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What changed in Hillenbrand, Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Hillenbrand, Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+354 added−380 removedSource: 10-K (2024-11-19) vs 10-K (2023-11-15)

Top changes in Hillenbrand, Inc.'s 2024 10-K

354 paragraphs added · 380 removed · 283 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

81 edited+23 added−23 removed84 unchanged
Biggest changeCapital Allocation Framework Our capital allocation framework is built around three core priorities in the following order: • Safety and financial sustainability ◦ Maintaining adequate liquidity to support and sustain our ongoing operations; ◦ Honoring our current dividend policy, which provides an attractive cash return to our shareholders. • Growing our business ◦ Reinvesting in the business organically to drive innovation, growth, and operating efficiency; ◦ Enhancing our growth with strategic acquisitions that expand our technological capabilities, accelerate scale in key end markets or geographies, and provide an appropriate return for our shareholders; ◦ Maintaining an appropriate capital structure with a net debt to adjusted EBITDA target range of 1.7x to 2.7x. • Return capital ◦ Periodic opportunistic share repurchases to return capital to our shareholders. 5 Table of Contents Given the acquisitions completed in fiscal year 2023, we intend to continue to prioritize cash flow deployment to pay down debt, invest in organic initiatives for growth and operating efficiencies, as well as integration-related activities.
Biggest changeCapital Allocation Framework Our capital allocation framework is built around three core priorities in the following order: • Safety and financial sustainability ◦ Maintaining adequate liquidity to support and sustain our ongoing operations; ◦ Maintaining an appropriate capital structure with a net debt to consolidated adjusted earnings before interest, income tax, depreciation, and amortization (“adjusted EBITDA”) target range of 1.7x to 2.7x. • Growing our business ◦ Reinvesting in the business organically to drive innovation, growth, and operating efficiency; ◦ Enhancing our growth with strategic acquisitions that expand our technological capabilities, accelerate scale in key end markets or geographies, and provide an appropriate return for our shareholders • Return capital ◦ Providing cash return to our shareholders through our dividend; ◦ Opportunistic share repurchases to return capital to our shareholders.
Driving Growth Our growth is driven by several key factors, including: • Our leading positions in large, attractive end markets that are supported by long-term macro demand trends, including the expanding global middle class, the desire for more sustainable products and solutions, and the evolution of the global supply chain; • Our strong global footprint and large installed base, which supports profitable aftermarket expansion; and • A disciplined mergers and acquisitions framework that accelerates our growth with a focus on leading brands that enhance our technological capabilities and build scale in key end markets and/or geographies.
Driving Long-Term Growth Our growth is driven by several key factors, including: • Our leading positions in large, attractive end markets that are supported by long-term macro demand trends, including the expanding global middle class, the desire for more sustainable products and solutions, and the evolution of the global supply chain; • Our strong global footprint and large installed base, which supports profitable aftermarket expansion; and • A disciplined mergers and acquisitions framework that accelerates our growth with a focus on leading brands that enhance our technological capabilities and build scale in key end markets or geographies.
Its highly engineered capital equipment and systems offerings require aftermarket service and/or parts replacement, providing an opportunity for ongoing revenue at attractive margins.
Its highly engineered capital equipment and systems offerings require aftermarket service or parts replacement, providing an opportunity for ongoing revenue at attractive margins.
Molding Technology Solutions: Products and Services Molding Technology Solutions has a product portfolio that includes injection molding and extrusion equipment and hot runner systems and process controller technology. Molding Technology Solutions maintains leadership positions across these product lines, as well as leading positions in process control systems, mold bases and components, and MRO supplies.
Molding Technology Solutions: Products and Services Molding Technology Solutions has a product portfolio that includes injection molding and extrusion equipment as well as hot runner systems and process controller technology. Molding Technology Solutions maintains leadership positions across these product lines, as well as leading positions in process control systems, mold bases and components, and MRO supplies.
Molding Technology Solutions: Strategy Molding Technology Solutions seeks to execute its strategy through the following initiatives: • Strengthen leadership positions in global markets ◦ Leverage core technologies and applications expertise to expand presence in current end markets. ◦ Leverage Hillenbrand’s strong positions across the plastics value chain to cross-sell product lines. ◦ Expand product offering in key end markets, including emerging markets and new segments for sustainability such as recycling and biodegradable plastics. • Drive innovation and new product development ◦ Provide innovative product and service solutions to solve customers’ challenges, leveraging shared research and development and technology across the enterprise. ◦ Develop new products that are focused on solidifying Molding Technology Solutions’ current market positions and expanding the market through the introduction of technology that displaces other materials, primarily metal and glass. ◦ Provide value-added end-to-end solutions from individual components to integrated systems. ◦ Enable the customer to fulfill sustainability requirements (e.g., reduction of virgin resin). • Leverage HOM to drive margin expansion and profitable growth ◦ Apply HOM principles and tools, including voice of customer and segmentation with a goal to drive profitable growth. ◦ Leverage Hillenbrand’s global footprint and enhance support to customers through the entire lifecycle of their equipment usage to expand sales of aftermarket parts and services. ◦ Drive global supply strategy to achieve supply chain and operating efficiencies to improve cost and quality. 13 Table of Contents ◦ Enhance productivity through process standardization.
Molding Technology Solutions: Strategy Molding Technology Solutions seeks to execute its strategy through the following initiatives: • Strengthen leadership positions in global markets ◦ Leverage core technologies and applications expertise to expand presence in current end markets. ◦ Leverage Hillenbrand’s strong positions across the plastics value chain to cross-sell product lines. ◦ Expand product offering in key end markets, including emerging markets and new segments such as recycling and biodegradable plastics. 13 Table of Contents • Drive innovation and new product development ◦ Provide innovative product and service solutions to solve customers’ challenges, leveraging shared research and development and technology across the enterprise. ◦ Develop new products that are focused on solidifying Molding Technology Solutions’ current market positions and expanding the market through the introduction of technology that displaces other materials, primarily metal and glass. ◦ Provide value-added end-to-end solutions from individual components to integrated systems. ◦ Enable the customer in key end markets to fulfill sustainability requirements (e.g., reduction of virgin resin). • Leverage HOM to drive margin expansion and profitable growth ◦ Apply HOM principles and tools, including voice of customer and segmentation with a goal to drive profitable growth. ◦ Leverage Hillenbrand’s global footprint and enhance support to customers through the entire lifecycle of their equipment usage to expand sales of aftermarket parts and services. ◦ Drive global supply strategy to achieve operating efficiencies to improve cost and quality. ◦ Enhance productivity through process standardization.
We believe Advanced Process Solutions has attractive fundamentals including: • Strong product and technology positions with substantial brand value and recognition; • Industry-leading applications and engineering expertise; • Comprehensive solutions capabilities through a differentiated suite of complementary processing technologies; • A large installed base that supports an aftermarket parts and service business with historically stable revenue and attractive margins; • A customer base that is highly diversified, including a strong history of long-term relationships with blue-chip end user customers; and • A strong global footprint for sales, manufacturing, engineering, and service, including established operations in high growth countries such as India and China.
We believe Advanced Process Solutions has attractive fundamentals including: • Strong product and technology positions with substantial brand value and recognition; • Industry-leading applications and engineering expertise; • Comprehensive solutions capabilities through a differentiated suite of complementary processing technologies; • A large installed base that supports an aftermarket parts and service business with historically stable revenue and attractive margins; • A customer base that is highly diversified, including a strong history of long-term relationships with blue-chip end user customers; and • A strong global footprint for sales, manufacturing, engineering, and service, including established operations in high growth countries such as India.
We also make available through the “Investors” section of this website information related to the corporate governance of the Company, including position specifications for the Chairperson and each of the members of the Board of Directors, as well as for committee chairpersons; the Corporate Governance Standards of our Board of Directors; the charters of each of the standing committees of the Board of Directors; our Code of Ethical Business Conduct; our Global Anti-Corruption Policy; and our Supply Chain Transparency Policy.
We also make available through the “Investors” section of this website information related to the corporate governance of the Company, including position specifications for the Chairperson and each of the members of the Board of Directors, as well as for committee chairpersons and vice chairpersons; the Corporate Governance Standards of our Board of Directors; the charters of each of the standing committees of the Board of Directors; our Code of Ethical Business Conduct; our Global Anti-Corruption Policy; and our Supply Chain Transparency Policy.
The proprietary equipment is highly engineered and designed to solve the needs of customers for customized solutions. Material handling equipment is sold to a variety of industries, including plastics, food and pharmaceuticals, chemicals, and minerals. With the acquisition of FPM in 2023, the Company offers expanded material handling capabilities in each of these industries.
The proprietary equipment is highly engineered and designed to solve the needs of customers for customized solutions. Material handling equipment is sold to a variety of industries, including plastics, food and pharmaceuticals, chemicals, minerals, and recycling. With the acquisition of FPM in 2023, the Company offers expanded material handling capabilities in each of these industries.
Finally, we provide you a brief background on our executive officers so that you can understand their experience and qualifications. GENERAL Hillenbrand ( www.Hillenbrand.com ) is a global industrial company that provides highly-engineered processing equipment and solutions to customers around the world.
Finally, we provide you with a brief background on our executive officers so that you can understand their experience and qualifications. GENERAL Hillenbrand ( www.Hillenbrand.com ) is a global industrial company that provides highly-engineered processing equipment and solutions to customers around the world.
Advanced Process Solutions: Strategy Advanced Process Solutions seeks profitable growth through the following strategic initiatives: • Strengthen leadership positions and build targeted platforms 10 Table of Contents ◦ Grow platforms to critical mass to achieve benefits of leadership and scale in attractive end markets organically and through acquisitions. ◦ Capitalize on emerging trends in end markets such as food, recycling, and biopolymers. ◦ Leverage global footprint to provide leading aftermarket support to customers. • Drive innovation and new product development ◦ Provide innovative product and service solutions to solve customers’ challenges. ◦ Extend applications expertise to win in adjacent markets with high growth potential. ◦ Develop new products driven by voice of customer input and changing needs. ◦ Provide value-added end-to-end solutions from individual components to integrated systems. • Leverage HOM to drive margin expansion and profitable growth ◦ Apply HOM principles and tools, including voice of customer and segmentation, for profitable growth. ◦ Drive best-in-class lead times to grow share in aftermarket business. ◦ Implement strategic supplier relationships to improve cost and quality. ◦ Enhance productivity through process standardization.
Advanced Process Solutions: Strategy Advanced Process Solutions seeks profitable growth through the following strategic initiatives: • Strengthen leadership positions and build targeted platforms ◦ Grow platforms to critical mass to achieve benefits of leadership and scale in attractive end markets organically and through acquisitions. ◦ Capitalize on emerging trends in end markets such as food, recycling, and biopolymers. ◦ Leverage global footprint to provide leading aftermarket support to customers. • Drive innovation and new product development ◦ Provide innovative product and service solutions to solve customers’ challenges. ◦ Extend applications expertise to win in adjacent markets with high growth potential. ◦ Develop new products driven by voice of customer input and changing needs. ◦ Provide value-added end-to-end solutions from individual components to integrated systems. • Leverage HOM to drive margin expansion and profitable growth ◦ Apply HOM principles and tools, including voice of customer and segmentation, for profitable growth. ◦ Drive best-in-class lead times to grow share in aftermarket business. ◦ Implement strategic supplier relationships to improve cost and quality. ◦ Enhance productivity through process standardization.
From mechanical processing — shredding, washing, separating, drying, and agglomerating of plastics — to bulk material handling, feeding and extrusion, as well as compounding and pelletizing, our product offering encompasses the complete process chain.
From mechanical processing — shredding, washing, separating, drying, and agglomerating of plastics — to bulk material handling, feeding and extrusion, as well as compounding and pelletizing, our recycling product offering encompasses the complete process chain.
Item 1. BUSINESS In this section of the Form 10-K, we provide you a general overview of the Company, including a high-level review of our reportable segments and how we operate.
Item 1. BUSINESS In this section of the Form 10-K, we provide you with a general overview of the Company, including a high-level review of our reportable segments and how we operate.
Outside of the U.S., Hillenbrand provides an array of benefits to support employees and their families. These include benefits such as paid leaves of absence, medical insurance, disability coverage and life insurance, among others. Hillenbrand is committed to attracting, developing, engaging, and retaining the best people from around the world to make our businesses run and grow.
Outside of the U.S., Hillenbrand offers an array of benefits to support employees and their families. These include benefits such as paid leaves of absence, medical insurance, disability coverage and life insurance, among others. Hillenbrand is committed to attracting, developing, engaging, and retaining the best people from around the world to make our businesses run and grow.
We believe that long-term growth for this segment is driven by megatrends such as a rapidly growing middle class in China and India and a growing global population, resulting in rising demand for products sold in many of the end markets that Advanced Process Solutions serves, including plastic goods, food, and recycling.
We believe that long-term growth for this segment is driven by megatrends such as a rapidly growing middle class in certain geographies, such as China and India and a growing global population, resulting in rising demand for products sold in many of the end markets that Advanced Process Solutions serves, including plastic goods, food, and recycling.
We also own a number of trademarks and service marks relating to products and services which are of importance. We believe the marks Coperion, Coperion K-Tron, K-Tron, Rotex, BM&M, Herbold, VMI, Bakon, Shaffer, Peerless, Shick Esteve, Unifiller, and DIOSNA brands are material to our Advanced Process Solutions reportable operating segment.
We also own a number of trademarks and service marks relating to products and services which are of importance. We believe the marks Coperion, Coperion K-Tron, K-Tron, Rotex, BM&M, Herbold, VMI, Bakon, Shaffer, Peerless, Shick Esteve, Unifiller, DIOSNA, and Coperion Food Equipment brands are material to our Advanced Process Solutions reportable operating segment.
(aerospace) and General Dynamics Corporation (aerospace and defense). J. Michael Whitted, 51 , was elected Senior Vice President, Strategy and Corporate Development effective June 2018. Prior to joining the Company, Mr. Whitted served as Vice President, Corporate Development for SPX Corporation and SPX Flow, Inc., diversified global suppliers of infrastructure equipment to various industries, from 2001 to 2015.
(aerospace) and General Dynamics Corporation (aerospace and defense). J. Michael Whitted, 52 , was elected Senior Vice President, Strategy and Corporate Development effective June 2018. Prior to joining the Company, Mr. Whitted served as Vice President, Corporate Development for SPX Corporation and SPX Flow, Inc., diversified global suppliers of infrastructure equipment to various industries, from 2001 to 2015.
Molding Technology Solutions has long-standing relationships with its largest customers, having served many of them for over 30 years. No one Molding Technology Solutions customer accounted for more than 10% of Hillenbrand’s consolidated net revenue during the years ended September 30, 2023, 2022, or 2021.
Molding Technology Solutions has long-standing relationships with its largest customers, having served many of them for over 30 years. No one Molding Technology Solutions customer accounted for more than 10% of Hillenbrand’s consolidated net revenue during the years ended September 30, 2024, 2023, or 2022.
Soni, 50, was elected Senior Vice President, Chief Information Officer effective January 2023, prior to which he served as Vice President, Chief Information Officer beginning May 2017. Mr. Soni joined the Company from Honda Aircraft Company, a jet airplane manufacturer, where he served as Chief Information Officer – IT & Engineering Systems Division from 2015 to 2017.
Soni, 51, was elected Senior Vice President, Chief Information Officer effective January 2023, prior to which he served as Vice President, Chief Information Officer beginning May 2017. Mr. Soni joined the Company from Honda Aircraft Company, a jet airplane manufacturer, where he served as Chief Information Officer – IT & Engineering Systems Division from 2015 to 2017.
Advance Process Solutions continues to identify and qualify alternative sources to mitigate risk associated to single or sole source supply continuity, and has and may continue to purchase certain materials in safety stock where we have supply chain continuity concerns.
Advanced Process Solutions continues to identify and qualify alternative sources to mitigate risk associated to single or sole source supply continuity, and has and may continue to purchase certain materials in safety stock where we have supply chain continuity concerns.
Prior to that he served in various roles of increasing responsibility over approximately 15 years at Johnson Controls, including as Chief Financial Officer of Yangfeng Automotive Interiors in Shanghai, China, where he lived for five years. Prior to Johnson Controls, Mr. VanHimbergen spent nearly a decade at Pricewaterhouse Coopers LLP working with large multinational manufacturing companies. Mr.
Prior to that he served in various roles of increasing responsibility over approximately 15 years at Johnson Controls, including as Chief Financial Officer of Yangfeng Automotive Interiors in Shanghai, China, where he lived for five years. Prior to Johnson Controls, Mr. VanHimbergen spent nearly a decade at Pricewaterhouse Coopers LLP working with large multinational manufacturing companies. Since October 2015, Mr.
Except as set forth above and solely for convenience, the trademarks, trade names or service marks in this Annual Report on Form 10-K are generally referred to without the ™ and ® symbols, but such references should not be construed as any indicator that their respective owners will not assert their rights thereto.
Except as set forth above and solely for convenience, the trademarks, trade names or service marks in this Form 10-K are generally referred to without the ™ and ® symbols, but such references should not be construed as any indicator that their respective owners will not assert their rights thereto.
Recurring sales are supported by a large installed base of hot runner systems worldwide. • Mold components 11 Table of Contents ◦ Molding Technology Solutions designs, manufactures, and sells high-quality mold bases and plates available in various configurations to meet the needs of customers for a variety of applications under the DME ® brand.
Recurring sales are supported by a large installed base of hot runner systems worldwide. • Mold bases and components ◦ Molding Technology Solutions designs, manufactures, and sells high-quality mold bases and plates available in various configurations to meet the needs of customers for a variety of applications under the DME ® brand.
The cost or need for any such additional expenditure is not known. INFORMATION ABOUT OUR EXECUTIVE OFFICERS Our Board of Directors is responsible for electing the Company’s executive officers annually and from time to time as necessary. Executive officers serve in the ensuing year and until their respective successors are elected and qualified.
The cost or need for any such additional expenditure is not known. 14 Table of Contents INFORMATION ABOUT OUR EXECUTIVE OFFICERS Our Board of Directors is responsible for electing the Company’s executive officers annually and from time to time as necessary. Executive officers serve in the ensuing year and until their respective successors are elected and qualified.
