What changed in this filing

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Item 1. Financial Statements

2023-10-19 compared with 2023-07-20 · 192 added, 200 removed, 947 unchanged (29% of the section changed)

3 unchanged sentences

(Amounts in millions, except per share data)

Three Months Ended Six Months Ended

July 1, 2023 July 2, 2022 July 1, 2023 July 2, 2022

Three Months Ended Nine Months Ended

September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

Net sales $ 1,159.3 $ 1,102.5 $ 3,533.6 $ 3,336.9

26 unchanged sentences

(Amounts in millions)

Three Months Ended Six Months Ended

July 1, 2023 July 2, 2022 July 1, 2023 July 2, 2022

Three Months Ended Nine Months Ended

September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

Comprehensive income (loss):

19 unchanged sentences

(Amounts in millions, except share data)

September 30,

2023 December 31, 2022

19 unchanged sentences

Goodwill 1,035.9 1,045.3

Other intangibles – net 269.5 275.6

Other intangible assets – net 263.0 275.6

Pension assets 72.7 70.6

5 unchanged sentences

(Amounts in millions, except share data)

September 30,

2023 December 31, 2022

35 unchanged sentences

(Amounts in millions, except share data)

The following summarizes the changes in total equity for the three month period ended July 1, 2023:

The following summarizes the changes in total equity for the three month period ended September 30, 2023:

Shareholders’ Equity Attributable to Snap-on Incorporated

6 unchanged sentences

Interests Total

Balance at April 1, 2023 $ 67.5 $ 500.2 $ 6,458.1 $ ( 510.6 ) $ ( 1,905.0 ) $ 22.2 $ 4,632.4

Net earnings for the three months ended July 1, 2023

Balance at July 1, 2023 $ 67.5 $ 521.1 $ 6,635.6 $ ( 510.7 ) $ ( 1,956.4 ) $ 22.2 $ 4,779.3

Net earnings for the three months ended September 30, 2023

— — 243.1 — — 6.0 249.1

6 unchanged sentences

Other — — ( 0.8 ) — — ( 6.0 ) ( 6.8 )

Balance at July 1, 2023 $ 67.5 $ 521.1 $ 6,635.6 $ ( 510.7 ) $ ( 1,956.4 ) $ 22.2 $ 4,779.3

The following summarizes the changes in total equity for the six month period ended July 1, 2023:

Balance at September 30, 2023 $ 67.5 $ 531.7 $ 6,792.3 $ ( 563.3 ) $ ( 1,998.0 ) $ 22.2 $ 4,852.4

The following summarizes the changes in total equity for the nine month period ended September 30, 2023:

Shareholders’ Equity Attributable to Snap-on Incorporated

7 unchanged sentences

Balance at December 31, 2022 $ 67.4 $ 499.9 $ 6,296.2 $ ( 528.3 ) $ ( 1,853.9 ) $ 22.2 $ 4,503.5

Net Earnings for the six months ended July 1, 2023

Net Earnings for the nine months ended September 30, 2023

— — 755.8 — — 17.5 773.3

Other comprehensive income — — — 17.6 — — 17.6

Other comprehensive loss — — — ( 35.0 ) — — ( 35.0 )

Cash dividends – $ 4.86 per share

4 unchanged sentences

Other 0.1 — ( 2.1 ) — — ( 17.5 ) ( 19.5 )

Balance at July 1, 2023 $ 67.5 $ 521.1 $ 6,635.6 $ ( 510.7 ) $ ( 1,956.4 ) $ 22.2 $ 4,779.3

Balance at September 30, 2023 $ 67.5 $ 531.7 $ 6,792.3 $ ( 563.3 ) $ ( 1,998.0 ) $ 22.2 $ 4,852.4

See Notes to Condensed Consolidated Financial Statements.

2 unchanged sentences

(Amounts in millions, except share data)

The following summarizes the changes in total equity for the three month period ended July 2, 2022:

The following summarizes the changes in total equity for the three month period ended October 1, 2022:

Shareholders’ Equity Attributable to Snap-on Incorporated

6 unchanged sentences

Interests Total

Balance at April 2, 2022 $ 67.4 $ 474.7 $ 5,841.0 $ ( 350.6 ) $ ( 1,734.2 ) $ 22.3 $ 4,320.6

Net earnings for the three months ended July 2, 2022

Balance at July 2, 2022 $ 67.4 $ 488.1 $ 5,996.2 $ ( 457.7 ) $ ( 1,769.6 ) $ 22.4 $ 4,346.8

Net earnings for the three months ended October 1, 2022

— — 223.9 — — 5.6 229.5

6 unchanged sentences

Other — — ( 0.4 ) — — ( 5.7 ) ( 6.1 )

Balance at July 2, 2022 $ 67.4 $ 488.1 $ 5,996.2 $ ( 457.7 ) $ ( 1,769.6 ) $ 22.4 $ 4,346.8

The following summarizes the changes in total equity for the six month period ended July 2, 2022:

Balance at October 1, 2022 $ 67.4 $ 493.6 $ 6,144.0 $ ( 582.3 ) $ ( 1,805.5 ) $ 22.3 $ 4,339.5

The following summarizes the changes in total equity for the nine month period ended October 1, 2022:

Shareholders’ Equity Attributable to Snap-on Incorporated

7 unchanged sentences

Balance at January 1, 2022 $ 67.4 $ 472.7 $ 5,699.9 $ ( 343.9 ) $ ( 1,714.2 ) $ 21.9 $ 4,203.8

Net Earnings for the six months ended July 2, 2022

Net Earnings for the nine months ended October 1, 2022

— — 672.8 — — 16.6 689.4

6 unchanged sentences

Other — — ( 1.6 ) — — ( 16.2 ) ( 17.8 )

Balance at July 2, 2022 $ 67.4 $ 488.1 $ 5,996.2 $ ( 457.7 ) $ ( 1,769.6 ) $ 22.4 $ 4,346.8

Balance at October 1, 2022 $ 67.4 $ 493.6 $ 6,144.0 $ ( 582.3 ) $ ( 1,805.5 ) $ 22.3 $ 4,339.5

See Notes to Condensed Consolidated Financial Statements.

