10q10k10q10k.net

What changed in STANDEX INTERNATIONAL CORP/DE/'s 10-K — 2023 vs 2024

vs

Paragraph-level year-over-year comparison of STANDEX INTERNATIONAL CORP/DE/'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.

+155 added−153 removedSource: 10-K (2024-08-02) vs 10-K (2023-08-04)

Top changes in STANDEX INTERNATIONAL CORP/DE/'s 2024 10-K

155 paragraphs added · 153 removed · 130 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

27 edited+7 added−3 removed48 unchanged
Biggest changeThe Company established the Inclusion Advisory Council (IAC) as a collaboration of employee voices that helps to inform and align the company’s commitment to inclusivity and represents the diverse world in which we live and engage with our employees, communities, customers and shareholders. The IAC provides operational input and guidance to the Executive Leadership Team in three areas.
Biggest changeThe Inclusion Advisory Council (IAC) serves as a collaborative platform for employee voices, informing and aligning the company’s commitment to inclusivity. The IAC provides operational input to the Executive Leadership Team in three key areas: setting global inclusivity and diversity goals, collaborating with Corporate Communications to highlight the IAC’s work, and championing the implementation of IAC initiatives.
Our growth strategy is to continue to develop and/or acquire technologies to enhance surface textures that also allow our customers to introduce more sustainable manufacturing processes and reduce their own energy consumption. We are one company operating in 19 countries using a consistent approach to guarantee harmony on global programs in service of our customers.
Our growth strategy is to continue to develop and/or acquire technologies to enhance surface textures that also allow our customers to introduce more sustainable manufacturing processes and reduce their own energy consumption. We are one company operating in 18 countries using a consistent approach to guarantee harmony on global programs in service of our customers.
The U.S. Securities and Exchange Commission (the “SEC”) maintains an internet website at www.sec.gov that contains our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and proxy statements, and all amendments thereto. Standex’s internet website address is www.standex.com.
Securities and Exchange Commission (the “SEC”) maintains an internet website at www.sec.gov that contains our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and proxy statements, and all amendments thereto. Standex’s internet website address is www.standex.com.
Brands Business unit names are Standex Electronics, Standex-Meder Electronics, Renco Electronics, Northlake Engineering, Agile Magnetics, Sensor Solutions, Standex Electronics Japan. Other associated brand names include the MEDER, KENT, and KOFU reed switch brands. Products and Services Our sensing products employ reed switch, Hall effect, inductive, conductive and other technologies.
Brands Business unit names are Standex Electronics, Standex-Meder Electronics, Renco Electronics, Northlake Engineering, Agile Magnetics, Sensor Solutions, Standex Electronics Japan, Minntronix and Sanyu. Other associated brand names include the MEDER, KENT, and KOFU reed switch brands. Products and Services Our sensing products employ reed switch, Hall effect, inductive, conductive and other technologies.
Markets and Applications Spincraft products serve applications within the space, aviation, defense, energy, medical, and general industrial markets. ● The space market we serve is comprised of components and assemblies for space launch vehicles, engines, crewed and uncrewed spacecraft and other space infrastructure. ● The aviation market offerings include a large portfolio of components and assemblies for commercial and private aircraft engines, nacelles and fuel systems. ● The defense market we serve covers a wide spectrum of applications including components for missiles, naval propulsion and structures, large dimension exhaust systems and military aircraft engine solutions. ● Applications within the energy market include components and assemblies for new and MRO gas turbines, as well as solutions for oil & gas exploration operations. 5 Brands This group's brand name is Spincraft.
Markets and Applications Spincraft products serve applications within the space, aviation, defense, energy, medical, and general industrial markets. ● The space market we serve is comprised of components and assemblies for space launch vehicles, engines, crewed and uncrewed spacecraft and other space infrastructure. ● The aviation market offerings include a large portfolio of components and assemblies for commercial and private aircraft engines, nacelles and fuel systems. ● The defense market we serve covers a wide spectrum of applications including components for missiles, naval propulsion and structures, large dimension exhaust systems and military aircraft engine solutions. ● Applications within the energy market include components and assemblies for new and MRO gas turbines, as well as solutions for oil & gas exploration operations. 6 Table of Contents Brands This group's brand name is Spincraft.
Customers The business sells globally to a wide variety of mainly OEM customers focused in the end markets noted previously through a direct sales force, regional sales managers, field applications engineers, commissioned agents, representative groups, and distribution channels. 3 Engraving Our Engraving group is a global creator and provider of custom textures and surface finishes on tooling that enhance the beauty and function of a wide range of consumer good and automotive products.