Though backlog can be an indicator of future net revenue, it does not include projects and aftermarket orders that are booked and shipped within the same quarter. The timing of order placement, size of order, extent of customization, and customer delivery dates can create fluctuations in backlog and net revenue.
Though backlog can be an 9 Table of Contents indicator of future net revenue, it does not include projects and aftermarket orders that are booked and shipped within the same quarter. The timing of order placement, size of order, extent of customization, and customer delivery dates can create fluctuations in backlog and net revenue.
Customers purchasing injection molding or extrusion machines generally pay a deposit and make progress payments prior to shipment. Molding Technology Solutions’ net revenue is further diversified by end markets, and continued expansion into these end markets is an important element of its strategy.
Customers purchasing injection molding or extrusion machines generally pay a deposit and make progress payments prior to shipment. 12 Table of Contents Molding Technology Solutions’ net revenue is further diversified by end markets, and continued expansion into these end markets is an important element of its strategy.
Prior to that, he served as a Vice President for Bear Stearns (investment banking) from 1998 to 2001, where he led corporate finance and M&A advisory transactions. Mr. Whitted’s experience prior to Bear Stearns included corporate finance and M&A advisory roles at CIBC World Markets, Bankers Trust, and First Chicago NBD (investment banks). Megan A.
Prior to that, he served as a Vice President for Bear Stearns from 1998 to 2001, where he led corporate finance and M&A advisory transactions. Mr. Whitted’s experience prior to Bear Stearns included corporate finance and M&A advisory roles at CIBC World Markets, Bankers Trust, and First Chicago NBD. Megan A.
These extrusion products are sold under the Coperion ® brand. ◦ Material handling equipment includes pneumatic and hydraulic conveying equipment for difficult-to-move materials; high-precision feeders that can operate at both very high and very low fill rates; blenders for pellets and powders; and rotary valves, diverter valves, and slide-gate valves used for feeding, dosing, discharge, and distribution during pneumatic conveying.
These extrusion products are sold under the Coperion ® brand. 8 Table of Contents ◦ Material handling equipment includes pneumatic and hydraulic conveying equipment for difficult-to-move materials; high-precision feeders that can operate at both very high and very low fill rates; blenders for pellets and powders; and rotary valves, diverter valves, and slide-gate valves used for feeding, dosing, discharge, and distribution during pneumatic conveying.
Walke began her career with nearly a decade in public accounting at the firm of Ernst and Young LLP. Since 2013, she has also served as a member of the Board of Trustees of Oldenburg Academy, a private high school in Indiana. Ms. Walke also serves on the board of the Ripley County Community Foundation since February 2023.
Walke began her career with nearly a decade in public accounting at the firm of Ernst and Young LLP. She served as a member of the Board of Trustees of Oldenburg Academy, a private high school in Indiana, from 2013 to 2024. Ms. Walke also has served on the board of the Ripley County Community Foundation since February 2023.
Mental health care is a covered service under all U.S. Company medical plans, including inpatient care facility services, inpatient professional services, office visits, and outpatient care. Hillenbrand recognizes the importance of preparing for retirement. Employees are encouraged to participate in their own retirement savings where available.
Mental health care is a covered service under all U.S. company medical plans, including inpatient care facility services, inpatient professional services, office visits, and outpatient care. Hillenbrand recognizes the importance of preparing for retirement. Employees are encouraged to participate in their own retirement savings where available. In the U.S., most employees are eligible to participate in company 401(k) savings plans.
Molding Technology Solutions: Competition Molding Technology Solutions holds leading positions in key industries because of design and quality of products, extensive application and process engineering expertise, product support services, brand name recognition, and commitment to serving the broad needs of customers. 12 Table of Contents Molding Technology Solutions brands face strong competition in the markets where they compete.
Molding Technology Solutions: Competition Molding Technology Solutions holds leading positions in key industries because of design and quality of products, extensive application and process engineering expertise, product support services, brand name recognition, and commitment to serving the broad needs of its customers. Molding Technology Solutions brands face strong competition in the markets where they compete.
Prior to joining Hillenbrand, she served most recently as President of the Pumps Division at Flowserve Corporation, a manufacturer of pumps, valves, and seals, beginning in September 2020.
Prior to joining Hillenbrand, she served most recently as President of the Pumps Division at 15 Table of Contents Flowserve Corporation, a manufacturer of pumps, valves, and seals, beginning in September 2020.
Products are offered under brand names that are recognized as being among the leaders in their respective industries. • Injection molding and extrusion equipment ◦ Molding Technology Solutions designs, manufactures and sells plastic processing equipment and systems, which include injection molding, extrusion and auxiliary systems.
Products are offered under brand names that are recognized as being among the leaders in their respective industries. 11 Table of Contents • Injection molding and extrusion equipment ◦ Molding Technology Solutions designs, manufactures and sells plastic processing equipment and systems, which include injection molding, extrusion and auxiliary systems.
Molding Technology Solutions Molding Technology Solutions is a global leader in highly-engineered equipment, systems, and aftermarket parts and service for the plastic technology processing industry. Molding Technology Solutions has a comprehensive product portfolio that includes injection molding and extrusion equipment, hot runner systems, process control systems, mold bases and components, and maintenance, repair, and operating (“MRO”) supplies.
Molding Technology Solutions Molding Technology Solutions is a global leader in highly-engineered equipment, systems, and aftermarket parts and service for the plastic technology processing industry. Molding Technology Solutions has a comprehensive product portfolio that includes injection molding and extrusion equipment, hot runner systems, process control systems, mold bases and components, and MRO supplies.
We believe Molding Technology Solutions’ strong global presence positions it well to benefit from this growth. Molding Technology Solutions has made significant investments in China and India in order to capitalize on the projected growth in plastics in these markets and expects to further expand in Mexico as well.
We believe Molding Technology Solutions’ strong global presence positions it well to benefit from this growth. Molding Technology Solutions has made significant investments in China and India in order to capitalize on the projected growth in plastics in these markets.
There are no family relationships between any of our executive officers or between any of them and any members of the Board of Directors. The following is a list of our executive officers as of November 15, 2023. Kimberly K. Ryan, 56, has served as a director and as President and Chief Executive Officer of the Company since December 2021.
There are no family relationships between any of our executive officers or between any of them and any members of the Board of Directors. The following is a list of our executive officers as of November 19, 2024. Kimberly K. Ryan, 57, has served as a director and as President and Chief Executive Officer of the Company since December 2021.
The Molding Technology Solutions product lines are supported by aftermarket parts and services, which represented approximately 28% of Molding Technology Solutions’ total net revenue during fiscal 2023.
The Molding Technology Solutions product lines are supported by aftermarket parts and services, which represented approximately 38% of Molding Technology Solutions’ total net revenue during fiscal 2024.
Advanced Process Solutions’ product lines are supported by aftermarket parts and services, which represented approximately 28% of Advanced Process Solutions’ total net revenue during fiscal 2023.
Advanced Process Solutions’ product lines are supported by aftermarket parts and services, which represented approximately 33% of Advanced Process Solutions’ total net revenue during fiscal 2024.
We believe that our average employee tenure across the globe — 10.1 years as of the end of fiscal 2023 — reflects the high engagement and dedication of our employees. Our talent acquisition team uses internal and external resources to recruit highly skilled and talented employees, and we encourage employee referrals for open positions.
We believe that our average employee tenure across the globe — 10.4 years as of the end of the fiscal year 2024 — reflects the high engagement and dedication of our employees. Our 6 Table of Contents talent acquisition team uses internal and external resources to recruit highly skilled and talented employees, and we encourage employee referrals for open positions.
These trends include increased use of lightweight plastics in the automotive industry to improve fuel efficiency; more effective packaging in emerging markets to improve food shelf life, freshness, and safety; increased consumption of processed foods in emerging markets; innovation in a variety of applications in the medical space designed to improve safety, drug and therapy delivery, and durability; increased use of engineered plastics in construction that are more durable, lightweight and require little maintenance; increased use of biopolymers to help preserve the environment; and more sustainable food sources such as plant-based proteins.
These trends include increased use of lightweight plastics in the automotive industry which helps reduce emissions; more effective packaging in emerging markets to improve food shelf life, freshness, and safety; increased consumption of processed foods in emerging markets; innovation in a variety of applications in the medical space designed to improve safety, drug and therapy delivery, and durability; increased use of engineered plastics in construction that are more durable, lightweight and require little maintenance; increased use of biopolymers to help meet customer content goals; and more sustainable food sources such as plant-based proteins.
She began her career as an auditor at accounting firm Arthur Andersen LLP. From May 2019 through December 2022, Ms. Morytko served on the board for The Crosby Group (rigging, lifting, and material handling applications), a KKR company.
She began her career as an auditor at accounting firm Arthur Andersen LLP. From May 2019 through December 2022, Ms. Morytko served on the board for The Crosby Group (rigging, lifting, and material handling applications), a KKR company, as well as Pioneer Energy Services (oilfield services applications), a former publicly traded company.
We focus many benefit programs on employee wellness and have implemented solutions including onsite wellness centers, mental health support, telemedicine, and healthy weight loss programs. We believe that these solutions have helped us successfully manage healthcare and prescription drug costs for our employee population. Hillenbrand believes in supporting employee’s mental health in addition to physical well-being.
We focus many benefit programs on employee wellness and have implemented solutions including a biometric screening program, mental health support, and telemedicine. We believe that these solutions have helped us successfully manage healthcare and prescription drug costs for our employee population. Hillenbrand believes in supporting employee’s mental health in addition to physical well-being.
No one Advanced Process Solutions customer accounted for more than 10% of Hillenbrand’s consolidated net revenue during the years ended September 30, 2023, 2022, or 2021. For large or customized orders, customers generally pay a deposit and make progress payments in accordance with the project progress.
No one Advanced Process Solutions customer accounted for more than 10% of Hillenbrand’s consolidated net revenue during the years ended September 30, 2024, 2023, or 2022. For large or customized orders, customers generally pay a deposit and make progress payments in accordance with the project progress. Often, long-term relationships are established with these customers.
The Company’s goal is to continue developing Hillenbrand as a world-class global industrial company through the deployment of the HOM to drive product innovation, best-in-class pricing and commercial practices, and margin enhancement through productivity and integration-related synergy realization. Sustainability Sustainability is a key component of the HOM.
The Company’s goal is to continue developing Hillenbrand as a world-class global industrial company through the deployment of the HOM to drive product innovation, best-in-class pricing and commercial practices, and margin enhancement through productivity and integration-related synergy realization. Sustainability Hillenbrand’s sustainability program is overseen by the Board of Directors.
Among other things, we believe climate change will require meaningful action on a global scale, and we expect that further developing our understanding of our energy consumption and emissions will be an important part of examining the challenges posed by climate change. To date, our costs relating to addressing climate change have not been material.
Among other things, we believe climate change will require meaningful action on a global scale, and we expect that further developing our understanding of our energy consumption and emissions will be an important part of examining the challenges posed by climate change.
Walke, 44, was elected Vice President, Chief Accounting Officer in May 2022, after serving in an interim capacity beginning February 2022. Prior to that time, she served as the Company’s Director, Financial Reporting since August 2014 and prior to that in roles of increasing responsibility in the Company’s finance organization. Ms.
Walke, 45, was elected Vice President, Chief Accounting Officer in May 2022. Prior to that time, she served as the Company’s Director, Financial Reporting since August 2014 and prior to that in roles of increasing responsibility in the Company’s finance organization. Ms.
In everything we do, we strive to provide great professional opportunities for our people and recognize the critical role our human capital plays in supporting our strategy. As Hillenbrand acquires companies, it will take time to integrate them into our overall programs.
In everything we do, we strive to provide great professional opportunities for our people and recognize the critical role our human capital plays in supporting our strategy. As Hillenbrand acquires companies, it will take time to integrate them into our overall programs. Recently acquired companies are at varying stages of implementation as of September 30, 2024.
Additionally, leaders at director level and above (excluding leaders from our recent acquisitions) committed to a leadership goal related to Environmental, Social and Governance (“ESG”) progress as part of their annual performance goal setting. We also engage the diverse perspectives of our employees through Business Resource Groups (“BRGs”).
Additionally, in 2024, leaders at director level and above committed to a leadership goal related to sustainability progress as part of their annual performance goal setting. We also engage the diverse perspectives of our employees through Business Resource Groups (“BRGs”).
Our employees are at the center of everything we do because without them, we can’t move the world forward. They are the designers, engineers, manufacturers, makers, and shapers that bring our products and brands to life and strengthen our communities.
Purpose shapes the actions we take, the business decisions we make, and how we think about sustainability. Our employees are at the center of everything we do because without them, we can’t move the world forward. They are the designers, engineers, manufacturers, makers, and shapers that bring our products and brands to life and strengthen our communities.
Geographically, approximately 58% of Molding Technology Solutions’ net revenue in fiscal 2023 came from the Americas, 27% from Asia, and 15% from EMEA (Europe, the Middle East, and Africa).
Geographically, approximately 54% of Molding Technology Solutions’ net revenue in fiscal 2024 came from the Americas, 29% from Asia, and 17% from EMEA (Europe, the Middle East, and Africa).
Purpose and Core Values are an important part of our onboarding as we welcome new employees and acquired companies. We connect the new capabilities and experiences of these companies to our shared Purpose.
We remain focused on bringing our Purpose to life locally through our daily practices. Purpose and Core Values are an important part of our onboarding as we welcome new employees and integrate new companies. We connect the new capabilities and experiences of these companies to our shared Purpose.
As of September 30, 2023, approximately 3,300 employees globally work under collective bargaining agreements and works councils. Hillenbrand strives to maintain satisfactory relationships with all its employees, including the unions and works councils representing those employees. As a result, we have not experienced a significant work stoppage due to labor relations in more than 20 years.
Hillenbrand strives to maintain satisfactory relationships with all its employees, including the unions and works councils representing those employees. As a result, we have not experienced a significant work stoppage due to labor relations in more than 20 years. Health and Safety The health and safety of our employees is our highest priority.
We believe Molding Technology Solutions has attractive fundamentals including: • Strong product and technology positions with substantial brand value and recognition; • Strong market positions and engineering expertise; 4 Table of Contents • A large installed base that supports an aftermarket parts and service business with historically stable revenue and attractive margins; • A customer base that is highly diversified in end markets and applications, with a strong history of long-term customer relationships; and • Geographic diversification, including established operations in high growth countries such as India and China.
We believe Molding Technology Solutions has attractive fundamentals including: • Strong product and technology positions with substantial brand value and recognition; • Strong market positions and engineering expertise; • A large installed base that supports an aftermarket parts and service business with historically stable revenue and attractive margins; • A customer base that is highly diversified in end markets and applications, with a strong history of long-term customer relationships; and • Geographic diversification, including established operations in high growth countries such as India and China. 4 Table of Contents How We Operate Guided by our Purpose, Shape What Matters for Tomorrow, we strive to provide superior return for our shareholders, exceptional value for our customers, great professional opportunities for our employees, and to be responsible to our communities through the execution of our profitable growth strategy.
Over the past several years, we have significantly transformed our business through not only the completion of several strategic acquisitions, but also the divestiture of our legacy death care reportable operating segment, Batesville, as well as the divestiture of certain other non-core brands.
Over the past several years, we have significantly transformed our business through not only the completion of several strategic acquisitions, but also the divestiture of our historical Batesville reportable operating segment, as well as the divestiture of certain other non-core brands. The acquisitions provided leading brands, complementary technologies, and enhanced scale in attractive end markets, including food and recycling.
She currently serves on the Board of Directors of EnerSys (stored energy solutions for industrial applications), a position she has held since December 2022, including as a member of its Compensation and Audit Committees. 15 Table of Contents Carole A. Phillips, 51, became the Company’s Senior Vice President, Chief Procurement Officer in January 2023. Ms.
She currently serves on the Board of Directors of EnerSys (stored energy solutions for industrial applications), a position she has held since December 2022, including as a member of its Compensation and Audit Committees. In November 2024, Ms.
In fiscal 2023, we continued to cascade DEI into our talent practices by focusing on qualified diverse slates of candidates for senior leadership positions and assessing the diversity of succession plans for pipeline development.
We continue to focus on making meaningful progress in our DEI journey, including by embedding DEI into our talent practices by focusing on qualified diverse slates of candidates for manager through senior leadership positions in the U.S. and assessing the diversity of succession plans for pipeline development.
As a result, margin percentages tend to be lower on these large system sales when compared to the rest of the reportable operating segment. With the acquisition of Herbold in fiscal 2022, the Company now offers complete, innovative recycling solutions leveraging both Coperion and Herbold complementary 8 Table of Contents technologies.
As a result, margin percentages tend to be lower on these large system sales when compared to the rest of the reportable operating segment. The Company offers complete, innovative recycling solutions.
These reportable operating segments address macro trends supported by a growing middle class driving demand for plastics in a variety of applications, such as construction, food safety, and recycling, and demand for more sustainable food sources such as plant-based proteins, Hillenbrand was incorporated on November 1, 2007, in the state of Indiana and began trading on the New York Stock Exchange under the symbol “HI” on April 1, 2008.
These reportable operating segments address macro trends supported by a growing middle class driving demand for plastics in a variety of applications, such as construction, food safety, and recycling, and demand for more sustainable food sources such as plant-based proteins.
As we continue to grow as a company, living out our Purpose and Core Values empowers us to better serve one another, our communities, and our customers while we continue to pursue exceptional performance and long-term shareholder value.
As we continue to grow as a company, living out our Purpose empowers us to better serve one another, our communities, and our customers while we continue to pursue exceptional performance and long-term shareholder value. As we commit to our Purpose, together, we strive to ensuring a respectful and inclusive culture that enables career growth, development, and support for well-being.
Reportable Operating Segments Advanced Process Solutions Advanced Process Solutions is a leading global provider of highly-engineered process and material handling equipment, systems, and aftermarket parts and services for a variety of industries, including durable plastics, food, and recycling.
For further information, see Note 4 to our Consolidated Financial Statements included in Part II, Item 8, of this Form 10-K. Reportable Operating Segments Advanced Process Solutions Advanced Process Solutions is a leading global provider of highly-engineered process and material handling equipment, systems, and aftermarket parts and services for a variety of industries, including durable plastics, food, and recycling.
