What changed in this filing

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Item 1. Financial Statements

2024-08-02 compared with 2024-05-03 · 313 added, 224 removed, 630 unchanged (46% of the section changed)

4 unchanged sentences

in millions, except per share amounts)

Three months ended

2024 April 1,

Three months ended Six months ended

2023 June 29,

Revenues $ 501.3 $ 423.3 $ 966.5 $ 823.1

4 unchanged sentences

Special charges, net ( 0.2 ) — 0.4 —

Other operating expense, net 8.4 — 8.4 —

Operating income 74.6 51.3 139.2 101.1

11 unchanged sentences

Income from continuing operations $ 0.98 $ 0.84 $ 2.05 $ 1.70

Income from discontinued operations — 0.08

Income (loss) from discontinued operations, net of tax ( 0.02 ) ( 0.05 ) ( 0.03 ) 0.03

Net income per share $ 0.96 $ 0.79 $ 2.02 $ 1.73

2 unchanged sentences

Income from continuing operations $ 0.96 $ 0.82 $ 2.01 $ 1.66

Income from discontinued operations — 0.08

Income (loss) from discontinued operations, net of tax ( 0.02 ) ( 0.05 ) ( 0.02 ) 0.03

Net income per share $ 0.94 $ 0.77 $ 1.99 $ 1.69

24 unchanged sentences

Deferred income taxes 3.5 4.0

Assets of DBT and Heat Transfer (includes cash and equivalents of $ 5.0 and $ 5.5 at March 30, 2024 and December 31, 2023, respectively) (Note 3)

Assets of DBT and Heat Transfer (includes cash and equivalents of $ 4.9 and $ 5.5 at June 29, 2024 and December 31, 2023, respectively) (Note 3)

TOTAL ASSETS $ 2,783.1 $ 2,439.7

15 unchanged sentences

Stockholders' Equity:

Common stock ( 54,056,016 and 46,217,007 is sued and outstanding at March 30, 2024, respectively, and 53,618,720 and 45,674,572 issued and outstanding at December 31, 2023, respectively)

Common stock ( 54,120,924 and 46,289,384 issued and outstanding at June 29, 2024, respectively, and 53,618,720 and 45,674,572 issued and outstanding at December 31, 2023, respectively)

Paid-in capital 1,359.1 1,353.6

1 unchanged sentence

Accumulated other comprehensive income 244.9 261.1

Common stock in treasury ( 7,839,009 and 7,944,148 shares at March 30, 2024 and December 31, 2023, respectively)

Common stock in treasury ( 7,831,540 and 7,944,148 shares at June 29, 2024 and December 31, 2023, respectively)

( 452.2 ) ( 458.9 )

5 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

Three months ended March 30, 2024

Stock Paid-In

Capital Retained

Earnings Accum.

Comprehensive

Income Common

Treasury Total

Stockholders’

Three months ended June 29, 2024

Common Stock Paid-In Capital Retained Earnings Accum.

Other Comprehensive Income Common Stock In Treasury Total Stockholders’ Equity

Balance at March 30, 2024 $ 0.5 $ 1,351.6 $ 87.3 $ 250.9 $ ( 452.8 ) $ 1,237.5

Net income — — 44.2 — — 44.2

Other comprehensive loss, net — — — ( 6.0 ) — ( 6.0 )

Incentive plan activity

— 4.5 — — — 4.5

Long-term incentive compensation expense

— 3.7 — — — 3.7

Restricted stock unit vesting — ( 0.7 ) — — 0.6 ( 0.1 )

Balance at June 29, 2024 $ 0.5 $ 1,359.1 $ 131.5 $ 244.9 $ ( 452.2 ) $ 1,283.8

Six months ended June 29, 2024

Common Stock Paid-In Capital Retained Earnings Accum.

Other Comprehensive Income Common Stock In Treasury Total Stockholders’ Equity

Balance at December 31, 2023 $ 0.5 $ 1,353.6 $ 38.3 $ 261.1 $ ( 458.9 ) $ 1,194.6

6 unchanged sentences

Restricted stock unit vesting — ( 15.8 ) — — 6.7 ( 9.1 )

Balance at March 30, 2024 $ 0.5 $ 1,351.6 $ 87.3 $ 250.9 $ ( 452.8 ) $ 1,237.5

Three months ended April 1, 2023

Common Stock Paid-In Capital Retained Deficit Accum.

Balance at June 29, 2024 $ 0.5 $ 1,359.1 $ 131.5 $ 244.9 $ ( 452.2 ) $ 1,283.8

Three months ended July 1, 2023

Common Stock Paid-In Capital Retained Earnings (Deficit) Accum.

Other Comprehensive Income Common Stock In Treasury Total Stockholders’ Equity

Balance at April 1, 2023 $ 0.5 $ 1,335.3 $ ( 8.8 ) $ 259.3 $ ( 460.2 ) $ 1,126.1

Net income — — 36.0 — — 36.0

Other comprehensive income, net — — — 3.2 — 3.2

Incentive plan activity

— 3.0 — — — 3.0

Long-term incentive compensation expense

— 3.5 — — — 3.5

Restricted stock unit vesting — ( 0.3 ) — — 1.1 0.8

Balance at July 1, 2023 $ 0.5 $ 1,341.5 $ 27.2 $ 262.5 $ ( 459.1 ) $ 1,172.6

Six months ended July 1, 2023

Common Stock Paid-In Capital Retained Earnings (Deficit) Accum.

Other Comprehensive Income Common Stock In Treasury Total Stockholders’ Equity

Balance at December 31, 2022 $ 0.5 $ 1,338.3 $ ( 51.6 ) $ 257.5 $ ( 465.5 ) $ 1,079.2

2 unchanged sentences

Incentive plan activity

— 8.2 — — — 8.2

Long-term incentive compensation expense

— 6.6 — — — 6.6

Restricted stock unit vesting — ( 11.6 ) — — 6.4 ( 5.2 )

Balance at April 1, 2023 $ 0.5 $ 1,335.3 $ ( 8.8 ) $ 259.3 $ ( 460.2 ) $ 1,126.1

Balance at July 1, 2023 $ 0.5 $ 1,341.5 $ 27.2 $ 262.5 $ ( 459.1 ) $ 1,172.6

The accompanying notes are an integral part of these statements.

2 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Three months ended

2024 April 1,

Six months ended

Cash flows from (used in) operating activities:

2 unchanged sentences

Income from continuing operations 94.4 77.4

Adjustments to reconcile income from continuing operations to net cash from (used in) operating activities:

Adjustments to reconcile income from continuing operations to net cash from operating activities:

Special charges, net 0.4 —

12 unchanged sentences

Net cash used in discontinued operations ( 1.4 ) ( 7.0 )

Net cash from (used in) operating activities 10.5 ( 4.4 )

Net cash from operating activities 68.0 67.6

Cash flows from (used in) investing activities:

Proceeds related to company-owned life insurance policies, net 0.1 0.1

Business acquisition, net of cash acquired ( 294.1 ) —

Proceeds/borrowings related to company-owned life insurance policies, net 42.9 1.0

Business acquisitions, net of cash acquired ( 294.1 ) ( 547.1 )

Capital expenditures ( 20.3 ) ( 8.7 )

9 unchanged sentences

Minimum withholdings paid on behalf of employees for net share settlements, net of proceeds from the exercise of employee stock options ( 0.9 ) ( 2.4 )

Financing fees paid — ( 1.3 )

Net cash from continuing operations 230.5 426.2

5 unchanged sentences

Consolidated cash and equivalents, end of period $ 133.0 $ 95.6

Three months ended

2024 April 1,

Six months ended

Components of cash and equivalents:

9 unchanged sentences

Unless otherwise indicated, “we,” “us” and “our” mean SPX Technologies, Inc.

and its consolidated subsidiaries (“SPX”).

and its consolidated subsidiaries (“SPX” or the “Company”).

We prepared the condensed consolidated financial statements pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim reporting.

19 unchanged sentences

We purchased Ingénia for cash consideration of $ 294.1 , net of cash acquired of $ 1.5 .

Under the terms of the purchase and sales agreement, the seller is eligible for additional cash consideration of up to Canadian Dollars (“CAD”) 3.0 (or $ 2.2 at the time of acquisition), with payment scheduled to be made in the event certain contingent liabilities do not materialize.

The estimated fair value of such contingent consideration is $ 0.3 , which is reflected as a liability in our condensed consolidated balance sheet as of March 30, 2024.

Under the terms of the purchase and sales agreement, the seller is eligible for additional cash consideration of up to Canadian Dollar (“CAD”) 3.0 (or $ 2.2 at the time of acquisition), with payment scheduled to be made in the event certain contingent liabilities do not materialize.

The estimated fair value of such contingent consideration is $ 0.3 , which is reflected as a liability in our condensed consolidated balance sheet as of June 29, 2024.

The post-acquisition results of Ingénia are reflected within our HVAC reportable segment.