2 unchanged sentences

(Amounts in millions)

Six Months Ended

July 1, 2023 July 2, 2022

Nine Months Ended

September 30, 2023 October 1, 2022

Operating activities:

2 unchanged sentences

Depreciation 53.6 53.9

Amortization of other intangibles 13.9 14.4

Amortization of other intangible assets 20.7 21.6

Provision for losses on finance receivables 40.7 24.9

27 unchanged sentences

Effect of exchange rate changes on cash and cash equivalents ( 4.1 ) ( 7.8 )

Increase in cash and cash equivalents 114.1 32.9

Increase (decrease) in cash and cash equivalents 202.1 ( 20.7 )

Cash and cash equivalents at beginning of year 757.2 780.0

10 unchanged sentences

These financial statements should be read in conjunction with, and have been prepared in conformity with, the accounting principles reflected in the consolidated financial statements and related notes included in Snap-on’s 2022 Annual Report on Form 10-K for the fiscal year ended December 31, 2022 (“2022 year end”).

The company’s 2023 fiscal second quarter ended on July 1, 2023, and its 2022 fiscal second quarter ended on July 2, 2022.

The company’s 2023 and 2022 fiscal second quarters each contained 13 weeks of operating results.

The company’s 2023 fiscal third quarter ended on September 30, 2023, and its 2022 fiscal third quarter ended on October 1, 2022.

The company’s 2023 and 2022 fiscal third quarters each contained 13 weeks of operating results.

Snap-on’s Condensed Consolidated Financial Statements are prepared in conformity with generally accepted accounting principles in the United States of America (“GAAP”).

In the opinion of management, all adjustments (consisting of normal recurring adjustments) necessary for the fair presentation of the Condensed Consolidated Financial Statements for the three and six month periods ended July 1, 2023, and July 2, 2022, have been made.

In the opinion of management, all adjustments (consisting of normal recurring adjustments) necessary for the fair presentation of the Condensed Consolidated Financial Statements for the three and nine month periods ended September 30, 2023, and October 1, 2022, have been made.

Interim results of operations are not necessarily indicative of the results to be expected for the full fiscal year.

18 unchanged sentences

The following table shows the consolidated revenues by revenue source:

Three Months Ended Six Months Ended

(Amounts in millions) July 1, 2023 July 2, 2022 July 1, 2023 July 2, 2022

Three Months Ended Nine Months Ended

(Amounts in millions) September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

Revenue from contracts with customers $ 1,152.2 $ 1,096.3 $ 3,513.3 $ 3,318.7

7 unchanged sentences

The following tables represent external net sales disaggregated by geography, based on the customers’ billing addresses:

For the Three Months Ended July 1, 2023

For the Three Months Ended September 30, 2023

Commercial Snap-on Repair Systems

10 unchanged sentences

Total revenue $ 366.4 $ 515.4 $ 431.8 $ 94.9 $ ( 154.3 ) $ 1,254.2

For the Six Months Ended July 1, 2023

For the Nine Months Ended September 30, 2023

Commercial Snap-on Repair Systems

12 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

For the Three Months Ended July 2, 2022

For the Three Months Ended October 1, 2022

Commercial Snap-on Repair Systems

9 unchanged sentences

Total revenue $ 356.8 $ 496.6 $ 414.0 $ 87.3 $ ( 164.9 ) $ 1,189.8

For the Six Months Ended July 2, 2022

For the Nine Months Ended October 1, 2022

Commercial Snap-on Repair Systems

13 unchanged sentences

The following tables represent external net sales disaggregated by customer type:

For the Three Months Ended July 1, 2023

For the Three Months Ended September 30, 2023

Commercial Snap-on Repair Systems

8 unchanged sentences

Total revenue $ 366.4 $ 515.4 $ 431.8 $ 94.9 $ ( 154.3 ) $ 1,254.2

For the Six Months Ended July 1, 2023

For the Nine Months Ended September 30, 2023

Commercial Snap-on Repair Systems

8 unchanged sentences

Total revenue $ 1,094.4 $ 1,575.5 $ 1,330.4 $ 280.9 $ ( 466.7 ) $ 3,814.5

For the Three Months Ended July 2, 2022

For the Three Months Ended October 1, 2022

Commercial Snap-on Repair Systems

10 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

For the Six Months Ended July 2, 2022

For the Nine Months Ended October 1, 2022

Commercial Snap-on Repair Systems

28 unchanged sentences

The remaining duration of these unsatisfied performance obligations range from one month up to 60 months.

Snap-on had approximately $ 183.0 million of long-term contracts that have fixed consideration that extends beyond one year as of July 1, 2023.

Snap-on had approximately $ 185.0 million of long-term contracts that have fixed consideration that extends beyond one year as of September 30, 2023.

Snap-on expects to recognize approximately 60 % of these contracts as revenue by the end of fiscal 2024, an additional 35 % by the end of fiscal 2026, and the balance thereafter.

4 unchanged sentences

The timing of payment is typically on a monthly, quarterly or annual basis.

The balance of total contract liabilities was $ 67.0 million and $ 63.3 million at July 1, 2023, and December 31, 2022, respectively.

The balance of total contract liabilities was $ 65.9 million and $ 63.3 million at September 30, 2023, and December 31, 2022, respectively.

The current portion of contract liabilities is included in “Other accrued liabilities” and the non-current portion of such liabilities is included in “Other long-term liabilities” on the accompanying Condensed Consolidated Balance Sheets.

During the three and six months ended July 1, 2023, Snap-on recognized $ 10.6 million and $ 45.3 million of revenue that was included in the $ 63.3 million contract liability balance at December 31, 2022, which was primarily from the amortization of software subscriptions, extended warranties and other subscription agreements.

During the three and nine months ended September 30, 2023, Snap-on recognized $ 7.4 million and $ 52.7 million of revenue, respectively, that was included in the $ 63.3 million contract liability balance at December 31, 2022, which was primarily from the amortization of software subscriptions, extended warranties and other subscription agreements.

Trade and other accounts receivable:

Snap-on’s trade and other accounts receivable primarily arise from the sale of tools, diagnostics, and equipment products to a broad range of industrial and commercial customers and to Snap-on’s independent franchise van channel with payment terms generally ranging from 30 to 120 days.

The components of Snap-on’s trade and other accounts receivable as of July 1, 2023, and December 31, 2022, are as follows:

(Amounts in millions) July 1,

The components of Snap-on’s trade and other accounts receivable as of September 30, 2023, and December 31, 2022, are as follows:

(Amounts in millions) September 30,

2023 December 31, 2022

2 unchanged sentences

Total trade and other accounts receivable – net $ 776.8 $ 761.7

The following is a rollforward of the allowances for credit losses related to trade and other accounts receivable for the three and six months ended July 1, 2023, and July 2, 2022:

Three Months Ended Six Months Ended

(Amounts in millions) July 1, 2023 July 2, 2022 July 1, 2023 July 2, 2022

The following is a rollforward of the allowances for credit losses related to trade and other accounts receivable for the three and nine months ended September 30, 2023, and October 1, 2022:

Three Months Ended Nine Months Ended

(Amounts in millions) September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

Allowances for credit losses:

12 unchanged sentences

Finance receivables are comprised of extended-term payment contracts to both technicians and independent shop owners (i.e., franchisees’ customers) to enable them to purchase tools, diagnostics, and equipment products on an extended-term payment plan, with average payment terms of approximately four years .