Ryan began her career with Batesville in 1989, holding positions of increasing responsibility within Batesville and the Company’s former parent in finance, strategy, operations, logistics, and information technology. 14 Table of Contents From 2014 to 2023, Ms.
Ryan began her career with Batesville in 1989, holding positions of increasing responsibility within Batesville and the Company’s former parent in finance, strategy, operations, logistics, and information technology. From 2014 to 2023, Ms. Ryan served on the Board of Directors of Kimball International, Inc., a public manufacturing company (“Kimball”), including as a member of the Audit Committee.
Acquisitions The following acquisitions were made during the years ended September 30, 2023 and 2022, and are all currently included within our Advanced Process Solutions reportable operating segment: • On September 1, 2023, the Company completed the acquisition of Schenck Process Food and Performance Materials (“FPM”) business; 3 Table of Contents • On December 1, 2022, the Company completed the acquisition of the Peerless Food Equipment division (“Peerless”) of Illinois Tool Works Inc.; • On October 6, 2022, the Company completed the acquisition of LINXIS Group SAS (“Linxis”); • On August 31, 2022, the Company completed the acquisition of Herbold Meckesheim GmbH (“Herbold”); and • On June 30, 2022, the Company completed the acquisition of Gabler Engineering GmbH and affiliate (“Gabler”).
These end markets are attractive to Hillenbrand because they have strong, long-term growth characteristics, and allow us to leverage our existing expertise in process technology and systems engineering to provide comprehensive solutions to our customers. 3 Table of Contents Acquisitions The following acquisitions were made during the years ended September 30, 2023 and 2022, and are included within our Advanced Process Solutions reportable operating segment: • On September 1, 2023, the Company completed the acquisition of the Schenck Process Food and Performance Materials (“FPM”) business; • On December 1, 2022, the Company completed the acquisition of the Peerless Food Equipment division (“Peerless”) of Illinois Tool Works Inc.; and • On October 6, 2022, the Company completed the acquisition of LINXIS Group SAS (“Linxis”).
Since June 2022, he has also served as President of Advance Process Solutions, in which role he also oversees the Company’s Rotex business. Prior to these roles, Mr. Bartel served as President of Coperion’s Polymer Division from March 2020 to June 2021 and as Coperion’s Vice President of Compounding Machines from October 2013 to February 2020. Mr.
Ulrich Bartel, 64, was appointed President of the Company’s Coperion business and Senior Vice President of Hillenbrand in June 2021. Since June 2022, he has also served as President of Advanced Process Solutions, in which role he also oversees the Company’s Rotex business. Prior to these roles, Mr.
On February 1, 2023, the Company completed the divestiture of its historical Batesville reportable operating segment. This divestiture represented a strategic shift in Hillenbrand’s business and qualified as a discontinued operation.
For further information, see Note 5 to our Consolidated Financial Statements included in Part II, Item 8, of this Form 10-K. Divestitures On February 1, 2023, the Company completed the divestiture of its historical Batesville reportable operating segment. This divestiture represented a strategic shift in Hillenbrand’s business and qualified as a discontinued operation.
Farrell was in private practice for six years with global law firm Troutman Pepper. Mr. Farrell is also Chair of the Board of Trustees of Cure SMA, an international not-for-profit organization committed to developing a treatment and cure for spinal muscular atrophy, the number one genetic cause of death for infants. Leo J.
Farrell is also Chair of the Board of Trustees of Cure SMA, an international not-for-profit organization committed to developing a treatment and cure for spinal muscular atrophy, the number one genetic cause of death for infants. Tamara Morytko, 53 , was appointed Senior Vice President of Hillenbrand and President, Molding Technology Solutions in September 2023. Ms.
While global supply chains have recently suffered from various headwinds, those supporting our products have generally remained intact, providing access to sufficient inventory of the key materials needed for manufacturing. However, Advanced Process Solutions has experienced significant delays of certain raw materials and components, but has largely been able to mitigate the impact on our consolidated results of operations.
While global supply chains have recently suffered from various headwinds, those supporting our products have 10 Table of Contents generally remained intact, providing access to sufficient inventory of the key materials needed for manufacturing.
Bartel began his career at Coperion in 1990 as a process engineer, holding positions of increasing responsibility within Coperion in sales, service, process technology, engineering, manufacturing, and research. Nicholas R. Farrell, 44, is the Company’s Senior Vice President, General Counsel, and Secretary.
Bartel served as President of Coperion’s Polymer Division from March 2020 to June 2021 and as Coperion’s Vice President of Compounding Machines from October 2013 to February 2020. Mr. Bartel began his career at Coperion in 1990 as a process engineer, holding positions of increasing responsibility within Coperion in sales, service, process technology, engineering, manufacturing, and research. Nicholas R.
Accordingly, the operating results and cash flows related to the historical Batesville reportable operating segment have been reflected as discontinued operations in the Consolidated Statements of Operations and the Consolidated Statements of Cash Flows for all periods presented, while the assets and liabilities that were divested were classified within the Consolidated Balance Sheets as held for sale in the periods preceding the divestiture.
Accordingly, the operating results and cash flows related to the historical Batesville reportable operating segment have been reflected as discontinued operations in the Consolidated Statements of Operations and the Consolidated Statements of Cash Flows for all periods presented. Unless otherwise noted, discussion within this Form 10-K relates to continuing operations only and excludes the historical Batesville reportable operating segment.
He has served as General Counsel and Secretary since 2015 and also served as the Company’s Chief Compliance Officer from 2016 until March 2023. Mr. Farrell began his career with the Company in 2011 as Corporate and Securities Counsel, and in 2014 was named Vice President, Associate General Counsel and Assistant Secretary. Prior to joining Hillenbrand, Mr.
Farrell began his career with the Company in 2011 as Corporate and Securities Counsel, and in 2014 was named Vice President, Associate General Counsel and Assistant Secretary. Prior to joining Hillenbrand, Mr. Farrell was in private practice for six years with global law firm Troutman Pepper. Mr.
“Hillenbrand,” “the Company,” “we,” “us,” “our,” and similar words refer to Hillenbrand, Inc. and its subsidiaries unless context otherwise requires. Although Hillenbrand has been a publicly traded company since 2008, the brands owned by Hillenbrand have been in operation for many decades.
Although Hillenbrand has been a publicly traded company since 2008, the brands owned by Hillenbrand have been in operation for many decades.
Arora was Vice President of Global HR Services for Honeywell International Inc. (“Honeywell”), a diversified technology and manufacturing company, from October 2019 through December 2021. Prior to that, she served as Vice President, Global Human Resources and Communications, Safety and Productivity Solutions at Honeywell from November 2016 to October 2019. Since September 2020, Ms.
She brings to this role more than two decades of diverse experience in human resources across multiple industries. Prior to joining Hillenbrand, Ms. Arora was Vice President of Global HR Services for Honeywell International Inc. (“Honeywell”), a diversified technology and manufacturing company, from October 2019 through December 2021.
Geographically, approximately 37% of Advanced Process Solutions’ net revenue in fiscal 2023 came from the Americas, 32% from Asia, and 31% from EMEA (Europe, the Middle East, and Africa).
Advanced Process Solutions’ net revenue is diversified by end markets, and further penetration of these end markets is an important element of its strategy. Geographically, approximately 46% of Advanced Process Solutions’ net revenue in fiscal 2024 came from the Americas, 25% from Asia, and 29% from EMEA (Europe, the Middle East, and Africa).
Tamara Morytko, 52 , was appointed Senior Vice President of Hillenbrand and President, Molding Technology Solutions (MTS) in September 2023. Ms. Morytko has more than two decades of leadership in regional and global business operations.
Morytko has more than two decades of leadership in regional and global business operations. In August 2024, she was appointed interim Senior Vice President of Operations Center Of Excellence and Hillenbrand Operating Model, in an additional capacity.
By listening and acting with respect, embracing our individuality, and trusting in each other’s strengths, we create an inclusive culture that brings our Purpose to life. We continue to focus on making meaningful progress in our DEI Roadmap established in 2021.
Diversity, Equity and Inclusion Diversity, Equity, and Inclusion (“DEI”) at Hillenbrand is embedded in how we live and work and is part of our Core Values. By listening and acting with respect, embracing our individuality, and trusting in each other’s strengths, we create an inclusive culture that brings our Purpose to life.
We also hold ourselves accountable through measurement and transparency, including sharing our DEI progress regularly with our Board of Directors and publicly disclosing our global gender and U.S. ethnically diverse representation in our annual Sustainability Report, which can be found on the “Sustainability” section of our website at www.hillenbrand.com.
The BRG leaders and members championed celebrations and observances, led personal and professional development sessions, and provided education and awareness about their communities to our employees. 7 Table of Contents We also hold ourselves accountable through measurement and transparency, including sharing our diversity, equity, and inclusion progress regularly with our Board of Directors and publicly disclosing our global gender and U.S. ethnically diverse representation in our annual Sustainability Report.
Ryan served on the Board of Directors of Kimball International, Inc., a public manufacturing company (“Kimball”), including as a member of the Audit Committee. She also served as Kimball’s Board Chair from November 2018 to October 2021, during which time she also served on the Compensation Committee and Governance Committee. Robert M.
She also served as Kimball’s Board Chair from November 2018 to October 2021, during which time she also served on the Compensation Committee and Governance Committee. Robert M. VanHimbergen, 48, has been the Company’s Senior Vice President and Chief Financial Officer since April 2022. Mr.
Workplace Demographics Hillenbrand is committed to the growth of our employees by developing talent and building a growth-minded culture. We believe our employees give us the strength and skills to compete, and we must in turn help our employees reach their potential. As of September 30, 2023, we had approximately 10,400 employees worldwide.
We believe our employees give us the strength and skills to compete, and we must in turn help our employees reach their potential. As of September 30, 2024, we had approximately 10,450 employees worldwide. Approximately 3,000 employees were located within the United States (“U.S.”) and 7,450 employees were located outside of the U.S., primarily throughout Europe and Asia.
VanHimbergen also serves as the Chair of Ascension SE Wisconsin Foundation (since October 2015). Aneesha Arora, 45, has served as the Company’s Senior Vice President and Chief Human Resources Officer since January 2022. She brings to this role more than two decades of diverse experience in human resources across multiple industries. Prior to joining Hillenbrand, Ms.
VanHimbergen served on the Board of Directors of Ascension Wisconsin Foundation, where he was the Board Chair from 2017 to 2023, and he has served as the Board Chair of Ascension SE Wisconsin since 2017. Aneesha Arora, 46, has served as the Company’s Senior Vice President and Chief Human Resources Officer since January 2022.
We believe sustainability to be a source of value creation that must be aligned with the core strategy of the Company. We expect to continue developing this part of our strategy as we grow in our sustainability practice.
Since the establishment of our sustainability program, we have leveraged our HOM to drive sustainability performance in our operations throughout the Company, and we expect to continue developing this part of our strategy as we grow in our sustainability practice.
We believe the marks Milacron and Mold-Masters are material to our Molding Technology Solutions reportable operating segment. As our historical Batesville reportable operating segment was divested in early fiscal 2023, the Company no longer owns the trademark Batesville ® , and as a result we do not believe it was material for the year ended September 30, 2023.
We believe the marks Milacron and Mold-Masters are material to our Molding Technology Solutions reportable operating segment.
Approximately 3,200 employees were located within the United States (“U.S.”) and 7,200 employees were located outside of the U.S., primarily throughout Europe and Asia. Approximately 62% of our workforce within the U.S. is composed of manufacturing direct labor, and the remaining population includes all other selling, general, and administrative professional employees.
Approximately 51% of our workforce globally is composed of manufacturing direct labor, and the remaining population includes all other selling, general, and administrative professional employees. As of September 30, 2024, approximately 3,350 employees globally work under collective bargaining agreements or works councils.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeWe have a significant amount of debt, which could adversely affect the Company and limit our ability to respond to changes in our business or make future desirable acquisitions. As of September 30, 2023, our outstanding debt was $2,010.1, and this amount could increase if additional levels of liquidity are needed.
Biggest changeFailure to appropriately respond to this evolving landscape may result in legal liability, regulatory action, or brand and reputational harm. 6. We have a significant amount of debt, which could adversely affect the Company and limit our ability to respond to changes in our business or make future desirable acquisitions.
In addition, certain countries that are central to our businesses have imposed and/or been subject to imposition or have threatened imposition of retaliatory tariffs in response to tariffs imposed by the U.S. upon various raw materials and finished goods, including steel and others that are important to our businesses.
In addition, certain countries that are central to our businesses have imposed or been subject to imposition or have threatened imposition of retaliatory tariffs in response to tariffs imposed by the U.S. upon various raw materials and finished goods, including steel and others that are important to our businesses.
Our products may not compete successfully with those of our competitors. The markets for plastic processing equipment and related products, material handling equipment, complete equipment systems, mold components, are highly competitive and include a number of North American, European, and Asian competitors.
Our products may not compete successfully with those of our competitors. The markets for plastic processing equipment and related products, material handling equipment, complete equipment systems, and mold components are highly competitive and include a number of North American, European, and Asian competitors.
These efforts require varying levels of management resources, which may divert our attention from other business operations. If we do not realize the expected benefits of any divestiture transaction or experience unexpected costs or similar risks, our consolidated financial position, results of operations, and cash flows could be negatively impacted.
These efforts require varying levels of management resources, which may divert our attention from other business operations. If we do not realize the expected benefits of any divestiture transaction or experience unexpected costs or similar risks, our consolidated financial position, consolidated results of operations, and cash flows could be negatively impacted.
Unfavorable developments in the plastics industry could impact our customers and, as a result, have a material adverse effect on our business, financial condition, and consolidated results of operations. 18. Changes in food consumption patterns due to dietary trends, economic conditions, or other reasons may adversely affect our business, financial condition, results of operations, and cash flows.
Unfavorable developments in the plastics industry could impact our customers and, as a result, have a material adverse effect on our business, financial condition, and consolidated results of operations. 18. Changes in economic conditions, food consumption patterns due to dietary trends, or other reasons may adversely affect our business, financial condition, consolidated results of operations, and cash flows.
We cannot provide assurance that our internal controls and compliance systems will always protect us from acts committed by our employees, agents, or business partners that would violate U.S. and/or non-U.S. laws, including laws governing payments to government officials, bribery, fraud, anti-kickback, false claims, competition, export and import compliance, including the U.S.
We cannot provide assurance that our internal controls and compliance systems will always protect us from acts committed by our employees, agents, or business partners that would violate U.S. or non-U.S. laws, including laws governing payments to government officials, bribery, fraud, anti-kickback, false claims, competition, export and import compliance, including the U.S.
In addition, since our Consolidated Financial Statements are denominated in U.S. dollars, changes in currency exchange rates between the U.S. dollar and other currencies have had, and will continue to have, an impact on our results of operations.
In addition, since our Consolidated Financial Statements are denominated in U.S. dollars, changes in currency exchange rates between the U.S. dollar and other currencies have had, and will continue to have, an impact on our consolidated results of operations.
Despite our efforts to manage through a widespread pandemic, disease outbreak, or other health crisis, the degree to which these events ultimately impact our business, financial position, results of operations, and cash flows may depend on certain factors beyond our control, including the duration, spread, and severity of the event, the actions taken to contain the event and mitigate its public health effects, the impact on the U.S. and global economies and demand for our products, and how quickly and to what extent normal economic and operating conditions resume or become impacted by long-lasting changes.
Despite our efforts to manage through a widespread pandemic, disease outbreak, or other health crisis, the degree to which these events ultimately impact our business, financial position, consolidated results of operations, and cash flows may depend on certain factors beyond our control, including the duration, spread, and severity of the event, the actions taken to contain the event and mitigate its public health effects, the impact on the U.S. and global economies and demand for our products, and how quickly and to what extent normal economic and operating conditions resume or become impacted by long-lasting changes.
The integration of these companies may result in material challenges, including, without limitation: • the diversion of management’s attention from ongoing business concerns, and performance shortfalls as a result of the devotion of management’s attention to the integration; • managing a larger combined business; • maintaining employee morale and retaining key management and other employees; • retaining existing business and operational relationships, including customers, suppliers and other counterparties, and attracting new business and operational relationships; • the possibility of faulty assumptions underlying expectations regarding the integration process; • consolidating corporate and administrative infrastructures and eliminating duplicative operations; • coordinating geographically separate organizations; and • unanticipated issues in integrating information technology, communications and other systems.
The integration of these companies may result in material challenges, including, but without limitation: • the diversion of management’s attention from ongoing business concerns, and performance shortfalls as a result of the devotion of management’s attention to the integration; • managing a larger combined business; • maintaining employee morale and retaining key management and other employees; • retaining existing business and operational relationships, including customers, suppliers and other counterparties, and attracting new business and operational relationships; • the possibility of faulty assumptions underlying expectations regarding the integration process; • consolidating corporate and administrative infrastructures and eliminating duplicative operations; • coordinating geographically separate organizations; and • unanticipated issues in integrating information technology, communications and other systems.
If the Company suffers a loss or disclosure of protected information due to security breaches or other reasons, and if business continuity plans do not effectively address these issues on a timely basis, the Company may incur fines or penalties, or suffer interruption in its ability to manage operations, as well as reputational, competitive, or business harm, which could have a material adverse effect on our business, financial condition, and consolidated results of operations. 3.
If the Company suffers a loss or disclosure of protected information due to security breaches or other reasons, and if business continuity plans do not effectively address these issues on a timely basis, the Company may incur fines or penalties, or suffer interruption in its ability to manage operations, as well as reputational, competitive, or business harm, which could have a material adverse effect on our business, financial condition, and consolidated results of operations.
Sales volume is dependent upon the need for equipment used to produce these products, which may be significantly influenced by the demand for plastics, the capital investment needs of companies in the plastics industry, changes in technological advances, or changes in laws or regulations such as, but not limited to, those related to single-use plastics, expanded-polystyrene and polystryrene foams, extended producer responsibility, content requirements for products, recycled content requirements, and reduction mandates.