The assets acquired and liabilities assumed in the TAMCO, ASPEQ, and Ingénia transactions have been recorded at estimates of fair value as determined by management, based on information available and assumptions as to future operations and are subject to change, primarily for the final assessment and valuation of certain income tax amounts.

The assets acquired and liabilities assumed in the Ingénia transaction have been recorded at estimates of fair value as determined by management, based on information available and assumptions as to future operations and are subject to change, primarily for the final assessment and valuation of certain income tax amounts.

Preparing financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses.

6 unchanged sentences

We had one less day in the first quarter of 2024, and will have two more days in the fourth quarter of 2024 than in the respective 2023 periods.

It is not practicable to estimate the impact of the one less day on our consolidated operating results for the three months ended March 30, 2024, when compared to the consolidated operating results for the 2023 respective period.

It is not practicable to estimate the impact of the one less day on our consolidated operating results for the six months ended June 29, 2024, when compared to the consolidated operating results for the respective 2023 period.

(2) NEW ACCOUNTING PRONOUNCEMENTS

39 unchanged sentences

We expect no ne of the goodwill described above to be deductible for tax purposes.

We recognized revenues and net income for Ingénia of $ 12.5 and $ 0.6 , respectively, for the three months ended March 30, 2024 with the net income impacted by charges during the three months ended March 30, 2024 of $ 3.3 associated with amortization of the various intangible assets mentioned above and $ 0.9 associated with the excess fair value (over historical cost) of inventory acquired which was subsequently sold.

Additionally, during the three months ended March 30, 2024, we incurred acquisition-related costs for Ingénia of $ 2.3 , which have been recorded to “Selling, general and administrative” within our condensed consolidated statements of operations and “Corporate expense” within consolidated operating income in Note 6.

We recognized revenues and net income for Ingénia of $ 21.6 and $ 1.7 , and $ 34.1 and $ 2.3 , r espectively, for the three and six months ended June 2 9, 2024 with net income impacted by charges during the three and six months ended June 29, 2024 of (i) $ 5.3 and $ 8.6 , respectively, associated with amortization of the various intangible assets mentioned above and (ii) $ 0.9 and $ 1.8 , respectively, associate d with the excess fair value (over historical cost) of inventory acquired which was subsequently sold.

Addition ally, during the three and six months ended June 29, 2024, we incurred acquisition-related costs for Ingénia of $ 0.6 and $ 2.9 , respectively, which have been recorded to “Selling, general and administrative” within our condensed consolidated statements of operations and “Corporate expense” within consolidated operating income, as further described in Note 6.

Acquisition of ASPEQ

1 unchanged sentence

We financed the acquisition with available cash and borrowings under our senior credit facilities.

The assets acquired and liabilities assumed have been recorded at preliminary estimates of fair value as determined by management, based on information currently available and on current assumptions as to future operations and are subject to change upon completion of the acquisition method of accounting.

Final determination of the fair values of certain assets and liabilities will be completed within the measurement period of up to one year from the acquisition date, as permitted under GAAP.

The excess of the purchase price over the total of the estimated fair values assigned to tangible and identifiable intangible assets acquired and liabilities assumed is recognized as goodwill.

The excess of the purchase price over the total of the fair values assigned to tangible and identifiable intangible assets acquired and liabilities assumed is recognized as goodwill.

In order to determine the fair values of tangible and intangible assets acquired and liabilities assumed fo r ASPEQ, we engaged a third-party independent valuation specialist.

The following is a summary of the recorded preliminary fair values of the assets acquired and liabilities assumed for ASPEQ as of June 2, 2023:

The following is a summary of the recorded final fair values of the assets acquired and liabilities assumed for ASPEQ as of June 2, 2023:

Assets acquired:

10 unchanged sentences

(1) Includes net deferred income tax liabilities and other liabilities of $ 56.4 and $ 1.0 , respectively.

The identifiable intangible assets acquired consist of customer relationships, trademarks, technology, and customer backlog of $ 142.3 , $ 51.5 , $ 47.8 , and $ 4.5 , respectively, with such amounts based on a preliminary assessment of the related fair values.

We expect to amortize the ASPEQ customer relationships, technology, and customer backlog assets over 12.0 , 16.0 , and 1.0 years, respectively, with the trademarks acquired being indefinite-lived.

1 unchanged sentence

The qualitative factors that comprise the recorded goodwill include expected market growth for ASPEQ’s existing operations, increased volumes achieved by selling ASPEQ’s products through existing SPX sales channels, procurement and operational savings and efficiencies, and various other factors.

During the thre e months ended March 30, 2024, we incurred integration-related costs for ASPEQ of $ 0.9 , which have been recorded to “Selling, general and administrative” within our condensed consolidated statements of operations and “Acquisition-related and other costs” within consolidated operating income in Note 6.

The following unaudited pro forma information presents our condensed consolidated results of operations for the three months ended March 30, 2024 and April 1, 2023, respectively, as if the acquisitions of Ingénia and ASPEQ had taken place on January 1, 2023 and January 1, 2022, respectively.

The unaudited pro forma financial information is not intended to represent or be indicative of our condensed consolidated results of operations that would have been reported had the acquisition been completed as of the dates presented, and should not be taken as representative of our future consolidated results of operations.

The following unaudited pro forma information presents our condensed consolidated results of operations for the three and six months ended June 29, 2024 and July 1, 2023, respectively, as if the acquisitions of Ingénia and ASPEQ had taken place on January 1, 2023 and January 1, 2022, respectively.

The unaudited pro forma financial information is not intended to represent or be indicative of our condensed consolidated results of operations that would have been reported had the acquisitions been completed as of the dates presented, and should not be taken as representative of our future consolidated results of operations.

The pro forma results include estimates and assumptions that management believes are reasonable;

however, these results do not include any anticipated cost savings or expenses of the planned integration of Ingénia and ASPEQ.

These pro forma consolidated results of operations have been prepared for comparative purposes only and include additional interest expense on the borrowings required to finance the acquisitions, additional depreciation and amortization expense associated with fair value adjustments to the acquired property, plant and equipment and intangible assets, adjustments to reflect charges associated with acquisition-related costs and charges associated with the excess fair value (over historical cost) of inventory acquired and subsequently sold as if they were incurred during the first quarter of 2023 for Ingénia and first quarter of 2022 for ASPEQ, and the related income tax effects.

Three months ended

March 30, 2024 April 1, 2023

These pro forma consolidated results of operations have been prepared for comparative purposes only and include additional interest expense on the borrowings required to finance the acquisitions, additional depreciation and amortization expense associated with fair value adjustments to the acquired property, plant and equipment and intangible assets, adjustments to reflect charges associated with acquisition and integration-related costs and charges associated with the excess fair value (over historical cost) of inventory acquired and subsequently sold as if they were incurred during the first quarter of 2023 for Ingénia and first quarter of 2022 for ASPEQ, and the related income tax effects.

Three months ended Six months ended

June 29, 2024 July 1, 2023 June 29, 2024 July 1, 2023

Revenues $ 501.3 $ 457.9 $ 974.5 $ 903.6

20 unchanged sentences

In March 2023, an arbitration tribunal upheld the decision of the dispute adjudication panel.

The assets and liabilities of DBT have been included within “ Assets of DBT and Heat Transfer ” and “ Liabilities of DBT and Heat Transfer, ” respectively, on the condensed consolidated balance sheets as of March 30, 2024 and December 31, 2023.

The major line items constituting DBT ’ s assets and liabilities as of March 30, 2024 and December 31, 2023 are shown below:

March 30, 2024 December 31, 2023

As a result, South African Rand 126.6 (or $ 7.0 ) was recorded as income during the first quarter of 2023, with such amount recorded within “Gain (loss) on disposition of discontinued operations, net of tax.” Further, in June 2023, the arbitration tribunal ruled DBT was entitled to recover $ 1.3 of legal costs incurred related to the arbitration.

Additionally, in May 2023, a separate arbitration tribunal ruled DBT was entitled to recover $ 5.5 of legal costs incurred related to another prior arbitration.

Such amounts were recorded within “Gain (loss) on disposition of discontinued operations, net of tax” during the quarter ended July 1, 2023.

The major line items constituting DBT ’ s assets and liabilities as of June 29, 2024 and December 31, 2023 are shown below:

June 29, 2024 December 31, 2023

Cash and equivalents $ 4.9 $ 5.5

14 unchanged sentences

___________________________

(1) Recorded amounts relate primarily to disputed amounts due to or from a subcontractor used by DBT during the Kusile project, that is currently in liquidation.

(1) Recorded amounts relate primarily to disputed amounts due to or from a subcontractor engaged by DBT during the Kusile project, that is currently in liquidation.

The timing of the ultimate resolution of these matters is uncertain as they are likely to occur as part of the liquidation process.

(2) Includes DBT's remaining obligation under the Settlement Agreement to make a payment to MHI of South African Rand 480.9 (or $ 25.5 and $ 26.2 at March 30, 2024 and December 31, 2023, respectively), due in September 2024.

In connection with this remaining obligation, we entered into a foreign currency forward contract which we are accounting for as a fair value hedge.

