third amended and restated credit agreement, which amended and restated its $2,500.0 unsecured revolving credit facility, increasing the lenders’ aggregate unsecured revolving commitments under the facility by $500.0 to $3,000.0 (the “Revolving Credit Facility”).

The Revolving Credit Facility matures in March 2029 and gives the Company and certain of its subsidiaries the ability to borrow, in various currencies, at a spread that varies, based on the Company’s debt rating, over certain currency-specific benchmark rates, which benchmark rates, in the case of U.S.

dollar borrowings, are either the base rate or the adjusted term Secured Overnight Financing Rate (“SOFR”).

The Revolving Credit Facility was undrawn on the date it was amended and restated.

The Company may utilize the Revolving Credit Facility for general corporate purposes.

As of December 31, 2023 and 2022, there were no outstanding borrowings under the Revolving Credit Facility.

As of December 31, 2024 and 2023, there were no outstanding borrowings under the revolving credit facility then in effect.

The Revolving Credit Facility requires payment of certain annual agency and commitment fees and requires that the Company satisfy certain financial covenants.

On December 31, 2024, the Company was in compliance with the financial covenants under the Revolving Credit Facility.

On April 19, 2022, the Company entered into a two-year, $750.0 unsecured delayed draw term loan credit agreement (the “Term Loan”), which is scheduled to mature on April 19, 2024.

The Term Loan was undrawn at closing and may be drawn on up to five occasions over the life of the facility.

The Term Loan may be repaid at any time without premium or penalty, and, once repaid, cannot be reborrowed.

If drawn upon, the proceeds from the Term Loan are expected to be used for general corporate purposes.

Interest rates under the Term Loan are based on a spread over either the base rate or the adjusted term SOFR, which spread varies based on the Company’s debt rating.

As of December 31, 2023, the Company had not yet drawn upon the Term Loan, and as such, there were no outstanding borrowings under the Term Loan.

The Term Loan requires payment of certain commitment fees and requires that the Company satisfy certain financial covenants, which financial covenants are the same as those under the Revolving Credit Facility.

On December 31, 2023, the Company was in compliance with the financial covenants under the Term Loan.

The Company has a commercial paper program pursuant to which the Company may issue short-term unsecured commercial paper notes (the “USCP Notes”) in one or more private placements in the United States (the “U.S.

Commercial Paper Program”).

The maximum aggregate principal amount outstanding of USCP Notes at any time is $2,500.0.

On April 19, 2022, the Company entered into a two-year, $750.0 unsecured delayed draw term loan credit agreement (the “Term Loan”).

The Term Loan matured on April 19, 2024 without the Company drawing upon it throughout its term.

The Company has a commercial paper program (the “U.S.

Commercial Paper Program”) pursuant to which the Company may issue short-term unsecured commercial paper notes (the “USCP Notes” or “U.S.

Commercial Paper”) in one or more private placements in the United States.

On March 21, 2024, in conjunction with the increase in the capacity of the Revolving Credit Facility, the Company increased the borrowings available under its U.S.

Commercial Paper Program by $500.0.

As of December 31, 2024, the maximum aggregate principal amount outstanding of USCP Notes at any time is $3,000.0.

The Company utilizes borrowings under the U.S.

Commercial Paper Program for general corporate purposes, which, in recent years, have included fully or partially funding acquisitions, as well as repaying certain outstanding senior notes as was the case in 2021 with (i) the third quarter 2021 redemption of the 2021 Senior Notes, of which $227.7 aggregate principal amount was then outstanding, and (ii) the fourth quarter 2021 redemption of the 2022 Senior Notes, of which $295.0 aggregate principal amount was then outstanding .

Commercial Paper Program for general corporate purposes, which, in recent years, have included fully or partially funding acquisitions, as well as repaying certain outstanding senior notes.

The Company borrowed under the U.S.

Commercial Paper Program throughout much of 2023, the proceeds of which were used for general corporate purposes.

During the fourth quarter of 2023, the Company repaid all of its USCP Notes then outstanding, and, as of December 31, 2023, there were no USCP Notes outstanding.

As of December 31, 2022, the amount of USCP Notes outstanding was $632.8, with a weighted average interest rate of 4.69%.

Commercial Paper Program throughout much of 2024 and 2023, the proceeds of which were used for general corporate purposes, including, but not limited to, partially funding the acquisition of CIT in May 2024.