Sales volume is dependent upon the need for equipment used to produce these products, which may be significantly influenced by the demand for plastics, the capital investment needs of companies in the plastics industry, changes in technological advances, or changes in laws or regulations such as, but not limited to, those related to single-use plastics, expanded-polystyrene and polystyrene foams, extended producer responsibility, content requirements for products, recycled content requirements, and reduction mandates.
Furthermore, any divestiture may result in a dilutive impact to our future earnings if we are unable to offset the dilutive impact from the associated loss of revenue, and may also result in significant write-offs, including those related to goodwill and other intangible assets, any of which could have a material adverse effect on our results of operations and financial condition.
Furthermore, any divestiture may result in a dilutive impact to our future earnings if we are unable to offset the dilutive impact from the associated loss of revenue, and may also result in significant write-offs, including those related to goodwill and other intangible assets, any of which could have a material adverse effect on our consolidated results of operations and financial condition.
Moreover, if we are required to repay any of our debt before it becomes due, we may be unable to borrow or draw additional amounts under the Credit Agreement and L/G Facility Agreement or otherwise obtain the cash necessary to repay that additional debt when due, which could materially adversely affect our business, financial condition, and liquidity.
Moreover, if we are required to repay any of our debt before it becomes due, we may be unable to borrow or draw additional amounts under the Amended Credit Agreement and Amended L/G Facility Agreement or otherwise obtain the cash necessary to repay that additional debt when due, which could materially adversely affect our business, financial condition, and liquidity.
As discussed elsewhere in our risk factors, some of these factors are outside of the Company’s control, and any one of them could result in delays, increased costs, decreases in the amount of expected revenue or synergies, and diversion of management’s time and energy, which could materially affect our financial position, consolidated results of operations, and cash flows.
As discussed elsewhere in our risk factors, some of these factors are outside of the Company’s control, and any one of them could result in delays, increased costs, decreases in the amount of expected net revenue or synergies, and diversion of management’s time and energy, which could materially affect our financial position, consolidated results of operations, and cash flows.
We are also subject to other potential claims, including environmental, antitrust, patent infringement, business practices, commercial transactions, product and general liability, cybersecurity and privacy matters, workers’ compensation, auto liability, employment-related, and other matters. While we maintain insurance for certain of these exposures, the policies in place are often high-deductible policies.
We are subject to potential claims, including environmental, antitrust, patent infringement, business practices, commercial transactions, product and general liability, cybersecurity and privacy matters, workers’ compensation, auto liability, employment-related, and other matters. While we maintain insurance for certain of these exposures, the policies in place are often high-deductible policies.
Disruption caused by a pandemic and the Company’s response thereto could also increase the Company’s exposure to claims from customers, suppliers, financial institutions, regulators, payment card associations, employees and others, and to other workforce related risks, any of which could have a material adverse effect on the Company’s financial condition and results of operations.
Disruption caused by a pandemic and the Company’s response thereto could also increase the Company’s exposure to claims from customers, suppliers, financial institutions, regulators, payment card associations, employees and others, and to other workforce related risks, any of which could have a material adverse effect on the Company’s financial condition and consolidated results of operations.
We may be subject to unfavorable changes, including retroactive changes, in the tax laws and regulations to which we are subject. We are subject to tax audits by governmental authorities in the U.S. and numerous non-U.S. jurisdictions, which are inherently uncertain. Negative or unexpected results from one or more such tax audits could adversely affect our results of operations.
We may be subject to unfavorable changes, including retroactive changes, in the tax laws and regulations to which we are subject. We are subject to tax audits by governmental authorities in the U.S. and numerous non-U.S. jurisdictions, which are inherently uncertain. Negative or unexpected results from one or more such tax audits could adversely affect our consolidated results of operations.
Furthermore, interest rates we pay on our borrowings and our ability to borrow or draw under the Credit Agreement and L/G Facility Agreement or any other credit facility in the future, or pursuant to other available sources, could be adversely affected by matters including market volatility, economic downturns, or other instability or uncertainty.
Furthermore, interest rates we pay on our borrowings and our ability to borrow or draw under the Amended Credit Agreement and Amended L/G Facility Agreement or any other credit facility in the future, or pursuant to other available sources, could be adversely affected by matters including market volatility, economic downturns, or other instability or uncertainty.
It is difficult to measure the actual loss that might be incurred related to litigation or other potential claims, and the ultimate outcome of claims, lawsuits, and proceedings could have a material adverse effect on our financial condition, results of operations, and cash flows.
It is difficult to measure the actual loss that might be incurred related to litigation or other potential claims, and the ultimate outcome of claims, lawsuits, and proceedings could have a material adverse effect on our financial condition, consolidated results of operations, and cash flows.
Tax controls and changes in tax laws or regulations or the interpretation given to them may expose us to negative tax consequences, including interest payments and potential penalties, which could have a material adverse effect on our results of operations. 22.
Tax controls and changes in tax laws or regulations or the interpretation given to them may expose us to negative tax consequences, including interest payments and potential penalties, which could have a material adverse effect on our consolidated results of operations. 22.
All acquisitions, including the FPM, Linxis, Herbold, and Peerless acquisitions, involve inherent uncertainties, which may include, among other things, our ability to: • successfully identify the most suitable targets for acquisition; • negotiate reasonable terms; • properly perform due diligence and determine all the significant risks associated with a particular acquisition; • successfully achieve the desired performance of the acquired company; • avoid diversion of Company management’s attention from other important business activities; and • where applicable, implement restructuring activities without an adverse impact to business operations.
All acquisitions, including the FPM and Linxis acquisitions, involve inherent uncertainties, which may include, among other things, our ability to: • successfully identify the most suitable targets for acquisition; • negotiate reasonable terms; • properly perform due diligence and determine all the significant risks associated with a particular acquisition; • successfully achieve the desired performance of the acquired company; • avoid diversion of Company management’s attention from other important business activities; and • where applicable, implement restructuring activities without an adverse impact to business operations.
These impacts and conditions include, but may not be limited to, potential significant volatility or decreases 17 Table of Contents in demand for our products, changes in customer behavior and preferences, disruptions in or closures of our manufacturing operations or those of our customers and suppliers, disruptions within our supply chain, limitations on our employees’ ability to work and travel, potential increased vulnerability to cybersecurity incidents, including breaches of information systems security that could be due to widespread remote working arrangements or other conditions, potential financial difficulties of customers and suppliers, significant changes in economic or political conditions, including rapidly changing government orders and regulations and our efforts to comply with them, and related financial and commodity volatility, including volatility in raw material and other input costs (including but not limited to oil prices), any of which could last for extended periods.
These impacts and conditions include, but may not be limited to, potential significant volatility or decreases in demand for our products, changes in customer behavior and preferences, disruptions in or closures of our manufacturing operations or those of our customers and suppliers, disruptions within our supply chain, limitations on our employees’ ability to work and travel, potential increased vulnerability to cybersecurity incidents, including breaches of information systems security that could be due to widespread remote working arrangements or other conditions, potential financial difficulties of customers and suppliers, significant changes in economic or political conditions, including rapidly changing government orders and regulations and our efforts to comply with them, and related financial and commodity volatility, including volatility in raw material and other input costs (including but not limited to oil prices), any of which could last for extended periods.
A sustained labor shortage, lack of skilled labor, or increased turnover or labor inflation could lead to increased costs, such as increased overtime to meet demand and increased wage rates to attract and retain employees, which could negatively affect our ability to efficiently operate our manufacturing and distribution facilities and overall business and have other material adverse effects on our business, financial condition, and consolidated results of operations. 5.
A sustained labor shortage, lack of skilled labor, or increased turnover or labor inflation could lead to increased costs, such as increased overtime to meet demand and increased wage rates to attract and retain employees, which could negatively affect our ability to efficiently operate our manufacturing and distribution facilities and overall business and have other material adverse effects on our business, financial condition, and consolidated results of operations. 4.
We may be vulnerable to credit rating downgrades, which could have an impact on our ability to secure future financing on terms commercially acceptable to us, to access the credit and capital markets, or to negotiate favorable covenants in any future amendments to our financial documents or new financings. 10.
We may be vulnerable to credit rating downgrades, which could have an impact on our ability to secure future financing on terms commercially acceptable to us, to access the credit and capital markets, or to negotiate favorable covenants in any future amendments to our financial documents or new financings. 7.
For a more detailed discussion of claims, see Note 13 to our Consolidated Financial Statement included in Part II, Item 8, of this Form 10-K. 23. Uncertainty in the U.S. political and regulatory environment could negatively impact our business .
For a more detailed discussion of claims, see Note 13 to our Consolidated Financial Statements included in Part II, Item 8, of this Form 10-K. 23. Uncertainty in the U.S. political and regulatory environment could negatively impact our business .
Although we believe we will be able to attract and retain talented personnel and replace key personnel should the need arise, if we are unable to hire and retain employees capable of performing at a high-level, or if mitigation measures we may take to respond to a decrease in labor availability, such as overtime and third-party outsourcing, have unintended negative effects, our business could be adversely affected.
Although we believe we will be able to attract and retain talented personnel and replace key personnel should the need arise, if 17 Table of Contents we are unable to hire and retain employees capable of performing at a high-level, or if mitigation measures we may take to respond to a decrease in labor availability, such as overtime and third-party outsourcing, have unintended negative effects, our business could be adversely affected.
Principal competitive factors in the plastic processing industry, material handling equipment, and complete equipment systems include price, lead time, product features, technology, total cost of ownership, performance, reliability, quality, delivery, and customer service.
Principal competitive factors in the plastic processing industry, material handling equipment, and complete equipment systems include price, lead time, product features, technology, total cost of ownership, performance, reliability, quality, delivery, and customer service. Principal competitive factors in the mold components industry include technology, price, quality, performance, and delivery.
If we are unable to successfully manage the risks associated with expanding our global business or to adequately manage operational fluctuations, it could adversely affect our business, financial condition, or consolidated results of operations. 9.
If we are unable to successfully manage the risks associated with expanding our global business or to adequately manage operational fluctuations, it could adversely affect our business, financial condition, or consolidated results of operations. 12.
We have global operations, and the COVID-19 pandemic or other widespread pandemic, disease outbreak, or other health crisis, and the various government, industry and consumer actions related thereto, including mandated or voluntary shutdowns, could have negative impacts on our business and have created or could create or intensify adverse conditions described in our other risk factors.
We have global operations, and a widespread pandemic, disease outbreak, or other health crisis, and the various government, industry and consumer actions related thereto, including mandated or voluntary shutdowns, could have negative impacts on our business and have created or could create or intensify adverse conditions described in our other risk factors.
We believe these provisions are important for a public company and protect our shareholders from coercive or otherwise potentially unfair takeover tactics by encouraging potential acquirers to negotiate with our Board of Directors and by providing our Board of Directors with appropriate time to assess any acquisition proposal.
We believe these provisions are important for a public company and protect our shareholders from coercive or otherwise potentially unfair takeover tactics by encouraging potential acquirers to negotiate with our Board of Directors and by providing 26 Table of Contents our Board of Directors with appropriate time to assess any acquisition proposal.
These covenants could adversely affect us by limiting our financial and operating flexibility as well as our ability to plan for and react to market conditions, including as a result of global financial, socioeconomic, and political uncertainty and 20 Table of Contents the effect on our business, and to meet our capital needs.
These covenants could adversely affect us by limiting our financial and operating flexibility as well as our ability to plan for and react to market conditions, including as a result of global financial, socioeconomic, and political uncertainty and the effect on our business, and to meet our capital needs.
We operate in highly competitive industries, many of which are currently subject to intense price competition, and if we are unable to compete successfully, it could have a material adverse effect on our business, financial condition, and consolidated results of operations. Many of the industries in which we operate are highly competitive.
We operate in highly competitive industries, many of which are currently subject to intense price competition, and if we are unable to compete successfully, it could have a material adverse effect on our business, financial condition, and consolidated results of operations. 21 Table of Contents Many of the industries in which we operate are highly competitive.
Decrease in demand for base resin or engineering plastics or equipment used in the production of these products, changes in technological advances, or changes in laws or 23 Table of Contents regulations could have a material adverse effect on our business, financial condition, and consolidated results of operations.
Decrease in demand for base resin or engineering plastics or equipment used in the production of these products, changes in technological advances, or changes in laws or regulations could have a material adverse effect on our business, financial condition, and consolidated results of operations.
If we are unable to comply with the financial and other covenants in our debt agreements, our business, financial condition, and liquidity could be materially adversely affected. Our Credit Agreement and the L/G Facility Agreement (each as defined below) contain financial and other restrictive covenants.
If we are unable to comply with the financial and other covenants in our debt agreements, our business, financial condition, and liquidity could be materially adversely affected. Our credit arrangements, including the Amended Credit Agreement and the Amended L/G Facility Agreement (each as defined below) contain financial and other restrictive covenants.
Instability in the global economy and financial markets can adversely affect our business in several ways, including limiting our customers’ ability to 16 Table of Contents obtain sufficient credit or to pay for our products within the terms of sale.
Instability in the global economy and financial markets can adversely affect our business in several ways, including limiting our customers’ ability to obtain sufficient credit or to pay for our products within the terms of sale.
Significant increases in the prices of raw materials, similar to the inflationary increases we have experienced recently, that cannot be recovered through increases in the price of our products and services could adversely affect our results of operations and cash flows.
Significant increases in the prices of raw materials, similar to the inflationary increases we have experienced in the past, that cannot be recovered through increases in the price of our products and services could adversely affect our consolidated results of operations and cash flows.
The Company could face labor disruptions that would interfere with operations. As of September 30, 2023 and 2022, approximately 31% and 30%, respectively, of Hillenbrand’s employees work under collective bargaining agreements or works councils.
The Company could face labor disruptions that would interfere with operations. As of September 30, 2024 and 2023, approximately 32% and 31%, respectively, of Hillenbrand’s employees work under collective bargaining agreements or works councils.
Extended inability to source a necessary raw material or service could cause us to cease manufacturing one or more products for a period of time, which could also lead to loss of customers, as well as reputational, competitive, or business harm, which could have a material adverse effect on our business, financial condition, and consolidated results of operations. 7.
Extended inability to source a necessary raw material or service could cause us to cease manufacturing one or more products for a period of time, which could also lead to loss of customers, as well as reputational, competitive, or business harm, which could have a material adverse effect on our business, financial condition, and consolidated results of operations. 20 Table of Contents 10.
Global market and economic conditions, including those related to the financial markets, could have a material adverse effect on our consolidated results of operations, financial condition, and liquidity. Our business is sensitive to changes in general economic conditions, both inside and outside the U.S.
Global market and economic conditions, including those related to the financial markets, could have a material adverse effect on our consolidated results of operations, financial condition, and liquidity. Our business is sensitive to changes in general economic conditions, both inside and outside the United States.
The risks described below are not the only risks we face, but these are the ones we currently think have the potential to significantly affect stakeholders in our Company if they were to develop adversely (due to size, volatility, or both).
The risks described below are not the only risks we face, but these are the ones we currently think have the potential to significantly 16 Table of Contents affect stakeholders in our Company if they were to develop adversely (due to size, volatility, or both).
We may not achieve the intended benefits of our acquisitions. Under such circumstances, management could be required to spend significant amounts of time and resources in the transition of the acquired business, and we may not fully realize benefits anticipated from key initiatives, including the application of the HOM.
Under such circumstances, management could be required to spend significant amounts of time and resources in the transition of the acquired business, and we may not fully realize benefits anticipated from key initiatives, including the application of the HOM.
We have incurred substantial expenses in connection with the completion of the acquisitions of FPM, Linxis, Herbold and Peerless, and we expect to incur further expenses in order to integrate a large number of processes, policies, procedures, operations, technologies, and systems in connection with these acquisitions. 12.
We have incurred substantial expenses in connection with the completion of the acquisitions of FPM and Linxis, and we expect to incur further expenses in order to integrate a large number of processes, policies, procedures, operations, technologies, and systems in connection with these acquisitions. 3.
We establish policies and provide training to assist them in understanding our policies and the regulations most applicable to our business; however, our reputation, ability to do business, and financial results may be impaired by improper conduct by these parties.
We establish policies and provide training to assist them in understanding our policies and the regulations most applicable to our business; however, our reputation, ability to do business, and consolidated results of operations may be impaired by improper conduct by these parties.
A disease outbreak, such as the COVID-19 pandemic, or other health crisis, could have a material adverse effect on our business and consolidated results of operations, the nature and extent of which are highly uncertain and unpredictable.
A disease outbreak, a pandemic, or other health crisis, could have a material adverse effect on our business and consolidated results of operations, the nature and extent of which are highly uncertain and unpredictable.
In many of the geographies where we operate, we face a potential shortage of qualified employees. A number of factors may adversely affect the labor force available to us or increase labor costs, including high employment levels, and government regulations. Although we have not experienced any material labor shortages to date, the labor market has become increasingly competitive.
A number of factors may adversely affect the labor force available to us or increase labor costs, including high employment levels, and government regulations. Although we have not experienced any material labor shortages to date, the labor market has become increasingly competitive.
These prices fluctuate based on a number of factors beyond our control, including changes in supply and demand, general economic conditions, labor costs, fuel-related delivery costs, competition, import duties, tariffs, currency exchange rates, and, in some cases, government regulation.
Our profitability is affected by the prices of the raw materials used in the manufacture of our products. These prices fluctuate based on a number of factors beyond our control, including changes in supply and demand, general economic conditions, labor costs, fuel-related delivery costs, competition, import duties, tariffs, currency exchange rates, and, in some cases, government regulation.
While we believe that our insurance plan provides appropriate levels of coverage for cyber risks and have taken steps to address these risks by implementing enhanced security technologies, internal controls, and business continuity plans, these measures may not be adequate to cover or prevent all potential losses nor remedy related damage to our reputation.
While we believe that our insurance plan provides appropriate levels of coverage for cyber risks and have taken steps to address these risks by implementing enhanced security technologies, internal controls, and business continuity plans, these measures may not be adequate to cover or prevent all potential losses nor remedy related damage to our reputation. 18 Table of Contents Regulators globally are increasingly imposing greater fines and penalties for privacy and data protection violations.
