Company: GGG
Filing Date: 2025-04-23
Form Type: 10-Q
Source: 0000042888-25-000014
Chunk: 12

Company: GRACO INC
Filing Date: 2025-04-23
Form: 10-Q
Item: Item 1
Chunk 12
---
 to source products from local suppliers. We continue to analyze the impact of these global tariffs on our business and we are working to mitigate the impact of tariffs through pricing and sourcing strategies. We cannot be sure these strategies will effectively mitigate the impact of these costs and if we are unable to do so or if demand for our products otherwise decreases, we expect these new tariffs will have a material impact on our results of operations in fiscal year 2025. 

Consolidated Results

A summary of financial results follows (in millions except per share amounts):

 Three Months Ended     Mar 28,2025Mar 29,2024% ChangeNet Sales$528.3 $492.2 7 %Operating Earnings144.0 133.0 8 %Net Earnings124.1 122.2 2 %Net Earnings, adjusted (1)120.5 112.6 7 %Diluted Net Earnings per Common Share$0.72 $0.71 1 %Diluted Net Earnings per Common Share, adjusted (1)$0.70 $0.65 8 %

(1) See below for a reconciliation of adjusted non-GAAP financial measures to GAAP.

Net sales for the first quarter increased 7 percent from the comparable period last year. The effect of changes in currency translation rates reduced sales growth for the quarter by 2 percentage points. Sales from acquired operations contributed 6 percentage points of growth.

Operating expense leverage offset a lower gross margin rate resulting in an 8 percent increase in operating earnings for the first quarter from the comparable period last year.

15

Net earnings for the first quarter increased 2 percent compared to last year, as increased operating earnings and other income more than offset lower excess tax benefits from stock option exercises.

Excluding the impacts of excess tax benefits from stock option exercises presents a more consistent basis for comparison of financial results. A calculation of the non-GAAP adjusted measurements of income taxes, effective income tax rate, net earnings and diluted earnings per share follows (in millions except per share amounts):

Three Months EndedMarch 28,2025March 29,2024Earnings before income taxes$151.5 $140.3 Income taxes, as reported$27.4 $18.1 Excess tax benefit from option exercises3.6 9.6 Income taxes, adjusted$31.0 $27.7 Effective income tax rate   As reported18