What changed in this filing

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Item 1. Business

2024-05-29 compared with 2023-05-25 · 53 added, 60 removed, 166 unchanged (41% of the section changed)

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The Company is focused on commercial and industrial applications that require the safety, reliability and quality provided by its superior design and engineering know-how.

Our products are used for mission critical applications where we have established, trusted brands with significant customer retention.

Our targeted market verticals include manufacturing, transportation, energy and utilities, process industries, industrial automation, construction and infrastructure, food and beverage, entertainment, life sciences, consumer packaged goods and e-commerce/supply chain/warehousing.

In fiscal 2022, the Company completed its acquisition of Dorner Mfg.

Our products are used for mission critical applications where we have established, trusted brands that are well known in the industry.

Our targeted market verticals include manufacturing, transportation including EV production and aerospace, energy and utilities, process industries, industrial automation, construction and infrastructure, food and beverage, entertainment, life sciences, consumer packaged goods and e-commerce/supply chain/warehousing.

In fiscal 2022, the Company initiated a new long-term strategy to transform from a legacy cyclical industrial company to a high growth, high margin secular growth company.

The Company expanded into the precision conveyance sector with its acquisitions of Dorner Mfg.

("Dorner") and Garvey Corporation ("Garvey").

Dorner is a leading automation solutions company providing unique, patented technologies in the design, application, manufacturing and integration of high-precision conveying systems.

Dorner is a leading supplier to the stable life sciences, food processing, and consumer packaged goods markets as well as the high growth industrial automation and e-commerce sectors.

The addition of Dorner provides attractive complementary adjacencies including sortation and asynchronous conveyance systems.

Dorner is a leading supplier to the stable life sciences, food processing, and consumer packaged goods markets as well as the higher growth industrial automation and e-commerce sectors.

The addition of Dorner has provided attractive complementary adjacencies to the Company.

Dorner offers a broad range of precision conveying systems to our product offerings, which include low profile, flexible chain, large scale, sanitary and vertical elevation conveyor systems, as well as pallet system conveyors.

Further in fiscal 2022, the Company completed its acquisition of Garvey Corporation ("Garvey"), which further expanded its precision conveyance offerings.

Garvey is a leading accumulation systems solutions company providing unique, patented systems for the automation of production processes whose products complement those of Dorner.

Most recently, in April 2023 we announced that we had entered into a definitive agreement to acquire montratec GmbH (montratec), a leading automation solutions company that designs and develops intelligent automation and transport systems for interlinking industrial production and logistics processes.

We expect to close on this acquisition on May 31, 2023 subject to customary closing conditions.

The acquisitions of Dorner and Garvey and expected acquisition of montratec accelerate the Company’s shift to intelligent motion solutions and serve as a platform to expand capabilities in advanced, higher technology automation solutions.

The Garvey acquisition added additional product capabilities as it is a leading accumulation systems solutions company providing unique, patented systems for the automation of production processes whose products complement those of Dorner.

The Company added asynchronous conveying technology in the precision conveyance sector in fiscal 2024 with its acquisition of montratec GmbH ("montratec"), a leading automation solutions company that designs and develops intelligent automation and transport systems for interlinking industrial production and logistics processes.

montratec product offerings compliment the previous acquisitions of both Dorner and Garvey.

Together, our acquisitions within the precision conveyance industry established a platform for growth organically as well as through further acquisitions as the industry is highly fragmented and offers complementary adjacencies, which we believe will enable further growth.

In the United States, we are the market leader for hoists, material handling digital power control systems and precision conveyors, our principal lines of products, and have strong market positions with certain chain, forged fittings, and actuator products.

Additionally, in Europe, we believe we are the market leader for manual hoists and a market leader in the heavy load, rail and niche custom applications for actuation.

Additionally, in Europe, we believe we are the market leader for manual hoists and a market leader in linear actuators used for heavy load, rail and niche custom applications for actuation.