Uncertainty in United States global trade policy could negatively impact our business . The U.S. government has at times indicated a willingness to significantly change, and has in some cases significantly changed, trade policies and/or agreements.
Uncertainty in United States global trade policy and risks with governmental instability in parts of the world such as Germany could negatively impact our business . The U.S. government has at times indicated a willingness to significantly change, and has in some cases significantly changed, trade policies or agreements.
These competitors may be better able to withstand and respond to changes in conditions within our industry. Competition in any of these areas may reduce our sales and adversely affect our earnings or cash flow by resulting in decreased sales volumes, reduced prices, and increased costs of manufacturing, distributing and selling our products. 13. We operate in cyclical industries.
Competition in any of these areas may reduce our sales and adversely affect our earnings or cash flow by resulting in decreased sales volumes, reduced prices, and increased costs of manufacturing, distributing, and selling our products. 13. We operate in cyclical industries.
In addition, in light of the impacts to our ability to generate cash from operations during periods of global financial, socioeconomic, and political uncertainty, our results may be further negatively impacted by our payment obligations (including interest) with respect to our outstanding borrowings under the Facility and our other credit agreements (each as defined below). 11.
In addition, in light of the impacts to our ability to generate cash from operations during periods of global financial, socioeconomic, and political uncertainty, our results may be further negatively impacted by our payment obligations (including interest) with respect to our outstanding borrowings under our credit arrangements. 19 Table of Contents 8.
Increasing environmental regulation and industry standards, as well as physical risks of climate change, could adversely impact the Company's consolidated results of operations, financial condition, and liquidity. New environmental-related regulations could require the Company to change its manufacturing processes or obtain substitute materials that may cost more or be less available for its manufacturing operations.
Sustainability-related regulations could adversely impact the Company's reputation, consolidated results of operations, financial condition, and liquidity. Sustainability-related regulations could require the Company to change its manufacturing processes or obtain substitute materials that may cost more or be less available for its manufacturing operations.
As a result of these factors, our business, cash flows, and consolidated results of operations could be materially impacted. 22 Table of Contents If we acquire a company that operates in an industry that is different from the ones in which we currently operate, our lack of experience with that company’s industry could have a material adverse impact on our ability to manage that business and realize the benefits of that acquisition. 15.
If we acquire a company that operates in an industry that is different from the ones in which we currently operate, our lack of experience with that company’s industry could have a material adverse impact on our ability to manage that business and realize the benefits of that acquisition. 15.
As a result, and especially if the acquired business is a separate reporting unit, the difference between the carrying value of the reporting unit and its fair value (typically referred to as “headroom”) is smaller at the time of acquisition. If the acquired business is included in an existing reporting unit, this impact often can be less significant.
As a result, and especially if the acquired business is a separate reporting unit, the difference between the carrying value of the reporting unit and its fair value (typically referred to as “headroom”) is smaller at the time of acquisition.
In addition, if certain key or sole suppliers were to become capacity constrained or insolvent, it could result in a reduction or interruption in supplies or a significant increase in the price of supplies. Substantial losses in the equity markets could have an adverse effect on the assets of the Company’s pension plans.
In addition, if certain key or sole suppliers were to become capacity constrained or insolvent, it could result in a reduction or interruption in supplies or a significant increase in the price of supplies. 2.
We may also decide to sell previously acquired businesses, or portions thereof, that no longer meet our strategic objectives, potentially resulting in a loss, accounting charge, or other negative impact.
We may also decide to sell previously acquired businesses, or portions thereof, that no longer meet our strategic objectives, potentially resulting in a loss, accounting charge, or other negative impact. As a result of these factors, our business, cash flows, and consolidated results of operations could be materially impacted.
Regulations on energy management and material management and other rules and regulations to address climate change and other environmental risks may increase the Company’s expenses and adversely affect its consolidated results of operations. In addition, the physical risks of climate change are highly uncertain and may differ in the geographic regions in which the Company operates.
Regulations on energy management and material management and other rules and regulations to address climate change and other sustainability-related risks may increase the Company’s expenses and adversely affect its consolidated results of operations.
Regulators globally are increasingly imposing greater fines and penalties for privacy and data protection violations. For example, the European Union and other jurisdictions, including China and some U.S. states, have enacted, and others may enact, new and expanded sets of compliance requirements on companies, like ours, that collect or process personal data.
For example, the European Union and other jurisdictions, including China and some U.S. states, have enacted, and others may enact, new and expanded sets of compliance requirements on companies, like ours, that collect or process personal data. Failure to comply with these or other data protection regulations could expose us to potentially significant liabilities.
In preparing financial statements for foreign operations with functional currencies other than the U.S. dollar, asset and liability accounts are translated at current exchange rates and income and expenses are translated using weighted-average exchange rates.
The Company’s predominant exposures are to the Euro, Canadian dollar, Swiss franc, Mexican peso, Chinese Renminbi, Japanese Yen, Indian Rupee, and British pound sterling. In preparing financial statements for foreign operations with functional currencies other than the U.S. dollar, asset and liability accounts are translated at current exchange rates and income and expenses are translated using weighted-average exchange rates.
This net revenue was primarily generated in Europe, the Middle East, Asia, South America, and Canada. In addition, we have manufacturing operations, suppliers, and employees located outside the U.S.
We derived approximately 59%, 62%, and 67% of our net revenue from our operations outside the U.S. for the years ended September 30, 2024, 2023, and 2022, respectively. This net revenue was primarily generated in Europe, the Middle East, Asia, South America, and Canada. In addition, we have manufacturing operations, suppliers, and employees located outside the U.S.
If environmental laws or regulations or industry standards are either changed or adopted and impose significant operational restrictions and compliance requirements upon the Company, its suppliers, its customers or its products, or if the Company’s operations are disrupted due to physical impacts of climate change, its customers, or its suppliers, the Company’s business, results of operations, and financial condition could be adversely impacted.
If environmental laws or sustainability regulations or industry standards are either changed or adopted and impose significant operational restrictions and compliance requirements upon the Company, this could impact suppliers, customers, products, or consolidated results of operations.
These risks could materially and adversely impact our business, results of operations and financial condition in the periods to come. 8.
These risks could materially and adversely impact our business, consolidated results of operations, and financial condition in the periods to come. 11. International economic, political, legal, and business factors could negatively affect our consolidated results of operations, cash flows, financial condition, and growth.
The successful implementation of our business strategy depends, in part, on our ability to attract and retain a skilled and talented workforce. Because of the complex nature of many of our products and services, we are generally dependent on a thoroughly trained and highly skilled workforce, including, for example, our engineers.
Because of the complex nature of many of our products and services, we are generally dependent on a thoroughly trained and highly skilled workforce, including, for example, our engineers. In many of the geographies where we operate, we face a potential shortage of qualified employees.
Competition may also limit our ability to pass on the effects of increases in our cost structure. In addition, some of our competitors may have greater financial resources and less debt than we do, which may place us at a competitive disadvantage in the future.
In addition, some of our competitors may have greater financial resources and less debt than we do, which may place us at a competitive disadvantage in the future. These competitors may be better able to withstand and respond to changes in conditions within our industry.
Inability to negotiate satisfactory new agreements or a labor disturbance at one or more of our facilities could have a material adverse effect on our operations. 26. Provisions in our Articles of Incorporation and By-laws and facets of Indiana law may prevent or delay an acquisition of the Company, which could decrease the trading price of our common stock.
Provisions in our Articles of Incorporation and By-laws and facets of Indiana law may prevent or delay an acquisition of the Company, which could decrease the trading price of our common stock.
An impairment charge on these assets could have a material adverse impact on our financial condition and consolidated results of operations. We maintain intangible assets related to the acquisitions of Burnaby Machine and Mill Equipment Ltd. (“BM&M”), Coperion, FPM, Gabler, Herbold, K-Tron, Linxis, Milacron, Peerless, and Rotex, portions of which were identified as either goodwill or indefinite-lived assets.
An impairment charge on these assets could have a material adverse impact on our financial condition and consolidated results of operations. We maintain intangible assets related to a number of historical acquisitions, portions of which were identified as either goodwill or indefinite-lived assets. We periodically assess these assets to determine if they are impaired.
In any case, until this headroom grows over time, due to business growth or lower carrying value of the reporting unit, a small decline in reporting unit fair value may trigger impairment charges. When impairment charges are triggered, they tend to be material due to the size of the assets involved.
If the acquired business is included 23 Table of Contents in an existing reporting unit, this impact often can be less significant. In any case, until this headroom grows over time, due to business growth or lower carrying value of the reporting unit, a small decline in reporting unit fair value may trigger impairment charges.
Increased prices for, poor quality of, or extended inability to source raw materials used in our products or associated services, or supply chain disruptions, could adversely affect profitability. Our profitability is affected by the prices of the raw materials used in the manufacture of our products.
The extent to which a disease outbreak, or any other health crisis, could impact our business cannot be predicted with certainty. 9. Increased prices for, poor quality of, or extended inability to source raw materials used in our products or associated services, or supply chain disruptions, could adversely affect profitability.
This exposes us to risks of disruption and cost increases in our established patterns for sourcing our raw materials, and creates increased uncertainties in planning our sourcing strategies and forecasting our margins. Changes in U.S. tariffs, quotas, trade relationships or agreements, or tax law could reduce the supply of goods available to us or increase our cost of goods.
Changes in U.S. tariffs, quotas, trade relationships or agreements, or tax law could reduce the supply of goods available to us or increase our cost of goods.
Principal competitive factors in the mold components industry include technology, price, quality, performance, and delivery. 21 Table of Contents Our competitors may be positioned to offer more favorable pricing to customers, resulting in reduced volume and profitability. In certain cases, we have lost business to competitors who offered prices lower than ours.
Our competitors may be positioned to offer more favorable pricing to customers, resulting in reduced volume and profitability. In certain cases, we have lost business to competitors who offered prices lower than ours. Competition may also limit our ability to pass on the effects of increases in our cost structure.
We generally seek indemnification from sellers covering these matters; however, the liability of the sellers is often limited, and certain former owners may be unable to meet their indemnification responsibilities. We cannot be assured that these indemnification provisions will fully protect us, and as a result we may face unexpected liabilities that adversely affect our profitability and financial position.
We cannot be assured that these indemnification provisions will fully protect us, and as a result we may face unexpected liabilities that adversely affect our profitability and financial position. We may not achieve the intended benefits of our acquisitions.
Future acquisitions could present these same risks as with the acquisitions we have made to date. Any charges relating to such impairments could adversely affect our results of operations in the periods recognized. 17. We derive significant revenue from the plastics industry.
Any charges relating to such impairments, similar to those recorded for the year ended September 30, 2024, could adversely affect our consolidated results of operations in the periods recognized. 17. We derive significant net revenue from the plastics industry.
These physical risks may impact the availability and cost of materials, sources and supply of energy, or product demand and manufacturing, and could increase insurance and other operating costs. Any future increased worldwide regulatory activity relating to climate change could expand the nature, scope, and complexity of matters that the Company is required to control, assess, and report.
Any future increased regulatory activity relating to these matters could expand the nature, scope, and complexity of matters that the Company is required to control, assess, and report.
This amount of debt (and additional debt we may incur) has important consequences to our businesses.
As of September 30, 2024, our outstanding debt was $1,893.0, and this amount could increase if additional levels of liquidity are needed. This amount of debt (and additional debt we may incur) has important consequences to our businesses.
Despite these efforts, realization of any of these liabilities or deficiencies may increase our expenses, adversely affect our financial position, or cause us to fail to meet our public financial reporting obligations.
Despite these efforts, realization of any of these liabilities or deficiencies may increase our expenses, adversely affect our financial position, or cause us to fail to meet our public financial reporting obligations. 22 Table of Contents We generally seek indemnification covering these matters from sellers or other sources including insurance policies; however, the liability of the sellers or other sources is often limited, and certain former owners may be unable to meet their indemnification responsibilities.
The extent to which a disease outbreak, including COVID-19, or any other health crisis, could impact our business cannot be predicted with certainty. 4. Increasing competition for highly skilled and talented workers, as well as labor shortages, could adversely affect our business.
Increasing competition for highly skilled and talented workers, as well as labor shortages, could adversely affect our business. The successful implementation of our business strategy depends, in part, on our ability to attract and retain a skilled and talented workforce.
Volatility of interest rates and negative equity returns could require greater contributions to the defined benefit plans in the future. 2. The performance of the Company may suffer from business disruptions associated with information technology, cyber-attacks or unauthorized access, or catastrophic losses affecting infrastructure.
Further, any failure to comply with sustainability-related regulations with respect to environment, supply chain, or governance matters may adversely impact our reputation, business, consolidated results of operations, financial condition, and liquidity. 5. The performance of the Company may suffer from business disruptions associated with information technology, cyber-attacks or unauthorized access, or catastrophic losses affecting infrastructure.
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Failure to comply with these or other data protection regulations could expose us to potentially significant liabilities.
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The development and use of artificial technologies are still in their early stages, and we are in the initial phase of incorporating artificial intelligence into our business. Artificial intelligence presents risks and challenges that could adversely impact our business.
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Further, any failure to adequately address stakeholder expectations or to achieve announced initiatives or goals with respect to environmental, social and governance matters may adversely impact our reputation, business, consolidated results of operations, financial condition, and liquidity. 18 Table of Contents 6.
Added
The legal and regulatory landscape surrounding artificial intelligence technologies is rapidly evolving and uncertain, including in the areas of intellectual property, cybersecurity, privacy, and data protection. Compliance with new or changing laws, regulations, or industry standards relating to artificial intelligence may impose significant costs and may limit our ability to develop, deploy, or use artificial intelligence technologies.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest change(in Ohio and Kansas), Germany, China, India, Canada, and the Czech Republic. Five of these facilities are owned and four are leased. Molding Technology Solutions also leases or owns a number of warehouse distribution centers, service centers, and sales offices located in the U.S., Mexico, Canada, Europe, Asia, and South America.
Biggest changeThree of these facilities are owned and six are leased. Molding Technology Solutions also leases or owns a number of warehouse distribution centers, service centers, and sales offices located in the U.S., Mexico, Canada, Europe, Asia, and South America. Facilities often serve multiple purposes, such as administration, sales, manufacturing, testing, warehousing, and distribution.
Item 2. PROPERTIES Our corporate headquarters is located in Batesville, Indiana, in a facility that we lease. At September 30, 2023, Advanced Process Solutions operated 16 significant manufacturing facilities located in the U.S. (in Kansas, Missouri, Ohio, and Virginia), 26 Table of Contents Germany, France, Switzerland, China, Canada, and the United Kingdom.
Item 2. PROPERTIES Our corporate headquarters is located in Batesville, Indiana, in a facility that we lease. At September 30, 2024, Advanced Process Solutions operated 14 significant manufacturing facilities located in the U.S. (in Kansas, Missouri, Ohio, and Virginia), Germany, France, Switzerland, China, and the United Kingdom. Five of these facilities are owned and nine are leased.
Seven of these facilities are owned and nine are leased. Advanced Process Solutions also leases or owns a number of warehouse distribution centers, service centers, and sales offices located in the U.S., Europe, Asia, Canada, and South America. At September 30, 2023, Molding Technology Solutions operated nine significant manufacturing facilities located in the U.S.
Advanced Process Solutions also leases or owns a number of warehouse distribution centers, service centers, and sales offices located in the U.S., Canada, Europe, Asia, and South America. At September 30, 2024, Molding Technology Solutions operated nine significant manufacturing facilities located in the U.S. (in Ohio and Kansas), Germany, China, India, Canada, and the Czech Republic.
Facilities often serve multiple purposes, such as administration, sales, manufacturing, testing, warehousing, and distribution. We believe our current facilities will provide adequate capacity to meet expected demand for the next several years.
We believe our current facilities will provide adequate capacity to meet expected demand for the next several years.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeItem 3. LEGAL PROCEEDINGS Like most companies, we are involved from time to time in claims, lawsuits, and government proceedings relating to our operations, including environmental, antitrust, patent infringement, business practices, commercial transactions, product and general liability, cybersecurity and privacy matters, workers’ compensation, auto liability, employment-related, and other matters.
Biggest changeItem 3. LEGAL PROCEEDINGS From time to time, we are involved in claims, lawsuits, and government proceedings relating to our operations, including environmental, antitrust, patent infringement, business practices, commercial transactions, product and general liability, cybersecurity and privacy matters, workers’ compensation, auto liability, employment-related, and other matters. The ultimate outcome of any claims, lawsuits, and proceedings cannot be predicted with certainty.
It is difficult to measure the actual loss that might be incurred related to litigation, and the ultimate outcome of these claims, lawsuits, and proceedings could have a material adverse effect on our financial condition, results of operations, and cash flows.
It is difficult to measure the actual loss that might be incurred related to litigation, and the ultimate outcome of these claims, lawsuits, and proceedings could have a material adverse effect on our financial condition, consolidated results of operations, and cash flows.
For more information on various legal proceedings, see Note 13 to our Consolidated Financial Statements included in Part II, Item 8, of this Form 10-K. That information is incorporated into this Item 3 by reference. Item 4. MINE SAFETY DISCLOSURES Not applicable. PART II
For more information on various legal proceedings, see Note 13 to our Consolidated Financial Statements included in Part II, Item 8, of this Form 10-K. That information is incorporated into this Item 3 by reference. Item 4. MINE SAFETY DISCLOSURES 28 Table of Contents Not applicable. PART II
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The ultimate outcome of any claims, lawsuits, and proceedings cannot be predicted with certainty.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeWe currently expect to pay approximately $15.6 each quarter in fiscal 2024 based on our outstanding common stock at September 30, 2023. Item 6. Reserved 27 Table of Contents
Biggest changeWe currently expect to pay approximately $15.8 each quarter in fiscal 2025 based on our outstanding common stock at September 30, 2024, subject to the discretion of our Board of Directors. Item 6. Reserved 29 Table of Contents
Item 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES Hillenbrand common stock is traded on the New York Stock Exchange under the ticker symbol “HI.” As of November 10, 2023, we had approximately 1,502 shareholders of record.
Item 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES Hillenbrand common stock is traded on the New York Stock Exchange under the ticker symbol “HI.” As of November 15, 2024, we had approximately 1,423 shareholders of record.
