Item 1. Financial Statements
Item 1. Financial Statements
MATTHEWS INTERNATIONAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (Unaudited)
(Dollar amounts in thousands)
March 31, 2024 September 30, 2023
ASSETS
Current assets:
Cash and cash equivalents $ 45,497 $ 42,101
Accounts receivable, net 192,735 207,526
Inventories, net 253,301 260,409
Contract assets 90,835 74,646
Other current assets 71,681 63,575
Total current assets 654,049 648,257
Investments 26,780 24,988
Property, plant and equipment, net 277,903 270,326
Operating lease right-of-use assets 65,779 71,629
Deferred income taxes 2,316 2,269
Goodwill 707,881 698,109
Other intangible assets, net 143,884 160,478
Other assets 11,885 11,325
Total assets $ 1,890,477 $ 1,887,381
LIABILITIES
Current liabilities:
Long-term debt, current maturities $ 5,419 $ 3,696
Current portion of operating lease liabilities 23,442 23,983
Trade accounts payable 107,147 114,316
Accrued compensation 44,525 58,872
Accrued income taxes 4,035 12,561
Contract liabilities 35,613 36,935
Other current liabilities 138,571 144,237
Total current liabilities 358,752 394,600
Long-term debt 837,357 786,484
Operating lease liabilities 44,658 50,189
Deferred income taxes 69,672 71,255
Other liabilities 70,691 59,572
Total liabilities 1,381,130 1,362,100
SHAREHOLDERS' EQUITY
Shareholders' equity-Matthews:
Common stock $ 36,334 $ 36,334
Additional paid-in capital 150,344 168,211
Retained earnings 705,113 714,727
Accumulated other comprehensive loss ( 172,504 ) ( 174,404 )
Treasury stock, at cost ( 209,987 ) ( 219,200 )
Total shareholders' equity-Matthews 509,300 525,668
Noncontrolling interests 47 ( 387 )
Total shareholders' equity 509,347 525,281
Total liabilities and shareholders' equity $ 1,890,477 $ 1,887,381
The accompanying notes are an integral part of these consolidated financial statements.
2
MATTHEWS INTERNATIONAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
(Dollar amounts in thousands, except per share data)
Three Months Ended
March 31, Six Months Ended
March 31,
2024 2023 2024 2023
Sales $ 471,223 $ 479,580 $ 921,209 $ 928,820
Cost of sales ( 323,041 ) ( 329,957 ) ( 640,674 ) ( 640,267 )
Gross profit 148,182 149,623 280,535 288,553
Selling expense ( 36,004 ) ( 34,539 ) ( 70,448 ) ( 67,978 )
Administrative expense ( 81,891 ) ( 81,516 ) ( 160,578 ) ( 159,437 )
Intangible amortization ( 8,959 ) ( 10,517 ) ( 18,754 ) ( 20,859 )
Operating profit 21,328 23,051 30,755 40,279
Interest expense ( 12,545 ) ( 12,047 ) ( 24,121 ) ( 22,262 )
Other income (deductions), net ( 878 ) 1,503 ( 1,758 ) ( 551 )
Income before income taxes 7,905 12,507 4,876 17,466
Income tax benefit (provision) 1,122 ( 3,382 ) 1,848 ( 4,694 )
Net income 9,027 9,125 6,724 12,772
Net loss attributable to noncontrolling interests — 2 — 58
Net income attributable to Matthews shareholders $ 9,027 $ 9,127 $ 6,724 $ 12,830
Earnings per share attributable to Matthews shareholders:
Basic $ 0.29 $ 0.30 $ 0.22 $ 0.42
Diluted $ 0.29 $ 0.29 $ 0.22 $ 0.41
The accompanying notes are an integral part of these consolidated financial statements.
3
MATTHEWS INTERNATIONAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited)
(Dollar amounts in thousands)
Three Months Ended March 31,
Matthews Noncontrolling Interest Total
2024 2023 2024 2023 2024 2023
Net income (loss): $ 9,027 $ 9,127 $ — $ ( 2 ) $ 9,027 $ 9,125
Other comprehensive (loss) income ("OCI"), net of tax:
Foreign currency translation adjustment ( 6,026 ) 4,432 — ( 5 ) ( 6,026 ) 4,427
Pension plans and other postretirement benefits ( 282 ) ( 176 ) — — ( 282 ) ( 176 )
Unrecognized gain (loss) on cash flow hedges:
Net change from periodic revaluation 1,983 ( 1,471 ) — — 1,983 ( 1,471 )
Net amount reclassified to earnings ( 499 ) ( 771 ) — — ( 499 ) ( 771 )
Net change in unrecognized gain (loss) on cash flow hedges 1,484 ( 2,242 ) — — 1,484 ( 2,242 )
OCI, net of tax ( 4,824 ) 2,014 — ( 5 ) ( 4,824 ) 2,009
Comprehensive income (loss) $ 4,203 $ 11,141 $ — $ ( 7 ) $ 4,203 $ 11,134
Six Months Ended March 31,
Matthews Noncontrolling Interest Total
2024 2023 2024 2023 2024 2023
Net income (loss): $ 6,724 $ 12,830 $ — $ ( 58 ) $ 6,724 $ 12,772
OCI, net of tax:
Foreign currency translation adjustment 5,659 24,992 22 ( 1 ) 5,681 24,991
Pension plans and other postretirement benefits ( 362 ) 769 — — ( 362 ) 769
Unrecognized loss on cash flow hedges:
Net change from periodic revaluation ( 2,406 ) ( 1,378 ) — — ( 2,406 ) ( 1,378 )
Net amount reclassified to earnings ( 991 ) ( 1,268 ) — — ( 991 ) ( 1,268 )
Net change in unrecognized loss on cash flow hedges ( 3,397 ) ( 2,646 ) — — ( 3,397 ) ( 2,646 )
OCI, net of tax 1,900 23,115 22 ( 1 ) 1,922 23,114
Comprehensive income (loss) $ 8,624 $ 35,945 $ 22 $ ( 59 ) $ 8,646 $ 35,886
The accompanying notes are an integral part of these consolidated financial statements.
4
MATTHEWS INTERNATIONAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
for the three and six months ended March 31, 2024 and 2023 (Unaudited)
(Dollar amounts in thousands, except per share data)
Shareholders' Equity
Common
Stock Additional
Paid-in
Capital Retained
Earnings Accumulated
Other
Comprehensive
(Loss) Income Treasury
Stock Non-
controlling
Interests Total
Balance,
September 30, 2023 $ 36,334 $ 168,211 $ 714,727 $ ( 174,404 ) $ ( 219,200 ) $ ( 387 ) $ 525,281
Net loss — — ( 2,303 ) — — — ( 2,303 )
Minimum pension liability — — — ( 80 ) — — ( 80 )
Translation adjustment — — — 11,685 — 22 11,707
Fair value of cash flow hedges — — — ( 4,881 ) — — ( 4,881 )
Total comprehensive income 4,443
Stock-based compensation — 4,651 — — — — 4,651
Purchase of 465,953 shares of treasury stock
— — — — ( 17,185 ) — ( 17,185 )
Issuance of 678,750 shares of treasury stock
— ( 25,356 ) — — 25,356 — —
Dividends — — ( 8,381 ) — — — ( 8,381 )
Transactions with non-controlling interest — ( 412 ) — — — 412 —
Balance,
December 31, 2023 $ 36,334 $ 147,094 $ 704,043 $ ( 167,680 ) $ ( 211,029 ) $ 47 $ 508,809
Net income — — 9,027 — — — 9,027
Minimum pension liability — — — ( 282 ) — — ( 282 )
Translation adjustment — — — ( 6,026 ) — — ( 6,026 )
Fair value of cash flow hedges — — — 1,484 — — 1,484
Total comprehensive income 4,203
Stock-based compensation — 4,327 — — — — 4,327
Purchase of 1,029 shares of treasury stock
— — — — ( 35 ) — ( 35 )
Issuance of 28,878 shares of treasury stock
— ( 1,077 ) — — 1,077 — —
Dividends — — ( 7,957 ) — — — ( 7,957 )
Balance,
March 31, 2024 $ 36,334 $ 150,344 $ 705,113 $ ( 172,504 ) $ ( 209,987 ) $ 47 $ 509,347
5
MATTHEWS INTERNATIONAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY, Continued
for the three and six months ended March 31, 2024 and 2023 (Unaudited)
(Dollar amounts in thousands, except per share data)
Shareholders' Equity
Common
Stock Additional
Paid-in
Capital Retained
Earnings Accumulated
Other
Comprehensive
(Loss) Income Treasury
Stock Non-
controlling
Interests Total
Balance,
September 30, 2022 $ 36,334 $ 160,255 $ 706,749 $ ( 190,191 ) $ ( 225,795 ) $ ( 276 ) $ 487,076
Net income (loss) — — 3,703 — — ( 56 ) 3,647
Minimum pension liability — — — 945 — — 945
Translation adjustment — — — 20,560 — 4 20,564
Fair value of cash flow hedges — — — ( 404 ) — — ( 404 )
Total comprehensive income 24,752
Stock-based compensation — 4,334 — — — — 4,334
Purchase of 89,025 shares of treasury stock
— — — — ( 2,451 ) — ( 2,451 )
Issuance of 245,006 shares of treasury stock
— ( 9,154 ) — — 9,154 — —
Cancellations of 34,327 shares of treasury stock
— 1,958 — — ( 1,958 ) — —
Dividends — — ( 8,794 ) — — — ( 8,794 )
Balance,
December 31, 2022 $ 36,334 $ 157,393 $ 701,658 $ ( 169,090 ) $ ( 221,050 ) $ ( 328 ) $ 504,917
Net income (loss) — — 9,127 — — ( 2 ) 9,125
Minimum pension liability — — — ( 176 ) — — ( 176 )
Translation adjustment — — — 4,432 — ( 5 ) 4,427
Fair value of cash flow hedges — — — ( 2,242 ) — — ( 2,242 )
Total comprehensive income 11,134
Stock-based compensation — 4,278 — — — — 4,278
Purchase of 7,606 shares of treasury stock
— — — — ( 288 ) — ( 288 )
Issuance of 46,069 shares of treasury stock
— ( 1,723 ) — — 1,723 — —
Dividends — — ( 7,683 ) — — — ( 7,683 )
Transactions with noncontrolling interests — — — — — 33 33
Balance,
March 31, 2023 $ 36,334 $ 159,948 $ 703,102 $ ( 167,076 ) $ ( 219,615 ) $ ( 302 ) $ 512,391
The accompanying notes are an integral part of these consolidated financial statements.