Contract receivables, with payment terms of up to 10 years, are comprised of extended-term payment contracts to a broad base of customers worldwide, including shop owners, both independents and national chains, for their purchase of tools, diagnostics, and equipment products, as well as extended-term contracts to franchisees to meet a number of financing needs, including working capital loans, loans to enable new franchisees to fund the purchase of the franchise and van leases, or the expansion of an existing franchise.

Finance and contract receivables are generally secured by the underlying tools, diagnostics and/or equipment products financed and, for contracts to franchisees, other franchisee assets.

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

The components of Snap-on’s current finance and contract receivables as of July 1, 2023, and December 31, 2022, are as follows:

(Amounts in millions) July 1,

Finance and contract receivables are generally secured by the underlying tools, diagnostics and/or equipment products financed and, for contracts to franchisees, other franchisee assets.

The components of Snap-on’s current finance and contract receivables as of September 30, 2023, and December 31, 2022, are as follows:

(Amounts in millions) September 30,

2023 December 31, 2022

20 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

The components of Snap-on’s finance and contract receivables with payment terms beyond one year as of July 1, 2023, and December 31, 2022, are as follows:

(Amounts in millions) July 1,

The components of Snap-on’s finance and contract receivables with payment terms beyond one year as of September 30, 2023, and December 31, 2022, are as follows:

(Amounts in millions) September 30,

2023 December 31, 2022

33 unchanged sentences

A receivable 30 days or more past due is considered delinquent.

However, customers are monitored prior to becoming 30 days past due.

The amortized cost basis of finance and contract receivables by origination year as of July 1, 2023, and charge-offs for the six months ended July 1, 2023, are as follows:

However, customer receivables are monitored prior to becoming 30 days past due.

The amortized cost basis of finance and contract receivables by origination year as of September 30, 2023, and charge-offs for the nine months ended September 30, 2023, are as follows:

(Amounts in millions) 2023 2022 2021 2020 2019 Prior Total

37 unchanged sentences

The allowances for credit losses are adjusted each period for changes in the credit risk and expected lifetime credit losses.

The following is a rollforward of the allowances for credit losses for finance and contract receivables for the three and six months ended July 1, 2023, and July 2, 2022:

The following is a rollforward of the allowances for credit losses for finance and contract receivables for the three and nine months ended September 30, 2023, and October 1, 2022:

Three Months Ended

July 1, 2023 Six Months Ended

September 30, 2023 Nine Months Ended

September 30, 2023

(Amounts in millions) Finance

10 unchanged sentences

Three Months Ended

July 2, 2022 Six Months Ended

October 1, 2022 Nine Months Ended

October 1, 2022

(Amounts in millions) Finance Receivables Contract Receivables Finance Receivables Contract Receivables

13 unchanged sentences

In limited instances, Snap-on’s financial services business may modify certain receivables.

The amount and number of finance and contract receivable modifications as of July 1, 2023, and December 31, 2022, were immaterial to both the financial services portfolio and the company’s results of operations and financial position.

The amount and number of finance and contract receivable modifications as of September 30, 2023, and December 31, 2022, were immaterial to both the financial services portfolio and the company’s results of operations and financial position.

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

The aging of finance and contract receivables as of July 1, 2023, and December 31, 2022, is as follows:

The aging of finance and contract receivables as of September 30, 2023, and December 31, 2022, is as follows:

(Amounts in millions) 30-59

2 unchanged sentences

Past Due Total Greater

July 1, 2023:

September 30, 2023:

Finance receivables $ 17.1 $ 11.9 $ 19.7 $ 48.7 $ 1,860.7 $ 1,909.4 $ 16.8

17 unchanged sentences

Such finance and contract receivables are covered by the company’s respective allowances for credit losses and are written-off against the allowances when appropriate.

The amount of finance and contract receivables on nonaccrual status as of July 1, 2023, and December 31, 2022, is as follows:

(Amounts in millions) July 1,

The amount of finance and contract receivables on nonaccrual status as of September 30, 2023, and December 31, 2022, is as follows:

(Amounts in millions) September 30,

2023 December 31, 2022

4 unchanged sentences

Inventories by major classification are as follows:

(Amounts in millions) July 1,

(Amounts in millions) September 30,

2023 December 31, 2022

5 unchanged sentences

Total inventories – net $ 1,032.9 $ 1,033.1

Inventories accounted for using the first-in, first-out (“FIFO”) method approximated 60 % and 61 % of total inventories as of July 1, 2023, and December 31, 2022, respectively.

Inventories accounted for using the first-in, first-out (“FIFO”) method approximated 58 % and 61 % of total inventories as of September 30, 2023, and December 31, 2022, respectively.

The company accounts for its non-U.S.

inventory on the FIFO method.

As of July 1, 2023, approximately 37 % of the company’s U.S.

As of September 30, 2023, approximately 36 % of the company’s U.S.

inventory was accounted for using the FIFO method and 64 % was accounted for using the last-in, first-out (“LIFO”) method.

There were no LIFO inventory liquidations in the three and six months ended July 1, 2023, or July 2, 2022.

There were no LIFO inventory liquidations in the three and nine months ended September 30, 2023, or October 1, 2022.

Goodwill and Other Intangible Assets

The changes in the carrying amount of goodwill by segment for the six months ended July 1, 2023, are as follows:

The changes in the carrying amount of goodwill by segment for the nine months ended September 30, 2023, are as follows:

(Amounts in millions) Commercial

4 unchanged sentences

Currency translation ( 5.9 ) — ( 3.5 ) ( 9.4 )

Balance as of July 1, 2023 $ 305.4 $ 12.4 $ 730.8 $ 1,048.6

Balance as of September 30, 2023 $ 297.0 $ 12.4 $ 726.5 $ 1,035.9

Additional disclosures related to other intangible assets are as follows:

July 1, 2023 December 31, 2022

September 30, 2023 December 31, 2022

(Amounts in millions) Gross Carrying Value Accumulated

15 unchanged sentences

Provisions for the impairment of goodwill and/or other intangible assets could arise in a future period due to significant and unanticipated changes in circumstances, such as declines in profitability and cash flow due to long-term deterioration in macroeconomic, industry and market conditions, the loss of key customers, changes in technology or markets, changes in key personnel or litigation, a sustained decrease in share price and/or other events.