Customers The business sells globally to a wide variety of mainly OEM customers focused in the end markets noted previously through a direct sales force, regional sales managers, field applications engineers, commissioned agents, representative groups, and distribution channels. 4 Table of Contents Engraving Our Engraving group is a global creator and provider of custom textures and surface finishes on tooling that enhance the beauty and function of a wide range of consumer good and automotive products.
No segments require any special working capital needs outside of the normal course of business. 6 Competition Standex manufactures and markets products many of which have achieved a unique or leadership position in their market, however, we encounter competition in varying degrees in all product groups and for each product line.
No segments require any special working capital needs outside of the normal course of business. 7 Table of Contents Competition Standex manufactures and markets products many of which have achieved a unique or leadership position in their market, however, we encounter competition in varying degrees in all product groups and for each product line.
Ademir Sarcevic 48 Vice President and Chief Financial Officer of the Company since September 2019. Various positions over the years at Pentair plc from 2012 to September 2019 with increasing responsibility ending as Senior Vice President and Chief Accounting Officer. Alan J. Glass 59 Vice President, Chief Legal Officer and Secretary of the Company since April 2016.
Ademir Sarcevic 49 Vice President and Chief Financial Officer of the Company since September 2019. Various positions over the years at Pentair plc from 2012 to September 2019 with increasing responsibility ending as Senior Vice President and Chief Accounting Officer. Alan J. Glass 60 Vice President, Chief Legal Officer and Secretary of the Company since April 2016.
Standex competes on the basis of Customer Intimacy in which our teams work as extensions of our customers organizations to apply our expertise and technology to address needs with customer solutions. International Operations International operations are conducted at 37 locations, in Europe, Canada, China, Japan, India, Southeast Asia, Korea, Mexico, and South Africa.
Standex competes on the basis of Customer Intimacy in which our teams work as extensions of our customers organizations to apply our expertise and technology to address needs with customer solutions. International Operations International operations are conducted at 42 locations, including Europe, Canada, China, Japan, India, Southeast Asia, Korea and Mexico.
Federal Industries focuses on the challenges of enabling retail and food service establishments to provide food and beverages that are fresh and appealing while at the same time providing for food safety, and energy efficiency. Our key differentiator is the ability to customize products to match customers’ décor within industry lead-time.
Federal Industries focuses on the challenges of enabling retail and food service establishments to provide food and beverages that are fresh and appealing while at the same time providing for food safety, and energy efficiency. Our key differentiator is the ability to customize products to meet customers' needs within industry standard lead-times.
Customers The Engraving business has become the global leader providing these products and services by offering a full range of services to automotive OEM’s, product designers, Tier 1 suppliers, and toolmakers all around the world. 4 Scientific Our Scientific business is a provider of specialty temperature-controlled equipment for the medical, scientific, pharmaceutical, biotech and industrial markets.
Customers The Engraving business has become the global leader providing these products and services by offering a full range of services to automotive OEM’s, product designers, Tier 1 suppliers, and toolmakers all around the world. 5 Table of Contents Scientific Our Scientific business specializes in providing specialty temperature-controlled equipment for the medical, scientific, pharmaceutical, biotech, and industrial markets.
Our fiscal year 2023 includes the twelve-month period from July 1, 2022 to June 30, 2023. 2 Our long-term business strategy is to create, improve, and enhance shareholder value by building more profitable, focused industrial platforms through our Standex Value Creation System.
Our fiscal year 2024 includes the twelve-month period from July 1, 2023 to June 30, 2024. 3 Table of Contents Our long-term business strategy is to create, improve, and enhance shareholder value by building more profitable, focused industrial platforms through our Standex Value Creation System.
Our product offerings include: ● Laboratory and medical grade refrigerators, freezers and accessories, ● Cryogenic storage tanks and accessories, and ● Environmental stability chambers and incubators. Brands Our products are sold under various brands including American BioTech Supply (ABS), Lab Research Products (LRP),Corepoint, Cryosafe, CryoGuard, and Scientific.
Our product offerings include: ● Laboratory and medical grade refrigerators, freezers and accessories, ● Cryogenic storage tanks and accessories, ● Blood bank refrigerators and plasma freezers, ● Ultra low temperature freezers, and ● Environmental stability chambers and incubators. Brands Our products are sold under various brands including American BioTech Supply (ABS), Lab Research Products (LRP),Corepoint, Cryosafe and CryoGuard.
Financial Information about Geographic Areas Information regarding revenues from external customers attributed to the United States, all foreign countries and any individual foreign country, if material, is contained in the Notes to Consolidated Financial Statements, “Revenue from Contracts with Customers.” Human Capital Resources Standex International recognizes that its long, successful history and future opportunities are directly linked to dedicated, engaged and diverse employees that serve the Company in all business operations.