Before the end of the fourth quarter of 2024 and 2023, the Company repaid all of its USCP Notes then outstanding.

As of December 31, 2024 and 2023, there were no USCP Notes outstanding.

The Company and one of its wholly owned European subsidiaries (the “Euro Issuer”) also have a commercial paper program (the “Euro Commercial Paper Program” and, together with the U.S.

Commercial Paper Program, the “Commercial Paper Programs”), pursuant to which the Euro Issuer may issue short-term unsecured commercial paper notes (the “ECP Notes” and, together with the USCP Notes, the “Commercial Paper”), which are guaranteed by the Company and are to be issued outside of the United States.

Commercial Paper Program, the

“Commercial Paper Programs”), pursuant to which the Euro Issuer may issue short-term unsecured commercial paper notes (the “ECP Notes” and, together with the USCP Notes, the “Commercial Paper”), which are guaranteed by the Company and are to be issued outside of the United States.

The ECP Notes may be issued in Euros, Sterling, U.S.

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The maximum aggregate principal amount outstanding of ECP Notes at any time is $2,000.0.

The Company utilizes borrowings under the Euro Commercial Paper Program for general corporate purposes, which may include, for example, fully or partially funding acquisitions.

The Company utilizes borrowings under the Euro Commercial Paper Program for general corporate purposes, which may include, for example, fully or partially funding acquisitions, as was the case in the first quarter of 2023 when the Company used borrowings under its Euro Commercial Paper Program, along with cash on hand, to fund an acquisition.

The Company did not borrow under the Euro Commercial Paper Program during 2024.

As of December 31, 2024 and 2023, there were no ECP Notes outstanding.

Amounts available under the Commercial Paper Programs may be borrowed, repaid and re-borrowed from time to time.

In conjunction with the Revolving Credit Facility, as of December 31, 2023, the authorization from the Company’s Board of Directors (the “Board”) limits the maximum principal amount outstanding of USCP Notes, ECP Notes, and any other commercial paper or similar programs, along with outstanding amounts under the Revolving Credit Facility, at any time to $2,500.0 in the aggregate .

The Commercial Paper Programs are rated A-2 by Standard & Poor’s and P-2 by Moody’s and, based on the Board’s authorization described above, are currently backstopped by the Revolving Credit Facility, as amounts undrawn under the Company’s Revolving Credit Facility are available to repay Commercial Paper, if necessary.

Net proceeds of the issuances of Commercial Paper are expected to be used for general corporate purposes.

In conjunction with the Revolving Credit Facility, as of December 31, 2024, the authorization from the Board limits the maximum aggregate principal amount outstanding of USCP Notes, ECP Notes, and any other commercial paper or similar programs, along with outstanding amounts under the Revolving Credit Facility, at any time to $3,000.0 .

The Commercial Paper Programs are rated A-2 by Standard & Poor’s and P-2 by Moody’s and, based on the Board’s authorization described above, are currently backstopped by the Revolving Credit Facility, as amounts undrawn under the Revolving Credit Facility are available to repay Commercial Paper, if necessary.

The Company reviews its optimal mix of short-term and long-term debt regularly and may replace certain amounts of Commercial Paper, short-term debt and current maturities of long-term debt with new issuances of long-term debt in the future.

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September 2031

November 2054

May 2026 (Euro Notes)

October 2028 (Euro Notes)

On April 1, 2024, the Company used cash on hand to repay the $350.0 aggregate principal amount of unsecured 3.20% Senior Notes due April 1, 2024 upon maturity.

On April 5, 2024, the Company issued three series of unsecured senior notes (collectively, the “April Senior Notes”):

(i) $450.0 aggregate principal amount of unsecured 5.050% Senior Notes due April 5, 2027 (the “Original 2027 Senior Notes”), (ii) $450.0 aggregate principal amount of unsecured 5.050% Senior Notes due April 5, 2029 (the “2029 Senior Notes”) and (iii) $600.0 aggregate principal amount of unsecured 5.250% Senior Notes due April 5, 2034 (the “2034 Senior Notes”).

The Company used net proceeds from the April Senior Notes, together with a combination of cash on hand and borrowings under the U.S.

Commercial Paper Program, to fund the cash consideration for the CIT acquisition in May 2024, along with the fees and expenses related thereto.