As of July 1, 2023, the company had no accumulated impairment losses.

As of September 30, 2023, the company had no accumulated impairment losses.

The weighted-average amortization periods related to other intangible assets are as follows:

2 unchanged sentences

Internally developed software 6

The weighted-average amortization period for all amortizable intangibles on a combined basis is 12 years.

The weighted-average amortization period for all amortizable intangible assets on a combined basis is 12 years.

Intangible asset renewal costs are expensed as incurred.

The aggregate amortization expense was $ 7.0 million and $ 13.9 million for the respective three and six month periods ended July 1, 2023, and $ 7.2 million and $ 14.4 million for the respective three and six month periods ended July 2, 2022.

The aggregate amortization expense was $ 6.8 million and $ 20.7 million for the respective three and nine month periods ended September 30, 2023, and $ 7.2 million and $ 21.6 million for the respective three and nine month periods ended October 1, 2022.

Based on current levels of amortizable intangible assets and estimated weighted-average useful lives, estimated annual amortization expense is expected to be $ 27.2 million in 2023, $ 21.9 million in 2024, $ 15.8 million in 2025, $ 11.9 million in 2026, $ 10.4 million in 2027, and $ 9.1 million in 2028.

Exit and Disposal Activities

Snap-on did not record any costs for exit and disposal activities for each of the three and six month periods ended July 1, 2023, and July 2, 2022.

Snap-on’s exit and disposal accrual activity for the first six months of 2023 is as follows:

Balance at First Quarter Balance at Second Quarter Balance at

(Amounts in millions) December 31, 2022 Provision Usage April 1,

2023 Provision Usage July 1,

Severance costs:

Commercial & Industrial Group $ 1.6 $ — $ ( 0.1 ) $ 1.5 $ — $ ( 0.1 ) $ 1.4

Snap-on Tools Group 0.1 — — 0.1 — ( 0.1 ) —

Repair System & Information Group 1.1 — ( 0.2 ) 0.9 — ( 0.1 ) 0.8

Total $ 2.8 $ — $ ( 0.3 ) $ 2.5 $ — $ ( 0.3 ) $ 2.2

As of July 1, 2023, the company expects that approximately $ 1.1 million of the $ 2.2 million exit and disposal accrual will be utilized in 2023, and the remainder thereafter, primarily for longer-term severance payments.

Snap-on expects to fund the remaining cash requirements of its exit and disposal activities with available cash on hand, cash flows from operating activities and borrowings under the company’s existing credit facilities.

The estimated costs for the exit and disposal activities were based on management’s best business judgement under prevailing circumstances.

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Snap-on’s effective income tax rate on earnings attributable to Snap-on was 23.0 % and 23.7 % in the respective first six month periods of 2023 and 2022.

Snap-on’s effective income tax rate on earnings attributable to Snap-on was 22.9 % and 23.0 % in the respective first nine month periods of 2023 and 2022.

Snap-on and its subsidiaries file income tax returns in the United States and in various state, local and foreign jurisdictions.

2 unchanged sentences

Accordingly, Snap-on’s gross unrecognized tax benefits may increase by a range of zero to $ 0.6 million over the next 12 months for uncertain tax positions expected to be taken in future tax filings.

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Short-term and Long-term Debt

Short-term and long-term debt as of July 1, 2023, and December 31, 2022, consisted of the following:

(Amounts in millions) July 1,

Short-term and long-term debt as of September 30, 2023, and December 31, 2022, consisted of the following:

(Amounts in millions) September 30,

2023 December 31, 2022

8 unchanged sentences

Total long-term debt $ 1,184.4 $ 1,183.8

* Includes unamortized debt issuance costs.

Notes payable of $ 17.8 million as of July 1, 2023, compared to $ 17.2 million as of 2022 year end.

Snap-on has an $ 800 million multi-currency revolving credit facility that terminates on September 16, 2024 (the “Credit Facility”);

no amounts were borrowed or outstanding under the Credit Facility for the six months ended and as of July 1, 2023.

* Includes unamortized debt issuance costs and issuance discounts.

Notes payable of $ 17.3 million as of September 30, 2023, compared to $ 17.2 million as of 2022 year end.

On September 12, 2023, Snap-on entered into a $ 900 million multi-currency revolving credit facility that terminates on September 12, 2028 (the “Credit Facility”), which amended and restated in its entirety the company’s previous $ 800 million multi-currency revolving credit facility that was set to terminate on September 16, 2024 .

The Credit Facility contains an accordion feature that, subject to certain customary conditions, may allow the maximum commitment to be increased by up to $ 450 million with the approval of the lenders providing additional commitments.

No amounts were borrowed or outstanding under either Credit Facility during the nine months ended as of September 30, 2023.

Borrowings under the Credit Facility bear interest at varying rates based on either:

4 unchanged sentences

Snap-on may, up to two times during any five-year period during the term of the Credit Facility (including any extensions thereof), elect to increase the maximum Leverage Ratio to 0.65 to 1.00 and/or increase the maximum Consolidated Net Debt to EBITDA Ratio to 4.00 to 1.00 for four consecutive fiscal quarters in connection with certain material acquisitions (as defined in the related credit agreement).

As of July 1, 2023, the company’s actual ratios of 0.07 and 0.27 , respectively, were both within the permitted ranges set forth in this financial covenant.

As of September 30, 2023, the company’s actual ratios of 0.05 and 0.21 , respectively, were both within the permitted ranges set forth in this financial covenant.

Snap-on generally issues commercial paper to fund its financing needs on a short-term basis and uses the Credit Facility as back-up liquidity to support such commercial paper issuances.

As of July 1, 2023, there were no commercial paper issuances outstanding.

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

As of September 30, 2023, there were no commercial paper issuances outstanding.

Financial Instruments

9 unchanged sentences

Snap-on does not use derivative instruments for speculative or trading purposes.

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Snap-on is exposed to global market risks, including the effects of changes in foreign currency exchange rates, interest rates, and the company’s stock price.

18 unchanged sentences

The change in the fair value of the derivative is recorded in “Long-term debt” on the accompanying Condensed Consolidate d Balance Sheets.

T here were no outstanding interest rate swaps as of both July 1, 2023, and December 31, 2022 .

T here were no outstanding interest rate swaps as of both September 30, 2023, and December 31, 2022 .

Treasury locks:

3 unchanged sentences

Upon the issuance of debt, the related amount in Accumulated OCI is released over the term of the debt and recognized as an adjustment to interest expense on the Condensed Consolidated Statements of Earnings.

