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New words:
advertising, arrangement, broad, cloud, CODM, constituted, contact, County, deciding, decline, differentiate, disaggregation, edge, education, entity, Europe, existing, forecast, Fulton, import, knowledge, literature, longer, media, payable, print, proposed, quality, reconciliation, Regulation, remeasure, remove, Retrospective, retrospectively, Rule, scope, social, sought, spectrum, terminated, unrecognized, vision, vitality, wholly
Removed:
acquiring, added, benchmark, claim, column, combination, commitment, conflict, country, creating, depreciation, derivative, difficult, dismissal, Dollar, driven, earned, EBITDA, economy, effectively, estate, Estimating, evidential, expedient, fact, fewer, floating, global, globe, grid, hardware, hold, imposed, indeterminate, inherently, joint, largely, leverage, line, negatively, netting, originated, outcome, Overnight, pay, platform, practical, prejudice, projection, prospective, ratio, real, reduce, remaining, resolved, response, restructuring, resulted, Russia, secured, skylight, small, SOFR, strong, temporary, Ukraine, uncertainty, unrestricted, variety, voluntary
Financial report summary
?Risks
- Our business and results have been and may be adversely affected by fluctuations in the cost or availability of raw materials, components, purchased finished goods, or services.
- Our results may be adversely affected by market and competitive pricing.
- Innovations of new products and services may not yield desired returns.
- We may not be able to identify, finance, and complete suitable acquisitions, alliances, or investments, and we may pursue future growth through acquisitions, alliances, or investments, which may not yield anticipated benefits.
- We may experience difficulties in streamlining activities, which could impact shipments to customers, product quality, and the realization of expected savings from streamlining actions.
- General business, political, and economic conditions, including the strength of the construction and renovation market, political events, or other factors may affect demand for our products and services.
- Technological developments and increased competition could affect our operating profit margins and sales volume.
- We may be unable to sustain significant customer and/or channel partner relationships.
- We could be adversely affected by external disruptions to our operations.
- Company operating systems, information systems, or devices have experienced, and may experience in the future, a failure, a compromise of security, or a violation of data privacy laws or regulations, which could adversely impact our operations as well as the effectiveness of internal controls over operations and financial reporting.
- Changes in our relationship with employees, changes in U.S. or international employment regulations, an inability to attract and retain talented employees, or a loss of key employees could adversely impact the effectiveness of our operations.
- There are inherent risks in our solutions and services businesses.
- We may be subject to risk in connection with third-party relationships necessary to operate our business.
- We are subject to risks related to operations and suppliers outside the United States.
- Our business could be negatively impacted by social impact and sustainability matters.
- We have begun to incorporate artificial intelligence capabilities in our product offerings, and challenges with properly managing the use of artificial intelligence and machine learning could result in reputational harm, competitive harm, and legal liability, and adversely affect our results of operations, financial condition, and/or cash flows.
- Failure to comply with the broad range of standards, laws, and regulations in the jurisdictions in which we operate may result in exposure to substantial disruptions, costs, and liabilities.
- We may develop unexpected legal contingencies or matters that exceed insurance coverage.
- If our products are improperly designed, manufactured, packaged, or labeled, or are otherwise alleged to cause harm or injury, we may need to recall those items, may have increased warranty costs, and could be the target of product liability claims.
- We may not be able to adequately protect our intellectual property and could be the target of intellectual property claims.
- We are exposed to certain regulatory, financial and other risks related to climate change and other sustainability matters.
- Tax liabilities due in the jurisdictions in which we operate may exceed anticipated amounts.
- The market price and trading volume of our shares may be volatile.
- Risks related to our defined benefit retirement plans may adversely impact results of operations and cash flows.
- Our business and operations are subject to interest rate risks, and changes in interest rates can reduce demand for our products and increase borrowing costs.
- The instability of certain financial institutions may have adverse impacts on certain of our vendors and customers and/or on our ability to access our cash deposits, which could negatively impact our cash flows, results of operations, and financial condition.
Management Discussion
- Net sales for the first quarter of fiscal 2024 decreased $63.2 million, or 6.3%, to $934.7 million, compared with $997.9 million in the prior-year period due to a decline in sales within our ABL segment, partially offset by higher sales within our ISG segment. The fiscal 2023 acquisition of KE2 Therm and divestiture of our Sunoptics business did not have meaningful impacts on consolidated net sales for the first quarter of fiscal 2024.
- Gross profit for the first quarter of fiscal 2024 increased $11.9 million, or 2.9%, to $428.4 million, compared with $416.5 million in the prior-year period, and gross profit margin increased 410 basis points to 45.8% from 41.7% compared with the prior-year period. Our gross profit increased compared with the prior period due primarily to favorable material and import costs, partially offset by higher labor, overhead, and quality costs as well as the fall through of the net sales decline.
- Selling, distribution, and administrative expenses (“SD&A”) expenses for the first quarter of fiscal 2024 were $295.5 million, compared with $300.7 million in the prior-year period, a decrease of $5.2 million, or 1.7%. The decrease in SD&A expenses was due primarily to lower commissions, freight costs, and amortization, partially offset by higher employee-related costs. Amortization expense of definite-lived intangibles decreased in fiscal 2024 as we recorded $4.0 million of accelerated amortization for intangibles associated in fiscal 2023 with certain brands that were discontinued.