(2) Includes DBT's remaining obligation under the Settlement Agreement to make a payment to MHI of South African Rand 480.9 (or $ 26.4 and $ 26.2 at June 29, 2024 and December 31, 2023, respectively), due in September 2024.

In connection with this remaining

obligation, we entered into a foreign currency forward contract which we are accounting for as a fair value hedge.

Refer to Note 14 for additional details.

2 unchanged sentences

As a result of completing the wind-down plan, we are reporting Heat Transfer as a discontinued operation for all periods presented.

The assets and liabilities of Heat Transfer have been included within “ Assets of DBT and Heat Transfer ” and “ Liabilities of DBT and Heat Transfer, ” respectively, on the condensed consolidated balance sheets as of March 30, 2024 and December 31, 2023.

The major line items constituting Heat Transfer ’ s assets and liabilities as of March 30, 2024 and December 31, 2023 are shown below:

March 30, 2024 December 31, 2023

The assets and liabilities of Heat Transfer have been included within “Assets of DBT and Heat Transfer” and “Liabilities of DBT and Heat Transfer,” respectively, on the condensed consolidated balance sheets as of June 29, 2024 and December 31, 2023.

The major line items constituting Heat Transfer’s assets and liabilities as of June 29, 2024 and December 31, 2023 are shown below:

June 29, 2024 December 31, 2023

Other current assets $ 0.3 $ 0.3

6 unchanged sentences

As a result, it is possible that the resulting gains/losses on these and other previous divestitures may be materially adjusted in subsequent periods.

For the three months ended March 30, 2024 and April 1, 2023, results of operations from our businesses reported as discontinued operations were as follows:

Three months ended

March 30, 2024 April 1, 2023

For the three and six months ended June 29, 2024 and July 1, 2023, results of operations from our businesses reported as discontinued operations were as follows:

Three months ended Six months ended

June 29, 2024 July 1, 2023 June 29, 2024 July 1, 2023

Income (loss) from discontinued operations (1)

$ ( 0.4 ) $ ( 2.4 ) $ ( 0.6 ) $ 0.6

Income tax benefit 0.2 0.7

Income from discontinued operations, net — 3.7

Income tax (provision) benefit ( 0.2 ) 0.2 — 0.9

Income (loss) from discontinued operations, net ( 0.6 ) ( 2.2 ) ( 0.6 ) 1.5

Loss from discontinued operations (2)

Income tax benefit — —

( 0.2 ) ( 0.1 ) ( 0.4 ) ( 0.1 )

Income tax provision ( 0.2 ) — ( 0.2 ) —

Loss from discontinued operations, net ( 0.4 ) ( 0.1 ) ( 0.6 ) ( 0.1 )

Income (loss) from discontinued operations ( 0.6 ) ( 2.5 ) ( 1.0 ) 0.5

Income tax benefit 0.2 0.7

Income tax (provision) benefit ( 0.4 ) 0.2 ( 0.2 ) 0.9

Income (loss) from discontinued operations, net $ ( 1.0 ) $ ( 2.3 ) $ ( 1.2 ) $ 1.4

________________________________

(1) Income for the three months ended April 1, 2023 resulted primarily from income recorded in connection with the dispute resolution matter mentioned above, partially offset by legal costs incurred in connection with various dispute resolution matters that existed prior to the Settlement Agreement.

(2) Loss for the three months ended March 30, 2024 resulted primarily from revisions to liabilities retained in connection with prior dispositions.

(1) Income for the six months ended July 1, 2023 resulted primarily from income recorded in connection with the dispute resolutions mentioned above, partially offset by legal costs incurred in connection with various dispute resolution matters that existed prior to the Settlement Agreement.

Loss for the three months ended July 1, 2023 resulted primarily from net legal costs incurred in connection with various dispute resolution matters that existed prior to the Settlement Agreement.

(2) Loss for the three and six months ended June 29, 2024 and July 1, 2023 resulted primarily from revisions to liabilities, including income tax liabilities, retained in connection with prior dispositions.

(4) REVENUES FROM CONTRACTS

Disaggregated Revenues

We disaggregate revenue from contracts with customers by major product line and based on the timing of recognition for each of our reportable segments, as we believe such disaggregation best depicts how the nature, amount, timing, and uncertainty of our revenues and cash flows are affected by economic factors, with such disaggregation presented below for the three months ended March 30, 2024 and April 1, 2023:

Three months ended March 30, 2024

Three months ended June 29, 2024

Reportable Segments HVAC Detection and Measurement Total

2 unchanged sentences

Boilers, electrical heating, and ventilation 111.9 — 111.9

Underground locators, inspection and rehabilitation

equipment, and robotic systems — 61.0 61.0

Underground locators, inspection and rehabilitation equipment, and robotic systems — 66.1 66.1

Communication technologies, aids to navigation, and transportation systems — 78.7 78.7

4 unchanged sentences

$ 356.5 $ 144.8 $ 501.3

Three months ended April 1, 2023

Six months ended June 29, 2024

Reportable Segments HVAC Detection and Measurement Total

2 unchanged sentences

Boilers, electrical heating, and ventilation 226.5 — 226.5

Underground locators, inspection and rehabilitation

equipment, and robotic systems — 65.9 65.9

Underground locators, inspection and rehabilitation equipment, and robotic systems — 127.1 127.1

Communication technologies, aids to navigation, and transportation systems — 180.5 180.5

4 unchanged sentences

$ 658.9 $ 307.6 $ 966.5

Three months ended July 1, 2023

Reportable Segments HVAC Detection and Measurement Total

Major product lines

Package and process cooling equipment and services, and engineered air movement solutions $ 173.3 $ — $ 173.3

Boilers, electrical heating, and ventilation 95.7 — 95.7

Underground locators, inspection and rehabilitation equipment, and robotic systems — 67.2 67.2

Communication technologies, aids to navigation, and transportation systems — 87.1 87.1

$ 269.0 $ 154.3 $ 423.3

Timing of Revenue Recognition

Revenues recognized at a point in time $ 248.0 $ 127.3 $ 375.3

Revenues recognized over time 21.0 27.0 48.0

$ 269.0 $ 154.3 $ 423.3

Six months ended July 1, 2023

Reportable Segments HVAC Detection and Measurement Total

Major product lines

Package and process cooling equipment and services, and engineered air movement solutions $ 331.6 $ — $ 331.6

Boilers, electrical heating, and ventilation 189.0 — 189.0

Underground locators, inspection and rehabilitation equipment, and robotic systems — 133.1 133.1

Communication technologies, aids to navigation, and transportation systems — 169.4 169.4

$ 520.6 $ 302.5 $ 823.1

Timing of Revenue Recognition

Revenues recognized at a point in time $ 476.3 $ 255.5 $ 731.8

Revenues recognized over time 44.3 47.0 91.3

$ 520.6 $ 302.5 $ 823.1

Contract Balances

3 unchanged sentences

On a contract-by-contract basis, the contract assets and contract liabilities are reported net within our condensed consolidated balance sheets.

Our contract balances consisted of the following as of March 30, 2024 and December 31, 2023 :

Contract Balances March 30, 2024 December 31, 2023 Change

Our contract balances consisted of the following as of June 29, 2024 and December 31, 2023:

Contract Balances June 29, 2024 December 31, 2023 Change

Contract Accounts Receivable (1)

10 unchanged sentences

In general, we receive payments from customers based on a billing schedule established in our contracts.

During the three months ended March 30, 2024, changes in contract balances were not materially impacted by any other factors besides the acquisition of Ingénia.

At March 30, 2024, contract account receivables and current contract liabilities attributable to Ingénia were $ 20.7 and $ 0.7 , respectively.

During the three months ended March 30, 2024, we recognized revenues of $ 26.5 related to our contract liabilities at December 31, 2023 .

During the three and six months ended June 29, 2024, changes in contract balances were not materially impacted by any other factors besides the acquisition of Ingénia.

At June 29, 2024, contract account receivables and current contract liabilities attributable to Ingénia were $ 20.0 and $ 0.5 , respectively.

During the three and six months ended June 29, 2024, we recognized revenues of $ 14.2 and $ 40.7 , respectively, related to our contract liabilities at December 31, 2023.

Performance Obligations

As of March 30, 2024, the aggre gate amount allocat ed to remaining performance obligations was $ 141.4 .

We expect to recognize revenue on approximately 73 % and 86 % of remaining performance obliga tions over the next 12 and 24 months, respectively, with the remaining recognized thereafter.

There were no material changes to our operating and finance leases during the three months ended March 30, 2024.

As of June 29, 2024, the aggre gate amount all ocated to remaining performance obligations was $ 137.1 .

We expect to recognize revenue on approximately 76 % and 84 % of these remaining performance obligations o ver the next 12 and 24 months, respectively, with the remaining recognized thereafter.

There have been no material changes to our finance leases during the three and six months ended June 29, 2024.

During the six months ended June 29, 2024, we obtained operating lease right-of-use assets in exchange for new lease obligations of $ 15.8 , recorded as a non-cash activity within the condensed consolidated statement of cash flows.