There were no treasury locks outstanding as of both July 1, 2023, and December 31, 2022.

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

There were no treasury locks outstanding as of both September 30, 2023, and December 31, 2022.

Stock-based deferred compensation risk management:

2 unchanged sentences

Since stock-based deferred compensation liabilities increase as the company’s stock price rises and decrease as the company’s stock price declines, the equity forwards are intended to mitigate the potential impact on deferred compensation expense that may result from such mark-to-market changes.

As of July 1, 2023, Snap-on had equity forwards in place intended to manage market risk with respect to 68,800 shares of Snap-on common stock associated with its deferred compensation plans.

As of September 30, 2023, Snap-on had equity forwards in place intended to manage market risk with respect to 69,400 shares of Snap-on common stock associated with its deferred compensation plans.

Counterparty risk:

2 unchanged sentences

Snap-on does not anticipate non-performance by its counterparties, but cannot provide assurances.

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Fair value of financial instruments:

The fair values of financial instruments that do not approximate the carrying values in the financial statements are as follows:

July 1, 2023 December 31, 2022

September 30, 2023 December 31, 2022

(Amounts in millions) Carrying

11 unchanged sentences

• Fair value of long-term debt is estimated, using Level 2 fair value measurements, based on quoted market values of Snap-on’s publicly traded senior debt.

The carrying value of long-term debt includes unamortized debt issuance costs.

The carrying value of long-term debt includes unamortized debt issuance costs and issuance discounts.

The fair value of notes payable approximates such instruments’ carrying value due to their short-term nature.

• The fair value of all other financial instruments, including trade and other accounts receivable, accounts payable and other financial instruments, approximates such instruments’ carrying value due to their short-term nature.

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Pension Plans

Snap-on’s net periodic pension benefit included the following components:

Three Months Ended Six Months Ended

(Amounts in millions) July 1, 2023 July 2, 2022 July 1, 2023 July 2, 2022

Three Months Ended Nine Months Ended

(Amounts in millions) September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

Service cost $ 4.7 $ 6.7 $ 14.1 $ 20.1

7 unchanged sentences

Depending on market and other conditions, Snap-on may make discretionary cash contributions to its pension plans in 2023.

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Postretirement Health Care Plans

Snap-on’s net periodic postretirement health care cost included the following components:

Three Months Ended Six Months Ended

(Amounts in millions) July 1, 2023 July 2, 2022 July 1, 2023 July 2, 2022

Three Months Ended Nine Months Ended

(Amounts in millions) September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

Interest cost $ 0.4 $ 0.3 $ 1.5 $ 0.9

6 unchanged sentences

The 2011 Incentive Stock and Awards Plan (the “2011 Plan”) provides for the grant of stock options, performance share units (“PSUs”), stock appreciation rights (“SARs”) and restricted stock awards (which may be designated as “restricted stock units” or “RSUs”).

As of July 1, 2023, the 2011 Plan had 2,629,450 shares available for future grants.

As of September 30, 2023, the 2011 Plan had 2,633,565 shares available for future grants.

The company uses treasury stock to deliver shares under the 2011 Plan.

Net stock-based compensation expense was $ 10.2 million and $ 20.4 million for the respective three and six month periods ended July 1, 2023, and $ 8.5 million and $ 17.5 million for the respective three and six month periods ended July 2, 2022.

Cash received from stock purchase plan and stock option exercises during the respective three and six month periods ended July 1, 2023, totaled $ 51.8 million and $ 84.6 million.

Cash received from stock purchase plan and stock option exercises during the respective three and six month periods ended July 2, 2022 totaled $ 23.4 million and $ 29.2 million.

The tax benefit realized from both the exercise and vesting of share-based payment arrangements was $ 5.4 million and $ 10.5 million for the respective three and six month periods ended July 1, 2023, and $ 1.8 million and $ 3.9 million for the respective three and six month periods ended July 2, 2022.

Net stock-based compensation expense was $ 11.0 million and $ 31.4 million for the respective three and nine month periods ended September 30, 2023, and $ 8.1 million and $ 25.6 million for the respective three and nine month periods ended October 1, 2022.

Cash received from stock purchase plan and stock option exercises during the respective three and nine month periods ended September 30, 2023, totaled $ 9.9 million and $ 94.5 million.

Cash received from stock purchase plan and stock option exercises during the respective three and nine month periods ended October 1, 2022, totaled $ 12.2 million and $ 41.4 million.

The tax benefit realized from both the exercise and vesting of share-based payment arrangements was $ 2.6 million and $ 13.1 million for the respective three and nine month periods ended September 30, 2023, and $ 3.3 million and $ 7.2 million for the respective three and nine month periods ended October 1, 2022.

Stock options:

1 unchanged sentence

Stock option grants vest ratably on the first, second and third anniversaries of the date of grant.

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

The fair value of each stock option award is estimated on the date of grant using the Black-Scholes valuation model.

4 unchanged sentences

treasury yield curve on the grant date for the expected term of the option.

The following weighted-average assumptions were used in calculating the fair value of stock options granted during the three and six month periods ended July 1, 2023, and July 2, 2022, using the Black-Scholes valuation model:

Three Months Ended Six Months Ended

July 1, 2023 July 2, 2022 July 1, 2023 July 2, 2022

The following weighted-average assumptions were used in calculating the fair value of stock options granted during the nine month periods ended September 30, 2023, and October 1, 2022, using the Black-Scholes valuation model:

Nine Months Ended

September 30, 2023 October 1, 2022

Expected term of option (in years)

3.80 3.74 4.89 5.14

Expected volatility factor 23.99 % 22.61 %

1 unchanged sentence

Risk-free interest rate 3.99 % 2.00 %

A summary of stock option activity as of and for the six months ended July 1, 2023, is presented below:

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Below is a summary of stock option activity as of and for the nine months ended September 30, 2023:

(in thousands)

5 unchanged sentences

Forfeited or expired ( 22 ) 218.12

Outstanding at July 1, 2023 2,122 174.65 5.6 $ 240.9

Exercisable at July 1, 2023 1,609 158.64 4.5 208.4

Outstanding at September 30, 2023 2,044 175.99 5.4 $ 161.7

Exercisable at September 30, 2023 1,535 159.80 4.4 146.3

* Weighted-average

The weighted-average grant date fair value of stock options granted during the six months ended July 1, 2023, and July 2, 2022, was $ 51.09 and $ 34.35 , respectively.

The intrinsic value of stock options exercised was $ 24.5 million and $ 47.1 million during the respective three and six month periods ended July 1, 2023, and $ 7.4 million and $ 10.2 million during the respective three and six month periods ended July 2, 2022.