Financial Information about Geographic Areas Information regarding revenues from external customers attributed to the United States, all foreign countries and any individual foreign country, if material, is contained in the Notes to Consolidated Financial Statements, “Revenue from Contracts with Customers.” Human Capital Resources Standex International understands that its rich history of success and future opportunities are directly linked to its dedicated, engaged, and diverse workforce.
See the Notes to Consolidated Financial Statements for international operations financial data. Our net sales from continuing international operations decreased slightly from 42% in fiscal year 2022 to 39% in fiscal year 2023.
See the Notes to Consolidated Financial Statements for international operations financial data. Our net sales from continuing international operation s decreased slightly from 39% in fiscal year 2023 to 38% in fiscal year 2024.
As of June 30, 2023, we employ approximately 3,800 employees of which approximately 1,200 are in the United States. About 200 of our U.S. employees are represented by unions. Wages and benefits are competitive with those of other manufacturers in the geographic areas in which our facilities are located.
As of June 30, 2024, we employ approximately 3,700 employees of which approximately 1,100 are in the United States. About 200 of our U.S. employees are represented by unions. Our competitive wages and benefits align with those of other manufacturers in our geographic locations.
There are no family relationships among any of the directors or executive officers of the Company. Long-Lived Assets Long-lived assets are described and discussed in the Notes to Consolidated Financial Statements under the caption “Long-Lived Assets.” Available Information Standex’s corporate headquarters are at 23 Keewaydin Drive, Salem, New Hampshire 03079, and our telephone number at that location is (603) 893-9701.
Long-Lived Assets Long-lived assets are described and discussed in the Notes to Consolidated Financial Statements under the caption “Long-Lived Assets.” Available Information Standex’s corporate headquarters are at 23 Keewaydin Drive, Salem, New Hampshire 03079, and our telephone number at that location is (603) 893-9701. The U.S.
Our global Standex Safety Council, with representatives from all Standex sites, meets regularly, as we work continuously to enhance our safety culture and closely monitor our Total Recordable Incident Rate. The Company’s Chief Human Resources Officer meets regularly with the Chief Executive Officer to align Human Capital strategy, plan and initiatives with business strategy and goals.
Our global Standex Safety Council, which includes representatives from all Standex sites, meets regularly to enhance our safety culture and monitor our Total Recordable Incident Rate. The Chief Human Resources Officer frequently collaborates with the Chief Executive Officer to align Human Capital strategies and initiatives with our business goals.
Products and Services We manufacture and provide specialty-controlled temperature equipment purpose-built for the medical, scientific, pharmaceutical, biotech and industrial markets. Our comprehensive portfolio includes a range of innovative reach in cold storage solutions for medications, vaccines, blood products and patient samples. Customers Scientific products are sold to medical and laboratory distributors, healthcare facilities, research universities, pharmaceutical companies, and pharmacies.
Products and Services We manufacture and provide specialty-controlled temperature equipment purpose-built for the medical, scientific, pharmaceutical, biotech and industrial markets. Our comprehensive portfolio includes a range of innovative storage solutions for medications, vaccines, blood products, patient samples, biologics and laboratory samples.
Engineering Technologies Our Engineering Technologies Group (ETG) is a provider of innovative, metal-formed solutions for OEM and Tier 1 manufacturers for use in their advanced engineering designs.
Customers Scientific products are sold to medical and laboratory distributors, healthcare facilities, research universities, pharmaceutical and biotech companies, pharmacies and industrial facilities. Engineering Technologies Our Engineering Technologies Group (ETG) is a provider of innovative, metal-formed solutions for OEM and Tier 1 manufacturers for use in their advanced engineering designs.
Annemarie Bell 59 Vice President, Chief Human Resources Officer since July 2021, Vice President of Human Resources from June 2019 to July 2021, Interim Vice President of Human Resources from October 2018 through June 2019; Vice President of Human Resources for four of Standex business units from October 2015 through October 2018 The executive officers are elected each year at the first meeting of the Board of Directors subsequent to the annual meeting of stockholders, to serve for one-year terms of office.
Annemarie Bell 52 Vice President, Chief Human Resources Officer since July 2021, Vice President of Human Resources from June 2019 to July 2021, Interim Vice President of Human Resources from October 2018 through June 2019; Vice President of Human Resources for four of Standex business units from October 2015 through October 2018.