No purchases of our common stock were made during the year ended September 30, 2023. Dividend Policy We returned $61.3 to shareholders in fiscal 2023 in the form of quarterly dividends. We increased our quarterly dividend in fiscal 2023 to $0.2200 per common share from $0.2175 per common share paid in fiscal 2022.
No purchases of our common stock were made during the year ended September 30, 2024. Dividend Policy We returned $62.5 to shareholders in fiscal 2024 in the form of quarterly dividends. We increased our quarterly dividend in fiscal 2024 to $0.2225 per common share from $0.2200 per common share paid in fiscal 2023.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

107 edited+40 added−64 removed57 unchanged
Biggest changeYear Ended September 30, 2023 2022 Consolidated net income $ 576.7 $ 215.2 Interest expense, net 77.7 64.3 Income tax expense 102.8 84.0 Depreciation and amortization 125.6 98.6 Consolidated EBITDA 882.8 462.1 Income from discontinued operations (net of income tax expense) (462.6) (99.5) Business acquisition, divestiture, and integration costs (1) 46.2 29.4 Restructuring and restructuring-related charges (2) 5.1 3.1 Inventory step-up costs related to acquisitions 11.7 — Loss on divestiture (3) — 3.1 Other — 3.3 Adjusted EBITDA $ 483.2 $ 401.5 (1) Business acquisition, divestiture, and integration costs during 2023 primarily included professional fees related to the Linxis, Peerless, and FPM acquisitions and professional fees and employee-related costs attributable to the integration of Milacron and Linxis.
Biggest changeNON-GAAP OPERATING PERFORMANCE MEASURES The following is a reconciliation from consolidated net (loss) income, the most directly comparable GAAP operating performance measure, to our non-GAAP adjusted EBITDA. 40 Table of Contents Year Ended September 30, 2024 2023 Consolidated net (loss) income $ (202.0) $ 576.7 Interest expense, net 121.5 77.7 Income tax expense 64.8 102.8 Depreciation and amortization 158.0 125.6 Consolidated EBITDA 142.3 882.8 Income from discontinued operations (net of income tax (benefit) expense) (2.2) (462.6) Impairment charges (1) 265.0 — Pension settlement charges (2) 35.2 — Business acquisition, divestiture, and integration costs (3) 72.2 46.2 Inventory step-up costs 0.6 11.7 Restructuring and restructuring-related charges (4) 26.2 5.1 Gain on sale of property, plant, and equipment (33.7) — Other non-recurring costs related to a discrete commercial dispute 6.1 — Adjusted EBITDA from Continuing Operations $ 511.7 $ 483.2 (1) Hillenbrand recorded impairment charges to goodwill and certain indefinite-lived intangible assets within the Molding Technology Solutions reportable operating segment during 2024.
The identifiable intangible assets are impacted by a number of judgmental assumptions including future revenue growth rates and EBITDA margins on such revenue, customer attrition rates, and the discount rates. See Note 5 to our Consolidated Financial Statements included in Part II, Item 8, of this Form 10-K, for further information on recent business combinations.
The identifiable intangible assets are impacted by a number of judgmental assumptions including future net revenue growth rates and EBITDA margins on such net revenue, customer attrition rates, and the discount rates. See Note 5 to our Consolidated Financial Statements included in Part II, Item 8, of this Form 10-K, for further information on recent business combinations.
These arrangements include the Amended L/G Agreement (defined below) under which unsecured letters of credit, bank guarantees, or other surety bonds may be issued. The Company may request an increase to the total capacity under the Amended L/G Agreement by an additional €100, subject to approval of the lenders. We have significant operations outside the U.S.
These arrangements include the Amended L/G Facility Agreement (defined below) under which unsecured letters of credit, bank guarantees, or other surety bonds may be issued. The Company may request an increase to the total capacity under the Amended L/G Facility Agreement by an additional €100, subject to approval of the lenders. We have significant operations outside the U.S.
Accordingly, we use adjusted EBITDA, among other measures, to monitor our business performance. Adjusted EBITDA is not a recognized term under GAAP and therefore does not purport to be an alternative to consolidated net income. Further, the Company’s measure of adjusted EBITDA may not be comparable to similarly titled measures of other companies.
Accordingly, we use adjusted EBITDA, among other measures, to monitor our business performance. Adjusted EBITDA is not a recognized term under GAAP and therefore does not purport to be an alternative to consolidated net (loss) income. Further, the Company’s measure of adjusted EBITDA may not be comparable to similarly titled measures of other companies.
(5) See Notes 6, 7, and 8 to our Consolidated Financial Statements included in Part II, Item 8, of this Form 10-K for lease, financing, and pension obligations, respectively. 43 Table of Contents Summarized Financial Information for Guarantors and the Issuer of Guaranteed Securities Summarized financial information of Hillenbrand (the “Parent”) and our subsidiaries that are guarantors of our senior unsecured notes (the “Guarantor Subsidiaries”) is shown below on a combined basis as the “Obligor Group.” The Company’s senior unsecured notes are guaranteed by certain of our wholly-owned domestic subsidiaries and rank equally in right of payment with all of our existing and financial information of the Obligor Group.
(5) See Notes 6, 7, and 8 to our Consolidated Financial Statements included in Part II, Item 8, of this Form 10-K for lease, financing, and pension obligations, respectively. 44 Table of Contents Summarized Financial Information for Guarantors and the Issuer of Guaranteed Securities Summarized financial information of Hillenbrand (the “Parent”) and our subsidiaries that are guarantors of our senior unsecured notes (the “Guarantor Subsidiaries”) is shown below on a combined basis as the “Obligor Group.” The Company’s senior unsecured notes are guaranteed by certain of our wholly-owned domestic subsidiaries and rank equally in right of payment with all of our existing and financial information of the Obligor Group.
The transaction price of a contract, or the amount the Company expects to receive upon satisfaction of the performance obligation, is determined by reference to the contract’s terms and includes adjustments, if applicable, for any variable consideration, such as sales discounts and sales incentives, all of which require us to make estimates for the portion of these allowances that have yet to be credited or paid to our customers.
The transaction price of a contract, or the amount the Company expects to receive upon satisfaction of the performance obligation, is determined by reference to the contract’s terms and includes adjustments, if applicable, for any variable consideration, such as sales discounts, which may require us to make estimates for the portion of these allowances that have yet to be credited or paid to our customers.
Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (dollars in millions throughout Management’s Discussion and Analysis of Financial Condition and Results of Operations) (unless otherwise stated, references to years relate to fiscal years) The following discussion compares our results for the year ended September 30, 2023, to the year ended September 30, 2022.
Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (dollars in millions throughout Management’s Discussion and Analysis of Financial Condition and Results of Operations) (unless otherwise stated, references to years relate to fiscal years) The following discussion compares our results for the year ended September 30, 2024, to the year ended September 30, 2023.
If we elect to perform or are required to perform a quantitative analysis, we compare the carrying amount of the reporting unit’s net assets, including goodwill, to the fair value of the reporting unit. If the fair value exceeds the carrying value, no further evaluation is required, and no impairment loss is recognized.
If we elect to perform or are required to perform a quantitative analysis, we compare the carrying amount of the reporting unit’s carrying value, including goodwill, to the fair value of the reporting unit. If the fair value exceeds the carrying value, no further evaluation is required, and no impairment loss is recognized.
While the Company can implement and has implemented certain strategies to address these events, changes in operating plans or adverse changes in the future could reduce the underlying cash flows used to estimate reporting unit fair values and could result in a further decline in fair value that would trigger a future material impairment charge of the reporting units’ goodwill balance.
While the Company can 32 Table of Contents implement and has implemented certain strategies to address these events, changes in operating plans or adverse changes in the future could reduce the underlying cash flows used to estimate reporting unit fair values and could result in a further decline in fair value that would trigger a future material impairment charge of the reporting units’ goodwill balance.
The Company used available borrowings under the Facility to fund this acquisition. Linxis has six market-leading brands – Bakon, Diosna, Shaffer, Shick Esteve, Unifiller, and VMI – that serve customers in over 100 countries. With a global manufacturing, sales, and service footprint, Linxis specializes in design, manufacturing, and service of dosing, kneading, mixing, granulating, drying, and coating technologies.
The Company used available borrowings under the Facility to fund this acquisition. Linxis’ six market-leading brands – Bakon, Diosna, Shaffer, Shick Esteve, Unifiller, and VMI – serve customers in over 100 countries. With a global manufacturing, sales, and service footprint, Linxis specializes in design, manufacturing, and service of dosing, kneading, mixing, granulating, drying, and coating technologies.
Similar to goodwill, the Company can elect to perform the annual impairment test for indefinite-lived intangibles other than goodwill (primarily trade names) using a qualitative analysis, considering similar factors as outlined in the goodwill discussion in order to determine if it is more likely than not that the fair values of the trade names are less than the respective carrying values.
Similar to goodwill, the Company can elect to perform the annual impairment test for indefinite-lived intangible assets other than goodwill (primarily trade names) using a qualitative analysis, considering similar factors as outlined in the goodwill discussion in order to determine if it is more likely than not that the fair values of the trade names are less than the respective carrying values.
As of September 30, 2023, we repurchased 4,143,000 shares under the December 2, 2021 share repurchase program for approximately $175.0 in the aggregate. At September 30, 2023, we had approximately $125.0 remaining for share repurchases under the existing authorization by the Board of Directors. No purchases of our common stock were made during the year ended September 30, 2023.
As of September 30, 2024, we repurchased 4,143,000 shares under the December 2, 2021 share repurchase program for approximately $175.0 in the aggregate. At September 30, 2024, we had approximately $125.0 remaining for share repurchases under the existing authorization by the Board of Directors. No repurchases of our common stock were made during the year ended September 30, 2024.
During the year ended September 30, 2023, the following operational decisions and economic developments had an impact on our current and may impact our future cash flows, consolidated results of operations, and financial position.
During the year ended September 30, 2024, the following operational decisions and economic developments had an impact on our current and may impact our future cash flows, consolidated results of operations, and financial position.
Acquisition of Peerless Food Equipment 34 Table of Contents On December 1, 2022, the Company completed the acquisition of the Peerless Food Equipment division (“Peerless”) of Illinois Tool Works Inc. for a purchase price of $59.2, net of certain customary post-closing adjustments and including cash acquired, using available borrowings under the Facility.
Acquisition of Peerless Food Equipment On December 1, 2022, the Company completed the acquisition of the Peerless Food Equipment division (“Peerless”) of Illinois Tool Works Inc. for a purchase price of $59.2, net of certain customary post-closing adjustments and including cash acquired, using available borrowings under the Facility.
Contractual Obligations and Contingent Liabilities and Commitments The following table summarizes our future obligations not quantified and disclosed elsewhere in this Form 10-K as of September 30, 2023.
Contractual Obligations and Contingent Liabilities and Commitments The following table summarizes our future obligations not quantified and disclosed elsewhere in this Form 10-K as of September 30, 2024.
Those assumptions and estimates include macroeconomic conditions, competitive activities, cost containment, achievement of synergy initiatives, market data and market multiples (6.5-11.0 times adjusted EBITDA), discount rates (12.5-16.0%), and terminal growth rates (2.0%), as well as future levels of revenue growth, adjusted EBITDA, and working capital requirements, which are based upon the Company’s strategic plan.
Those assumptions and estimates include macroeconomic conditions, competitive activities, cost containment, achievement of synergy initiatives, market data and market multiples (6.0-11.0 times adjusted EBITDA), discount rates (12.0-15.5%), and terminal growth rates (2.0% - 3.0%), as well as future levels of net revenue growth, adjusted EBITDA, and working capital requirements, which are based upon the Company’s strategic plan.
We regularly review and adjust the mix of fixed-rate and variable-rate debt within our capital structure in order to achieve a target range based on our financing strategy. 40 Table of Contents We have taken proactive measures to maintain financial flexibility.
We regularly review and adjust the mix of fixed-rate and variable-rate debt within our capital structure in order to achieve a target range based on our financing strategy. We have taken proactive measures to maintain financial flexibility.
This information is provided because exchange rates can distort the underlying change in these metrics, either positively or negatively. The cost structures 28 Table of Contents for Corporate is generally not significantly impacted by the fluctuation in foreign exchange rates, and we do not disclose the foreign currency impact in the Operations Review below where the impact is not significant.
This information is provided because exchange rates can distort the underlying change in these metrics, either positively or negatively. The cost structure for 30 Table of Contents Corporate is generally not significantly impacted by the fluctuation in foreign exchange rates, and we do not disclose the foreign currency impact in the Operations Review below where the impact is not significant.
Such factors we consider in a qualitative 30 Table of Contents analysis include, but are not limited to, macroeconomic conditions, industry and market considerations, cost factors, Company-specific events, events affecting the reporting unit, and the overall financial performance of the reporting unit.
Such factors we consider in a qualitative analysis include, but are not limited to, macroeconomic conditions, industry and market considerations, cost factors, Company-specific events, events affecting the reporting unit, and the overall financial performance of the reporting unit.
We have no off-balance sheet financing agreements or guarantees as of September 30, 2023 that we believe are reasonably likely to have a current or future effect on our financial condition, results of operations, or cash flows.
We have no off-balance sheet financing agreements or guarantees as of September 30, 2024 that we believe are reasonably likely to have a current or future effect on our financial condition, consolidated results of operations, or cash flows.
The determination of identifiable intangible assets is subjective and generally requires complex valuation methodologies including the relief from royalty method and multi-period excess earnings method, for which we generally use a third-party valuation specialist.
The determination of identifiable intangible assets is 34 Table of Contents subjective and generally requires complex valuation methodologies including the relief from royalty method and multi-period excess earnings method, for which we generally use a third-party valuation specialist.
If we elect to perform or are required to perform a quantitative analysis, the test consists of a comparison of the fair 31 Table of Contents value of the indefinite-lived intangible asset to the carrying value of the asset as of the impairment testing date.
If we elect to perform or are required to perform a quantitative analysis, the test consists of a comparison of the fair value of the indefinite-lived intangible asset to the carrying value of the asset as of the impairment testing date.
Foreign currency impact decreased net revenue by 1%. 37 Table of Contents We expect future net revenue for Advanced Process Solutions to continue to be influenced by order backlog because of the lead time involved in fulfilling engineered-to-order equipment and solutions for customers.
Foreign currency impact increased net revenue by 1%. 38 Table of Contents We expect future net revenue for Advanced Process Solutions to continue to be influenced by order backlog because of the lead time involved in fulfilling engineered-to-order equipment and solutions for customers.
The discussion comparing our results for the year ended September 30, 2022, to the year ended September 30, 2021, is included within Management’s Discussion and Analysis of Financial Condition and Results of Operation in our Annual Report on Form 10-K for the year ended September 30, 2022, filed with the SEC on November 16, 2022.
The discussion comparing our results for the year ended September 30, 2023, to the year ended September 30, 2022, is included within Management’s Discussion and Analysis of Financial Condition and Results of Operation in our Annual Report on Form 10-K for the year ended September 30, 2023, filed with the SEC on November 15, 2023.
Asset Impairment Determinations Impairment of goodwill and intangible assets Goodwill and other intangible assets with indefinite lives, primarily tradenames, are tested for impairment at least annually and upon the occurrence of certain triggering events or substantive changes in circumstances that indicate that the fair value may be below carrying value. Impairment of goodwill is tested at the reporting unit level.
Asset Impairment Determinations Impairment of goodwill and indefinite-lived intangible assets Goodwill and other intangible assets with indefinite lives, primarily tradenames, are tested for impairment at least annually and upon the occurrence of certain triggering events or substantive changes in circumstances that indicate that the fair value may be below carrying value.
The Company has made, and intends to continue to make, substantial investments in our businesses in foreign jurisdictions to support the ongoing development and growth of our international operations. As of September 30, 2023, we had a transition tax liability of $11.2 pursuant to the 2017 Tax Cuts and Jobs Act (the “Tax Act”).
The Company has made, and intends to continue to make, substantial investments in our businesses in foreign jurisdictions to support the ongoing development and growth of our international operations. As of September 30, 2024, we had a transition tax liability of $6.2 pursuant to the 2017 Tax Cuts and Jobs Act.
Our anticipated contribution to our defined benefit pension plans in 2024 i s $10.9. We will continue to monitor plan funding levels, performance of the assets within the plans, and overall economic activity, and we may make additional discretionary funding decisions based on the net impact of the above factors.
Our anticipated contribution to our defined benefit pension plans in 2025 i s $11.8. We will continue to monitor plan funding levels, performance of the assets within the plans, and overall economic activity, and we may make additional discretionary funding decisions based on the net impact of the above factors.
We obtain this information during due diligence and through other sources. In the months after closing, as we obtain additional information about these assets and liabilities, including through tangible asset appraisals, and learn more about the newly acquired business, we are able to refine the estimates of fair value and more accurately allocate the purchase price.
In the months after closing, as we obtain additional information about these assets and liabilities, including through tangible asset appraisals, and learn more about the newly acquired business, we are able to refine the estimates of fair value and more accurately allocate the purchase price.
We currently expect to pay approximately $15.6 in cash dividends each quarter in fiscal 2024 based on our outstanding common stock at September 30, 2023. We increased our quarterly dividend in 2023 to $0.2200 per common share from $0.2175 per common share paid in 2022.
We currently expect to pay approximately $15.8 in cash dividends each quarter in fiscal 2025 based on our outstanding common stock at September 30, 2024. We increased our quarterly dividend in 2024 to $0.2225 per common share from $0.2200 per common share paid in 2023.
The information can also be used to perform trend analysis and to better identify operating trends that may otherwise be masked or distorted by items such as the above excluded items. We believe this information provides a higher degree of transparency. An important non-GAAP measure that we use is adjusted earnings before interest, income tax, depreciation, and amortization (“adjusted EBITDA”).
The information can also be used to perform trend analysis and to better identify operating trends that may otherwise be masked or distorted by items such as the above excluded items. We believe this information provides a higher degree of transparency. An important non-GAAP measure that we use is adjusted EBITDA.