6
MATTHEWS INTERNATIONAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(Dollar amounts in thousands)
Six Months Ended
March 31,
2024 2023
Cash flows from operating activities:
Net income $ 6,724 $ 12,772
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and amortization 46,784 47,877
Stock-based compensation expense 8,978 8,612
Deferred tax provision 29 268
Gain on sale of assets, net ( 316 ) —
Defined benefit plan settlement losses — 1,271
Defined benefit plan settlement payments — ( 24,242 )
Proceeds from the settlement of cash flow hedges — 10,474
Changes in working capital items ( 35,609 ) ( 10,885 )
Decrease in other assets 11,724 3,298
Decrease in other liabilities ( 7,782 ) ( 2,083 )
Other operating activities, net ( 691 ) ( 2,651 )
Net cash provided by operating activities 29,841 44,711
Cash flows from investing activities:
Capital expenditures ( 24,033 ) ( 23,772 )
Acquisitions, net of cash acquired ( 5,825 ) ( 7,586 )
Other investing activities, net 95 155
Net cash used in investing activities ( 29,763 ) ( 31,203 )
Cash flows from financing activities:
Proceeds from long-term debt 491,142 414,843
Payments on long-term debt ( 449,509 ) ( 441,963 )
Purchases of treasury stock ( 17,220 ) ( 2,739 )
Dividends ( 16,691 ) ( 14,126 )
Payments of debt issuance costs ( 4,704 ) —
Other financing activities — ( 914 )
Net cash provided by (used in) financing activities 3,018 ( 44,899 )
Effect of exchange rate changes on cash 300 1,893
Net change in cash and cash equivalents 3,396 ( 29,498 )
Cash and cash equivalents at beginning of year 42,101 71,414
Cash and cash equivalents at end of period $ 45,497 $ 41,916
The accompanying notes are an integral part of these consolidated financial statements.
7
MATTHEWS INTERNATIONAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
March 31, 2024
(Dollar amounts in thousands, except per share data)
Note 1. Nature of Operations
Matthews International Corporation ("Matthews" or the "Company"), founded in 1850 and incorporated in Pennsylvania in 1902, is a global provider of memorialization products, industrial technologies and brand solutions. The Company manages its businesses under three segments: Memorialization, Industrial Technologies and SGK Brand Solutions. Memorialization products consist primarily of bronze and granite memorials and other memorialization products, caskets, cremation-related products, and cremation and incineration equipment primarily for the cemetery and funeral home industries. Industrial Technologies includes the design, manufacturing, service and distribution of high-tech custom energy storage solutions; product identification and warehouse automation technologies and solutions, including order fulfillment systems for identifying, tracking, picking and conveying consumer and industrial products; and coating and converting lines for the packaging, pharma, foil, décor and tissue industries. SGK Brand Solutions consists of brand management, pre-media services, printing plates and cylinders, imaging services, digital asset management, merchandising display systems, and marketing and design services primarily for the consumer goods and retail industries.
The Company has facilities in North America, Europe, Asia, Australia, and Central and South America.
Note 2. Basis of Presentation
The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles ("GAAP") for interim financial information for commercial and industrial companies and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. The year-end consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by GAAP. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for fair presentation have been included. Operating results for the three and six months ended March 31, 2024 are not necessarily indicative of the results that may be expected for the fiscal year ending September 30, 2024. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company's Annual Report on Form 10-K for the year ended September 30, 2023. The consolidated financial statements include all domestic and foreign subsidiaries in which the Company maintains an ownership interest and has operating control and any variable interest entities for which the Company is the primary beneficiary. Investments in certain companies over which the Company exerts significant influence, but does not control the financial and operating decisions, are accounted for as equity method investments. Investments in certain companies over which the Company does not exert significant influence are accounted for as cost method investments. All intercompany accounts and transactions have been eliminated. The Company applies highly inflationary accounting for subsidiaries when the cumulative inflation rate for a three-year period meets or exceeds 100 percent.
Effective April 1, 2022, the Company has applied highly inflationary accounting to its Turkish subsidiaries. Under highly inflationary accounting, the financial statements of these subsidiaries are remeasured into the Company's reporting currency (U.S. dollar) and exchange gains and losses from the remeasurement of monetary assets and liabilities are reflected in current earnings, rather than accumulated other comprehensive loss on the Consolidated Balance Sheets , until such time as the applicable economy is no longer considered highly inflationary. As of March 31, 2024 and September 30, 2023, the Company had net monetary assets related to its Turkish subsidiaries of $ 4,612 and $ 4,271 , respectively. Exchange losses related to highly inflationary accounting totaled $ 390 and $ 710 for the three and six months ended March 31, 2024, respectively, and $ 160 and $ 1,248 for the three and six months ended March 31, 2023, respectively. Such amounts were included in the Consolidated Statements of Income within other income (deductions), net.
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
8
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued
(Dollar amounts in thousands, except per share data)
Note 2. Basis of Presentation (continued)
New Accounting Pronouncements:
Issued
In December 2023, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") No. 2023-09, Income Taxes (Topic 740) which enhances the transparency and decision usefulness of income tax disclosures including rate reconciliations and income taxes paid among other tax disclosures. The ASU is effective for annual periods for the Company beginning in fiscal year 2026. The Company is in the process of assessing the impact this ASU will have on its consolidated financial statements.
In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280) which improves financial reporting by requiring disclosure of incremental segment information on an annual and interim basis for all public entities, including enhanced disclosures about significant segment expenses. The ASU is effective for annual periods for the Company beginning in fiscal year 2025, and interim periods beginning in fiscal year 2026. The Company is in the process of assessing the impact this ASU will have on its consolidated financial statements.
In October 2023, the FASB issued ASU No. 2023-06, Disclosure Improvements. The amendments in this update affect the presentation and disclosure of a variety of topics in the Codification, and align them with the Securities and Exchange Commission ("SEC") regulations. The effective date of the amendments of this ASU will be determined for each individual disclosure based on the effective date of the SEC’s removal of the related disclosure from Regulation S-X or Regulation S-K. If the SEC has not removed the applicable requirements from Regulation S-X or Regulation S-K by June 30, 2027, then this ASU will not become effective. The adoption of this ASU is not expected to have a material impact on the Company's consolidated financial statements.
Adopted
In September 2022, the FASB issued ASU No. 2022-04, Liabilities - Supplier Finance Programs (Subtopic 405-50) which enhances the transparency of supplier finance programs by addressing disclosure requirements. Specifically, the amendment requires disclosure of key program terms, amounts outstanding, balance sheet presentation, and a rollforward of amounts outstanding during the annual period. The adoption of this ASU in the first quarter of fiscal 2024 had no material impact on the Company's consolidated financial statements.
The Company facilitates a voluntary supply chain finance program (the "Program") to provide certain suppliers with the opportunity to sell receivables due from the Company to participating financial institutions at the sole discretion of both the suppliers and the financial institutions. The Company is not a party to the agreements between the suppliers and the financial institutions and has no economic interest in a supplier's decision to sell a receivable. The range of payment terms negotiated with a supplier is consistent, irrespective of whether a supplier participates in the Program. All outstanding payments owed under the Program are recorded within trade accounts payable in the Consolidated Balance Sheets. The Company accounts for all payments made under the Program as a reduction to operating cash flows in changes in working capital within the Consolidated Statements of Cash Flows. The amounts owed to a participating financial institution under the Program and included in trade accounts payable were $ 4,670 and $ 3,027 at March 31, 2024 and September 30, 2023, respectively.