Supplemental balance sheet information related to operating leases is as follows:

June 29, 2024 December 31, 2023

Operating Leases:

Affected Line Item in the Condensed Consolidated Balance Sheets

Operating lease ROU assets $ 52.2 $ 42.4 Other assets

Operating lease current liabilities $ 10.2 $ 11.3 Accrued expenses

Operating lease non-current liabilities 39.4 28.5 Other long-term liabilities

Total operating lease liability $ 49.6 $ 39.8

The weighted average remaining lease term (years) of our operating leases as of June 29, 2024 and December 31, 2023, were as follows:

June 29, 2024 December 31, 2023

Operating Leases 5.9 5.5

The discount rate utilized to determine the present value of lease payments over the lease term is our incremental borrowing rate based on the information available at lease commencement date.

In developing the incremental borrowing rate, we considered the interest rate that reflects a term similar to the underlying lease term on a fully collateralized basis.

We concluded to apply the incremental borrowing rate at a consolidated portfolio level using a five-year term, as the results did not materially differ upon further stratification.

The weighted-average discount rate for our operating leases was 3.8 % and 3.2 % at June 29, 2024 and December 31, 2023, respectively.

The future minimum payments under our operating leases were as follows as of June 29, 2024:

Operating Leases

Remainder of 2024 $ 6.7

Thereafter 13.0

Total lease payments 55.5

Less imputed interest 5.9

(6) INFORMATION ON REPORTABLE SEGMENTS

4 unchanged sentences

In determining our reportable segments, we apply the threshold criteria of the Segment Reporting Topic of the Codification.

Segment Income is determined before considering, if applicable, impairment and special charges, long-term incentive compensation, certain other operating income/expense, other indirect corporate expenses, intangible asset amortization expense, inventory step-up charges, and certain other acquisition-related costs.

This is consistent with the way our Chief Operating Decision Maker ( “ CODM ” ) evaluates the results of each segment.

9 unchanged sentences

Corporate expense generally relates to the operating cost of our Charlotte, North Carolina corporate headquarters.

Financial data for our reportable segments for the three months ended March 30, 2024 and April 1, 2023 are presented below:

Three months ended

2024 April 1,

Financial data for our reportable segments for the three and six months ended June 29, 2024 and July 1, 2023 are presented below:

Three months ended Six months ended

2023 June 29,

HVAC reportable segment $ 356.5 $ 269.0 $ 658.9 $ 520.6

6 unchanged sentences

Acquisition-related and other costs (1)

2.3 1.5 4.9 2.1

Long-term incentive compensation expense 3.7 3.5 7.0 6.6

1 unchanged sentence

Special charges, net ( 0.2 ) — 0.4 —

Other operating expense, net (2)

Consolidated operating income $ 74.6 $ 51.3 $ 139.2 $ 101.1

________________________________

(1) Represents certain acquisition-related costs incurred of $ 2.6 and $ 0.6 during the three months ended March 30, 2024 and April 1, 2023, respectively, including additional “Cost of products sold” related to the step-up of inventory (to fair value) acquired in connection with the Ingénia acquisition of $ 0.9 during the three months ended March 30, 2024.

(1) Represents certain integration costs incurred of $ 2.3 and $ 4.9 during the three and six months ended June 29, 2024, respectively, and $ 1.5 and $ 2.1 during the three and six months ended July 1, 2023, respectively, including additional “Cost of products sold” related to the step-up of inventory (to fair value) acquired in connection with the Ingénia acquisition of $ 0.9 and $ 1.8 during the three and six months ended June 29, 2024, respectively, and the ASPEQ acquisition of $ 1.1 during the three and six months ended July 1, 2023.

(2) Represents a charge of $ 8.4 related to a settlement with the seller of ULC Robotics (“ULC”) regarding additional contingent consideration.

(7) SPECIAL CHARGES, NET

Special charges, net, for the three months ended March 30, 2024 and April 1, 2023 are described in more detail below:

Three months ended

2024 April 1,

Special charges, net, for the three and six months ended June 29, 2024 and July 1, 2023 are described in more detail below:

Three months ended Six months ended

2023 June 29,

HVAC reportable segment $ ( 0.1 ) $ — $ 0.2 $ —

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Total $ ( 0.2 ) $ — $ 0.4 $ —

HVAC — Charges for the three months ended March 30, 2024 related primarily to severance costs associated with a restructuring action at one of the segment's cooling businesses.

Detection and Measurement — Charges for the three months ended March 30, 2024 related primarily to severance costs associated with restructuring actions at the segment's inspection and rehabilitation and aids to navigation businesses.

No significant future charges are expected to be incurred under actions approved as of March 30, 2024.

The following is an analysis of our restructuring liabilities for the three months ended March 30, 2024 and April 1, 2023:

Three months ended

2024 April 1,

HVAC — Special charges, net for the three and six months ended June 29, 2024 related primarily to recording, and subsequent adjustments of, severance costs associated with a restructuring action at one of the segment's cooling businesses.

Detection and Measurement — Special charges, net for the three and six months ended June 29, 2024 related primarily to recording, and subsequent adjustments of, severance costs associated with restructuring actions at the segment's inspection and rehabilitation and aids to navigation businesses.

No significant future charges are expected to be incurred under actions approved as of June 29, 2024.

The following is an analysis of our restructuring liabilities for the six months ended June 29, 2024 and July 1, 2023:

Six months ended

Balance at beginning of year $ 0.7 $ —

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Utilization — cash ( 0.8 ) —

Currency translation adjustment and other ( 0.1 ) —

Balance at end of period $ 0.3 $ —

(8) INVENTORIES, NET

Inventories are accounted for under the first-in, first-out method and are comprised of the following at March 30, 2024 and December 31, 2023:

Inventories are accounted for under the first-in, first-out method and are comprised of the following at June 29, 2024 and December 31, 2023:

2024 December 31,

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(9) GOODWILL AND OTHER INTANGIBLE ASSETS

The changes in the carrying amount of goodwill for the three months ended March 30, 2024 were as follows:

The changes in the carrying amount of goodwill for the six months ended June 29, 2024 were as follows:

2023 Goodwill

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Combinations (1)

Translation March 30,

Translation June 29,

HVAC reportable segment

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__________________________

(1) Reflects (i) goodwill acquired with the Ingénia acquisition of $ 141.2 and (ii) an increase in ASPEQ and TAMCO goodwill of $ 3.4 and $ 0.1 , respectively, resulting from revisions to the valuation of certain assets and liabilities.

As indicated in Note 1, the acquired assets, including goodwill, and liabilities assumed in the Ingénia, ASPEQ, and TAMCO acquisitions have been recorded at estimates of fair value and are subject to change upon completion of acquisition accounting.

(1) Reflects (i) goodwill acquired with the Ingénia acquisition o f $ 141.6 and (ii) an increase in ASPEQ and TAMCO goodwill of $ 3.9 and $ 1.7 , respectively, resulting from revisions to the valuation of certain assets and liabilities.

As indicated in Notes 1 and 3, the acquired assets, including goodwill, and liabilities assumed in the In génia acquisition have been recorded at estimates of fair value and are subject to change upon completion of acquisition accounting.

Other Intangibles, Net

Identifiable intangible assets at March 30, 2024 and December 31, 2023 comprised the following:

March 30, 2024 December 31, 2023

Identifiable intangible assets at June 29, 2024 and December 31, 2023 comprised the following:

June 29, 2024 December 31, 2023

Value Accumulated

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In connection with the acquisition of Ingénia, which has definite-lived intangible assets as noted above, we updated our estimated annual amortization expense related to intangible assets to approximately $ 66.0 for the full year 2024, $ 54.0 for 2025, and $ 53.0 for each of the three years thereafter.

At March 30, 2024, the net carrying value of intangible assets with determinable lives consisted of $ 422.4 in the HVAC reportable segment and $ 117.7 in the Detection and Measurement reportable segment.

At March 30, 2024, trademarks with indefinite lives consisted of $ 156.6 in the HVAC reportable segment and $ 63.9 in the Detection and Measurement reportable segment.

We review goodwill and indefinite-lived intangible assets for impairment annually during th e fourth quarter in conjunction with our annual financial planning process, with such testing based primarily on events and circumstances existing

as of the end of the third quarter.

In addition, we test goodwill for impairment on a more frequent basis if there are indications of potential impairment.

At June 29, 2024, the net carrying value of intangible assets with determinable lives consisted of $ 408.8 in the HVAC reportable segment and $ 113.5 in the Detection and Measurement reportable segment.

At June 29, 2024, trademarks with indefinite lives consisted of $ 156.6 in the HVAC reportable segment and $ 63.8 in the Detection and Measurement reportable segment.

In addition, we test goodwill for impairment on a more frequent basis if there are indications

of potential impairment.

In reviewing goodwill and indefinite-lived intangible assets for impairment, we initially perform a qualitative analysis.

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If ASPEQ and Ingénia are unable to achieve their current financial forecast, we may be required to record an impairment charge in a future period related to their goodwill or indefinite-lived intangible assets.