On October 31, 2024, the Company issued three series of unsecured senior notes (collectively, the “October Senior Notes”):

(i) $250.0 aggregate principal amount of unsecured 5.050% Senior Notes due April 5, 2027 (the “Additional 2027 Senior Notes”), which constituted a further issuance of the Company’s Original 2027 Senior Notes issued in April 2024, thus forming a single series with, and having the same terms (other than the issue date, issue price and the first interest payment date) as, the Original 2027 Senior Notes, and thus having a total aggregate principal amount of $700.0 of unsecured 5.050% Senior Notes due April 5, 2027 outstanding (the Original 2027 Senior Notes, together with the Additional 2027 Senior Notes collectively referred to as the “2027 Senior Notes”), (ii) $750.0 aggregate principal amount of unsecured 5.000% Senior Notes due January 15, 2035 (the “2035 Senior Notes”) and (iii) $500.0 aggregate principal amount of unsecured 5.375% Senior Notes due November 15, 2054 (the “2054 Senior Notes”).

On January 31,

2025, the Company used the net proceeds from the October Senior Notes, together with borrowings under the U.S.

Commercial Paper Program and cash on hand, to fund the cash consideration for the Company’s acquisition of CommScope’s Mobile Networks Business, along with the fees and expenses related thereto.

On March 30, 2023, the Company issued the 2026 Senior Notes.

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Commercial Paper Program.

On September 14, 2021, the Company issued the 2031 Senior Notes.

The Company used the net proceeds from the 2031 Senior Notes to repay certain outstanding borrowings under the U.S.

Commercial Paper Program.

All of the Company’s outstanding senior notes in the United States (the “ U.S.

Senior Notes”) are unsecured and rank equally in right of payment with the Company’s and the Euro Issuer’s other unsecured senior indebtedness.

Senior Notes”) are unsecured and rank equally in right of payment with all of the Company’s other senior unsecured and unsubordinated indebtedness, including the Company’s guarantee of the Euro Issuer’s obligations under the Euro Notes.

Interest on each series of U.S.

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The Euro Issuer has two outstanding unsecured senior notes issued in Europe.

The Euro Issuer has €500.0 (approximately $545.4 at date of issuance) principal amount of unsecured 0.750% Senior Notes due May 4, 2026 (the “2026 Euro Notes”), the net proceeds of which were used to repay amounts outstanding under the then existing revolving credit facility.

In addition, the Euro Issuer also has €500.0 (approximately $574.6 at date of issuance) principal amount of unsecured 2.000% Senior Notes due October 8, 2028 (the “2028 Euro Notes”, together with the 2026 Euro Notes, the “Euro Notes”, and the Euro Notes, together with the U.S.

The Euro Issuer has €500.0 (approximately $545.4 at date of issuance) aggregate principal amount of unsecured 0.750% Senior Notes due May 4, 2026 (the “2026 Euro Notes”), the net proceeds of which were used to repay amounts outstanding under the then existing revolving credit facility.

In addition, the Euro Issuer also has €500.0 (approximately $574.6 at date of issuance) aggregate principal amount of unsecured 2.000% Senior Notes due October 8, 2028 (the “2028 Euro Notes”, together with the 2026 Euro Notes, the “Euro Notes”, and the Euro Notes, together with the U.S.

Senior Notes, the “Senior Notes”), the net proceeds of which were used to repay a portion of the outstanding amounts under our Commercial Paper Programs, with the remainder of the net proceeds being used for general corporate purposes.

The Euro Notes are unsecured and rank equally in right of payment with the Company’s and the Euro Issuer’s other unsecured senior indebtedness and are fully and unconditionally guaranteed on a senior unsecured basis by the Company.

The Euro Notes are unsecured and rank equally in right of payment with all of the Euro Issuer’s senior unsecured and unsubordinated indebtedness and are fully and unconditionally guaranteed on a senior unsecured basis by the Company.

Interest on each series of Euro Notes is payable annually.

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Refer to Note 4 of the Notes to Consolidated Financial Statements for further information related to the Company’s debt.

On April 27, 2021, the Board authorized a stock repurchase program under which the Company may purchase up to $2,000.0 of the Company’s Common Stock during the three-year period ending April 27, 2024 (the “2021 Stock Repurchase Program”).