In October 2021, the FASB issued ASU No. 2021-08, Business Combinations (Topic 805) which improves the accounting for acquired revenue contracts with customers in a business combination by addressing diversity in practice and inconsistency related to recognition of an acquired contract asset/liability, and payment terms and their effect on subsequent revenue recognized by the acquirer. The adoption of this ASU in the first quarter of fiscal 2024 had no material impact on the Company's consolidated financial statements.
9
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued
(Dollar amounts in thousands, except per share data)
Note 3. Revenue Recognition
The Company disaggregates revenue from contracts with customers by geography, as it believes geographic regions best depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors. Disaggregated sales by segment and region for the three and six months ended March 31, 2024 and 2023 were as follows:
Memorialization Industrial Technologies SGK Brand Solutions Consolidated
Three Months Ended March 31, Three Months Ended March 31, Three Months Ended March 31, Three Months Ended March 31,
2024 2023 2024 2023 2024 2023 2024 2023
North America $ 212,053 $ 211,878 $ 32,817 $ 41,835 $ 63,152 $ 62,324 $ 308,022 $ 316,037
Central and South America — — — — 1,308 995 1,308 995
Europe 7,907 8,462 81,579 81,970 52,731 52,941 142,217 143,373
Australia 2,196 2,549 — — 2,153 2,216 4,349 4,765
Asia — — 1,740 1,709 13,587 12,701 15,327 14,410
Total Sales $ 222,156 $ 222,889 $ 116,136 $ 125,514 $ 132,931 $ 131,177 $ 471,223 $ 479,580
Memorialization Industrial Technologies SGK Brand Solutions Consolidated
Six Months Ended March 31, Six Months Ended March 31, Six Months Ended March 31, Six Months Ended March 31,
2024 2023 2024 2023 2024 2023 2024 2023
North America $ 409,218 $ 407,077 $ 65,956 $ 77,975 $ 125,872 $ 129,904 $ 601,046 $ 614,956
Central and South America — — — — 2,562 2,332 2,562 2,332
Europe 15,878 16,825 158,355 153,271 102,863 101,458 277,096 271,554
Australia 5,131 5,489 — — 4,324 4,515 9,455 10,004
Asia — — 3,199 3,411 27,851 26,563 31,050 29,974
Total Sales $ 430,227 $ 429,391 $ 227,510 $ 234,657 $ 263,472 $ 264,772 $ 921,209 $ 928,820
Revenue from products or services provided to customers over time accounted for approximately 18 % and 13 % of revenue for the three months ended March 31, 2024 and 2023, respectively and 19 % and 13 % of revenue for the six months ended March 31, 2024 and 2023, respectively.
10
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued
(Dollar amounts in thousands, except per share data)
Note 4. Fair Value Measurements
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A three level fair value hierarchy is used to prioritize the inputs used in valuations, as defined below:
Level 1: Observable inputs that reflect unadjusted quoted prices for identical assets or liabilities in active markets.
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.
Level 3: Unobservable inputs for the asset or liability.
The fair values of the Company's assets and liabilities measured on a recurring basis are categorized as follows:
March 31, 2024 September 30, 2023
Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total
Assets:
Derivatives (1)
$ — $ 1,889 $ — $ 1,889 $ — $ 4,006 $ — $ 4,006
Equity and fixed income mutual funds — 1,466 — 1,466 — 699 — 699
Life insurance policies — 4,825 — 4,825 — 4,926 — 4,926
Total assets at fair value $ — $ 8,180 $ — $ 8,180 $ — $ 9,631 $ — $ 9,631
Liabilities:
Derivatives (1)
$ — $ 5,198 $ — $ 5,198 $ — $ 2,766 $ — $ 2,766
Total liabilities at fair value $ — $ 5,198 $ — $ 5,198 $ — $ 2,766 $ — $ 2,766
(1) Interest rate swaps and cross currency swaps are valued based on observable market swap rates and are classified within Level 2 of the fair value hierarchy.
The carrying values for other financial assets and liabilities approximated fair value at March 31, 2024 and September 30, 2023.
Note 5. Inventories
Inventories consisted of the following:
March 31, 2024 September 30, 2023
Raw materials $ 71,068 $ 70,451
Work in process 103,060 108,400
Finished goods 79,173 81,558
$ 253,301 $ 260,409
Note 6. Investments
Non-current investments consisted of the following:
March 31, 2024 September 30, 2023
Equity and fixed income mutual funds $ 1,466 $ 699
Life insurance policies 4,825 4,926
Equity-method investments 332 323
Other (primarily cost-method) investments 20,157 19,040
$ 26,780 $ 24,988
11
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued
(Dollar amounts in thousands, except per share data)
Note 7. Debt and Financing Arrangements
Long-term debt at March 31, 2024 and September 30, 2023 consisted of the following:
March 31, 2024 September 30, 2023
Revolving credit facilities $ 511,057 $ 463,168
2025 Senior Notes 298,362 298,500
Other borrowings 17,200 19,241
Finance lease obligations 16,157 9,271
Total debt 842,776 790,180
Less current maturities ( 5,419 ) ( 3,696 )
Long-term debt $ 837,357 $ 786,484
The Company has a domestic credit facility with a syndicate of financial institutions that was amended and restated in January 2024. The amended and restated loan agreement includes a $ 750,000 senior secured revolving credit facility, which matures in January 2029, subject to the terms and conditions of the amended facility. A portion of the revolving credit facility (not to exceed $ 350,000 ) can be drawn in foreign currencies. Borrowings under the revolving credit facility bear interest at the Secured Overnight Financing Rate ("SOFR"), plus a 0.10 % per annum rate spread adjustment, plus a factor ranging from 1.00 % to 2.00 % ( 1.50 % at March 31, 2024) based on the Company's leverage ratio. The leverage ratio is defined as total indebtedness divided by EBITDA (earnings before interest, income taxes, depreciation and amortization) as defined within the domestic credit facility agreement. The Company is required to pay an annual commitment fee ranging from 0.15 % to 0.30 % (based on the Company's leverage ratio) of the unused portion of the revolving credit facility. The Company incurred new debt issuance costs of $ 4,704 in connection with the amended and restated agreement, which were deferred and are being amortized over the term of the facility. Unamortized costs were $ 5,363 and $ 949 at March 31, 2024 and September 30, 2023, respectively.
The domestic credit facility requires the Company to maintain certain leverage and interest coverage ratios. A portion of the facility (not to exceed $ 55,000 ) is available for the issuance of trade and standby letters of credit. Outstanding U.S. dollar denominated borrowings on the revolving credit facility at March 31, 2024 and September 30, 2023 were $ 447,949 and $ 405,000 , respectively. Outstanding Euro denominated borrowings on the revolving credit facility at March 31, 2024 and September 30, 2023 were € 55.0 million ($ 59,370 ) and € 55.0 million ($ 58,168 ), respectively. The weighted-average interest rate on the outstanding borrowings for the domestic credit facility (including the effects of interest rate swaps and Euro denominated borrowings) at March 31, 2024 and 2023 was 4.89 % and 5.17 %, respectively.
The Company has $ 299,217 of 5.25 % senior unsecured notes due December 1, 2025 (the "2025 Senior Notes"). The 2025 Senior Notes bear interest at a rate of 5.25 % per annum with interest payable semi-annually in arrears on June 1 and December 1 of each year. The Company's obligations under the 2025 Senior Notes are guaranteed by certain of the Company's direct and indirect wholly-owned subsidiaries. The Company is subject to certain covenants and other restrictions in connection with the 2025 Senior Notes. The Company incurred direct financing fees and costs in connection with the 2025 Senior Notes. Unamortized costs were $ 855 and $ 1,125 at March 31, 2024 and September 30, 2023, respectively.
The Company and certain of its domestic subsidiaries sell, on a continuous basis without recourse, their trade receivables to Matthews Receivables Funding Corporation, LLC (“Matthews RFC”), a wholly-owned bankruptcy-remote subsidiary of the Company. Matthews RFC has a receivables purchase agreement (“RPA”) to sell up to $ 125,000 of receivables to certain purchasers (the “Purchasers”) on a recurring basis in exchange for cash (referred to as “capital” within the RPA) equal to the gross receivables transferred. The parties intend that the transfers of receivables to the Purchasers constitute purchases and sales of receivables. Matthews RFC has guaranteed to each Purchaser the prompt payment of sold receivables, and has granted a security interest in its assets for the benefit of the Purchasers. Under the RPA, each Purchaser’s share of capital accrues yield at a floating rate plus an applicable margin. The Company is the master servicer under the RPA, and is responsible for administering and collecting receivables. The RPA, which had a maturity date of March 2024, was amended in March 2024 to extend the maturity date to March 2026.
