Company: GGG
Filing Date: 2025-10-22
Form Type: 10-Q
Source: 0000042888-25-000047
Chunk: 42

Company: GRACO INC
Filing Date: 2025-10-22
Form: 10-Q
Item: Item 8
Chunk 42
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643.4 $1,564.6 

(1)     North, South and Central America, including the United States

(2)    Europe, Middle East and Africa

The following table presents the components of net sales change by geographic region:

Three MonthsNine MonthsVolume and PriceAcquisitions CurrencyTotalVolume and PriceAcquisitions CurrencyTotalAmericas(1)%3%0%2%(2)%3%0%1%EMEA(5)%11%6%12%(1)%12%2%13%Asia Pacific(3)%10%0%7%3%9%(2)%10%Consolidated(2)%6%1%5%(1)%6%0%5%

Gross Profit

The gross profit margin rate was flat for the third quarter and decreased approximately 1 percentage point for the year to date from the comparable periods last year as price realization and favorable product and channel mix offset higher product costs and the unfavorable effects of lower margin rates from acquired operations for the quarter but unable to offset these items for the year to date. Higher product costs included increased tariff costs of $5 million for the quarter and $9 million for the year to date. Interim pricing actions in the third quarter began to offset the effects of increased tariff costs.

Operating Expenses

18

Total operating expenses decreased $6 million (5 percentage points) for the third quarter and decreased $3 million (1 percentage point) year to date and included a non-cash gain of $14 million from the reduction in fair value of acquisition-related contingent consideration. Incremental expenses from acquired operations of $10 million for the quarter and $29 million for the year to date were partially offset by decreases in product development spending and selling, marketing and distribution expenses.

Other (Income) Expense

Other non-operating income decreased $2 million for the third quarter from the comparable period last year largely due to decreased interest income. For the year to date, other non-operating income decreased $5 million compared to last year and included higher exchange losses on net liabilities of certain foreign operations of $8 million and decreased interest income of $7 million. Partially offsetting these year-to-date items were a $5 million gain in the first quarter from the sale of a former manufacturing and distribution facility in Switzerland and $1 million of favorable market valuation changes on investments held to fund certain retirement benefits. 

Income Taxes

The effective income tax rate was 18 percent for the third quarter and 19 percent for the year to date