During the years ended December 31, 2023, 2022 and 2021, the Company repurchased 7.2 million, 9.9 million and 6.2 million shares of its Common Stock for $585.1, $730.5 and $457.9, respectively, under the 2021 Stock Repurchase Program.

Of the total repurchases made in 2023, 5.5 million shares, or $435.8, have been retired

by the Company, with the remainder of the repurchased shares being retained in Treasury stock at the time of repurchase.

Of the total repurchases made in 2022, 9.3 million shares, or $689.7, have been retired by the Company, with the remainder of the repurchased shares being retained in Treasury stock at the time of repurchase.

Of the total repurchases made in 2021 under the 2021 Stock Repurchase Program, 5.8 million shares, or $424.9, were retired by the Company, with the remainder of the repurchased shares being retained in Treasury stock at the time of repurchase.

From January 1, 2024 through January 31, 2024, the Company did not repurchase any additional shares of its Common Stock, and, as of February 1, 2024, the Company has remaining authorization to purchase up to $226.5 of its Common Stock under the 2021 Stock Repurchase Program.

The timing and amount of any future purchases will depend on a number of factors, such as the levels of cash generation from operations, the volume of stock options exercised by employees, cash requirements for acquisitions, dividends paid, economic and market conditions and the price of the Common Stock.

In April 2018, the Board authorized a stock repurchase program under which the Company could purchase up to $2,000.0 of Common Stock during the three-year period ending April 24, 2021 (the “2018 Stock Repurchase Program”).

On April 23, 2024, the Board authorized a new stock repurchase program under which the Company may purchase up to $2,000.0 of its Common Stock during the three-year period ending on the close of business on April 28, 2027 (the “2024 Stock Repurchase Program”).

The 2024 Stock Repurchase Program became effective on April 29, 2024.

During the year ended December 31, 2024, the Company repurchased 7.0 million shares of its Common Stock for $463.7 under the 2024 Stock Repurchase Program.

As a result of these purchases, the Company completed all purchases authorized under the 2018 Stock Repurchase Program, and, therefore, the 2018 Stock Repurchase Program was terminated.

Of the total repurchases made in 2021 under the 2018 Stock Repurchase Program, 2.8 million shares, or $184.0, were retired by the Company, with the remainder of the repurchased shares being retained in Treasury stock at the time of repurchase.

Of the total repurchases made in 2024 under the 2024 Stock Repurchase Program, 4.2 million shares, or $287.5, have been retired by the Company, with the remainder of the repurchased shares retained in Treasury stock at the time of repurchase.

From January 1, 2025 to January 31, 2025, the Company repurchased 0.7 million additional shares of its Common Stock for $50.7, and, as of February 1, 2025, the Company has remaining authorization to purchase up to $1,485.6 of its Common Stock under the 2024 Stock Repurchase Program.

The timing and amount of any future repurchases will depend on a number of factors, such as the levels of cash generation from operations, the volume of stock options exercised by employees, cash requirements for acquisitions, dividends paid, economic and market conditions and the price of the Common Stock.

In April 2021, the Board authorized a stock repurchase program under which the Company could purchase up to $2,000.0 of its Common Stock during the three-year period ending April 27, 2024 (the “2021 Stock Repurchase Program”).

During the year ended December 31, 2024, the Company repurchased 4.1 million shares of its Common Stock for $225.6 under the 2021 Stock Repurchase Program.

All of the repurchased shares under the 2021 Stock Repurchase Program during 2024 have been retired by the Company.

As a result of these repurchases, the Company completed all repurchases authorized under the 2021 Stock Repurchase Program, and, therefore, the 2021 Stock Repurchase Program has terminated.

During the year ended December 31, 2023, the Company repurchased 14.4 million shares of its Common Stock for $585.1 under the 2021 Stock Repurchase Program.

Of the total repurchases made in 2023, 10.9 million shares, or $435.8, were retired by the Company, with the remainder of the repurchased shares retained in Treasury stock at the time of repurchase.

During the year ended December 31, 2022, the Company repurchased 19.8 million shares of its Common Stock for $730.5 under the 2021 Stock Repurchase Program.

Of the total repurchases made in 2022, 18.7 million shares, or $689.7, were retired by the Company, with the remainder of the repurchased shares retained in Treasury stock at the time of repurchase.