12
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued
(Dollar amounts in thousands, except per share data)
Note 7. Debt and Financing Arrangements (continued)
The proceeds of the RPA are classified as operating activities in the Company’s Consolidated Statements of Cash Flows. Cash received from collections of sold receivables may be used to fund additional purchases of receivables on a revolving basis, or to reduce all or any portion of the outstanding capital of the Purchasers. The fair value of the sold receivables approximated book value due to their credit quality and short-term nature, and as a result, no gain or loss on sale of receivables was recorded. As of March 31, 2024 and September 30, 2023, the amount sold to the Purchasers was $ 109,900 and $ 101,800 , respectively, which was derecognized from the Consolidated Balance Sheets. As collateral against sold receivables, Matthews RFC maintains a certain level of unsold receivables, which was $ 51,819 and $ 57,897 as of March 31, 2024 and September 30, 2023, respectively.
The following table sets forth a summary of receivables sold as part of the RPA:
Six Months Ended
March 31, 2024 Six Months Ended
March 31, 2023
Gross receivables sold
$ 194,116 $ 201,115
Cash collections reinvested
( 186,016 ) ( 189,105 )
Net cash proceeds received $ 8,100 $ 12,010
In March 2023, the Company, through its U.K. subsidiary, entered into a non-recourse factoring arrangement. In connection with this arrangement, the Company periodically sells trade receivables to a third-party purchaser in exchange for cash. These transfers of financial assets are recorded at the time the Company surrenders control of the assets. As these transfers qualify as true sales under the applicable accounting guidance, the receivables are de-recognized from the Company's Consolidated Balance Sheets upon transfer. The principal amount of receivables sold under this arrangement was $ 34,993 and $ 16,950 during the six months ended March 31, 2024 and 2023, respectively. The discounts on the trade receivables sold are included within administrative expense in the Consolidated Statements of Income. The proceeds from the sale of receivables are classified as operating activities in the Company's Consolidated Statements of Cash Flows. As of March 31, 2024 and September 30, 2023, the amount of factored receivables that remained outstanding was $ 15,411 and $ 18,045 , respectively.
The Company, through certain of its European subsidiaries, has a credit facility with a European bank, which is guaranteed by Matthews. The maximum amount of borrowing available under this facility is € 10.0 million ($ 10,795 ). The facility also provides € 18.5 million ($ 19,970 ) for bank guarantees. This facility has no stated maturity date and is available until terminated. Outstanding borrowings under the credit facility totaled € 3.5 million ($ 3,738 ) at March 31, 2024. There were no outstanding borrowings under the credit facility at September 30, 2023. The weighted-average interest rate on outstanding borrowings under this facility was 6.11 % and 5.17 % at March 31, 2024 and 2023, respectively.
Other borrowings totaled $ 17,200 and $ 19,241 at March 31, 2024 and September 30, 2023, respectively. The weighted-average interest rate on all other borrowings was 2.55 % and 3.01 % at March 31, 2024 and 2023, respectively.
As of March 31, 2024 and September 30, 2023, the fair value of the Company's long-term debt, including current maturities, which is classified as Level 2 in the fair value hierarchy, approximated the carrying value included in the Consolidated Balance Sheets. The Company was in compliance with all of its debt covenants as of March 31, 2024.
13
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued
(Dollar amounts in thousands, except per share data)
Note 8. Derivatives and Hedging Activities
The Company operates internationally and utilizes certain derivative financial instruments to manage its foreign currency, debt and interest rate exposures. At March 31, 2024 and September 30, 2023, derivative instruments were reflected on a gross-basis in the consolidated balance sheets as follows:
Derivatives: March 31, 2024 September 30, 2023
Interest Rate Swaps Cross- Currency Swaps Interest Rate Swaps Cross- Currency Swaps
Current assets:
Other current assets $ 472 $ — $ 920 $ —
Long-term assets:
Other assets 1,417 — 3,086 —
Current liabilities:
Other current liabilities ( 31 ) — — —
Long-term liabilities:
Other liabilities ( 91 ) ( 5,076 ) — ( 2,766 )
Total derivatives $ 1,767 $ ( 5,076 ) $ 4,006 $ ( 2,766 )
The following table presents information related to interest rate swaps entered into by the Company and designated as cash flow hedges:
March 31, 2024 September 30, 2023
Notional amount $ 175,000 $ 175,000
Weighted-average maturity period (years) 3.6 4.1
Weighted-average received rate 5.33 % 5.32 %
Weighted-average pay rate 3.83 % 3.83 %
The Company enters into interest rate swaps in order to achieve a mix of fixed and variable rate debt that it deems appropriate. The interest rate swaps have been designated as cash flow hedges of future variable interest payments which are considered probable of occurring. Based on the Company's assessment, all of the critical terms of each of the hedges matched the underlying terms of the hedged debt and related forecasted interest payments, and as such, these hedges were considered highly effective.
The fair value of the interest rate swaps reflected a net unrealized gain of $ 1,767 ($ 1,319 after tax) at March 31, 2024 and $ 4,006 ($ 2,991 after tax) at September 30, 2023, that is included in shareholders' equity as part of accumulated other comprehensive income (loss) ("AOCI"). Unrecognized gains of $ 5,775 ($ 4,316 after tax) and $ 8,084 ($ 6,041 after tax) related to previously terminated LIBOR-based swaps were also included in AOCI as of March 31, 2024 and September 30, 2023, respectively. Assuming market rates remain constant with the rates at March 31, 2024, a gain (net of tax) of approximately $ 2,896 included in AOCI is expected to be recognized in earnings over the next twelve months.
The Company has a U.S. Dollar/Euro cross currency swap with a notional amount of $ 81,392 , as of March 31, 2024 and September 30, 2023, which has been designated as a net investment hedge of foreign operations. The swap contract matures in September 2027. The Company assesses hedge effectiveness for this contract based on changes in fair value attributable to changes in spot prices. A loss of $ 3,790 (net of income taxes of $ 1,286 ) and a loss of $ 2,065 (net of income taxes of $ 701 ), which represented effective hedges of net investments, were reported as a component of AOCI within currency translation adjustment at March 31, 2024 and September 30, 2023, respectively. Income of $ 327 and $ 586 , which represented the recognized portion of the fair value of cross currency swaps excluded from the assessment of hedge effectiveness, was included in current period earnings as a component of interest expense for the three and six months ended March 31, 2024, respectively. Income of $ 309 and $ 581 , which represented the recognized portion of the fair value of cross currency swaps excluded from the assessment of hedge effectiveness, was included in current period earnings as a component of interest expense for the three and six months ended March 31, 2023, respectively. At March 31, 2024 and September 30, 2023, the swap totaled $ 5,076 and $ 2,766 , respectively, and was included in other accrued liabilities in the Consolidated Balance Sheets.
14
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued
(Dollar amounts in thousands, except per share data)
Note 8. Derivatives and Hedging Activities (continued)
The Company uses certain foreign currency debt instruments as net investment hedges of foreign operations with a notional amount of € 55.0 million ($ 59,370 ) as of March 31, 2024. Currency losses of $ 1,991 (net of income taxes of $ 675 ), which represent effective hedges of net investments, were reported as a component of AOCI within currency translation adjustment at March 31, 2024.
Refer to Note 12, "Accumulated Other Comprehensive Income" for further details regarding amounts recorded in AOCI and the Consolidated Statements of Income (Loss) related to derivatives.
Note 9. Share-Based Payments
The Company maintains an equity incentive plan (as amended and restated, the "2017 Equity Incentive Plan") that provides for grants of stock options, restricted shares, restricted share units ("RSUs"), stock-based performance units and certain other types of stock-based awards. Under the 2017 Equity Incentive Plan, which has a ten-year term from the date the Company's Board of Directors approved of the amendment and restatement of the 2017 Equity Incentive Plan, the maximum number of shares available for grants or awards is an aggregate of 3,450,000 (subject to adjustment upon certain events such as stock dividends or stock splits), following the amendment and restatement of the 2017 Equity Incentive Plan at the Company's 2022 Annual Shareholder Meeting. At March 31, 2024, 1,178,558 shares have been issued under the 2017 Equity Incentive Plan. 1,233,583 time-based RSUs, 1,579,514 performance-based RSUs, and 75,000 stock options have been granted under the 2017 Equity Incentive Plan. 1,720,892 of these share-based awards are outstanding as of March 31, 2024. The 2017 Equity Incentive Plan is administered by the Compensation Committee of the Board of Directors. The number of shares issued under performance-based RSUs may be up to 200 % of the number of performance-based RSUs, based on the satisfaction of specific criteria established by the plan administrator.
For the three-month periods ended March 31, 2024 and 2023, stock-based compensation cost totaled $ 4,327 and $ 4,278 , respectively. For the six-month periods ended March 31, 2024 and 2023, stock-based compensation totaled $ 8,978 and $ 8,612 , respectively. The associated future income tax benefit recognized for stock-based compensation was $ 1,093 and $ 1,057 for the three-month periods ended March 31, 2024 and 2023, respectively, and $ 1,778 and $ 1,608 for the six-month periods ended March 31, 2024 and 2023, respectively.
With respect to the restricted share unit grants, units generally vest on the third anniversary of the grant date. The number of units that vest depend on certain time and performance thresholds. Such performance thresholds include adjusted earnings per share, return on invested capital, appreciation in the market value of the Company's Class A Common Stock, or other targets established by the Compensation Committee of the Board of Directors. Approximately 40 % of the outstanding share units vest based on time, while the remaining vest based on pre-defined performance thresholds. The Company issues common stock from treasury shares once the units become vested.