The Company may request an increase of up to $600.0 in the total borrowing capacity under the Amended Credit Agreement, subject to approval of the lenders. In the normal course of business, operating companies within our reportable operating segments provide to certain customers bank guarantees and other credit arrangements in support of performance, warranty, advance payment, and other contractual obligations.
The Company may request an increase of up to $600.0 in the total borrowing capacity under the Amended Credit Agreement, subject to approval of the lenders. In the normal course of business, the Company provides, primarily to certain customers, bank guarantees and other credit arrangements in support of performance, warranty, advance payment, and other contractual obligations.
(2) Net revenue includes intercompany sales with non-guarantors of $5.0 and $32.2 for the years ended September 30, 2023 and 2022, respectively.
(2) Net revenue includes intercompany sales with non-guarantors of $11.3 and $5.0 for the years ended September 30, 2024 and September 30, 2023, respectively.
Core operating expenses primarily represent corporate operating expenses excluding costs related to business acquisition, divestiture, and integration costs. Business acquisition, divestiture, and integration costs include legal, tax, accounting, and other advisory fees and due diligence costs associated with investigating opportunities (including acquisitions and divestitures) and integrating completed acquisitions.
Core operating expenses primarily represent corporate operating expenses excluding costs related to business acquisition, divestiture, and integration costs. Business acquisition, divestiture, and integration costs include legal, tax, accounting, and other advisory fees and due diligence costs associated with investigating opportunities (including acquisitions and divestitures) and integrating completed acquisitions, and accelerating synergies and cost saving initiatives across the Company.
REVIEW OF CORPORATE EXPENSES Year Ended September 30, 2023 2022 Amount % of Net Revenue Amount % of Net Revenue Core operating expenses $ 61.1 2.2 $ 66.4 2.9 Business acquisition, divestiture, and integration costs 35.1 1.2 26.1 1.1 Restructuring and restructuring-related charges 0.2 — 0.8 — Other — — (0.3) — Operating expenses $ 96.4 3.4 $ 93.0 4.0 Corporate operating expenses include the cost of providing management and administrative services to each reportable operating segment.
REVIEW OF CORPORATE EXPENSES Year Ended September 30, 2024 2023 Amount % of Net Revenue Amount % of Net Revenue Core operating expenses $ 55.9 1.8 $ 61.1 2.2 Business acquisition, divestiture, and integration costs 25.7 0.8 35.1 1.2 Restructuring and restructuring-related charges — — 0.2 — Operating expenses $ 81.6 2.6 $ 96.4 3.4 Corporate operating expenses include the cost of providing management and administrative services to each reportable operating segment.
Guided by our Purpose, Shape What Matters for Tomorrow, we strive to provide superior return for our shareholders, exceptional value for our customers, great professional opportunities for our employees, and to be responsible to our communities through the execution of our profitable growth strategy.
We strive to provide superior return for our shareholders, exceptional value for our customers, great professional opportunities for our employees, and to be responsible to our communities through the execution of our profitable growth strategy.
This form of trade finance is customary in the industry and, as a result, we maintain adequate capacity to provide the guarantees. As of September 30, 2023, we had guarantee arrangements totaling $587.9, under which $326.9 was utilized for this purpose.
This form of trade finance is customary in the industry and, as a result, we maintain adequate capacity to provide the guarantees. As of September 30, 2024, we had guarantee arrangements totaling $594.3, under which $400.2 was utilized for this purpose.
The transition tax liability is expected to be paid over the next two years. On December 2, 2021, the Board of Directors authorized a new share repurchase program of up to $300.0, which replaced the previous $200.0 share repurchase program. The repurchase program has no expiration date but may be terminated by the Board of Directors at any time.
On December 2, 2021, the Board of Directors authorized a new share repurchase program of up to $300.0, which replaced the previous $200.0 share repurchase program. The repurchase program has no expiration date but may be terminated by the Board of Directors at any time.
Cash Flows Year Ended September 30, (in millions) 2023 2022 2021 Cash flows provided by (used in): Operating activities from continuing operations $ 207.0 $ 63.3 $ 362.7 Investing activities from continuing operations (722.3) (131.7) 137.6 Financing activities from continuing operations 693.4 (244.2) (523.3) Net cash flows from discontinued operations (144.4) 116.1 154.1 Effect of exchange rate changes on cash and cash equivalents (21.1) (16.8) 8.0 Net cash flows $ 12.6 $ (213.3) $ 139.1 Operating Activities Operating activities provided $207.0 of cash during 2023, and provided $63.3 of cash during 2022, a $143.7 (227%) increase.
Cash Flows Year Ended September 30, (in millions) 2024 2023 2022 Cash flows provided by (used in): Operating activities from continuing operations $ 191.3 $ 207.0 $ 63.3 Investing activities from continuing operations 26.8 (722.3) (131.7) Financing activities from continuing operations (227.1) 693.4 (244.2) Net cash flows from discontinued operations (23.3) (144.4) 116.1 Effect of exchange rate changes on cash and cash equivalents 10.0 (21.1) (16.8) Net cash flows $ (22.3) $ 12.6 $ (213.3) Operating Activities Operating activities from continuing operations provided $191.3 of cash during 2024, and provided $207.0 of cash during 2023, a $15.7 (8%) decrease.
We believe the Company ended the fiscal year with and continues to have sufficient liquidity to operate in the current business environment. With respect to the Facility, as of September 30, 2023, the Company had an outstanding balance of $505.1.
We believe the Company ended the fiscal year with and continues to have sufficient liquidity to operate in the current business environment. 41 Table of Contents With respect to the Facility, as of September 30, 2024, the Company had an outstanding balance of $298.5.
Operating expenses included business acquisition, divestiture, and integration costs ($1.8 in 2023 and $1.3 in 2022) and restructuring and restructuring-related charges ($1.1 in 2023 and $0.5 in 2022). Excluding these charges, adjusted operating expenses as a percentage of net revenue increased 50 basis points to 13.7%.
Operating expenses as a percentage of net revenue increased 560 basis points to 19.6%. Operating expenses included business acquisition, divestiture, and integration costs ($16.0 in 2024 and $1.8 in 2023) and restructuring and restructuring-related charges ($6.7 in 2024 and $1.1 in 2023). Excluding these charges, adjusted operating expenses as a percentage of net revenue increased 260 basis points to 16.3%.
Foreign currency impact decreased consolidated adjusted EBITDA by $9.5. LIQUIDITY AND CAPITAL RESOURCES In this section, we discuss our ability to access cash to meet business needs. We discuss how we see cash flow being affected for the next twelve months. We describe actual results in generating and using cash by comparing 2023 to 2022.
LIQUIDITY AND CAPITAL RESOURCES In this section, we discuss our ability to access cash to meet business needs. We discuss how we see cash flow being affected for the next twelve months. We describe actual results in generating and using cash by comparing 2024 to 2023.
Gross profit margin decreased 150 basis points to 29.6% in 2023, primarily driven by cost inflation and unfavorable product mix, partially offset by favorable pricing and productivity improvements. Molding Technology Solutions’ gross profit included restructuring and restructuring-related charges ($2.3 in 2023 and $0.1 in 2022) and business acquisition, divestiture, and integration costs ($0.7 in 2023 and $0.3 in 2022).
Gross profit margin decreased 230 basis points to 27.3% in 2024, primarily driven by restructuring and restructuring-related charges and cost inflation, partially offset by favorable product mix. Molding Technology Solutions’ gross profit included restructuring and restructuring-related charges ($20.0 in 2024 and $2.3 in 2023) and business acquisition, divestiture, and integration costs ($0.7 in 2023).
Gross profit margin decreased 150 basis points to 29.6% in 2023, primarily driven by cost inflation and unfavorable product mix, partially offset by favorable pricing and productivity improvements. Molding Technology Solutions’ gross profit included restructuring and restructuring-related charges ($2.3 in 2023 and $0.1 in 2022) and business acquisition, divestiture, and integration costs ($0.7 in 2023 and $0.3 in 2022).
Gross profit margin decreased 230 basis points to 27.3% in 2024, primarily driven by restructuring and restructuring-related charges and cost inflation, partially offset by favorable product mix. Molding Technology Solutions’ gross profit included restructuring and restructuring-related charges ($20.0 in 2024 and $2.3 in 2023) and business acquisition, divestiture, and integration costs ($0.7 in 2023).
For further information on divestitures, see Note 4 to our Consolidated Financial Statements included in Part II, Item 8 of this Form 10-K. Interest expense increased $13.4 (21%), primarily due to increased borrowing for acquisitions. For further information, see Note 7 to our Consolidated Financial Statements included in Part II, Item 8 of this Form 10-K.
See Note 8 our Consolidated Financial Statements included in Part II, Item 8 of this Form 10-K for further information on the pension settlement charges. Interest expense increased $43.8 (56%), primarily due to increased borrowing for recent acquisitions. For further information, see Note 7 to our Consolidated Financial Statements included in Part II, Item 8 of this Form 10-K.
Advanced Process Solutions’ gross profit included inventory step-up costs related to acquisitions ($11.7 in 2023), business acquisition, divestiture, and integration costs ($0.5 in 2023 and $0.1 in 2022), restructuring and restructuring-related charges ($2.1 in 2022), and other one-time costs ($0.8 in 2022).
Advanced Process Solutions’ gross profit included inventory step-up costs related to acquisitions ($0.6 in 2024 and $11.7 in 2023), business acquisition, divestiture, and integration costs ($0.5 in 2023), and restructuring and restructuring-related charges ($0.3 in 2024).
Divestitures Divestiture of Batesville As previously described, on February 1, 2023, the Company completed the divestiture of its historical Batesville reportable operating segment to BL Memorial Partners, LLC, a Delaware limited liability company owned by funds affiliated with LongRange Capital, L.P., for $761.5, subject to closing adjustments, and including an $11.5 subordinated note.
Divestitures Divestiture of Batesville On February 1, 2023, the Company completed the divestiture of its historical Batesville reportable operating segment to BL Memorial Partners, LLC, a Delaware limited liability company owned by funds affiliated with LongRange Capital, L.P., for $761.5, including an $11.5 subordinated note. 35 Table of Contents This divestiture represented a strategic shift in Hillenbrand’s business and qualified as a discontinued operation.
September 30, 2023 September 30, 2022 Combined Balance Sheets Information: Current assets (1) $ 2,710.8 $ 2,590.3 Non-current assets 3,533.3 2,656.1 Current liabilities 985.1 623.2 Non-current liabilities 1,583.5 1,289.6 Year Ended September 30, 2023 Year Ended September 30, 2022 Combined Statements of Operations Information: Net revenue (2) $ 441.5 $ 1,042.0 Gross profit 93.0 353.5 Net income attributable to Obligors 223.2 396.7 (1) Current assets include intercompany receivables from non-guarantors of $2,070.6 and $1,868.7 as of September 30, 2023 and September 30, 2022, respectively.
September 30, 2024 September 30, 2023 Combined Balance Sheets Information: Current assets (1) $ 2,077.4 $ 2,710.8 Non-current assets 6,453.1 3,533.3 Current liabilities 753.3 985.1 Non-current liabilities 1,591.6 1,583.5 Year Ended September 30, 2024 Year Ended September 30, 2023 Combined Statements of Operations Information: Net revenue (2) $ 784.3 $ 441.5 Gross profit 215.2 93.0 Net (loss) income attributable to Obligors (84.2) 223.2 (1) Current assets include intercompany receivables from non-guarantors of $1,487.7 and $2,070.6 as of September 30, 2024 and September 30, 2023, respectively.
If the qualitative test is elected, qualitative factors are assessed to determine whether it is more likely than not that the fair values of its reporting units are less than the respective carrying values of those reporting units.
For the purpose of the goodwill impairment test, the Company can elect to perform a quantitative or qualitative analysis. If the qualitative test is elected, qualitative factors are assessed to determine whether it is more likely than not that the fair values of its reporting units are less than the respective carrying values of those reporting units.
The estimated fair value, as calculated at July 1, 2023, for the three reporting units within the Molding Technology Solutions reportable operating segment ranged from approximately 10% to 28% greater than their carrying value (13% to 54% at the previous impairment assessment date).
The estimated fair value, as calculated on July 1, 2024, or as part of the interim impairment assessment discussed above, for the three reporting units within the Molding Technology Solutions reportable operating segment ranged from approximately 3% to 6% greater than their carrying value (10% to 28% at the previous annual goodwill impairment assessment date).
See Notes 4 and 5 to our Consolidated Financial Statements included in Part II, Item 8, of this Form 10-K for further information on these acquisitions and divestitures. Financing Activities Cash provided by financing activities was largely impacted by net borrowing activity and share repurchases.
See Notes 4 and 5 to our Consolidated Financial Statements included in Part II, Item 8, of this Form 10-K for further information on these acquisitions and divestitures.
As of September 30, 2023, the Company had $19.8 in outstanding letters of credit issued and $475.1 of available borrowing capacity under the Facility, all of which was immediately available based on our most restrictive covenant.
As of September 30, 2024, the Company had $20.3 in outstanding letters of credit issued and $681.2 of available borrowing capacity under the Facility, of which $599.4 was immediately available based on our most restrictive covenant.
Contract costs are incurred over longer periods of time and, accordingly, the estimation of these costs requires judgment. We measure progress based on costs incurred to date relative to total estimated cost at completion. Incurred cost represents work performed, which corresponds with, and we believe thereby best depicts, the transfer of control to the customer.
We measure progress based on costs incurred to date relative to total estimated cost at completion. Incurred cost represents work performed, which corresponds with, and we believe thereby best depicts, the transfer of control to the customer. Contract costs include labor, material, and certain overhead expenses.
Significant factors that influence these estimates include inflationary trends, technical and schedule risk, internal and subcontractor performance trends, business volume assumptions, asset utilization, and anticipated labor agreements. Net revenue and cost estimates are regularly monitored and revised based on changes in circumstances. Anticipated losses on long-term manufacturing contracts are recognized immediately when such losses become evident.
Significant factors that influence these estimates include inflationary trends, technical and schedule risk, internal and subcontractor performance trends, business volume assumptions, and anticipated labor agreements. Net revenue 31 Table of Contents and cost estimates are regularly monitored and revised based on changes in circumstances.
Under the income approach, the fair value of the reporting unit is based on the present value of estimated future cash flows utilizing a market-based weighted-average cost of capital determined separately for each reporting unit.
These multiples are then applied to the financial data for our reporting units to arrive at an indication of value. Under the income approach, the fair value of the reporting unit is based on the present value of estimated future cash flows utilizing a market-based weighted-average cost of capital determined separately for each reporting unit.
The effective tax rate was 47.4% in fiscal 2023 compared to 42.1% in fiscal 2022.
The effective tax rate was (46.5)% in fiscal 2024 compared to 47.4% in fiscal 2023.
Headquartered in Kansas City, Missouri, FPM specializes in the design, manufacturing, and service of feeding, filtration, baking, and material handling technologies and systems that are highly complementary to the equipment and solutions offered in our Advanced Process Solutions reportable operating segment. The results of FPM since the date of acquisition are included in the Advanced Process Solutions reportable operating segment.
The Company used available borrowings under its multi-currency revolving credit facility (the “Facility”) to fund this acquisition. Headquartered in Kansas City, Missouri, FPM specializes in the design, manufacturing, and service of feeding, filtration, baking, and material handling technologies and systems that are highly complementary to the equipment and solutions offered in our Advanced Process Solutions reportable operating segment.
As a result of these factors and the limited cushion (or headroom, as commonly referred) due to the acquisition of Milacron in fiscal 2020 and the impact of macroeconomic conditions, goodwill for the reporting units within the Molding Technology Solutions reportable operating segment generally are more susceptible to impairment risk.
As a result of these factors and the limited cushion (or headroom, as commonly referred) due to a number of recent acquisitions and the impact of macroeconomic conditions, goodwill for certain of the reporting units within the Molding Technology Solutions and Advanced Process Solutions reportable operating segments may be more susceptible to impairment risk.
Impairment of long-lived assets Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable.
Impairment of long-lived assets Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. For assets held and used, impairment may occur if projected undiscounted cash flows do not exceed the carrying value of the assets.
Off-Balance Sheet Arrangements 42 Table of Contents As part of its normal course of business, Hillenbrand is a party to various financial guarantees and other commitments. These arrangements involve elements of performance and credit risk that are not included in the Consolidated Balance Sheets.
We increased our quarterly dividend in 2024 to $0.2225 per common share from $0.2200 paid during 2023. Off-Balance Sheet Arrangements As part of its normal course of business, Hillenbrand is a party to various financial guarantees and other commitments. These arrangements involve elements of performance and credit risk that are not included in the Consolidated Balance Sheets.
(4) We have excluded from the table our $38.9 liability related to uncertain tax positions as the current portion is not significant and we are not able to reasonably estimate the timing of the long-term portion.
(3) Primarily includes estimated payments for the transition tax liability, the estimated liquidation of liabilities related to both our self-insurance reserves, and severance payments. (4) We have excluded from the table our $77.9 liability related to uncertain tax positions as the current portion is not significant, and we are not able to reasonably estimate the timing of the long-term portion.
We maintain financial controls over the customer qualification, contract pricing, and estimation processes designed to reduce the risk of contract losses. Standalone service net revenue is recognized either over time proportionately over the period of the underlying contract or as invoiced, depending on the terms of the arrangement. Standalone service revenue is not material to the Company.
Standalone service net revenue is recognized either over time proportionately over the period of the underlying contract or as invoiced, depending on the terms of the arrangement. Standalone service net revenue is not material to the Company.
Contract costs include labor, material, and certain overhead expenses. Cost 29 Table of Contents estimates are based on various assumptions to project the outcome of future events, including labor productivity and availability, the complexity of the work to be performed, the cost of materials, and the performance of suppliers and subcontractors.
Cost estimates are based on various assumptions to project the outcome of future events, including the complexity and length of the work to be performed, the cost of materials, and the performance of suppliers and subcontractors.
Payment Due by Period (in millions) Total Less Than 1 Year 1-3 Years 4-5 Years After 5 Years Interest on financing agreements (1) 375.1 106.2 177.6 59.6 31.7 Purchase obligations (2) 383.7 364.0 18.7 0.9 0.1 Other obligations (3) 49.9 35.0 8.7 2.0 4.2 Total contractual obligations (4)(5) $ 808.7 $ 505.2 $ 205.0 $ 62.5 $ 36.0 (1) Cash obligations for interest requirements relate to our fixed-rate debt obligations at the contractual rates as of September 30, 2023.