Contingent upon declaration by the Board, the Company pays a quarterly dividend on shares of its Common Stock.

On October 25, 2022, the Board approved an increase to the Company’s quarterly dividend rate from $0.20 per share to $0.21 per share, effective with dividends declared in the fourth quarter of 2022, and on October 24, 2023, the Board approved an additional increase to the Company’s quarterly dividend rate from $0.21 per share to $0.22 per share, effective with dividends declared in the fourth quarter of 2023, contingent upon declaration by the Board.

The following table summ arizes the declared quarterly dividends per share for each of the three years ended December 31, 2023, 2022 and 2021:

On October 24, 2023, the Board approved an increase to the Company’s quarterly dividend rate from $0.105 per share to $0.11 per share, effective with dividends declared in the fourth quarter of 2023, and on July 23, 2024, the Board approved an additional increase to the Company’s quarterly dividend rate from $0.11 per share to $0.165 per share, effective with dividends declared in the third quarter of 2024, contingent upon declaration by the Board.

The following table summ arizes the declared quarterly dividends per share during each of the three years ended December 31, 2024, 2023 and 2022:

First Quarter

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Fourth Quarter

The following table summarizes the dividends declared and paid for the years ended December 31, 2023, 2022 and 2021:

The following table summarizes the dividends declared and paid during the years ended December 31, 2024, 2023 and 2022:

Dividends declared

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The Company and certain of its subsidiaries in the United States have defined benefit pension plans (“U.S.

Plans”), which cover certain U.S.

Pension Plans”), which cover certain U.S.

employees and which represent the majority of the plan assets and benefit obligations of the aggregate defined benefit plans of the Company.

Plans’ benefits are generally based on years of service and compensation and are generally noncontributory.

Pension Plans’ benefits are generally based on years of service and compensation and are generally noncontributory.

The majority of U.S.

employees are not covered by the U.S.

Plans and are instead covered by various defined contribution plans.

Pension Plans and are instead covered by various defined contribution plans.

The Company also has an unfunded Supplemental Employee Retirement Plan (“SERP”, and together with the U.S.

Pension Plans, “U.S.

Plans”), which provides for the payment of the portion of annual pension that cannot be paid from the retirement plan as a result of regulatory limitations on average compensation for purposes of the benefit computation.

Certain foreign subsidiaries also have defined benefit plans covering their employees (the “Foreign Plans” and, together with the U.S.

Plans, the “Plans”).

The total liability for accrued pension and postretirement benefit obligations associated with the Company’s pension and postretirement benefit plans decreased in 2023 to $106.0 from $111.1 in 2022, primarily driven by actual positive returns on plan assets in 2023, partially offset by interest cost and the modest effect of the lower discount rates in 2023 on our projected benefit obligations.

The total liability for accrued pension and postretirement benefit obligations associated with the Company’s pension and postretirement benefit plans decreased in 2024 to $89.2 from $106.0 in 2023, primarily driven by the effect of higher discount rates in 2024 on our projected benefit obligations along with actual positive returns on plan assets in 2024, partially offset by interest cost.

There is no current requirement for cash contributions to any of the U.S.

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Refer to Note 9 of the Notes to Consolidated Financial Statements for further discussion of the Company’s benefit plans and other postretirement benefit plans.

During 2023, the Company completed 10 acquisitions (the “2023 Acquisitions”) for $970.4, net of cash acquired.

Five of the acquisitions have been included in the Harsh Environment Solutions segment, three acquisitions have been included in the Interconnect and Sensor Systems segment, and two acquisitions have been included in the Communications Solutions segment.

During 2024, the Company completed two acquisitions (the “2024 Acquisitions”), including the acquisition of CIT, for approximately $2,156.4, net of cash acquired.

Both acquisitions have been included in the Harsh Environment Solutions segment.

The 2024 Acquisitions were each funded using cash on hand, proceeds from the April Senior Notes or borrowings under the U.S.

Commercial Paper Program, or a combination thereof.

The 2024 Acquisitions are not material, either individually or in the aggregate, to the Company’s financial results.

On May 21, 2024, pursuant to a definitive stock purchase agreement by and between the Company and Carlisle Companies Incorporated dated January 30, 2024, the Company completed the acquisition of CIT for approximately $1,995.3, net of cash acquired and subject to customary post-closing adjustments.