As of March 30, 2024, ASPEQ and Ingénia's goodwill totaled $ 194.5 and $ 140.2 , respectively, and indefinite-lived intangible assets totaled $ 51.5 for ASPEQ.

As of June 29, 2024, ASPEQ and Ingénia's goodwill totaled $ 195.0 and $ 139.4 , respectively, and indefinite-lived intangible assets totaled $ 51.5 for ASPEQ.

We perform our annual trademarks impairment testing during the fourth quarter, or on a more frequent basis, if there are indications of potential impairment.

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The following is an analysis of our product warranty accrual for the periods presented:

Three months ended

2024 April 1,

10 Six months ended

Balance at beginning of year $ 37.9 $ 34.7

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(11) EMPLOYEE BENEFIT PLANS

Net periodic benefit (income) expense for our pension and postretirement plans include the following components:

Net periodic benefit (income) expense for our pension and postretirement plans included the following components:

Domestic Pension Plans

Three months ended

2024 April 1,

Three months ended Six months ended

2023 June 29,

Service cost $ — $ — $ — $ —

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Foreign Pension Plans

Three months ended

2024 April 1,

Three months ended Six months ended

2023 June 29,

Service cost $ — $ — $ — $ —

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Postretirement Plans

Three months ended

2024 April 1,

Three months ended Six months ended

2023 June 29,

Service cost $ — $ — $ — $ —

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(12) INDEBTEDNESS

The following summarizes our debt activity (both current and non-current) for the three months ended March 30, 2024:

The following summarizes our debt activity (both current and non-current) for the six months ended June 29, 2024:

2023 Borrowings Repayments Other (5)

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current maturities of long-term debt 17.3 24.1

Total long-term debt $ 523.1 $ 516.6

Total long-term debt, net $ 523.1 $ 509.9

___________________________

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The revolving credit facility was utilized as the primary funding mechanism for the Ingénia acquisition.

(2) The term loans are repayable in quarterly installments equal to 0.625 % of the initial term loan balances of $ 545.0 , in each of the first three quarters of 2024, and 1.25 % during the fourth quarter of 2024, all quarters of 2025 and 2026, and the first two quarters of 2027.

(2) The term loans are repayable in quarterly installments equal to 0.625 % of the initial balances of $ 545.0 , in each of the first three quarters of 2024, and 1.25 % during the fourth quarter of 2024, all quarters of 2025 and 2026, and the first two quarters of 2027.

The remaining balances are payable in full on August 12, 2027.

Balances are net of unamortized debt issuance costs of $ 1.6 and $ 1.7 at March 30, 2024 and December 31, 2023, respectively.

Balances are net of unamortized debt issuance costs of $ 1.5 and $ 1.7 at June 29, 2024 and December 31, 2023, respectively.

(3) Under this arrangement, we can borrow, on a continuous basis, up to $ 60.0 , as available.

Borrowings under this arrangement are collateralized by eligible trade receivables of certain of our businesses.

At March 30, 2024, we had $ 5.0 of available borrowing capacity under this facility after giving effect to outstanding borrowings of $ 34.0 .

(4) Primarily includes balances under a purchase card program of $ 1.6 and $ 1.9 and finance lease obligations of $ 0.8 and $ 0.5 at March 30, 2024 and December 31, 2023, respectively.

At June 29, 2024, we had $ 5.0 of available borrowing capacity under this facility after giving effect to outstanding borrowings of $ 55.0 .

(4) Primarily includes balances under a purchase card program of $ 1.3 and $ 1.9 and finance lease obligations of $ 0.7 and $ 0.5 at June 29, 2024 and December 31, 2023, respectively.

The purchase card program allows for payment beyond the normal payment terms for goods and services acquired under the program.

As this arrangement extends the payment of these purchases beyond their normal payment terms through third-party lending institutions, we have classified these amounts as short-term debt.

(5) “Other” includes the impact of amortization of debt issuance costs associated with the term loans.

(5) “Other” includes the amortization of debt issuance costs associated with the term loans.

Senior Credit Facilities

A detailed description of our senior credit facilities is included in our 2023 Annual Report on Form 10-K.

At March 30, 2024, we had $ 207.8 of available borrowing capacity under our revolving credit facilities, after giving effect to borrowings under the domestic revolving loan facility of $ 281.4 and $ 10.8 reserved for outstanding letters of credit.

In addition, at March 30, 2024, we had $ 8.6 of available issuance capacity under our foreign credit instrument facilities after giving effect to $ 16.4 reserved for outstanding letters of credit.

The weighted-average interest rate of outstanding borrowings under our senior credit agreement was approximately 7.0 % at March 30, 2024.

At March 30, 2024, we were in compliance with all covenants of our senior credit agreement.

At June 29, 2024, we had $ 288.9 of available borrowing capacity under our revolving credit facilities, after giving effect to borrowings under the domestic revolving loan facility of $ 200.0 and $ 11.1 reserved for outstanding letters of credit.

In addition, at June 29, 2024, we had $ 6.4 of available issuance capacity under our foreign credit instrument facilities after giving effect to $ 18.6 reserved for outstanding letters of credit.

The weighted-average interest rate of outstanding borrowings under our senior credit agreement was approximately 6.9 % at June 29, 2024.

At June 29, 2024, we were in compliance with all covenants of our senior credit agreement.

Company-owned Life Insurance

The Company has investments in company-owned life insurance (“COLI”) policies, which are recorded at their cash surrender value at each balance sheet date.

Changes in the cash surrender value during the period are recorded as a gain or loss within “Other income (expense), net” within our condensed consolidated statements of operations.

The cash surrender value of the company’s investments in COLI assets was $ 75.8 and $ 76.7 at March 30, 2024 and December 31, 2023, respectively, recorded in “Other assets” on the condensed consolidated balance sheets.

Changes in the cash surrender value during the period are recorded as a gain or loss

within “Other income (expense), net” within our condensed consolidated statements of operations.

The Company has the ability to borrow against a portion of its investment in the COLI policies as an additional source of liquidity.

At March 30, 2024, the Company had not borrowed against any of its existing COLI policies’ cash surrender value.

During the quarter ended June 29, 2024, the Company borrowed $ 41.2 against the cash surrender value of these COLI policies.

Such borrowings were primarily used to pay down amounts payable under the revolving credit facility.

The amounts borrowed incur interest at a rate of 5.3 %.

The cash surrender value of the Company’s investments in COLI assets, net of the aforementioned borrowing, was $ 34.9 and $ 76.7 at June 29, 2024 and December 31, 2023, respectively, recorded in “Other assets” on the condensed consolidated balance sheets.

(13) DERIVATIVE FINANCIAL INSTRUMENTS

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We have designated, and are accounting for, our Swaps as cash flow hedges.

As of March 30, 2024 and December 31, 2023 , the unrealized gain, net of tax, recorded in accumulated other comprehensive income ( “ AOCI ”) was $ 4.4 and $ 5.7 , respectively.

In addition, the fair value of our Swaps, recorded as a current asset, was $ 5.8 and $ 7.5 as of March 30, 2024 and December 31, 2023, respectively .

As of June 29, 2024 and December 31, 2023 , the unrealized gain, net of tax, recorded in accumulated other comprehensive income ( “ AOCI ”) was $ 2.9 and $ 5.7 , respectively.

In addition, the fair value of our Swaps, recorded as a current asset, was $ 3.8 and $ 7.5 as of June 29, 2024 and December 31, 2023, respectively.

Changes in the fair value of our Swaps are reclassified into earnings, as a component of interest expense, when the forecasted transaction impacts earnings.

4 unchanged sentences

From time to time, we enter into forward contracts to manage the exposure on contracts with forecasted transactions denominated in non-functional currencies and to manage the risk of transaction gains and losses associated with assets/liabilities denominated in currencies other than the functional currency of certain subsidiaries (“FX forward contracts”).

We had FX forward contracts with an aggregate notional amount of $ 5.1 and $ 9.4 outstanding as of March 30, 2024 and December 31, 2023, respectively, with all of the $ 5.1 scheduled to mature within one year.

The fair value of these FX forward contracts was less than $ 0.1 at March 30, 2024 and December 31, 2023.

In addition to the above, we entered FX forward contracts associated with the Settlement Agreement, to mitigate our exposure to fluctuations in the South African Rand, with a notional amount of South African Rand 480.9 (or $ 24.9 at the time of execution) and a fair value of $ 0.6 and $ 1.3 at March 30, 2024 and December 31, 2023, respectively, which are included within “Assets of DBT and Heat Transfer” on the condensed consolidated balance sheets.

We had FX forward contracts with an aggregate notional amount of $ 8.0 and $ 9.4 outstanding as of June 29, 2024 and December 31, 2023, respectively, with all of the $ 8.0 scheduled to mature within one year.

The fair value of our FX forward contracts was less than $ 0.1 at June 29, 2024 and December 31, 2023.