We have achieved this leadership position through strategic acquisitions, our extensive, diverse, and well-established distribution channels and our commitment to product innovation and quality.

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STAHL serves independent crane builders and Engineering Procurement and Construction ("EPC") firms, providing products to a variety of end markets including automotive, general manufacturing, oil and gas, steel and concrete, power generation, as well as process industries such as chemical and pharmaceuticals.

We are continuing to transform from a legacy cyclical industrial company to a top-tier, secular growth, intelligent motion solutions company.

We are continuing our transformation from a legacy cyclical industrial company to a top-tier, secular growth, intelligent motion solutions company.

In accordance with our strategic framework, we are building out the Columbus McKinnon Business System ("CMBS") and growth framework to be market-led, customer-centric and operationally excellent with our people and values at the core.

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Here we expand beyond our SAM into the broader Total Addressable Market (“TAM”).

This involves building out our presence both geographically and in new verticals with expanded offerings, which we expect we can accomplish organically as well as with acquisitions.

This involves building out our presence both geographically and in new verticals with expanded offerings, which we expect to be accomplished organically as well as with selective acquisitions.

• Reimagining the Core is a more transformational path that rethinks our TAM and targets strategic expansion beyond our existing TAM.

As we think more broadly about material handling and increasing trends in intelligent motion, not just lifting, but solutions for how materials move throughout customer environments, there are some compelling ideas that emerge.

The Dorner and Garvey acquisitions are examples of reimagining Columbus McKinnon’s core, which added an additional $5 billion to our TAM, with the specialty conveying microsegment growing at an estimated 6% to 8% rate annually.

The strategy is geared toward investing in new products that solve our customers’ tough problems and expands into new platforms that provide intelligent motion solutions for material handling, such as precision conveyance capabilities.

We believe our recent acquisitions of Dorner and Garvey establish a platform for expansion supported by new product development, a fragmented competitive landscape and complementary adjacencies.

The acquisitions also allow Dorner and Garvey to expand geographically by having access to our global footprint and provide us with an entry point into a pipeline of additional acquisition opportunities in the fragmented precision conveying industry.

Our legacy Lifting business is cyclical in nature and sensitive to changes in general economic conditions, including changes in industrial capacity utilization, industrial production, and general economic activity indicators, like GDP growth.

and Eurozone capacity utilization and the ISM Production Index are leading market indicators for our Company.

The acquisitions of our conveyor businesses is an example of reimagining Columbus McKinnon’s core, which added approximately $5 billion to our TAM, with the specialty conveying microsegment growing at an estimated 6% to 8% rate annually.

Business Description

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and power and motion control systems, such as AC and DC drive systems, radio remote controls, push button pendant stations, brakes, and collision avoidance and power delivery subsystems.

The fiscal 2022 acquisitions of Dorner and Garvey expand our product offerings to include a broad range of highly engineered, precision conveying solutions.

Our legacy Lifting business is cyclical in nature and sensitive to changes in general macro economic conditions, including changes in industrial capacity utilization, industrial production, and general macro economic activity indicators, like GDP growth.

Our products are typically manufactured for stock or assembled to order from standard components and are sold primarily through a variety of commercial distributors and, to a lesser extent, directly to end-users.

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The diverse end-users of our products are in a variety of industries including manufacturing, power generation and distribution, utilities, wind power, warehouses, commercial construction, oil and gas exploration and refining, petrochemical, marine, ship building, transportation and heavy-duty trucking, agriculture, logging and mining.

The acquisitions of Dorner and Garvey expand the Company's reach to include the stable life sciences, food processing and consumer packaged goods markets and high growth industrial automation and e-commerce sectors.

We also serve a niche market for the entertainment industry, including permanent and traveling concerts, live theater, and sporting venues.

Our precision conveyance acquisitions expanded our product offerings to include a broad range of highly engineered, precision conveying solutions.

montratec’s principal markets include aerospace and electric vehicle production amongst others.