The fair value of stock options vested was $ 9.1 million and $ 10.5 million during the respective six month periods ended July 1, 2023, and July 2, 2022.

As of July 1, 2023, there was $ 17.2 million of unrecognized compensation cost related to non-vested stock options that is expected to be recognized as a charge to earnings over a weighted-average period of 1.9 years.

The weighted-average grant date fair value of stock options granted during the nine months ended September 30, 2023, and October 1, 2022, was $ 51.09 and $ 34.35 , respectively.

The intrinsic value of stock options exercised was $ 9.9 million and $ 57.0 million during the respective three and nine month periods ended September 30, 2023, and $ 13.1 million and $ 23.3 million during the respective three and nine month periods ended October 1, 2022.

The fair value of stock options vested was $ 9.1 million and $ 10.5 million during the respective nine month periods ended September 30, 2023, and October 1, 2022.

As of September 30, 2023, there was $ 14.5 million of unrecognized compensation cost related to non-vested stock options that is expected to be recognized as a charge to earnings over a weighted-average period of 1.6 years.

Performance share units:

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The PSUs have a three-year performance period based on the results of the consolidated financial metrics of the company.

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

The fair value of PSUs is calculated using the market value of a share of Snap-on’s common stock on the date of grant and assumed forfeitures based on recent historical experience;

in recent years, forfeitures have not been significant.

The weighted-average grant date fair value of PSUs granted during the six months ended July 1, 2023, and July 2, 2022, was $ 249.26 and $ 204.87 , respectively.

PSUs related to 60,402 shares and 46,217 shares were paid out during the six months ended July 1, 2023, and July 2, 2022, respectively.

The weighted-average grant date fair value of PSUs granted during the nine months ended September 30, 2023, and October 1, 2022, was $ 249.26 and $ 204.87 , respectively.

PSUs related to 60,402 shares and 46,217 shares were paid out during the nine months ended September 30, 2023, and October 1, 2022, respectively.

Earned PSUs vest and are generally paid out following the conclusion of the applicable performance period upon approval by the Organization and Executive Compensation Committee of the company’s Board of Directors (the “Board”).

Changes to the company’s non-vested PSUs during the six months ended July 1, 2023, are as follows:

Changes to the company’s non-vested PSUs during the nine months ended September 30, 2023, are as follows:

(in thousands)

3 unchanged sentences

Cancellations and other ( 4 ) 215.56

Non-vested PSUs at July 1, 2023 267 208.54

Non-vested PSUs at September 30, 2023 283 208.71

* Weighted-average

** Reflects the number of PSUs above target levels based on performance metrics.

As of July 1, 2023, there was $ 23.9 million of unrecognized compensation cost related to non-vested PSUs that are expected to be recognized as a charge to earnings over a weighted-average period of 1.2 years.

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

As of September 30, 2023, there was $ 20.6 million of unrecognized compensation cost related to non-vested PSUs that are expected to be recognized as a charge to earnings over a weighted-average period of 1.0 year.

Restricted stock units:

3 unchanged sentences

in recent years, forfeitures have not been significant.

The weighted-average grant date fair value of RSUs granted during the six months ended July 1, 2023, and July 2, 2022, was $ 249.26 and $ 211.67 , respectively.

Changes to the company’s non-vested RSUs during the six months ended July 1, 2023, are as follows:

The weighted-average grant date fair value of RSUs granted during the nine months ended September 30, 2023, and October 1, 2022, was $ 249.26 and $ 211.67 , respectively.

Changes to the company’s non-vested RSUs during the nine months ended September 30, 2023, are as follows:

(in thousands)

1 unchanged sentence

Granted 26 249.26

Vested ( 1 ) 196.44

Cancellations and other ( 2 ) 215.96

Non-vested RSUs at July 1, 2023 82 215.39

Non-vested RSUs at September 30, 2023 81 215.66

* Weighted-average

As of July 1, 2023, there was $ 9.6 million of unrecognized compensation cost related to non-vested RSUs that are expected to be recognized as a charge to earnings over a weighted-average period of 1.4 years.

As of September 30, 2023, there was $ 8.1 million of unrecognized compensation cost related to non-vested RSUs that are expected to be recognized as a charge to earnings over a weighted-average period of 1.2 years.

Stock appreciation rights:

2 unchanged sentences

SARs are granted with an exercise price equal to the market value of a share of Snap-on’s common stock on the date of grant.

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Stock-settled SARs are accounted for as equity instruments and provide for the issuance of Snap-on common stock equal to the amount by which the company’s stock has appreciated over the exercise price.

9 unchanged sentences

treasury yield curve in effect as of the grant date (for stock-settled SARs) or reporting date (for cash-settled SARs) for the length of time corresponding to the expected term of the SARs.

The following weighted-average assumptions were used in calculating the fair value of stock-settled SARs granted during the six months ended July 1, 2023, and July 2, 2022, using the Black-Scholes valuation model:

Six Months Ended

July 1, 2023 July 2, 2022

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following weighted-average assumptions were used in calculating the fair value of stock-settled SARs granted during the nine months ended September 30, 2023, and October 1, 2022, using the Black-Scholes valuation model:

Nine Months Ended

September 30, 2023 October 1,

Expected term of stock-settled SARs (in years)

2 unchanged sentences

Risk-free interest rate 3.87 % 1.96 %

A summary of stock-settled SARs as of and for the six months ended July 1, 2023, are as follows:

Below is a summary of stock-settled SARs as of and for the nine months ended September 30, 2023:

Stock-settled

6 unchanged sentences

Forfeited or expired ( 73 ) 161.76

Outstanding at July 1, 2023 330 189.32 6.9 $ 32.6

Exercisable at July 1, 2023 199 165.46 5.6 24.4

Outstanding at September 30, 2023 327 189.52 6.7 $ 21.4

Exercisable at September 30, 2023 195 165.35 5.4 17.5

* Weighted-average

The weighted-average grant date fair value of stock-settled SARs granted during the six months ended July 1, 2023, and July 2, 2022, was $ 48.85 and $ 32.63 , respectively.

The intrinsic value of stock-settled SARs exercised was $ 2.6 million and $ 4.8 million during the respective three and six month periods ended July 1, 2023, and $ 0.5 million and $ 0.7 million during the respective three and six month periods ended July 2, 2022.

The fair value of stock-settled SARs vested was $ 1.9 million and $ 2.0 million during the respective six month periods ended July 1, 2023, and July 2, 2022.

As of July 1, 2023, there was $ 4.2 million of unrecognized compensation cost related to non-vested stock-settled SARs that is expected to be recognized as a charge to earnings over a weighted-average period of 1.9 years.