In addition to the above, we entered FX forward contracts associated with the Settlement Agreement, to mitigate our exposure to fluctuations in the South African Rand, with a notional amount of South African Rand 480.9 (or $ 24.9 at the time of execution) and a fair value of $ 1.5 and $ 1.3 at June 29, 2024 and December 31, 2023, respectively, which are included within “Assets of DBT and Heat Transfer” on the condensed consolidated balance sheets.

All of these FX forward contracts are scheduled to mature within one year.

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The following table sets forth the number of weighted-average shares outstanding used in the computation of basic and diluted income per share:

Three months ended

2024 April 1,

Three months ended Six months ended

2023 June 29,

Weighted-average number of common shares used in basic income per share 46.246 45.533 46.038 45.457

1 unchanged sentence

Weighted-average number of common shares and dilutive securities used in diluted income per share 47.158 46.627 46.901 46.500

The weighted-average number of restricted stock units and stock options excluded from the computation of diluted income per share because the assumed proceeds for these instruments exceed the average market value of the underlying common stock for the related period were 0.123 and 0.321 , respectively, for the three months ended March 30, 2024, and 0.173 and 0.534 , respectively, for the three months ended April 1, 2023.

The weighted-average number of restricted stock units and stock options excluded from the computation of diluted income per share because the assumed proceeds for these instruments exceed the average market value of the underlying common stock for the related period were 0.155 and 0.283 , r espectively, for the three mon ths ended June 29, 2024, and 0.137 and 0.305 , respectively, for the six months ended June 29, 2024.

The weighted-average number of restricted stock units and stock options excluded from the computation of diluted income per share because the assumed proceeds for these instruments exceed the average market value of the underlying common stock for the related period were 0.228 and 0.535 , respectively, for the three months ended July 1, 2023, and 0.198 and 0.529 , respectively, for the six months ende d July 1, 2023 .

Long-Term Incentive Compensation

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Stock options and RSU’s vest ratably over the three-year period subsequent to the date of grant.

Non-employee directors receive annual long-term incentive awards at the time of our annual meeting of stockholders, with the 2024 meeting scheduled for May 14, 2024.

C ompensation expense related to long-term incentive awards totaled $ 3.3 and $ 3.1 for the three months ended March 30, 2024 and April 1, 2023, respectively.

The related tax benefit was $ 0.6 and $ 0.5 for the three months ended March 30, 2024 and April 1, 2023, respectively.

PSU’s and RSU’s

We use the Monte Carlo simulation model valuation technique to determine the fair value of our restricted stock units that contain a market condition (i.e., the PSU’s).

The Monte Carlo simulation model utilizes multiple input variables that determine the probability of satisfying the market condition stipulated in the award and calculates the fair value of each PSU.

The following table summarizes the PSU and RSU activity from December 31, 2023 through March 30, 2024 :

Unvested PSU’s and RSU’s Weighted-Average Grant-Date Fair Value Per Share

Outstanding at December 31, 2023 0.510 $ 58.53

Granted 0.135 122.71

Vested ( 0.187 ) 60.64

Forfeited ( 0.002 ) 55.59

Outstanding at March 30, 2024 0.456 $ 76.82

As of March 30, 2024 , there was $ 22.7 of unrecognized compensation cost related to PSU’s and RSU’s.

We expect this cost to be recognized over a weighted-average period of 2.5 years.

Stock Options

On February 28, 2024, we granted 0.052 stock options, all of which were outstanding (but not exercisable) as of March 30, 2024 .

The exercise price per share of these options is $ 116.40 and the maximum contractual term of these options is 10 years.

The fair value per share of the stock options granted on February 28, 2024 was $ 50.84 .

The fair value of each option grant was estimated using the Black-Scholes option-pricing model with the following assumptions:

Annual expected stock price volatility 37.43 %

Annual expected dividend yield — %

Risk-free interest rate 4.23 %

Expected life of stock option (in years) 6.0

Annual expected stock price volatility is based on a weighted average of SPX’s stock volatility of the most recent six-year historical volatility of a peer company group.

There is no annual expected dividend yield as we discontinued dividend

payments in 2015 and do not expect to pay dividends for the foreseeable future.

The average risk-free interest rate is based on the five-year and seven-year treasury constant maturity rates.

The expected option life is based on a three-year pro-rata vesting schedule and represents the period of time that awards are expected to be outstanding.

The following table summarizes the stock option activity from December 31, 2023 through March 30, 2024 :

Shares Weighted-Average Exercise Price

Options outstanding at December 31, 2023 1.221 $ 30.70

Exercised ( 0.404 ) 14.86

Forfeited — —

Granted 0.052 116.40

Options outstanding at March 30, 2024 0.869 $ 43.26

As of March 30, 2024 , there was $ 3.7 of unrecognized compensation cost related to stock options.

We expect this cost to be recognized over a weighted-average period of 2.6 years.

Effective May 14, 2024, we granted 0.008 RSU’s to our non-employee directors, which vest in their entirety immediately prior to the annual meeting of stockholders in May 2025.

C ompensation expense within income from continuing operations related to long-term incentive awards totaled $ 3.7 and $ 3.5 for the three months ended June 29, 2024 and July 1, 2023 , respectively, an d $ 7.0 an d $ 6.6 for the six months ended June 29, 2024 and July 1, 2023 , respectively.

The related tax benefit w as $ 0.6 for the three months ended June 29, 2024 and July 1, 2023 and $ 1.2 and $ 1.1 for the six months e nded June 29, 2024 and July 1, 2023 , respectively.

Repurchases of Common Stock

On May 14, 2024, our Board of Directors authorized management, in its sole discretion, to repurchase, in any fiscal year, up to $ 100.0 of our common stock, subject to maintaining compliance with all covenants of our senior credit agreement.

No share repurchases were effected pursuant to this and prior authorizations during the three and six months ended June 29, 2024.

Accumulated Other Comprehensive Income

The changes in the components of accumulated other comprehensive income, net of tax, for the three months ended March 30, 2024 were as follows:

The changes in the components of AOCI, net of tax, for the three months ended June 29, 2024 were as follows:

Adjustment Net Unrealized Gains

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__________________________

(1) Net of tax provision o f $ 1.4 and $ 1.8 as of March 30, 2024 and December 31, 2023, respectively.

(2) Net of tax provision of $ 1.6 and $ 1.8 as of March 30, 2024 and December 31, 2023, respectively.

The balances as of March 30, 2024 and December 31, 2023 include unamortized prior service credits.

The changes in the components of accumulated other comprehensive income, net of tax, for the three months ended April 1, 2023 were as follows:

(1) Net of tax provision o f $ 0.8 and $ 1.4 as of June 29, 2024 and March 30, 2024, respectively.

(2) Net of tax provision of $ 1.4 and $ 1.6 as of June 29, 2024 and March 30, 2024, respectively.

The balances as of June 29, 2024 and March 30, 2024 include unamortized prior service credits.

The changes in the components of AOCI, net of tax, for the six months ended June 29, 2024 were as follows:

Adjustment Net Unrealized Gains

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Amounts reclassified from accumulated other comprehensive income — ( 3.5 ) ( 1.2 ) ( 4.7 )

Current-period other comprehensive loss ( 12.2 ) ( 2.8 ) ( 1.2 ) ( 16.2 )

Balance at end of period $ 238.8 $ 2.9 $ 3.2 $ 244.9

__________________________

(1) Net of tax provision of $ 0.8 a nd $ 1.8 as of June 29, 2024 and December 31, 2023, respectively.

(2) Net of tax provision of $ 1.4 and $ 1.8 as of June 29, 2024 and December 31, 2023, respectively.

The balances as of June 29, 2024 and December 31, 2023 include unamortized prior service credits.

The changes in the components of AOCI, net of tax, for the three months ended July 1, 2023 were as follows:

Adjustment Net Unrealized Gains

on Qualifying Cash

Flow Hedges (1)

Postretirement

Adjustment (2)

Balance at beginning of period $ 243.5 $ 9.1 $ 6.7 $ 259.3

Other comprehensive income before reclassifications 3.9 1.8 — 5.7

Amounts reclassified from accumulated other comprehensive income — ( 1.7 ) ( 0.8 ) ( 2.5 )

Current-period other comprehensive income (loss) 3.9 0.1 ( 0.8 ) 3.2

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__________________________

(1) Net of tax provision of $ 3.1 and $ 3.7 as of April 1, 2023 and December 31, 2022, respectively.

(2) Net of tax provision of $ 2.4 and $ 2.7 as of April 1, 2023 and December 31, 2022, respectively.

The balances as of April 1, 2023 and December 31, 2022 include unamortized prior service credits.

The following summarizes amounts reclassified from each component of accumulated other comprehensive income for the three months ended March 30, 2024 and April 1, 2023:

(1) Net of tax provision of $ 3.1 as of July 1, 2023 and April 1, 2023.

(2) Net of tax provision of $ 2.2 and $ 2.4 as of July 1, 2023 and April 1, 2023, respectively.

The balances as of July 1, 2023 and April 1, 2023 include unamortized prior service credits.