Payment Due by Period (in millions) Total Less Than 1 Year 1-3 Years 4-5 Years After 5 Years Interest on financing agreements (1) $ 354.9 $ 100.5 $ 166.4 $ 69.4 $ 18.6 Purchase obligations (2) 326.5 307.8 18.6 0.1 — Other obligations (3) 45.8 38.3 6.9 0.3 0.3 Total contractual obligations (4)(5) $ 727.2 $ 446.6 $ 191.9 $ 69.8 $ 18.9 (1) Cash obligations for interest requirements relate to our fixed-rate debt obligations at the contractual rates as of September 30, 2024.
As a result of the Milacron acquisition in fiscal 2020 and the impact of macroeconomic headwinds, there is less cushion or headroom for the reporting units with the Molding Technology Solutions reportable operating segment.
As a result of a number of recent acquisitions and the impact of macroeconomic headwinds, there is less cushion or headroom for certain reporting units within the Molding Technology Solutions and Advanced Process Solutions reportable operating segments.
On an adjusted basis, which excluded inventory step-up cost related to acquisitions ($11.7 in 2023), restructuring and restructuring-related charges ($2.3 in 2023 and $2.2 in 2022), business acquisition, divestiture, and integration costs ($1.2 in 2023 and $0.4 in 2022), and other one-time costs ($1.0 in 2022), gross profit increased $196.0 (26%), and adjusted gross profit margin improved 100 basis points to 34.1%. • Advanced Process Solutions’ gross profit increased $213.1 (49%), primarily due to the impact of acquisitions, favorable pricing, productivity improvements, and higher volume, partially offset by cost inflation and an increase in inventory step-up costs related to acquisitions.
On an adjusted basis, which excluded inventory step-up costs related to acquisitions ($0.6 in 2024 and $11.7 in 2023), restructuring and restructuring-related charges ($20.3 in 2024 and $2.3 in 2023), and business acquisition, divestiture, and integration costs ($1.2 in 2023), gross profit increased $114.2 (12%), and adjusted gross profit margin decreased 20 basis points to 33.9%. • Advanced Process Solutions’ gross profit increased $160.4 (25%), primarily due to the impact of the FPM acquisition, favorable pricing, and a decrease in inventory step-up costs related to acquisitions, partially offset by a decrease in capital equipment sales volumes and cost inflation.
OPERATIONS REVIEW — ADVANCED PROCESS SOLUTIONS Year Ended September 30, 2023 2022 Amount % of Net Revenue Amount % of Net Revenue Net revenue $ 1,823.5 100.0 $ 1,269.8 100.0 Gross profit 651.5 35.7 438.4 34.5 Operating expenses 337.6 18.5 210.0 16.5 Amortization expense 44.2 17.6 Year Ended September 30, 2023 Compared to Year Ended September 30, 2022 Net revenue increased $553.7 (44%) primarily driven by the impact of acquisitions ($456.8), favorable pricing, and higher aftermarket parts and service net revenue.
OPERATIONS REVIEW — ADVANCED PROCESS SOLUTIONS Year Ended September 30, 2024 2023 Amount % of Net Revenue Amount % of Net Revenue Net revenue $ 2,288.0 100.0 $ 1,823.5 100.0 Gross profit 811.9 35.5 651.5 35.7 Operating expenses 451.1 19.7 337.6 18.5 Amortization expense 67.2 44.2 Year Ended September 30, 2024 Compared to Year Ended September 30, 2023 Net revenue increased $464.5 (25%) primarily driven by the impact of the FPM acquisition ($489.6), higher aftermarket parts and service net revenue, and favorable pricing, partially offset by a decrease in capital equipment sales volumes.
For all reporting units, the fair value of the reporting unit was determined to exceed the carrying value, resulting in no impairment to goodwill as part of this test.
For all reporting units and indefinite-lived intangible assets, the fair values of the respective reporting unit and indefinite-lived intangible assets were determined to exceed the carrying value, resulting in no impairment to goodwill or indefinite-lived intangible assets as part of the annual impairment assessment.
Accounting for these contracts involves management judgment in estimating total contract revenue and cost. Contract revenue is largely determined by negotiated contract prices and quantities, modified by our assumptions regarding contract options, change orders, and incentive and award provisions associated with technical performance clauses.
Accounting for these contracts involves management judgment in estimating total contract revenue and cost. Contract revenue is largely determined by negotiated contract prices and quantities, modified by our assumptions regarding contract options and change orders. Contract costs are incurred over longer periods of time and, accordingly, the estimation of these costs requires judgment.
These reportable operating segments are characterized by well-known brands that are recognized for technological capabilities and process expertise that can be shared across the reportable operating segments to serve customers globally. These reportable operating segments address macro trends supported by a growing middle class driving demand for plastics in a variety of applications, such as construction, food safety, and recycling.
These reportable operating segments address macro trends supported by a growing middle class driving demand for plastics in a variety of applications, such as construction, food safety, and recycling.
Foreign currency impact decreased gross profit by 1%. Gross profit margin improved 120 basis points to 35.7% in 2023, primarily due to the impact of acquisitions and favorable pricing, partially offset by cost inflation.
Foreign currency impact increased gross profit by 1%. Gross profit margin decreased 20 basis points to 35.5% in 2024, primarily due to cost inflation, partially offset by favorable pricing and a decrease in inventory step-up costs.
Gross profit increased $213.1 (49%), primarily due to the impact of acquisitions, favorable pricing, productivity improvements, and higher volume, partially offset by cost inflation and an increase in inventory step-up costs related to acquisitions. Foreign currency impact decreased gross profit by 1%.
Gross profit increased $160.4 (25%), primarily due to the impact of the FPM acquisition, favorable pricing, and a decrease in inventory step-up costs related to acquisitions, partially offset by a decrease in capital equipment sales volumes and cost inflation. Foreign currency impact increased gross profit by 1%.
Net revenue attributable to backlog is also affected by foreign exchange rate fluctuations for orders denominated in currencies other than U.S. dollars. Order backlog increased $468.5 (34%) from $1,397.9 at September 30, 2022, to $1,866.4 at September 30, 2023. The increase in order backlog was primarily driven by acquisitions and a favorable foreign currency impact (5%).
Net revenue attributable to backlog is also affected by foreign exchange rate fluctuations for orders denominated in currencies other than U.S. dollars. Order backlog decreased $185.0 (10%) from $1,866.4 at September 30, 2023, to $1,681.4 at September 30, 2024.
OPERATIONS REVIEW — MOLDING TECHNOLOGY SOLUTIONS Year Ended September 30, 2023 2022 Amount % of Net Revenue Amount % of Net Revenue Net revenue $ 1,002.5 100.0 $ 1,045.5 100.0 Gross profit 296.7 29.6 325.4 31.1 Operating expenses 140.0 14.0 139.7 13.4 Amortization expense 35.4 36.4 Year Ended September 30, 2023 Compared to Year Ended September 30, 2022 Net revenue decreased $43.0 (4%), primarily driven by a decrease in hot runner equipment sales, partially offset by favorable pricing and higher aftermarket parts and service net revenue.
OPERATIONS REVIEW — MOLDING TECHNOLOGY SOLUTIONS Year Ended September 30, 2024 2023 Amount % of Net Revenue Amount % of Net Revenue Net revenue $ 894.8 100.0 $ 1,002.5 100.0 Gross profit 244.6 27.3 296.7 29.6 Operating expenses 175.1 19.6 140.0 14.0 Amortization expense 35.2 35.4 Impairment charges 265.0 — Gain on sale of property, plant, and equipment (36.0) — Year Ended September 30, 2024 Compared to Year Ended September 30, 2023 Net revenue decreased $107.7 (11%), primarily driven by a decrease in injection molding and hot runner equipment sales volumes.
The non-cash charge of $11.2 for the year ended September 30, 2021, was recorded within the impairment charges caption on the Consolidated Statements of Operations. For further information, see Note 4 to our Consolidated Financial Statements included in Part II, Item 8, of this Form 10-K.
See Note 2 to our Consolidated Financial Statements included in Part II, Item 8 of this Form 10-K for further information on the impairment charges. Gain on sale of property, plant, and equipment was $36.0 primarily due to the sale of property located in Ohio during the year ended September 30, 2024.
This list is not exhaustive, but is designed to give you a better understanding of where we think a larger degree of judgment will be required due to the nature of the item and the way it is typically valued. 32 Table of Contents The Company makes an initial allocation of the purchase price at the date of acquisition based upon its understanding of the fair value of the acquired assets, including identifiable intangible assets, and assumed liabilities.
This list is not exhaustive, but is designed to give you a better understanding of where we think a larger degree of judgment will be required due to the nature of the item and the way it is typically valued.
On a sequential basis, order backlog decreased $33.2 (12%) to $233.2 at September 30, 2023, down from $266.4 at June 30, 2023.
Order backlog decreased $2.1 (1%) from $233.2 at September 30, 2023, to $231.1 at September 30, 2024. Foreign currency impact increased order backlog by 1%. On a sequential basis, order backlog decreased $7.4 (3%) to $231.1 at September 30, 2024, down from $238.5 at June 30, 2024.
For purposes of the goodwill impairment test, weighting is equally attributed to both the market and income approaches in arriving at the fair value of the reporting units. Under the market approach, we utilize the guideline company method, which involves calculating valuation multiples based on financial data from comparable publicly traded companies.
For purposes of the goodwill impairment test, weighting is equally attributed to both the market and income approaches in arriving at the fair value of the reporting units.
These non-GAAP measures are referred to as “adjusted” measures and primarily exclude the following items: • business acquisitions, divestiture, and integration costs; • restructuring and restructuring-related charges; • impairment charges; • inventory step-up costs related to acquisitions; • gains and losses on divestitures; • the related income tax impact for all of these items; and • the revaluation of deferred tax balances resulting from fluctuations in currency exchange rates and non-routine changes in tax rates for certain foreign jurisdictions, and the impact that the Molding Technology Solutions reportable operating segment’s loss carryforward attributes have on tax provisions related to the imposition of tax on Global Intangible Low-Taxed Income (“GILTI”) earned by certain foreign subsidiaries, the Foreign Derived Intangible Income Deduction (“FDII”), and the Base Erosion and Anti-Abuse Tax (“BEAT”).
These non-GAAP measures are referred to as “adjusted” measures and primarily exclude the following items: • business acquisitions, divestiture, and integration costs; • restructuring and restructuring-related charges; • impairment charges; • gain on sale of property, plant, and equipment; • pension settlement charges; • inventory step-up costs related to acquisitions; • other non-recurring costs related to a discrete commercial dispute; • gains and losses on divestitures; • other individually immaterial one-time costs; • the related income tax impact for all of these items; and • the revaluation of deferred tax balances resulting from fluctuations in currency exchange rates and non-routine changes in tax rates for certain foreign jurisdictions.
A reporting unit is an operating segment or one level below an operating segment if discrete financial information is prepared and regularly reviewed by operating segment management. For the purpose of the goodwill impairment test, the Company can elect to perform a quantitative or qualitative analysis.
Impairment of goodwill is tested at the reporting unit level. A reporting unit is an operating segment or one level below an operating segment if discrete financial information is prepared and regularly reviewed by operating segment management. The Company currently has six reporting units (five during the year ended September 30, 2023).
Advanced Process Solutions’ gross profit included inventory step-up costs related to acquisitions ($11.7 in 2023), business acquisition, divestiture, and integration costs ($0.5 in 2023 and $0.1 in 2022), restructuring and restructuring-related charges ($2.1 in 2022), and other one-time costs ($0.8 in 2022).
Advanced Process Solutions’ gross profit included inventory step-up costs related to acquisitions ($0.6 in 2024 and $11.7 in 2023), business acquisition, divestiture, and integration costs ($0.5 in 2023), and restructuring and restructuring-related charges ($0.3 in 2024). Excluding these charges, adjusted gross profit increased $149.4 (23%) and adjusted gross profit margin decreased 90 basis points to 35.5%.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

9 edited+0 added−4 removed5 unchanged
Biggest changeTo the extent that commodity prices increase and we do not have firm pricing from our suppliers, or if our 44 Table of Contents suppliers are not able to honor such prices, we may experience a decline in our gross margins to the extent we are not able to increase selling prices of our products or obtain supply chain efficiencies, including as a result of current global supply chain disruptions, to offset increases in commodity costs.
Biggest changeTo the extent that commodity prices increase and we do not have firm pricing from our suppliers, or if our suppliers are not able to honor such prices, we may experience a decline in our gross margins to the extent we are not able to increase selling prices of our products or obtain supply chain efficiencies, including as a result of current global supply chain disruptions, to offset increases in commodity costs. 45 Table of Contents At September 30, 2024, our variable rate debt obligations were $677.5, which included borrowings on the Facility.
The interest we pay on such borrowings is dependent on interest rate conditions and the timing of our financing needs. If we assumed borrowings under our variable rate debt obligations remained unchanged for the next fiscal year, a one percentage point change in the related interest rates would decrease or increase our annual interest expense by approximately $8.9.
The interest we pay on such borrowings is dependent on interest rate conditions and the timing of our financing needs. If we assumed borrowings under our variable rate debt obligations remained unchanged for the next fiscal year, a one percentage point change in the related interest rates would decrease or increase our annual interest expense by approximately $6.8.
We are subject to interest rate risk associated with such borrowings, which bear a variable rate of interest that is based upon, at the Company’s option, (A) if denominated in US dollars, at the Term SOFR Rate or the Alternate Base Rate (each as defined in the Amended Credit Agreement), (B) if denominated in Japanese Yen, Canadian dollars or Euros, at rates based on the rates offered for deposits in the applicable interbank markets for such currencies and (C) if denominated in Pounds Sterling or Swiss Francs, at SONIA and SARON, respectively (each as defined in the Credit Agreement), plus, in each case, a margin based on the Company’s leverage ratio.
We are subject to interest rate risk associated with such borrowings, which bear a variable rate of interest that is based upon, at the Company’s option, (A) if denominated in U.S. dollars, at the Term SOFR Rate or the Alternate Base Rate (each as defined in the Amended Credit Agreement), (B) if denominated in Japanese Yen, Canadian dollars or Euros, at rates based on the rates offered for deposits in the applicable interbank markets for such currencies and (C) if denominated in Pounds Sterling or Swiss Francs, at SONIA and SARON, respectively (each as defined in the Credit Agreement), plus, in each case, a margin based on the Company’s leverage ratio.
The fair value of these financial instruments would hypothetically change by $1.2 and $7.6 as of September 30, 2023 and 2022, respectively, if there were a 10% movement in end-of-period market rates. The translation of the financial statements of our non-U.S. operations from local currencies into U.S. dollars is also sensitive to changes in foreign exchange rates.
The fair value of these financial instruments would hypothetically change by $4.1 and $1.2 as of September 30, 2024 and 2023, respectively, if there were a 10% movement in end-of-period market rates. The translation of the financial statements of our non-U.S. operations from local currencies into U.S. dollars is also sensitive to changes in foreign exchange rates.
The carrying value of all of the Company’s derivative instruments at fair value resulted in assets of $1.5 and $2.6 (included in prepaid expenses and other current assets) and liabilities of $1.7 and $8.0 (included in other current liabilities and other long-term liabilities) at September 30, 2023 and 2022, respectively.
The carrying value of all of the Company’s derivative instruments at fair value resulted in assets of $19.0 and $1.5 (included in prepaid expenses and other current assets) and liabilities of $40.5 and $1.7 (included in other current liabilities and other long-term liabilities) at September 30, 2024 and 2023, respectively.
The result of the appreciation or depreciation of all applicable currencies against the U.S. dollar would be a change in shareholders’ equity of $122.0 and $118.6 as of September 30, 2023 and 2022, respectively. 45 Table of Contents
The result of the appreciation or depreciation of all applicable currencies against the U.S. dollar would be a change in shareholders’ equity of $125.3 and $122.0 as of September 30, 2024 and 2023, respectively. 46 Table of Contents
Exposure to this variability is periodically managed through the use of natural hedges and also by entering into currency exchange agreements. The aggregate notional amount of all derivative instruments was $164.6 and $156 at September 30, 2023 and 2022, respectively.
We are subject to variability in foreign currency exchange rates in our international operations. Exposure to this variability is periodically managed through the use of natural hedges and also by entering into currency exchange agreements. The aggregate notional amount of all derivative instruments was $172.5 and $164.6 at September 30, 2024 and 2023, respectively.
The term “market risk” generally means how results of operations and the value of assets and liabilities could be affected by market factors such as interest rates, currency exchange rates, the value of commodities, and debt and equity price risks. If those factors change significantly, it could help or hurt our bottom line, depending on how we react to them.
The term “market risk” generally means how consolidated results of operations and the value of assets and liabilities could be affected by market factors such as interest rates, currency exchange rates, the value of commodities, and debt and equity price risks.
We are exposed to various market risks. We have established policies, procedures, and internal processes governing our management of market risks and the use of financial instruments to manage our exposure to such risks.
If those factors change significantly, it could help or hurt our bottom line, depending on how we react to them. We are exposed to various market risks. We have established policies, procedures, and internal processes governing our management of market risks and the use of financial instruments to manage our exposure to such risks.
Removed
At September 30, 2023, our variable rate debt obligations were $892.6, which included borrowings on the Facility.
Removed
Our pension plans’ assets are also subject to volatility that can be caused by fluctuations in general economic conditions. Plan assets are invested by the plans’ fiduciaries, which direct investments according to specific policies.
Removed
Those policies subject investments to the following restrictions in our domestic plan: short-term securities must be rated A1/P1, liability-hedging fixed income securities must have an average quality credit rating of investment grade, and investments in equities in any one company may not exceed 10% of the equity portfolio.
Removed
Favorable or unfavorable investment performance over the long term will impact our pension expense if it deviates from our assumption related to future rate of return. We are subject to variability in foreign currency exchange rates in our international operations.

Other HI 10-K year-over-year comparisons