Of our fiscal 2024 sales, $574,843,000, or 57%, were U.S.

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Below-the-hook tooling, textile, and chain slings and associated forgings, and clamps are specialized lifting apparatus used in a variety of lifting activities performed in conjunction with hoisting or lifting applications.

We recently announced that along with a strategic partner we have developed a cutting-edge battery hoist.

Combining our industry-leading hoist design with our partner's expertise in lithium-ion battery and brushless motor technology, the innovative BatteryStar™ hoist provides the lifting strength and speed of an electric chain hoist and the portability of a manual hoist without the need for time-consuming manual operation or access to a power source.

The BatteryStar hoist has a 1-metric-ton lifting capacity with 20 feet of lift as standard and lifting speeds of 8 feet per minute.

The hoist will be available for sale beginning in fiscal 2025.

We also manufacture explosion-protected hoists and custom engineered hoists, including wire rope and manual and electric chain hoists.

These branded products are sold to a variety of end markets including automotive, general manufacturing, oil and gas, steel and concrete, power generation as well as process industries such as chemical and pharmaceuticals.

High-precision conveying systems – Our fiscal 2022 acquisitions of Dorner and Garvey expanded our product offerings to include high-precision, specialty conveyor system solutions.

These conveyor systems range from build to order modular standard systems to highly engineered customer solutions.

High-precision conveying systems – Dorner and Garvey expanded our product offerings to include high-precision, specialty conveyor system solutions.

These conveyor systems range from build to order modular standard systems to highly engineered custom solutions.

These products offer customers high quality and reliable solutions that enhance productivity and profitability.

We expect to further expand our product offering in the this space with the April 2023 announcement that we had entered into a definitive agreement to acquire montratec.

montratec product offerings complement both Dorner and Garvey, and further our shift to intelligent motion and serve as a platform to expand capabilities in advanced, higher technology automation solutions.

We expect to close on this acquisition on May 31, 2023 subject to customary closing conditions.

The Company’s most recent acquisition, montratec, provides asynchronous conveying solutions, which complements both Dorner and Garvey product offerings.

This furthers our shift to intelligent motion solutions and provides capabilities in advanced, higher technology automation solutions.

Digital Power Control and Delivery Systems - Through our Magnetek brand, we are a leading provider of innovative power control and delivery systems and solutions for overhead material handling applications used in a number of diverse industries, including aerospace, automotive, steel, aluminum, paper, logging, mining, ship loading, nuclear power plants, and heavy movable structures.

We are a major supplier in North America of power and motion control systems, which include AC and DC drive systems, radio remote controls, push button pendant stations, brakes, and collision avoidance and power delivery subsystems.

While we sell primarily to original equipment manufacturers ("OEMs") of overhead cranes and hoists, we spend a great deal of effort understanding the needs of end users to gain specification.

While we sell primarily to original equipment manufacturers ("OEMs") of overhead cranes and hoists, we engage with end users to understand their needs and gain specification.

We can combine our products with engineered services to provide complete customer-specific system solutions.

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federal regulations require the use of alloy chain for overhead lifting applications because of its strength and wear characteristics.

A line of our alloy chain is sold under the Herc-Alloy TM brand name for use in overhead lifting, pulling, and

restraining applications.

A line of our alloy chain is sold under the Herc-Alloy TM brand name for use in overhead lifting, pulling, and restraining applications.

In addition, we also sell specialized load chain for use in hoists, as well as three grades and multiple sizes of carbon steel welded-link chain for various load securing and other non-overhead lifting applications.

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Orders for products that are manufactured to customer specifications are generally shipped within four to twelve weeks.

However, the COVID-19 pandemic has negatively impacted supply chains and has resulted in significantly longer lead-times and past-due backlog compared to these historical levels.

In fiscal 2024, the Company made significant progress reducing past-due backlog to more normal levels.

In addition, fluctuations in backlog can reflect the project-oriented nature of certain aspects of our business.