The changes in the components of AOCI, net of tax, for the six months ended July 1, 2023 were as follows:

Adjustment Net Unrealized Gains

on Qualifying Cash

Flow Hedges (1)

Postretirement

Adjustment (2)

Balance at beginning of period $ 239.1 $ 11.0 $ 7.4 $ 257.5

Other comprehensive income before reclassifications 8.3 1.5 — 9.8

Amounts reclassified from accumulated other comprehensive income — ( 3.3 ) ( 1.5 ) ( 4.8 )

Current-period other comprehensive income (loss) 8.3 ( 1.8 ) ( 1.5 ) 5.0

Balance at end of period $ 247.4 $ 9.2 $ 5.9 $ 262.5

__________________________

(1) Net of tax provision of $ 3.1 and $ 3.7 as of July 1, 2023 and December 31, 2022, respectively.

(2) Net of tax provision of $ 2.2 and $ 2.7 as of July 1, 2023 and December 31, 2022, respectively.

The balances as of July 1, 2023 and December 31, 2022 include unamortized prior service credits.

The following summarizes amounts reclassified from each component of AOCI for the three months ended June 29, 2024 and July 1, 2023:

Amount Reclassified from AOCI

Three months ended

March 30, 2024 April 1, 2023 Affected Line Item in the Condensed

June 29, 2024 July 1, 2023 Affected Line Item in the Condensed

Consolidated Statements of Operations

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$ ( 0.6 ) $ ( 0.8 )

The following summarizes amounts reclassified from each component of AOCI for the six months ended June 29, 2024 and July 1, 2023:

Amount Reclassified from AOCI

Six months ended

June 29, 2024 July 1, 2023 Affected Line Item in the Condensed

Consolidated Statements of Operations

Gains on qualifying cash flow hedges:

Swaps $ ( 4.8 ) $ ( 4.4 ) Interest expense

Pre-tax ( 4.8 ) ( 4.4 )

Income taxes 1.3 1.1

$ ( 3.5 ) $ ( 3.3 )

Gains on pension and postretirement items:

Amortization of unrecognized prior service credits - Pre-tax $ ( 1.6 ) $ ( 2.0 ) Other income (expense), net

Income taxes 0.4 0.5

$ ( 1.2 ) $ ( 1.5 )

(15) CONTINGENT LIABILITIES AND OTHER MATTERS

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Also, while we believe we are entitled to indemnification from third parties for some of these claims, these rights may be insufficient or unavailable to protect us against potential loss exposures.

Our recorded liab ilities related to these matters, primarily associated with environmental matters, totaled $ 38.7 and $ 37.9 at March 30, 2024 and December 31, 2023, respectively.

Of these amounts, $ 29.9 and $ 29.4 are included in “Other long-term liabilities” within our condensed consolidated balance sheets at March 30, 2024 and December 31, 2023 , respectively, with the remainder included in “Accrued expenses.” The liabilities we record for these matters are based on a number of assumptions, including historical claims and payment experience.

While we base our assumptions on facts currently known to us, they entail inherently subjective judgments and uncertainties.

Our recorded liab ilities related to these matters, primarily associated with environmental matters, totaled $ 37.8 and $ 37.9 at June 29, 2024 and December 31, 2023, respectively.

Of these amounts, $ 29.7 and $ 29.4 are included in “Other long-term liabilities” within our condensed consolidated balance sheets at June 29, 2024 and December 31, 2023 , respectively, with the remainder included in “Accrued expenses.” The liabilities we record for these matters are based on a number of assumptions, including historical claims and payment experience.

While we base our assumptions on facts currently known to

us, they entail inherently subjective judgments and uncertainties.

As a result, our current assumptions for estimating these liabilities may not prove accurate, and we may be required to adjust these liabilities in the future, which could result in charges to earnings.

These variances relative to current expectations could have a material impact on our financial position and results of operations.

These variances relative to current expectations could have a material impact on our financial position and results of operations in future periods.

Large Power Projects in South Africa

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Refer to Note 3 for additional details.

in connection with delays on the Kusile project of South African Rand 126.6 (or $ 7.0 ) with such amount recorded to “Gain (loss) on disposition of discontinued operations, net of tax.”

Prior to the Settlement Agreement, DBT had experienced success in enforcing its rights through dispute resolution processes, including a favorable arbitration ruling during the first quarter of 2023 related to awards for costs incurred in connection with delays on the Kusile project of South African Rand 126.6 (or $ 7.0 ) with such amount recorded to “Gain (loss) on disposition of discontinued operations, net of tax” during the first quarter of 2023.

Further, in June 2023, the arbitration tribunal ruled DBT was entitled to recover $ 1.3 of legal costs incurred related to the arbitration.

Additionally, in May 2023, a separate arbitration tribunal ruled DBT was entitled to recover $ 5.5 of legal costs incurred related to another prior arbitration.

Such amounts were recorded within “Gain (loss) on disposition of discontinued operations, net of tax” during the quarter ended July 1, 2023.

Claim against Surety - On February 5, 2021, DBT received payment of $ 6.7 on bonds issued in support of performance by one of DBT’s subcontractors.

The subcontractor, currently in liquidation, maintains a right to seek recovery of such amount and, thus, the amount received by DBT has not been reflected in our condensed consolidated statements of operations.

Claim for Contingent Consideration Related to ULC Robotics (“ULC”) Acquisition

In connection with our acquisition of ULC in September 2020, the seller of ULC was eligible for additional cash consideration of up to $ 45.0 upon achievement of certain operating and financial performance milestones.

At the time of the acquisition, we recorded a liability of $ 24.3 , which represented the estimated fair value of the contingent consideration.

During the third quarter of 2021, we concluded that the operational and financial performance milestones noted above were not achieved and, thus, no amount is due to the seller.

On August 23, 2022, the seller of ULC initiated a breach-of-contract lawsuit against us in the United States District Court for the Eastern District of New York claiming that it is entitled to a portion of the additional cash consideration, linked to certain operating performance milestones, totaling $ 15.0 .

If successful with their claim, the plaintiff is also eligible to recover pre-judgement interest and attorney's fees in addition to the $ 15.0 claimed.

We have defenses against the claim and, thus, while we do not believe we have a probable loss associated with the claim, it is reasonably possible we may incur a loss associated with it.

Claim for Contingent Consideration Related to ULC Acquisition

In connection with our acquisition of ULC in September 2020, the seller of ULC was eligible to receive additional contingent consideration of up to $ 45.0 under an earn-out provision.

During the third quarter of 2021, we concluded that none of the milestones for the payment of any of the contingent consideration were achieved.

On May 20, 2024, we entered into a settlement agreement with the seller of ULC to resolve a lawsuit it commenced in August 2022 seeking contingent consideration of $ 15.0 , prejudgment interest on that amount, and attorney's fees.

The settlement agreement required a payment by us to the seller of ULC of $ 8.4 , which was paid during the second quarter of 2024, with a corresponding charge recorded within “Other operating expense, net” within the condensed consolidated statement of operations for the three and six months ended June 29, 2024.

We expect this payment to be tax deductible in future periods.

Resolution of Dispute with Former Representative

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Based on current information, we believe that our operations are in substantial compliance with applicable environmental laws and regulations, and we are not aware of any violations that could have a material effect, individually or in the aggregate, on our business, financial condition, and results of operations or cash flows.

We had liabilities for site investigation and/or remediation at 16 sites that we own or control, as of March 30, 2024 and December 31, 2023.

We had liabilities for site investigation and/or remediation at 16 sites that we own or control, or formerly owned and controlled, as of June 29, 2024 and December 31, 2023.

In addition, while we believe that we maintain adequate accruals to cover the costs of site investigation and/or remediation, we cannot provide assurance that new matters, developments, laws and regulations, or stricter interpretations of existing laws and regulations will not materially affect our business or operations in the future.

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Accordingly, our estimates may change based on future developments, including new or changes in existing environmental laws or policies, differences in costs required to complete anticipated actions from estimates provided, future findings of investigation or remediation actions, or alteration to the expected remediation plans.

It is our policy to revise an estimate once it becomes probable and the amount of change can be reasonably estimated.

It is our policy to revise an estimate once the revision becomes probable and the amount of change can be reasonably estimated.

We generally do not discount our environmental accruals and do not reduce them by anticipated insurance recoveries.

We take into account third-party indemnification from financially viable parties in determining our accruals where there is no dispute regarding the right to indemnification.

In the case of contamination at offsite, third-party disposal sites, as of March 30, 2024 and December 31, 2023, we have been notified that we are potentially responsible and have received other notices of potential liability pursuant to various environmental laws at 9 sites, at which the liability has not been settled, and all of which have been active in the past few years.

In the case of contamination at offsite, third-party disposal sites, as of June 29, 2024 and December 31, 2023, we have been notified that we are potentially responsible and have received other notices of potential liability pursuant to various environmental laws at 9 sites, at which the liability has not been settled and all of which have been active in the past few years.

These laws may impose liability on certain persons that are considered jointly and severally liable for the costs of investigation and remediation of hazardous substances present at these sites, regardless of fault or legality of the original disposal.