The Company funded the CIT acquisition through a combination of net proceeds from the April Senior Notes, as discussed earlier in this Item 7, together with borrowings under the U.S.

Commercial Paper Program and cash on hand.

CIT, headquartered in St.

Augustine, FL, is a leading global supplier of harsh environment interconnect solutions, primarily to the commercial aerospace, defense and industrial end markets.

CIT’s wide range of products include wire and cable, cable assemblies,

contacts, connectors and sensors, which management believes are highly complementary to Amphenol’s existing interconnect and sensor solutions.

During 2023, the Company completed 10 acquisitions (the “2023 Acquisitions”) for approximately $970.4, net of cash acquired.

Five of the acquisitions were included in the Harsh Environment Solutions segment, three acquisitions were included in the Interconnect and Sensor Systems segment, and two acquisitions were included in the Communications Solutions segment.

The 2023 Acquisitions were each funded using cash on hand or borrowings under our Commercial Paper Programs, or a combination thereof.

One of the 2023 Acquisitions, which closed in the second quarter of 2023, represented a bargain purchase, where the estimated fair value of assets acquired, net of liabilities assumed, exceeded the purchase price.

The Company recognized a non-cash gain of $5.4 on the bargain purchase acquisition during the year ended December 31, 2023, which has been recorded separately in the Company’s Consolidated Statements of Income.

The Company recognized a non-cash gain of $5.4 on the bargain purchase acquisition during the year ended December 31, 2023, which was recorded separately in the Company’s Consolidated Statements of Income.

The 2023 Acquisitions were not material, either individually or in the aggregate, to the Company’s financial results.

During 2022, the Company completed two acquisitions (the “2022 Acquisitions”) for $288.2, net of cash acquired.

One of the 2022 Acquisitions was included in the Harsh Environment Solutions segment, and the other acquisition was included in the Interconnect and Sensor Systems segment.

The 2022 Acquisitions, which were funded through a combination of borrowings under the U.S.

Commercial Paper Program and cash on hand, were not material, either individually or in the aggregate, to the Company’s financial results.

Acquisition-related Expenses

In 2024, the Company incurred $145.6 ($119.3 after-tax) of acquisition-related expenses, comprised primarily of (i) external transaction costs associated with acquisitions and the amortization related to the value associated with acquired backlog resulting from the CIT acquisition (such acquisition-related expenses aggregating $127.4 are presented separately in the Consolidated Statements of Income) and (ii) the amortization of acquisition-related inventory step-up costs of $18.2 associated with the CIT acquisition (such costs are recorded in Cost of sales in the Consolidated Statements of Income).

In 2023, the Company incurred $34.6 ($30.2 after-tax) of acquisition-related expenses, comprised primarily of external transaction costs associated with the 2023 Acquisitions, along with the amortization related to the value associated with acquired backlog resulting from three of the 2023 Acquisitions.

In 2022, the Company incurred $21.5 ($18.4 after-tax) of acquisition-related expenses, comprised primarily of the amortization related to the value associated with acquired backlog resulting from the 2022 Acquisitions, along with external transaction costs.

Such acquisition-related expenses are presented separately in the accompanying Consolidated Statements of Income.

For further discussion of the Company’s acquisitions, refer to Note 11 of the Notes to Consolidated Financial Statements.

Subsequent Events

On January 30, 2024, the Company entered into a definitive stock purchase agreement by and between the Company and Carlisle Companies Incorporated (“Carlisle”), agreeing to acquire the Carlisle Interconnect Technologies (“CIT”) business of Carlisle for an aggregate purchase price of $2,025 in cash, subject to customary post-closing adjustments.

The acquisition is expected to be completed by the end of the second quarter of 2024 and is subject to certain regulatory approvals and other customary closing conditions.

The Company expects to finance the CIT acquisition through a combination of cash on hand and debt financing, which could include borrowings under the Company’s existing credit and/or U.S.

Commercial Paper Program.

CIT, headquartered in St.

Augustine, FL, is a leading global supplier of harsh environment interconnect solutions primarily to the commercial aerospace, defense and industrial end markets.

CIT’s wide range of products include wire and cable, cable assemblies, contacts, connectors and sensors, which, management believes, are highly complementary to Amphenol’s existing interconnect and sensor solutions.