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following weighted-average assumptions were used in calculating the fair value of cash-settled SARs granted during the six months ended July 1, 2023, and July 2, 2022, using the Black-Scholes valuation model:

Six Months Ended

July 1, 2023 July 2, 2022

The weighted-average grant date fair value of stock-settled SARs granted during the nine months ended September 30, 2023, and October 1, 2022, was $ 48.85 and $ 32.63 , respectively.

The intrinsic value of stock-settled SARs exercised was $ 0.2 million and $ 5.0 million during the respective three and nine month periods ended September 30, 2023, and $ 0.5 million and $ 1.2 million during the respective three and nine month periods ended October 1, 2022.

The fair value of stock-settled SARs vested was $ 1.9 million and $ 2.0 million during the respective nine month periods ended September 30, 2023, and October 1, 2022.

As of September 30, 2023, there was $ 3.6 million of unrecognized compensation cost related to non-vested stock-settled SARs that is expected to be recognized as a charge to earnings over a weighted-average period of 1.7 years.

The following weighted-average assumptions were used in calculating the fair value of cash-settled SARs granted during the nine months ended September 30, 2023, and October 1, 2022, using the Black-Scholes valuation model:

Nine Months Ended

September 30, 2023 October 1,

Expected term of cash-settled SARs (in years)

2 unchanged sentences

Risk-free interest rate 4.80 % 4.25 %

The intrinsic value of cash-settled SARs exercised was zero and $ 0.4 million for the respective three and six month periods ended July 1, 2023, and $ 0.2 million and $ 0.6 million for the respective three and six month periods ended July 2, 2022.

The fair value of cash-settled SARs vested was $ 0.1 million for both the six month periods ended July 1, 2023, and July 2, 2022.

Changes to the company’s non-vested cash-settled SARs during the six months ended July 1, 2023, are as follows:

The intrinsic value of cash-settled SARs exercised was zero and $ 0.4 million for the respective three and nine month periods ended September 30, 2023, and zero and $ 0.6 million for the respective three and nine month periods ended October 1, 2022.

The fair value of cash-settled SARs vested was $ 0.1 million for both the nine month periods ended September 30, 2023, and October 1, 2022.

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Changes to the company’s non-vested cash-settled SARs during the nine months ended September 30, 2023, are as follows:

(in thousands)

2 unchanged sentences

Vested ( 1 ) 79.48

Non-vested cash-settled SARs at July 1, 2023 2 86.09

Non-vested cash-settled SARs at September 30, 2023 2 59.29

* Weighted-average

As of July 1, 2023, there was $ 0.2 million of unrecognized compensation cost related to non-vested cash-settled SARs that is expected to be recognized as a charge to earnings over a weighted-average period of 1.9 years.

As of September 30, 2023, there was $ 0.1 million of unrecognized compensation cost related to non-vested cash-settled SARs that is expected to be recognized as a charge to earnings over a weighted-average period of 1.7 years.

Restricted stock awards – non-employee directors:

The company awarded 5,760 shares and 6,525 shares of restricted stock to non-employee directors for the respective six month periods ended July 1, 2023, and July 2, 2022.

The company awarded 5,760 shares and 6,525 shares of restricted stock to non-employee directors for the respective nine month periods ended September 30, 2023, and October 1, 2022.

The fair value of the restricted stock awards is expensed over a one-year vesting period based on the fair value on the date of grant.

5 unchanged sentences

The company records compensation expense when Snap-on’s period-end stock price is greater than the plan purchase price.

There were 27,225 shares and 18,464 shares issued under this plan for the respective six month periods ended July 1, 2023, and July 2, 2022.

As of July 1, 2023, 551,598 shares were reserved for issuance under this plan and Snap-on held participant contributions of approximately $ 0.5 million.

There were 27,225 shares and 18,452 shares issued under this plan for the respective nine month periods ended September 30, 2023, and October 1, 2022.

As of September 30, 2023, 551,598 shares were reserved for issuance under this plan and Snap-on held participant contributions of approximately $ 1.9 million.

Participants are able to withdraw from the plan at any time prior to the ending date and receive back all contributions made during the plan year.

Compensation expense for plan participants was $ 0.5 million and $ 1.0 million for the three and six month periods ended July 1, 2023, and zero for both the three and six month periods ended July 2, 2022, respectively.

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Compensation expense for plan participants was zero and $ 1.0 million for the three and nine month periods ended September 30, 2023, respectively.

The company did not recognize any compensation expense for plan participants for both the three and nine month periods ended October 1, 2022.

Franchisee stock purchase plan:

2 unchanged sentences

The company records mark-to-market expense when Snap-on’s period-end stock price is greater than the plan purchase price.

There were 46,510 shares and 44,937 shares issued under this plan for the respective six month periods ended July 1, 2023, and July 2, 2022.

As of July 1, 2023, 178,715 shares were reserved for issuance under this plan and Snap-on held participant contributions of approximately $ 1.0 million.

There were 46,510 shares and 44,937 shares issued under this plan for the respective nine month periods ended September 30, 2023, and October 1, 2022.

As of September 30, 2023, 178,715 shares were reserved for issuance under this plan and Snap-on held participant contributions of approximately $ 4.3 million.

Participants are able to withdraw from the plan at any time prior to the ending date and generally receive back all contributions made during the plan year.

The company recognized market-to-market expense of $ 0.7 million and $ 1.6 million for the three and six month periods ended July 1, 2023, and zero for both the three and six month periods ended July 2, 2022, respectively.

The company recognized market-to-market expense of zero and $ 1.6 million for the three and nine month periods ended September 30, 2023.

The company did not recognize any mark-to-market expense for both the three and nine month periods ended October 1, 2022.

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Earnings Per Share

The shares used in the computation of the company’s basic and diluted earnings per common share are as follows:

Three Months Ended Six Months Ended

July 1, 2023 July 2, 2022 July 1, 2023 July 2, 2022

Three Months Ended Nine Months Ended

September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

Weighted-average common shares outstanding 52,822,472 53,212,751 52,932,781 53,307,241

3 unchanged sentences

The dilutive effect of the potential exercise of outstanding stock options and stock-settled SARs to purchase common shares is calculated using the treasury stock method.

As of July 1, 2023, there were 500 awards outstanding that were anti-dilutive;

as of July 2, 2022, there were no awards outstanding that were anti-dilutive.

As of both September 30, 2023, and October 1, 2022, there were no awards outstanding that were anti-dilutive.

Performance-based equity awards are included in the diluted earnings per share calculation based on the attainment of the applicable performance metrics to date.