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We record a liability when it is both probable and the amount can be reasonably estimated.

In our opinion, after considering accruals established for such purposes of $ 24.1 at March 30, 2024 and December 31, 2023, the cost of remedial actions for compliance with the present laws and regulations governing the protection of the environment are not expected to have a material impact, individually or in the aggregate, on our financial position, results of operations or cash flows.

In our opinion, after considering accruals established for such purposes of $ 24.1 at June 29, 2024 and December 31, 2023, the cost of remedial actions for compliance with the present laws and regulations governing the protection of the environment are not expected to have a material impact, individually or in the aggregate, on our financial position, results of operations or cash flows.

Self-insured Risk Management Matters

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Uncertain Tax Benefits

As of March 30, 2024 , we had gross and net unrecognized tax benefi ts of $ 2.0 .

All of these net unrecognized tax benefits would impact our effective tax rate from continuing operations if recognized.

As of June 29, 2024 , we had gross and net unrecognized tax ben efits of $ 2.6 .

All of these unrecognized tax benefits would impact our effective tax rate from continuing operations if recognized.

We classify interest and penalties related to unrecognized tax benefits as a component of our income tax provision.

As of March 30, 2024, gross and net accrued interest totaled $ 1.3 .

As of March 30, 2024, we had no accrual for penalties included in our unrecognized tax benefits.

As of June 29, 2024, gross and net accrued interest totaled $ 1.3 .

As of June 29, 2024, we had no accrual for penalties included in our unrecognized tax benefits.

Based on the outcome of certain examinations or as a result of the expiration of statutes of limitations for certain jurisdictions, we do not believe that within the next 12 months our previously unrecognized tax benefits will decrease by a material amount.

The previously unrecognized tax benefits relate to a variety of tax matters including transfer pricing and various foreign matters.

The previously unrecognized tax benefits relate to a variety of tax matters including transfer pricing and various state matters.

Organization for Economic Co-operation and Development (“OECD”) Pillar Two Model Rules

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The Company is within the scope of the OECD Pillar Two model rules and is assessing the impact thereof.

As of March 30, 2024, we believe the implementation of these rules will not have a material impact on our financial results.

As of June 29, 2024, we believe the implementation of these rules will not have a material impact on our financial results.

Other Tax Matters

For the three months ended March 30, 2024, we recorded an income tax provision of $ 1.9 on $ 51.1 of pre-tax income from continuing operations, resulting in an effective rate of 3.7 %.

This compares to an income tax provision for the three months ended April 1, 2023 of $ 11.3 on $ 50.4 of pre-tax income from continuing operations, resulting in an effective rate of 22.4 %.

The most significant item impacting the income tax provision for the first quarters of 2024 and 2023 was $ 10.9 and $ 0.9 , respectively, of excess tax benefits resulting from stock-based compensation awards that vested and/or were exercised during the periods.

For the three months ended June 29, 2024, we recorded an income tax provision of $ 15.2 on $ 60.4 of pre-tax income from continuing operations, resulting in an effective rate of 25.2 %.

This compares to an income tax provision for the three months ended July 1, 2023 of $ 7.8 on $ 46.1 of pre-tax income from continuing operations, resulting in an effective rate of 16.9 %.

The most significant items impacting the income tax provision for the second quarters of 2024 and 2023 were (i) $ 0.5 of tax provision and $ 1.2 of tax benefit, respectively, related to revisions to liabilities for uncertain tax positions and (ii) $ 0.2 and $ 0.5 , respectively, of excess tax benefits associated with stock-based compensation awards that vested and/or were exercised during the periods.

In addition, the rate for the three months ended July 1, 2023 was favorably impacted by a tax benefit of $ 1.8 related to the release of valuation allowances recognized against certain deferred tax assets, as we now expect these deferred tax assets to be realized.

For the six months ended June 29, 2024, we recorded an income tax provision of $ 17.1 on $ 111.5 of pre-tax income from continuing operations, resulting in an effective rate of 15.3 %.

This compares to an income tax provision for the six months ended July 1, 2023 of $ 19.1 on $ 96.5 of pre-tax income from continuing operations, resulting in an effective rate of 19.8 %.

The most significant items impacting the income tax provision during the first half of 2024 and 2023 were (i) $ 11.1 and $ 1.4 , respectively, of excess tax benefits resulting from stock-based compensation awards that vested and/or were exercised during the periods and (ii) $ 0.5 of tax provision and $ 1.2 of tax benefit, respectively, related to revisions to liabilities for uncertain tax positions.

In addition, the 2023 rate was favorably impacted by a tax benefit of $ 1.8 related to the release of valuation allowances recognized against certain deferred tax assets, as we now expect these deferred tax assets to be realized.

We perform reviews of our income tax positions on a continuous basis and accrue for potential uncertain positions when we determine that an uncertain position meets the criteria of the Income Taxes Topic of the Codification.

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Contingent Consideration for the Ingénia Acquisition — In connection with the acquisition of Ingénia, the seller is eligible for additional cash consideration of up to CAD 3.0 (or $ 2.2 at the time of acquisition), with payment scheduled to be made in the event certain contingent liabilities do not materialize.

The estimated fair value of such contingent consideration is $ 0.3 , which is reflected as a liability in our condensed consolidated balance sheet as of March 30, 2024.

Goodwill, Indefinite-Lived Intangible and Other Long-Lived Assets — Certain of our non-financial assets are subject to impairment analysis, including long-lived assets, indefinite-lived intangible assets and goodwill.

We review the carrying

amounts of such assets whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable or at least annually for indefinite-lived intangible assets and goodwill.

Any resulting asset impairment would require that the instrument be recorded at its fair value.

Derivative Financial Instruments — Our financial derivative assets and liabilities include interest rate swaps and FX forward contracts, valued using valuation models based on observable market inputs such as forward rates, inte rest rates, our own credit risk and the credit risk of our counterparties, which comprise investment-grade financial institutions.

The estimated fair value of such contingent consideration is $ 0.3 , which is reflected as a liability in our condensed consolidated balance sheet as of June 29, 2024.

Goodwill, Indefinite-Lived Intangible and Other Long-Lived Assets — Certain of our non-financial assets are subject to impairment analyses, including long-lived assets, indefinite-lived intangible assets and goodwill.

We review the carrying amounts of such assets whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable or at least annually for indefinite-lived intangible assets and goodwill.

Any asset impairment would result in the asset being recorded at its fair value.

Derivative Financial Instruments — Our financial derivative assets and liabilities include interest rate swaps and FX forward contracts, and are valued using valuation models based on observable market inputs such as forward rates, inte rest rates, our own credit risk and the credit risk of our counterparties, which comprise investment-grade financial institutions.

Based on these inputs, the derivative assets and liabilities are classified within Level 2 of the valuation hierarchy.

We have not made any adjustments to the inputs obtained from the independent sources.

Based on our continued ability to enter into interest rate swaps and FX forward contracts, we consider the markets for our fair value instruments active.

Based on our continued ability to enter into forward contracts, we consider the markets for our fair value instruments active.

We primarily use the income approach, which uses valuation techniques to convert future amounts to a single present amount.

As of March 30, 2024, there has been no significant impact to the fair value of our derivative liabilities due to our own credit risk, as the related instruments are collateralized under our senior credit facilities.

As of June 29, 2024, there has been no significant impact to the fair value of our derivative liabilities due to our own credit risk, as the related instruments are collateralized under our senior credit facilities.

Similarly, there has been no significant impact to the fair value of our derivative assets based on our evaluation of our counterparties’ credit risks.

Equity Security — We estimate the fair value of an equity security that we hold utilizing a practical expedient under existing guidance, with such estimated fair value based on our ownership percentage applied to the net asset value as provided quarterly by the investee.

During the first quarter, the net asset value is updated based on the investee’s most recent audited financial statements.

During the three months ended March 30, 2024 and April 1, 2023, we recorded a loss of $ 4.2 and a gain of $ 3.6 , respectively, to “ Other income (expense), net ” to reflect the change in the estimated fair value of the equity security.

As of March 30, 2024 and December 31, 2023 , the equity security had an estimated fair value of $ 35.2 and $ 39.4 , respectively.

Indebtedness and Other — The estimated fair value of our debt instruments as of March 30, 2024 and December 31, 2023 approximated the related carrying values due primarily to the variable market-based interest rates for such instruments.

The value is updated annually, during the first quarter, based on the investee’s most recent audited financial statements.

Duri ng the three and six months ended June 29, 2024 and July 1, 2023, we recorded gains (losses) of $ 0.0 and $( 4.2 ), and $ 0.0 and $ 3.6 , respectively, to “Other income (expense), net” to reflect changes in the estimated fair value of the equity security.

As of June 29, 2024 and December 31, 2023, the equity security had an estimated fair value of $ 35.2 and $ 39.4 , respectively.

Indebtedness and Other — The estimated fair value of our debt instruments as of June 29, 2024 and December 31, 2023 approximated the related carrying values due primarily to the variable market-based interest rates for such instruments.

Se e Note 12 f or further details.

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