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Other important factors include distributor relationships and territory coverage as well as the robustness of our digital tools which impacts the customer experience.

We believe we have leading U.S.

market share in various products categories including hoists, trolleys and components, AC and DC material handling drives, screw jacks, precision conveyors, and elevator DC drives.

These product categories represented 51% of our U.S.

net sales for fiscal 2023.

Major competitors for hoists are Konecranes, and Kito (and its U.S.

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for forged attachments are The Crosby Group, Brewer Tichner Company and Chicago Hardware and Fixture Company;

for actuators and rotary unions are Deublin, Joyce-Dayton, and Nook Industries, a division of Altra Industrial Motion Corp.;

for actuators and rotary unions are Deublin, Joyce-Dayton, and Nook Industries, a division of Altra Industrial Motion Corp., which was acquired by Regal Rexnord;

and for precision conveyors and accumulators are FlexLink, Bosch Rexroth AG, MK North America, Inc., Duravant, Nercon Eng.

Inc and Arrowhead Systems, recently acquired by Rexroth.

Inc and Arrowhead Systems, which was acquired by Regal Rexnord.

Human Capital Management

Headquartered in Buffalo, New York, Columbus McKinnon’s global footprint includes offices and manufacturing facilities in more than 25 countries across North America, Latin America, Europe, the Middle East, Africa and Asia.

Headquartered in Charlotte, North Carolina, Columbus McKinnon’s global footprint includes offices, warehouses and manufacturing facilities in 25 countries across North America, Latin America, Europe, the Middle East, Africa and Asia.

At March 31, 2024, we had 3,515 employees globally.

Approximately 6% of our employees are represented under two separate U.S.

collective bargaining agreements that expire in May 2024 and September 2024.

We also have various labor agreements with our non-U.S.

collective bargaining agreements that expire in September 2024 and May 2027.

We also have various labor agreements

with our non-U.S.

employees that we negotiate from time to time.

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The Company’s people and the behaviors they display define our success, including integrity, respect and teamwork.

Many of our material social factors, including Employee Health and Safety, Training and Development, Talent Recruitment and Retention, Diversity, Equity and Inclusion, and Community Involvement, are directly connected to our commitment to people and values.

Many of our Human Capital Management priorities, including Occupational Health and Safety, Succession and People Development, Diversity and Equal Opportunity, and Local Communities, are directly connected to our commitment to people and values.

Our people enable us to grow, and our values ensure we grow responsibly and sustainably.

• The Company places the highest priority on workplace safety.

We feel it is critical to ensure our most valuable assets, our employees, have a safe environment to work in every day.

“Connect safety to everything you do” highlights the importance of safety to our culture.

We believe it is critical to ensure that our most valuable assets, our employees, have a safe environment to work in every day.

Our first value, “Connect safety to everything you do” highlights the importance of safety to our culture.

As a permanent agenda item at all management meetings, safety comes first.

For fiscal 2024 and 2023, the Company had an overall safety incident rate of 0.71 and 0.69, respectively (number of injuries and illnesses multiplied by 200,000, divided by hours worked).

• We are committed to embracing diversity, equity and inclusion and making it a part of everything we do.

• We are committed to embracing diversity, equity and inclusion and integrating it into our business.

We know the positive impact diverse and inclusive teams have on our business, employees, customers, and communities around the world.

We are dedicated to building a company that future generations can be proud of and a team that embraces diversity and appreciates differences across the enterprise.

We have embedded diversity, equity and inclusion into the People and Values framework of the Columbus McKinnon Business System.

We are working to create an environment of inclusion.

We launched a series of virtual training modules around diversity, inclusion and unconscious bias.

We have updated our core value “Win as a team” to specifically address embracing diversity.

We also recognize our corporate responsibility to advance our Environmental Social and Governance (“ESG”) efforts and to be held accountable for making progress.