If and when the acquisition is consummated, the Company expects to report the CIT business within its Harsh Environment Solutions segment.

Acquisitions of CommScope’s Mobile Networks Business and LifeSync Corporation

On January 31, 2025, pursuant to a purchase agreement (the “CommScope Purchase Agreement”) with CommScope Holding Company, Inc.

(“CommScope”) dated July 18, 2024, the Company completed the acquisition of CommScope’s mobile networks-related businesses, specifically the Outdoor Wireless Networks segment and the Distributed Antenna Systems business (collectively, the “Mobile Networks Business”) for an aggregate purchase price of approximately $2,100 in cash, subject to customary post-closing adjustments.

The Company funded the acquisition of the Mobile Networks Business through a combination of net proceeds from the October Senior Notes, as discussed in Note 4 of the accompanying Notes to Consolidated Financial Statements, together with borrowings under the U.S.

Commercial Paper Program and cash on hand.

The Mobile Networks Business provides mobile networks solutions, with advanced technologies in the areas of base station antennas and related interconnect solutions, as well as distributed antenna systems.

The Mobile Networks Business’s wide range of products add advanced antenna and associated interconnect products, technologies and capabilities, which management believes are highly complementary to Amphenol’s existing product portfolio for next-generation wireless networks.

The Mobile Networks Business will be included in the Communications Solutions segment.

Also, on January 31, 2025, the Company completed the acquisition of LifeSync Corporation (“LifeSync”), a high-technology provider of interconnect products for medical applications, which will be included in the Harsh Environment Solutions segment.

For further discussion of the Company’s acquisitions, refer to Note 11 and Note 15 of the Notes to Consolidated Financial Statements.

Environmental Matters

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The Company believes that its operations are currently in substantial compliance with applicable environmental laws and regulations and that the costs of continuing compliance will not have a material adverse effect on the Company’s financial condition, results of operations or cash flows.

For more information on certain environmental matters, refer to Note 14 of the Notes to Consolidated Financial Statements.

Inflation and Costs

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However, in certain markets, implementing price increases can be difficult, and there is no guarantee that the Company will be successful.

From time to time, the Company may encounter difficulties in obtaining certain raw materials or components necessary for production due to supply chain constraints and logistical challenges, which may include regulatory restrictions.

From time to time, the Company has encountered, and in the future may encounter, difficulties in obtaining certain raw materials or components necessary for production at reasonable costs due to supply chain constraints and logistical challenges, which may include regulatory restrictions and the imposition of additional tariffs.

These difficulties may also negatively impact the pricing of materials and components sourced or used by the Company.

While the Company does not currently anticipate significant, broad-based difficulties in obtaining raw materials or components necessary for production, inflationary pressures and logistical challenges may impact the cost and availability of certain raw materials and components used by the Company and result in supply shortages for discrete raw materials or components, which could be further exacerbated by increased commodity prices and additional inflation.

For a discussion of certain risks related to inflation and costs, refer to the risk factor titled “ The Company and certain of its suppliers and customers have experienced difficulties obtaining certain raw materials and components, and the cost of certain of the Company’s raw materials and components is increasing ” in Part I, Item 1A.

While the Company does not currently anticipate significant, broad-based difficulties in obtaining raw materials or components necessary for production, inflationary pressures and increased commodity prices may impact the cost and availability of certain raw materials and components used by the Company and result in supply shortages for discrete raw materials or components.

For a discussion of certain risks related to inflation and costs, refer to the risk factor titled “ The Company and certain of its suppliers and customers have experienced, and may in the future experience, difficulties obtaining certain raw materials and components, and the cost of certain of the Company’s raw materials and components may increase ” in Part I, Item 1A.

Risk Factors herein.

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Management believes that these non-GAAP financial measures may be helpful to investors in assessing the Company’s overall financial performance, trends and year-over-year comparative results, in addition to the reasons noted below.

Non-GAAP financial measures related to operating income, operating margin, net income from continuing operations attributable to Amphenol Corporation, effective tax rate and diluted EPS from continuing operations exclude income and expenses that are not directly related to the Company’s operating performance during the years presented.

Non-GAAP financial measures related to operating income, operating margin, net income attributable to Amphenol Corporation, effective tax rate and diluted EPS exclude income and expenses that are not directly related to the Company’s operating performance during the years presented.