The transactions for RSUs for the six months ended March 31, 2024 were as follows:
RSUs Weighted-
average
Grant-date
Fair Value
Non-vested at September 30, 2023 1,728,697 $ 30.90
Granted 458,320 40.39
Vested ( 449,775 ) 30.07
Expired or forfeited ( 16,350 ) 35.22
Non-vested at March 31, 2024 1,720,892 $ 33.60
During the third quarter of fiscal 2021, 75,000 stock options were granted under the 2017 Equity Incentive Plan. The option price for each stock option granted was $ 41.70 , which was equal to the fair market value of the Company's Class A Common Stock on the date of grant. During the second quarter of fiscal 2024, all of these stock options were forfeited in connection with an employee retirement.
15
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued
(Dollar amounts in thousands, except per share data)
Note 9. Share-Based Payments (continued)
As of March 31, 2024, the total unrecognized compensation cost related to all unvested stock-based awards was $ 28,205 and is expected to be recognized over a weighted average period of 2.2 years.
The fair value of certain stock-based awards that are subject to performance conditions are estimated on the date of grant using a binomial lattice valuation model. The following table indicates the assumptions used in estimating the fair value of certain stock-based awards granted during the six-month period ended March 31, 2024.
Six Months Ended
March 31, 2024
Expected volatility 31.8 %
Dividend yield 2.4 %
Average risk-free interest rate 4.7 %
Average expected term (years) 3.0
The risk-free interest rate is based on United States Treasury yields at the date of grant. The dividend yield is based on the most recent dividend payment and average stock price over the 12 months prior to the grant date. Expected volatilities are based on the historical volatility of the Company's stock price. The expected term for grants in the six months ended March 31, 2024 represents an estimate of the average period of time for RSUs to vest.
The Company maintains the Amended and Restated 2019 Director Fee Plan, the Amended and Restated 2014 Director Fee Plan and the 1994 Director Fee Plan (collectively, the "Director Fee Plans"). There will be no further fees or share-based awards granted under the Amended and Restated 2014 Director Fee Plan and the 1994 Director Fee Plan. Under the Amended and Restated 2019 Director Fee Plan, non-employee directors (except for the Chairman of the Board) each receive, as an annual retainer fee for fiscal 2024, either cash or shares of the Company's Class A Common Stock with a value equal to $ 90 . The annual retainer fee for fiscal 2024 paid to the non-employee Chairman of the Board is $ 210 . Where the annual retainer fee is provided in shares, each director may elect to be paid these shares on a current basis or have such shares credited to a deferred stock account as phantom stock, with such shares to be paid to the director subsequent to leaving the Board. The total number of shares of stock that have been authorized to be issued under the Amended and Restated 2019 Director Fee Plan or credited to a deferred stock compensation account for subsequent issuance is 300,000 shares of Class A Common Stock (subject to adjustment upon certain events such as stock dividends or stock splits), following the amendment and restatement of the 2019 Director Fee Plan at the Company's 2023 Annual Shareholder Meeting. The value of deferred shares is recorded in other liabilities. A total of 50,355 shares and share units had been deferred under the Director Fee Plans as of March 31, 2024. Additionally, non-employee directors each receive an annual stock-based grant (non-statutory stock options, stock appreciation rights and/or restricted shares or units) with a value of $ 140 for fiscal 2024. As of March 31, 2024, 373,471 restricted shares and RSUs have been granted under the Director Fee Plans, 200,242 of which were issued under the 2019 Director Fee Plan. 67,560 RSUs are unvested at March 31, 2024 under the Director Fee Plans.
Note 10. Earnings Per Share Attributable to Matthews' Shareholders
The information used to compute earnings per share attributable to Matthews' common shareholders was as follows:
Three Months Ended
March 31, Six Months Ended
March 31,
2024 2023 2024 2023
Net income attributable to Matthews shareholders $ 9,027 $ 9,127 $ 6,724 $ 12,830
Weighted-average shares outstanding (in thousands):
Basic shares 30,926 30,778 30,921 30,741
Effect of dilutive securities 293 401 292 330
Diluted shares 31,219 31,179 31,213 31,071
Dividends declared per common share $ 0.24 $ 0.23 $ 0.48 $ 0.46
16
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued
(Dollar amounts in thousands, except per share data)
Note 11. Pension and Other Postretirement Benefit Plans
The Company provides defined benefit pension and other postretirement plans to certain employees. Net periodic pension and other postretirement benefit cost for the plans included the following:
Three months ended March 31,
Pension Other Postretirement
2024 2023 2024 2023
Service cost $ 31 $ 31 $ 13 $ 19
Interest cost * 129 105 171 161
Amortization:
Prior service credit — — ( 91 ) ( 91 )
Net actuarial gains * ( 9 ) ( 6 ) ( 181 ) ( 177 )
Net benefit cost $ 151 $ 130 $ ( 88 ) $ ( 88 )
Six months ended March 31,
Pension Other Postretirement
2024 2023 2024 2023
Service cost $ 61 $ 88 $ 27 $ 38
Interest cost * 258 248 342 322
Amortization:
Prior service credit — — ( 182 ) ( 182 )
Net actuarial gains * ( 20 ) ( 16 ) ( 361 ) ( 354 )
Settlement losses * — 1,271 — —
Net benefit cost $ 299 $ 1,591 $ ( 174 ) $ ( 176 )
* Non-service components of pension and postretirement expense are included in other income (deductions), net.
In the first quarter of fiscal 2023, the Company made lump sum payments totaling $ 24,242 to fully settle the supplemental retirement plan ("SERP") and defined benefit portion of the officers retirement restoration plan ("ORRP") obligations. The settlement of these plan obligations resulted in the recognition of a non-cash charge of $ 1,271 , which has been presented as a component of other income (deductions), net for the six months ended March 31, 2023. This amount represents the immediate recognition of the deferred AOCI balances related to the SERP and ORRP.
17
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued
(Dollar amounts in thousands, except per share data)
Note 12. Accumulated Other Comprehensive Income
The changes in AOCI by component, net of tax, for the three-month periods ended March 31, 2024 and 2023 were as follows:
Post-retirement benefit plans Currency translation adjustment Cash Flow Hedges Total
Attributable to Matthews:
Balance, December 31, 2023 $ 6,680 $ ( 178,511 ) $ 4,151 $ ( 167,680 )
OCI before reclassification ( 72 ) ( 5,779 ) 1,983 ( 3,868 )
Amounts reclassified from AOCI ( 210 ) (a)
( 247 ) ( 499 ) (b)
( 956 )
Net current-period OCI ( 282 )
( 6,026 )
1,484 ( 4,824 )
Balance, March 31, 2024 $ 6,398 $ ( 184,537 ) $ 5,635 $ ( 172,504 )
Attributable to noncontrolling interest:
Balance, December 31, 2023 $ — $ 288 $ — $ 288
OCI before reclassification — — — —
Net current-period OCI — — — —
Balance, March 31, 2024 $ — $ 288 $ — $ 288
Post-retirement benefit plans Currency translation adjustment Cash Flow Hedges Total
Attributable to Matthews:
Balance, December 31, 2022 $ 6,127 $ ( 182,750 ) $ 7,533 $ ( 169,090 )
OCI before reclassification 29 4,663 ( 1,471 ) 3,221
Amounts reclassified from AOCI ( 205 ) (a)
( 231 ) ( 771 ) (b)
( 1,207 )
Net current-period OCI ( 176 ) 4,432 ( 2,242 ) 2,014
Balance, March 31, 2023 $ 5,951 $ ( 178,318 ) $ 5,291 $ ( 167,076 )
Attributable to noncontrolling interest:
Balance, December 31, 2022 $ — $ 259 $ — $ 259
OCI before reclassification — ( 5 )
— ( 5 )
Net current-period OCI — ( 5 ) — ( 5 )
Balance, March 31, 2023 $ — $ 254
$ — $ 254
(a) Amounts were included in net periodic benefit cost for pension and other postretirement benefit plans (see Note 11).
(b) Amounts were included in interest expense in the periods the hedged item affected earnings (see Note 8).