We are making significant investments in our people, processes and systems to enable meaningful progress in areas including, but not limited to, environmental stewardship, employee safety, workplace diversity and inclusion, connecting with our communities, and strong governance and risk management.

We have embedded diversity, equity and inclusion into the People and Values framework of the CMBS.

We are committed to ensuring that we have an environment of inclusion.

We launched a series of virtual training modules for employees that provides education around diversity, inclusion and unconscious bias.

One of our core values is “Win as a team” to specifically address embracing diversity.

We also recognize our corporate responsibility to advance our Environmental Social and Governance (“ESG”) efforts and to be accountable for making progress.

We are making investments in our people, processes and systems to enable meaningful progress in areas including, but not limited to, environmental stewardship, employee safety, workplace diversity and inclusion, connecting with our communities, and ensuring a strong governance and risk management culture.

We are taking deliberate steps to fully integrate ESG into our enterprise strategy, our business system, and our daily actions.

In addition, we also set the following objectives for fiscal 2023:

• Make significant investments to advance our ESG initiatives (People & Technology);

In addition, we set the following objectives for fiscal 2024:

• Drive a people-first culture through engagement, training and development opportunities;

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• Build upon our progress toward ESG targets and goals;

• Decrease our complexity to customers with an organizational restructure to a bi-regional structure;

• Further align with global carbon emissions reporting standards, including CDP and TCFD;

• Further align with global reporting standards and increasing global regulatory requirements;

• Be more transparent with internal and external stakeholders through communications and public disclosures.

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We purchase most of these raw materials and components from a limited number of strategic and preferred suppliers under agreements that are negotiated on a Company-wide basis through our global purchasing group.

Generally, as we experience fluctuations in our costs, we reflect these increases in costs as price increases to our customers with the goal of being margin neutral.

Currently, as a result of macroeconomic conditions, including rising inflation, we are continuing to experience higher raw material, freight, and logistics costs than we have seen in recent years, which we have been able to recover with pricing actions.

In the future, we may not be able to pass on these cost increases to our customers.

Generally, as we experience fluctuations in our costs, we are able to reflect these increases in costs with additional price increases to our customers with the goal of being margin neutral.

We own or have the rights to use certain trademarks, service marks and trade names that are registered with the U.S.

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Trademarks that are important in identifying and distinguishing our products include, but are not limited to, Hammerloks™ and Herc-Alloy™.

We also own domain names, including our website, www.columbusmckinnon.com.

We also own domain names, including our website, www.cmco.com.

Environmental and Other Governmental Regulation

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Because of the complexity and changing nature of environmental regulatory standards, it is possible that situations will arise from time to time requiring us to incur additional expenditures to ensure environmental regulatory compliance.

However, we are not aware of any environmental condition or any operation at any of our facilities, either individually or in the aggregate, which would cause expenditures having a material adverse effect on our results of operations, financial condition or cash flows.

However, we are not aware of any environmental condition or any operation at any of our facilities, either individually or in the aggregate, which would cause expenditures to have a material adverse effect on our results of operations, financial condition or cash flows.

Our operations are also governed by many other laws and regulations, including those relating to workplace safety and worker health, principally the Occupational Health and Safety Administration ("OSHA") in the U.S.

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We believe that we are in substantial compliance with these laws and regulations and do not believe that future compliance with such laws and regulations will have a material adverse effect on our operating results, financial condition, or liquidity.

See Note 16 to our March 31, 2023 consolidated financial statements included in Item 8 of this Form 10-K for more information on our matters involving litigation.

See Note 16 to our March 31, 2024 consolidated financial statements included in Item 8, Financial Statements and Supplementary Data, of this Form 10-K for more information on our matters involving litigation.

Available Information

Our internet address is www.columbusmckinnon.com .

Our internet address is www.cmco.com .

We make available free of charge through our website our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act, as soon as reasonably practicable after such documents are electronically filed with, or furnished to, the SEC.

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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 1. Business