Company: GGG
Filing Date: 2025-07-23
Form Type: 10-Q
Source: 0000042888-25-000025
Chunk: 38

Company: GRACO INC
Filing Date: 2025-07-23
Form: 10-Q
Item: Item 8
Chunk 38
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. Our global operating footprint and worldwide sales reach expose us to risks associated with trade conflicts between the U.S. and its trading partners. Escalating global trade conflicts could result in inflationary costs to manufacture, assemble and export our products. We may be required to increase prices to our customers, which may reduce demand, or if we do not or are unable to increase prices without reducing demand, we will experience reduced profitability. Continued geopolitical issues may cause customers outside of the U.S. seeking 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    Six Months Ended Jun 27,2025Jun 28,2024% ChangeJun 27,2025Jun 28,2024% ChangeNet Sales$571.8 $553.2 3 %$1,100.1 $1,045.4 5 %Operating Earnings157.5 161.4 (2)%301.5 294.4 2 %Net Earnings127.6 133.0 (4)%251.7 255.2 (1)%Net Earnings, adjusted (1)126.9 132.2 (4)%247.3 244.8 1 %Diluted Net Earnings per Common Share$0.76 $0.77 (1)%$1.48 $1.48 — %Diluted Net Earnings per Common Share, adjusted (1)$0.75 $0.77 (3)%$1.45 $1.42 2 %

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

Net sales for the second quarter increased 3 percent from the comparable period last year. Incremental sales from acquired operations contributed 6 percentage points of sales growth. EMEA and Asia Pacific sales growth was partially offset by a decrease in the Americas.

The gross profit margin rate declined approximately 2 percentage points for the