2 unchanged sentences

Snap-on calculates its accrual requirements based on historic warranty loss experience that is periodically adjusted for recent actual experience, including the timing of claims during the warranty period and actual costs incurred.

Snap-on’s product warranty accrual activity for the three and six months ended July 1, 2023, and July 2, 2022, is as follows:

Three Months Ended Six Months Ended

(Amounts in millions) July 1, 2023 July 2, 2022 July 1, 2023 July 2, 2022

Snap-on’s product warranty accrual activity for the three and nine months ended September 30, 2023, and October 1, 2022, is as follows:

Three Months Ended Nine Months Ended

(Amounts in millions) September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

Warranty reserve:

8 unchanged sentences

Lessee accounting:

Supplemental balance sheet information related to leases as of July 1, 2023, and December 31, 2022, is as follows:

(Amounts in millions) July 1,

Supplemental balance sheet information related to leases as of September 30, 2023, and December 31, 2022, is as follows:

(Amounts in millions) September 30,

2023 December 31, 2022

17 unchanged sentences

“Other income (expense) – net” on the accompanying Condensed Consolidated Statements of Earnings consists of the following:

Three Months Ended Six Months Ended

(Amounts in millions) July 1, 2023 July 2, 2022 July 1, 2023 July 2, 2022

Three Months Ended Nine Months Ended

(Amounts in millions) September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

Interest income $ 10.9 $ 4.6 $ 28.8 $ 6.7

6 unchanged sentences

Accumulated Other Comprehensive Income (Loss)

The following is a summary of net changes in Accumulated OCI by component and net of tax for the three months ended July 1, 2023:

Below is a summary of net changes in Accumulated OCI by component and net of tax for the three months ended September 30, 2023:

(Amounts in millions) Foreign

2 unchanged sentences

Postretirement

Balance as of April 1, 2023 $ ( 254.4 ) $ 6.9 $ ( 263.1 ) $ ( 510.6 )

Other comprehensive income before reclassifications 0.2 — — 0.2

Balance as of July 1, 2023 $ ( 254.2 ) $ 6.5 $ ( 263.0 ) $ ( 510.7 )

Other comprehensive loss before reclassifications ( 52.3 ) — — ( 52.3 )

Amounts reclassified from Accumulated OCI — ( 0.4 ) 0.1 ( 0.3 )

Net other comprehensive income (loss) ( 52.3 ) ( 0.4 ) 0.1 ( 52.6 )

Balance as of July 1, 2023 $ ( 254.2 ) $ 6.5 $ ( 263.0 ) $ ( 510.7 )

The following is a summary of net changes in Accumulated OCI by component and net of tax for the six months ended July 1, 2023:

Balance as of September 30, 2023 $ ( 306.5 ) $ 6.1 $ ( 262.9 ) $ ( 563.3 )

Below is a summary of net changes in Accumulated OCI by component and net of tax for the nine months ended September 30, 2023:

(Amounts in millions) Foreign

3 unchanged sentences

Balance as of December 31, 2022 $ ( 272.5 ) $ 7.3 $ ( 263.1 ) $ ( 528.3 )

Other comprehensive income before reclassifications 18.3 — — 18.3

Other comprehensive loss before reclassifications ( 34.0 ) — — ( 34.0 )

Amounts reclassified from Accumulated OCI — ( 1.2 ) 0.2 ( 1.0 )

Net other comprehensive income (loss) ( 34.0 ) ( 1.2 ) 0.2 ( 35.0 )

Balance as of July 1, 2023 $ ( 254.2 ) $ 6.5 $ ( 263.0 ) $ ( 510.7 )

The following is a summary of net changes in Accumulated OCI by component and net of tax for the three months ended July 2, 2022:

Balance as of September 30, 2023 $ ( 306.5 ) $ 6.1 $ ( 262.9 ) $ ( 563.3 )

Below is a summary of net changes in Accumulated OCI by component and net of tax for the three months ended October 1, 2022:

(Amounts in millions) Foreign

2 unchanged sentences

Postretirement

Balance as of April 2, 2022 $ ( 154.8 ) $ 8.5 $ ( 204.3 ) $ ( 350.6 )

Balance as of July 2, 2022 $ ( 265.1 ) $ 8.1 $ ( 200.7 ) $ ( 457.7 )

Other comprehensive loss before reclassifications ( 127.6 ) — — ( 127.6 )

1 unchanged sentence

Net other comprehensive income (loss) ( 127.6 ) ( 0.4 ) 3.4 ( 124.6 )

Balance as of July 2, 2022 $ ( 265.1 ) $ 8.1 $ ( 200.7 ) $ ( 457.7 )

Balance as of October 1, 2022 $ ( 392.7 ) $ 7.7 $ ( 197.3 ) $ ( 582.3 )

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following is a summary of net changes in Accumulated OCI by component and net of tax for the six months ended July 2, 2022:

Below is a summary of net changes in Accumulated OCI by component and net of tax for the nine months ended October 1, 2022:

(Amounts in millions) Foreign

6 unchanged sentences

Net other comprehensive income (loss) ( 247.6 ) ( 1.2 ) 10.4 ( 238.4 )

Balance as of July 2, 2022 $ ( 265.1 ) $ 8.1 $ ( 200.7 ) $ ( 457.7 )

The reclassifications out of Accumulated OCI for the three and six month periods ended July 1, 2023, and July 2, 2022, are as follows:

Balance as of October 1, 2022 $ ( 392.7 ) $ 7.7 $ ( 197.3 ) $ ( 582.3 )

The reclassifications out of Accumulated OCI for the three and nine month periods ended September 30, 2023, and October 1, 2022, are as follows:

Amount Reclassified from Accumulated OCI

Three Months Ended Six Months Ended

(Amounts in millions) July 1, 2023 July 2, 2022 July 1, 2023 July 2, 2022 Statement of Earnings

Three Months Ended Nine Months Ended

(Amounts in millions) September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022 Statement of Earnings

Gains on cash flow hedges:

28 unchanged sentences

Financial Data by Segment:

Three Months Ended Six Months Ended

(Amounts in millions) July 1, 2023 July 2, 2022 July 1, 2023 July 2, 2022

Three Months Ended Nine Months Ended

(Amounts in millions) September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022

Commercial & Industrial Group $ 366.4 $ 356.8 $ 1,094.4 $ 1,056.0

17 unchanged sentences

Earnings before income taxes $ 320.2 $ 291.2 $ 997.2 $ 890.9

(Amounts in millions) July 1,

(Amounts in millions) September 30,

2023 December 31, 2022

11 unchanged sentences

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-Q

Item 1. Financial Statements