18
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued
(Dollar amounts in thousands, except per share data)
Note 12. Accumulated Other Comprehensive Income (continued)
The changes in AOCI by component, net of tax, for the six-month periods ended March 31, 2024 and 2023 were as follows:
Post-retirement benefit plans Currency translation adjustment Cash Flow Hedges Total
Attributable to Matthews:
Balance, September 30, 2023 $ 6,760 $ ( 190,196 ) $ 9,032 $ ( 174,404 )
OCI before reclassification 59 6,102 ( 2,406 ) 3,755
Amounts reclassified from AOCI ( 421 ) (a)
( 443 ) ( 991 ) (b)
( 1,855 )
Net current-period OCI ( 362 )
5,659 ( 3,397 ) 1,900
Balance, March 31, 2024 $ 6,398 $ ( 184,537 ) $ 5,635 $ ( 172,504 )
Attributable to noncontrolling interest:
Balance, September 30, 2023 $ — $ 266 $ — $ 266
OCI before reclassification — 22 — 22
Net current-period OCI — 22 — 22
Balance, March 31, 2024 $ — $ 288 $ — $ 288
Post-retirement benefit plans Currency translation adjustment Cash Flow Hedges Total
Attributable to Matthews:
Balance, September 30, 2022 $ 5,182 $ ( 203,310 ) $ 7,937 $ ( 190,191 )
OCI before reclassification 232 25,426 ( 1,378 ) 24,280
Amounts reclassified from AOCI 537 (a)
( 434 ) ( 1,268 ) (b)
( 1,165 )
Net current-period OCI 769 24,992 ( 2,646 ) 23,115
Balance, March 31, 2023 $ 5,951 $ ( 178,318 ) $ 5,291 $ ( 167,076 )
Attributable to noncontrolling interest:
Balance, September 30, 2022 $ — $ 255 $ — $ 255
OCI before reclassification — ( 1 )
— ( 1 )
Net current-period OCI — ( 1 ) — ( 1 )
Balance, March 31, 2023 $ — $ 254
$ — $ 254
(a) Amounts were included in net periodic benefit cost for pension and other postretirement benefit plans (see Note 11).
(b) Amounts were included in interest expense in the periods the hedged item affected earnings (see Note 8).
19
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued
(Dollar amounts in thousands, except per share data)
Note 12. Accumulated Other Comprehensive Income (continued)
Reclassifications out of AOCI for the three and six-month periods ended March 31, 2024 and 2023 were as follows:
Amount reclassified from AOCI
Details about AOCI Components Three Months Ended March 31, 2024 Six Months Ended March 31, 2024 Affected line item in the Statement of income
Postretirement benefit plans
Prior service credit (a)
$ 91 $ 182
Actuarial losses 190 381 Other income (deductions), net
281 563 Income before income tax (b)
( 71 )
( 142 ) Income taxes
$ 210
$ 421 Net income
Derivatives
Cash flow hedges $ 668
$ 1,327 Interest expense
Net investment hedges 327 586 Interest expense
995 1,913 Income before income tax (b)
( 249 ) ( 479 ) Income taxes
$ 746 $ 1,434 Net income
Details about AOCI Components Three Months Ended
March 31, 2023 Six Months Ended
March 31, 2023 Affected line item in the Statement of income
Postretirement benefit plans
Prior service credit (a)
$ 91 $ 182
Actuarial losses 183 370 Other income (deductions), net
Settlement losses — ( 1,271 ) Other income (deductions), net
274 ( 719 ) Income before income tax (b)
( 69 )
182 Income taxes
$ 205
$ ( 537 ) Net income
Derivatives
Cash flow hedges $ 1,032
$ 1,697 Interest expense
Net investment hedges 309 581 Interest expense
1,341 2,278 Income before income tax (b)
( 339 )
( 576 ) Income taxes
$ 1,002 $ 1,702 Net income
(a) Prior service cost amounts are included in the computation of pension and other postretirement benefit expense, which is reported in cost of goods sold and selling and administrative expenses. For additional information, see Note 11.
(b) For pre-tax items, positive amounts represent income and negative amounts represent expense.
20
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued
(Dollar amounts in thousands, except per share data)
Note 13. Income Taxes
Income tax provisions for the Company's interim periods are based on the effective income tax rate expected to be applicable for the full year. The Company's consolidated income taxes for the first six months of fiscal 2024 were a benefit of $ 1,848 , compared to an expense of $ 4,694 for the first six months of fiscal 2023. The difference between the Company’s consolidated income taxes for the first six months of fiscal 2024 compared to the same period for fiscal 2023 resulted from a decrease in consolidated pre-tax income in fiscal 2024 compared to fiscal 2023 as well as a net tax benefit from discrete items. The Company’s fiscal 2024 six month effective tax rate varied from the U.S. statutory tax rate of 21.0% primarily due to state taxes, foreign statutory rate differentials, tax credits, non-tax benefited foreign losses, and a net discrete tax benefit. The Company’s fiscal 2023 six month effective tax rate varied from the U.S. statutory tax rate of 21.0% primarily due to state taxes, foreign statutory rate differentials, tax credits, and non-tax benefited foreign losses.
The Company had unrecognized tax benefits (excluding penalties and interest) of $ 4,549 and $ 3,779 on March 31, 2024 and September 30, 2023, respectively, which would impact the annual effective rate at March 31, 2024 and September 30, 2023, respectively. It is reasonably possible that the amount of unrecognized tax benefits could decrease by approximately $ 2,913 in the next 12 months primarily due to the completion of audits and the expiration of the statute of limitations.
The Company classifies interest and penalties on tax uncertainties as a component of the provision for income taxes. Total penalties and interest accrued were $ 862 and $ 730 at March 31, 2024 and September 30, 2023, respectively. These accruals may potentially be applicable in the event of an unfavorable outcome of uncertain tax positions.
The Company is currently under examination in several tax jurisdictions and remains subject to examination until the statute of limitations expires for those tax jurisdictions. As of March 31, 2024, the tax years that remain subject to examination by major jurisdictions generally are:
United States – Federal 2020 and forward
United States – State 2019 and forward
Canada 2020 and forward
Germany 2019 and forward
United Kingdom 2022 and forward
Singapore 2020 and forward
Australia 2018 and forward
21
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued
(Dollar amounts in thousands, except per share data)
Note 14. Segment Information
The Company manages its businesses under three segments: Memorialization, Industrial Technologies and SGK Brand Solutions. The Memorialization segment consists primarily of bronze and granite memorials and other memorialization products, caskets, cremation-related products, and cremation and incineration equipment primarily for the cemetery and funeral home industries. The Industrial Technologies segment includes the design, manufacturing, service and distribution of high-tech custom energy storage solutions; product identification and warehouse automation technologies and solutions, including order fulfillment systems for identifying, tracking, picking and conveying consumer and industrial products; and coating and converting lines for the packaging, pharma, foil, décor and tissue industries. The SGK Brand Solutions segment consists of brand management, pre-media services, printing plates and cylinders, imaging services, digital asset management, merchandising display systems, and marketing and design services primarily for the consumer goods and retail industries.
The Company's primary measure of segment profitability is adjusted earnings before interest, income taxes, depreciation and amortization ("adjusted EBITDA"). Adjusted EBITDA is defined by the Company as earnings before interest, income taxes, depreciation, amortization and certain non-cash and/or non-recurring items that do not contribute directly to management’s evaluation of its operating results. These items include stock-based compensation, the non-service portion of pension and postretirement expense, acquisition and divestiture costs, enterprise resource planning ("ERP") integration costs, and strategic initiatives and other charges. This presentation is consistent with how the Company's chief operating decision maker (the “CODM”) evaluates the results of operations and makes strategic decisions about the business. For these reasons, the Company believes that adjusted EBITDA represents the most relevant measure of segment profit and loss.
In addition, the CODM manages and evaluates the operating performance of the segments, as described above, on a pre-corporate cost allocation basis. Accordingly, for segment reporting purposes, the Company does not allocate corporate costs to its reportable segments. Corporate costs include management and administrative support to the Company, which consists of certain aspects of the Company’s executive management, legal, compliance, human resources, information technology (including operational support) and finance departments. These costs are included within "Corporate and Non-Operating" in the following table to reconcile to consolidated adjusted EBITDA and are not considered a separate reportable segment. Management does not allocate non-operating items such as investment income, other income (deductions), net and noncontrolling interest to the segments.
22
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued
(Dollar amounts in thousands, except per share data)
Note 14. Segment Information (continued)
The following table sets forth information about the Company's segments, including a reconciliation of adjusted EBITDA to net income.
Three Months Ended
March 31, Six Months Ended
March 31,
2024 2023 2024 2023
Sales:
Memorialization $ 222,156 $ 222,889 $ 430,227 $ 429,391
Industrial Technologies 116,136 125,514 227,510 234,657
SGK Brand Solutions 132,931 131,177 263,472 264,772
Consolidated Sales $ 471,223 $ 479,580 $ 921,209 $ 928,820
Adjusted EBITDA:
Memorialization $ 46,614 $ 48,030 $ 83,314 $ 87,167
Industrial Technologies 10,028 15,565 19,650 27,767
SGK Brand Solutions 15,370 11,020 28,263 23,252
Corporate and Non-Operating ( 15,212 ) ( 16,168 ) ( 28,945 ) ( 30,448 )
Total Adjusted EBITDA $ 56,800 $ 58,447 $ 102,282 $ 107,738
Acquisition and divestiture related items (1)**
( 2,062 ) ( 2,852 ) ( 3,299 ) ( 4,137 )
Strategic initiatives and other charges (2)**
( 4,962 ) ( 1,280 ) ( 10,882 ) ( 3,061 )
Highly inflationary accounting losses (primarily non-cash) (3)
( 390 ) ( 160 ) ( 710 ) ( 1,248 )
Stock-based compensation ( 4,327 ) ( 4,278 ) ( 8,978 ) ( 8,612 )
Non-service pension and postretirement expense (4)
( 110 ) ( 83 ) ( 219 ) ( 1,471 )
Depreciation and amortization *
( 23,261 ) ( 24,148 ) ( 46,784 ) ( 47,877 )
Interest expense, including RPA and factoring financing fees (5)
( 13,783 ) ( 13,137 ) ( 26,534 ) ( 23,808 )
Net loss attributable to noncontrolling interests — ( 2 ) — ( 58 )
Income before income taxes 7,905 12,507 4,876 17,466
Income tax benefit (provision) 1,122 ( 3,382 ) 1,848 ( 4,694 )
Net income $ 9,027 $ 9,125 $ 6,724 $ 12,772
(1) Includes certain non-recurring items associated with recent acquisition and divestiture activities.