Items excluded in the presentation of such non-GAAP financial measures in any period may consist of, without limitation, acquisition-related expenses, refinancing-related costs, gains associated with bargain purchase acquisitions, and certain discrete tax items including, but not limited to, (i) the excess tax benefits related to stock-based compensation and (ii) the impact of significant changes in tax law.

Non-GAAP financial measures related to net sales exclude the impact of foreign currency exchange rates and acquisitions.

Non-GAAP financial measures and their most directly comparable U.S.

GAAP financial measures presented within this Item 7 are on a continuing operations basis only and exclude any results associated with discontinued operations.

The non-GAAP financial information contained herein is included for supplemental purposes only and should not be considered in isolation or as a substitute for or superior to the related U.S.

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The non-GAAP financial measures defined below should be read in conjunction with the Company’s financial statements presented in accordance with U.S.

The reconciliations of these non-GAAP financial measures to the

most directly comparable U.S.

The reconciliations of these non-GAAP financial measures to the most directly comparable U.S.

GAAP financial measures for the years ended December 31, 2024, 2023 and 2022 are included in “Results of Operations” and “Liquidity and Capital Resources” within this Item 7:

● Adjusted Diluted EPS is defined as diluted earnings per share from continuing operations (as reported in accordance with U.S.

● Adjusted Diluted EPS is defined as diluted earnings per share (as reported in accordance with U.S.

GAAP), excluding income and expenses and their specific tax effects that are not directly related to the Company’s operating performance during the years presented.

Adjusted Diluted EPS is calculated as Adjusted Net Income from continuing operations attributable to Amphenol Corporation, as defined below, divided by the weighted average outstanding diluted shares as reported in the Consolidated Statements of Income.

● Adjusted Effective Tax Rate is defined as Provision for income taxes, as reported in the Consolidated Statements of Income, expressed as a percentage of Income from continuing operations before income taxes, as reported in the Consolidated Statements of Income, each excluding income and expenses and their specific tax effects that are not directly related to the Company’s operating performance during the years presented.

● Adjusted Net Income from continuing operations attributable to Amphenol Corporation is defined as Net income from continuing operations attributable to Amphenol Corporation, as reported in the Consolidated Statements of Income, excluding income and expenses and their specific tax effects that are not directly related to the Company’s operating performance during the years presented.

Adjusted Diluted EPS is calculated as Adjusted Net Income attributable to Amphenol Corporation, as defined below, divided by the weighted average outstanding diluted shares as reported in the Consolidated Statements of Income.

● Adjusted Effective Tax Rate is defined as Provision for income taxes, as reported in the Consolidated Statements of Income, expressed as a percentage of Income before income taxes, as reported in the Consolidated Statements of Income, each excluding income and expenses and their specific tax effects that are not directly related to the Company’s operating performance during the years presented.

● Adjusted Net Income attributable to Amphenol Corporation is defined as Net income attributable to Amphenol Corporation, as reported in the Consolidated Statements of Income, excluding income and expenses and their specific tax effects that are not directly related to the Company’s operating performance during the years presented.

● Adjusted Operating Income is defined as Operating income, as reported in the Consolidated Statements of Income, excluding income and expenses that are not directly related to the Company’s operating performance during the years presented.

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dollars, as well as Organic Net Sales Growth (as defined below) and Constant Currency Net Sales Growth, and believes that such information is useful to investors to assess the underlying sales trends.

● Free Cash Flow is defined as (i) Net cash provided by operating activities from continuing operations (“Operating Cash Flow” - as reported in accordance with U.S.

● Free Cash Flow is defined as (i) Net cash provided by operating activities (“Operating Cash Flow” - as reported in accordance with U.S.

GAAP) less (ii) capital expenditures (as reported in accordance with U.S.

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● Organic Net Sales Growth is defined as the year-over-year percentage change in net sales growth resulting from operating volume and pricing changes and excludes the impact of (i) changes in foreign currency exchange rates (described above), which is outside the control of the Company, and (ii) acquisitions, both of which are taken as a percentage of the respective prior year period(s) net sales.

The acquisition impact represents the percentage impact on net sales resulting from acquisitions that have not been included in the Company’s consolidated results for the full current year period(s) and/or prior comparable year period(s) presented.

Such net sales related to these acquisitions do not reflect the underlying growth of the Company on a comparative basis.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis