Company: GGG
Filing Date: 2025-10-22
Form Type: 10-Q
Source: 0000042888-25-000047
Chunk: 43

Company: GRACO INC
Filing Date: 2025-10-22
Form: 10-Q
Item: Item 8
Chunk 43
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. Adjusted to exclude the impacts of certain non-recurring items (see Financial Results Adjusted for Comparability), the adjusted effective income tax rate of 20 percent for the quarter increased 1 percentage point from the comparable period last year due to the unfavorable effects of foreign earnings taxed at higher rates than the U.S. For the year to date, the adjusted effective tax rate of 20 percent was flat compared to the same period last year.

Segment Results

Certain measurements of segment operations compared to last year are summarized below:

Contractor Segment

The following table presents net sales and operating earnings as a percentage of sales for the Contractor segment 

(dollars in millions):

 Three Months Ended   Nine Months Ended September 26,2025September 27,2024September 26,2025September 27,2024Net SalesAmericas$186.1 $182.4 $563.4 $552.9 EMEA52.6 40.1 168.2 131.2 Asia Pacific23.7 19.8 74.8 57.9 Total$262.4 $242.3 $806.4 $742.0 Operating earnings as a percentage of net sales26 %29 %25 %30 %

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

Three MonthsNine MonthsVolume and PriceAcquisitionsCurrencyTotalVolume and PriceAcquisitions CurrencyTotalAmericas(3)%5%0%2%(4)%6%0%2%EMEA(1)%26%6%31%(3)%28%3%28%Asia Pacific(12)%33%(1)%20%(3)%34%(2)%29%Segment Total(3)%11%0%8%(3)%12%0%9%

Incremental sales from acquired operations in the Contractor segment for the third quarter and year to date were partially offset by sales declines in ongoing operations primarily due to continued weakness in worldwide construction markets. The operating margin rate declined 3 percentage points for the quarter and 5 percentage points for the year to date mainly due to higher product costs from increased tariffs and the unfavorable effects of lower margin rates of acquired operations. The rate of decline in operating margin lessened as price realization improved as the third quarter progressed.

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Industrial Segment

The following table presents net sales and operating earnings as a percentage of sales for the Industrial segment 

(dollars in millions):

 Three