(2) Includes certain non-recurring costs associated with commercial, operational and cost-reduction initiatives, and costs associated with global ERP system integration efforts. Fiscal 2024 also includes costs related to an ongoing contractual dispute which totaled $ 4,972 for the six months ended March 31, 2024. Fiscal 2023 includes loss recoveries totaling $ 2,154 for the six months ended March 31, 2023, which were related to a previously disclosed theft of funds by a former employee initially identified in fiscal 2015.
(3) Represents exchange losses associated with highly inflationary accounting related to the Company's Turkish subsidiaries (see Note 2, "Basis of Presentation").
(4) Non-service pension and postretirement expense includes interest cost, expected return on plan assets, amortization of actuarial gains and losses, curtailment gains and losses, and settlement gains and losses. These benefit cost components are excluded from adjusted EBITDA since they are primarily influenced by external market conditions that impact investment returns and interest (discount) rates. Curtailment gains and losses and settlement gains and losses are excluded from adjusted EBITDA since they generally result from certain non-recurring events, such as plan amendments to modify future benefits or settlements of plan obligations. The service cost and prior service cost components of pension and postretirement expense are included in the calculation of adjusted EBITDA, since they are considered to be a better reflection of the ongoing service-related costs of providing these benefits. Please note that GAAP pension and postretirement expense or the adjustment above are not necessarily indicative of the current or future cash flow requirements related to these employee benefit plans.
(5) Includes fees for receivables sold under the RPA and factoring arrangements totaling $ 1,238 and $ 1,090 for the three months ended March 31, 2024 and 2023, respectively, and $ 2,413 and $ 1,546 for the six months ended March 31, 2024 and 2023, respectively.
* Depreciation and amortization was $ 6,914 and $ 5,711 for the Memorialization segment, $ 5,571 and $ 5,916 for the Industrial Technologies segment, $ 9,669 and $ 11,319 for the SGK Brand Solutions segment, and $ 1,107 and $ 1,202 for Corporate and Non-Operating, for the three months ended March 31, 2024 and 2023, respectively. Depreciation and amortization was $ 13,327 and $ 11,285 for the Memorialization segment, $ 11,948 and $ 11,769 for the Industrial Technologies segment, $ 19,241 and $ 22,379 for the SGK Brand Solutions segment, and $ 2,268 and $ 2,444 for Corporate and Non-Operating, for the six months ended March 31, 2024 and 2023, respectively.
** Acquisition costs, ERP integration costs, and strategic initiatives and other charges were $ 1,037 and $ 333 for the Memorialization segment, $ 4,431 and $ 2,437 for the Industrial Technologies segment, $ 358 and $ 2,610 for the SGK Brand Solutions segment, and $ 1,198 and income of $ 1,248 for Corporate and Non-Operating, for the three months ended March 31, 2024 and 2023, respectively. Acquisition costs, ERP integration costs, and strategic initiatives and other charges were $ 1,097 and $ 711 for the Memorialization segment, $ 9,799 and $ 3,374 for the Industrial Technologies segment, $ 1,221 and $ 3,131 for the SGK Brand Solutions segment, and $ 2,064 and income of $ 18 for Corporate and Non-Operating, for the six months ended March 31, 2024 and 2023, respectively.
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued
(Dollar amounts in thousands, except per share data)
Note 15. Acquisitions and Divestitures
Fiscal 2024:
In January 2024, the Company completed a small acquisition within the Memorialization segment for a purchase price of $ 5,825 (net of holdbacks and other adjustments, including working capital). The preliminary purchase price allocation was not finalized as of March 31, 2024 and remains subject to change as the Company obtains additional information related to working capital, intangible assets and other liabilities.
Fiscal 2023:
In September 2023, the Company completed a small divestiture within the Industrial Technologies segment. Net proceeds from the divestiture totaled approximately $ 6,700 , and the transaction resulted in a pre-tax gain of $ 1,827 , which was recorded as a component of administrative expenses in the fourth quarter of fiscal 2023. The transaction also included $ 2,250 of contingent consideration, which represents the maximum amount the Company could potentially recognize at the resolution of the two-year contingency period.
In March 2023, the Company purchased the remaining ownership interest in a non-consolidated Industrial Technologies subsidiary for $ 4,759 (net of cash acquired and holdbacks). The Company finalized the allocation of the purchase price in the first quarter of fiscal 2024, resulting in no significant adjustments.
In February 2023, the Company acquired Eagle Granite Company ("Eagle") within the Memorialization segment for a total purchase price of $ 18,384 , consisting of cash of $ 8,650 (net of cash acquired) and a deferred purchase price amount of $ 9,734 , which is scheduled to be paid to the seller two years from the acquisition date. In addition, the Company recorded a liability of approximately $ 3,800 for potential future contingent consideration related to certain earnout provisions, which, if owed, is scheduled to be paid to the seller four years from the acquisition date. Eagle serves cemeteries and monument companies with a full complement of granite memorialization products. The Company finalized the allocation of the purchase price in the first quarter of fiscal 2024, resulting in adjustments to certain liability accounts.
During the first fiscal quarter of 2023, the Company completed small acquisitions within the SGK Brand Solutions segment for a combined purchase price of $ 1,932 (net of cash acquired and holdbacks). The Company finalized the purchase price allocations in the fourth quarter of fiscal 2023, resulting in an immaterial adjustment to certain tax accounts.
Note 16. Goodwill and Other Intangible Assets
A summary of the carrying amount of goodwill attributable to each segment as well as the changes in such amounts are as follows:
Memorialization Industrial Technologies SGK Brand
Solutions Consolidated
Net goodwill at September 30, 2023
$ 366,015 $ 115,073 $ 217,021 $ 698,109
Additions during period 2,551 — — 2,551
Translation and other adjustments 3,397 620 3,204 7,221
Net goodwill at March 31, 2024
$ 371,963 $ 115,693 $ 220,225 $ 707,881
The net goodwill balances at March 31, 2024 and September 30, 2023 included $ 261,186 of accumulated impairment losses. Accumulated impairment losses at March 31, 2024 and September 30, 2023 were $ 5,000 , $ 23,946 and $ 232,240 for the Memorialization, Industrial Technologies and SGK Brand Solutions segments, respectively.
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited), Continued
(Dollar amounts in thousands, except per share data)
Note 16. Goodwill and Other Intangible Assets (continued)
The Company performed its annual impairment review of goodwill and indefinite-lived intangible assets in the second quarter of fiscal 2024 (January 1, 2024) and determined that the estimated fair values for all goodwill reporting units exceeded their carrying values, therefore no impairment charges were necessary. The results of this review indicated that the estimated fair value of the Company's SGK Brand Solutions reporting unit exceeded the carrying value (expressed as a percentage of carrying value) by approximately 7 %. The fair value for the reporting unit was determined using level 3 inputs (including estimates of revenue growth, EBITDA contribution and the discount rates) and a combination of the income approach using the estimated discounted cash flows and a market-based valuation methodology. If current projections are not achieved or specific valuation factors outside the Company's control (such as discount rates and continued economic and industry challenges) significantly change, additional goodwill write-downs may be necessary in future periods.
The following tables summarize the carrying amounts and related accumulated amortization for intangible assets as of March 31, 2024 and September 30, 2023, respectively.
Carrying
Amount Accumulated
Amortization Net
March 31, 2024:
Indefinite-lived trade names $ 30,540 $ — $ 30,540
Definite-lived trade names 151,338 ( 124,986 ) 26,352
Customer relationships 379,416 ( 295,742 ) 83,674
Copyrights/patents/other 19,268 ( 15,950 ) 3,318
$ 580,562 $ ( 436,678 ) $ 143,884
September 30, 2023 :
Indefinite-lived trade names $ 30,540 $ — $ 30,540
Definite-lived trade names 151,185 ( 122,474 ) 28,711
Customer relationships 378,161 ( 280,910 ) 97,251
Copyrights/patents/other 19,375 ( 15,399 ) 3,976
$ 579,261 $ ( 418,783 ) $ 160,478
The net change in intangible assets during the six months ended March 31, 2024 included the impact of foreign currency fluctuations during the period, additional amortization, and additions related to a small acquisition within the Memorialization segment.
Amortization expense on intangible assets was $ 8,959 and $ 10,517 for the three-month periods ended March 31, 2024 and 2023, respectively. Amortization expense on intangible assets was $ 18,754 and $ 20,859 for the six-month periods ended March 31, 2024 and 2023, respectively. Amortization expense is estimated to be $ 17,736 for the remainder of fiscal 2024, $ 20,614 in 2025, $ 14,293 in 2026, $ 13,200 in 2027 and $ 11,135 in 2028.
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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
CAUTIONARY STATEMENTS REGARDING FORWARD LOOKING STATEMENTS AND NON-GAAP FINANCIAL MEASURES:
The following discussion should be read in conjunction with the consolidated financial statements of Matthews International Corporation ("Matthews" or the "Company") and related notes thereto included in this Quarterly Report on Form 10-Q and the Company's Annual Report on Form 10-K for the fiscal year ended September 30, 2023. Any forward-looking statements contained herein are included pursuant to the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, statements regarding the expectations, hopes, beliefs, intentions or strategies of the Company regarding the future, and may be identified by the use of words such as “expects,” “believes,” “intends,” “projects,” “anticipates,” “estimates,” “plans,” “seeks,” “forecasts,” “predicts,” “objective,” “targets,” “potential,” “outlook,” “may,” “will,” “could” or the negative of these terms, other comparable terminology and variations thereof. Such forward-looking statements involve known and unknown risks and uncertainties that may cause the Company's actual results in future periods to be materially different from management's expectations, and no assurance can be given that such expectations will prove correct. Factors that could cause the Company's results to differ materially from the results discussed in such forward-looking statements principally include changes in domestic or international economic conditions, changes in foreign currency exchange rates, changes in interest rates, changes in the cost of materials used in the manufacture of the Company's products, any impairment of goodwill or intangible assets, environmental liability and limitations on the Company’s operations due to environmental laws and regulations, disruptions to certain services, such as telecommunications, network server maintenance, cloud computing or transaction processing services, provided to the Company by third-parties, changes in mortality and cremation rates, changes in product demand or pricing as a result of consolidation in the industries in which the Company operates or other factors such as supply chain disruptions, labor shortages or labor cost increases, changes in product demand or pricing as a result of domestic or international competitive pressures, ability to achieve cost-reduction objectives, unknown risks in connection with the Company's acquisitions and divestitures, cybersecurity concerns and costs arising with management of cybersecurity threats, effectiveness of the Company's internal controls, compliance with domestic and foreign laws and regulations, technological factors beyond the Company's control, impact of pandemics or similar outbreaks or other disruptions to our industries, customers or supply chains, the impact of global conflicts, such as the current war between Russia and Ukraine, and other factors described in Item 1A - "Risk Factors" in this Form 10-Q and Item 1A - "Risk Factors" in the Company's Form 10-K for the fiscal year ended September 30, 2023. In addition, although the Company does not currently have any customers that would be considered individually significant to consolidated sales, changes in the distribution of the Company's products or the potential loss of one or more of the Company's larger customers are also considered risk factors. Matthews cautions that the foregoing list of important factors is not all inclusive. Readers are also cautioned not to place undue reliance on any forward looking statements, which reflect management's analysis only as of the date of this report, even if subsequently made available by Matthews on its website or otherwise. Matthews does not undertake to update any forward looking statement, whether written or oral, that may be made from time to time by or on behalf of Matthews to reflect events or circumstances occurring after the date of this report unless required by law.
Included in this report are measures of financial performance that are not defined by generally accepted accounting principles in the United States ("GAAP"). These non-GAAP financial measures assist management in comparing the Company's performance on a consistent basis for purposes of business decision-making by removing the impact of certain items that management believes do not directly reflect the Company's core operations. For additional information and reconciliations from the consolidated financial statements see "Non-GAAP Financial Measures" below.
RESULTS OF OPERATIONS:
The Company manages its businesses under three segments: Memorialization, Industrial Technologies and SGK Brand Solutions. The Memorialization segment consists primarily of bronze and granite memorials and other memorialization products, caskets, cremation-related products, and cremation and incineration equipment primarily for the cemetery and funeral home industries. The Industrial Technologies segment includes the design, manufacturing, service and distribution of high-tech custom energy storage solutions; product identification and warehouse automation technologies and solutions, including order fulfillment systems for identifying, tracking, picking and conveying consumer and industrial products; and coating and converting lines for the packaging, pharma, foil, décor and tissue industries. The SGK Brand Solutions segment consists of brand management, pre-media services, printing plates and cylinders, imaging services, digital asset management, merchandising display systems, and marketing and design services primarily for the consumer goods and retail industries.
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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations, Continued
The Company's primary measure of segment profitability is adjusted earnings before interest, income taxes, depreciation and amortization ("adjusted EBITDA"). Adjusted EBITDA is defined by the Company as earnings before interest, income taxes, depreciation, amortization and certain non-cash and/or non-recurring items that do not contribute directly to management’s evaluation of its operating results. These items include stock-based compensation, the non-service portion of pension and postretirement expense, acquisition and divestiture costs, enterprise resource planning ("ERP") integration costs, and strategic initiatives and other charges. This presentation is consistent with how the Company's chief operating decision maker (the “CODM”) evaluates the results of operations and makes strategic decisions about the business. For these reasons, the Company believes that adjusted EBITDA represents the most relevant measure of segment profit and loss.
In addition, the CODM manages and evaluates the operating performance of the segments, as described above, on a pre-corporate cost allocation basis. Accordingly, for segment reporting purposes, the Company does not allocate corporate costs to its reportable segments. Corporate costs include management and administrative support to the Company, which consists of certain aspects of the Company’s executive management, legal, compliance, human resources, information technology (including operational support) and finance departments. These costs are included within "Corporate and Non-Operating" in the following table to reconcile to consolidated adjusted EBITDA and are not considered a separate reportable segment. Management does not allocate non-operating items such as investment income, other income (deductions), net and noncontrolling interest to the segments.
The following table sets forth the sales and adjusted EBITDA for the Company's three reporting segments for the three and six-month periods ended March 31, 2024 and 2023. Refer to Note 14, "Segment Information" in Item 1 - "Financial Statements" for the Company's financial information by segment.
Three Months Ended
March 31, Six Months Ended
March 31,
2024 2023 2024 2023
Sales: (Dollar amounts in thousands)
Memorialization $ 222,156 $ 222,889 $ 430,227 $ 429,391
Industrial Technologies 116,136 125,514 227,510 234,657
SGK Brand Solutions 132,931 131,177 263,472 264,772
Consolidated Sales $ 471,223 $ 479,580 $ 921,209 $ 928,820
Adjusted EBITDA:
Memorialization $ 46,614 $ 48,030 $ 83,314 $ 87,167
Industrial Technologies 10,028 15,565 19,650 27,767
SGK Brand Solutions 15,370 11,020 28,263 23,252
Corporate and Non-Operating (15,212) (16,168) (28,945) (30,448)
Total Adjusted EBITDA (1)
$ 56,800 $ 58,447 $ 102,282 $ 107,738
(1) Total Adjusted EBITDA is a non-GAAP financial measure. See the "Non-GAAP Financial Measures" section below.
Sales for the six months ended March 31, 2024 were $921.2 million, compared to $928.8 million for the six months ended March 31, 2023. The decrease in fiscal 2024 sales reflected higher sales in the Memorialization segment, offset by lower sales in the Industrial Technologies and SGK Brand Solutions segments. On a consolidated basis, changes in foreign currency exchange rates were estimated to have a favorable impact of $4.8 million on fiscal 2024 sales compared to the prior year.
Memorialization segment sales for the first six months of fiscal 2024 were $430.2 million, compared to $429.4 million for the first six months of fiscal 2023. The sales increase reflected higher sales of granite memorial products, benefits from recent acquisitions (primarily the fiscal 2023 acquisition of Eagle Granite Company) and improved price realization. These increases were partially offset by lower unit sales of caskets, bronze memorial products and cremation equipment. These declines reflected a return to more normalized death rates following the COVID-19 pandemic. Changes in foreign currency exchange rates had a favorable impact of $403,000 on the segment's sales compared to the prior year. Industrial Technologies segment sales were $227.5 million for the first six months of fiscal 2024, compared to $234.7 million for the first six months of fiscal 2023. The change in sales reflected higher sales of purpose-built engineered products (primarily energy storage solutions for the electric vehicle market), higher product identification sales, and increased sales of surfaces products. These increases were offset by reduced sales of warehouse automation solutions and automotive engineering solutions, and the sales impact of a fiscal 2023 divestiture (see Acquisitions and Divestitures below). Changes in foreign currency exchange rates had a favorable impact of $4.7 million on the segment's sales compared to the prior year. In the SGK Brand Solutions segment, sales for the first six months of fiscal 2024 were $263.5 million, compared to $264.8 million for the first six months of fiscal 2023. The
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Text extracted from the filing as submitted to EDGAR. Formatting, tables and exhibits are simplified for reading; the original document is authoritative for anything you rely on.