We strive to maintain open, two-way communication and build excellent relationships with both our non-union employee population and the various unions and works councils within our business segments. Employees participate in regular training programs appropriate for their responsibility and optional training programs have been developed for those who seek professional and personal growth opportunities.
We prioritize open, two-way communication and foster strong relationships with both our non-union employees and the various unions and works councils within our business segments. Regular training programs tailored to employees’ roles and optional development opportunities are available for those seeking personal and professional growth.
We have divested, and likely will continue to divest, businesses that we feel are not strategic or do not meet our growth and return expectations. The Company’s strong historical cash flow has been a cornerstone for funding our capital allocation strategy.
We continue to execute on acquisitions where strategically aligned with our businesses and where the opportunity meets our investment metrics. We have divested, and likely will continue to divest, businesses that we feel are not strategic or do not meet our growth and return expectations.
The group designs and produces its products in Summerville, SC. Our product portfolio is used to control the temperatures of critical healthcare products, medications, vaccines and laboratory samples. We focus on solving customer problems for these critical applications and deliver innovative products and solutions meeting both exacting regulatory requirements and the unique needs of our customers.
Our focus is on solving customer problems for these critical applications, delivering innovative products and solutions that meet stringent regulatory requirements and the unique needs of our customers.
Our goal is to strive to provide a rewarding employee experience across the company. We continuously review our Human Capital Resources metrics, including safety metrics, turnover, and culture survey responses and associated action plans, to promote an emotionally and physically safe and inclusive working environment.
We aim to provide a rewarding employee experience across the company by continuously reviewing our Human Capital Resources metrics, such as safety metrics, turnover rates, and culture survey responses. These reviews help us promote a safe, inclusive, and engaging work environment. Our LEAP performance management and development process emphasizes both manager engagement and employee ownership.
We also launched our Women and Leadership Employee Resource Group in fiscal year 2023, which aims to continue increasing representation of women at all levels to contribute to the Company’s business success through relationships, and partnerships. 7 Executive Officers of Standex The executive officers of the Company as of June 30, 2023 are a s follows: Name Age Principal Occupation During the Past Five Years David Dunbar 61 President and Chief Executive Officer of the Company since January 2014.
Work continues to add additional ERGs in partnership with the IAC. 8 Table of Contents Executive Officers of Standex The executive officers of the Company as of June 30, 2024 are a s follows: Name Age Principal Occupation During the Past Five Years David Dunbar 62 President and Chief Executive Officer of the Company since January 2014.
Our LEAP performance management and development process places emphasis on both manager engagement and employee ownership. We regularly conduct employee engagement and satisfaction surveys, including our annual Culture Survey, completed in fiscal year 2023. Results from these surveys and engagement activities drive advances in senior management focus to continuously improve our culture and way of working.
We conduct regular employee engagement and satisfaction surveys, including our annual Culture Survey. Insights from these surveys drive senior management’s efforts to continually improve our company culture and operations. In fiscal year 2025, we will implement a Human Capital Management System to further support our commitment to our workforce.
Removed
We recently established an innovation and technology function focused on accelerating new, longer-term growth opportunities for emerging technologies, including our ongoing development project with a global renewable energy company. We continue to execute on acquisitions where strategically aligned with our businesses and where the opportunity meets our investment metrics.
Added
The Company’s strong historical cash flow has been a cornerstone for funding our capital allocation strategy.
Removed
First, the IAC sets global goals and objectives to promote inclusivity and diversity. Second, the IAC collaborates with Corporate Communications and the global Standex community to help develop internal and external communications highlighting the work and progress of the IAC. Finally, the IAC champions the adoption and implementation of IAC initiatives and projects within our respective businesses.
Added
We design and produce these products in Summerville, SC, ensuring high quality and reliability We offer a range of products in our portfolio that control the temperatures of critical healthcare products, medications, vaccines, and laboratory samples.
Removed
Sean Valashinas 52 Vice President, Chief Accounting Officer and Assistant Treasurer of the Company since October 2007.
Added
This system will enhance our ability to manage and develop our talent, streamline operations enhance employee development and satisfaction ensuring that we continue to provide a rewarding and supportive environment for all employees.
Added
Additionally, we launched the Women and Leadership Employee Resource Group in fiscal year 2023, aiming to increase the representation of women at all levels, enhancing the company’s success through relationships and partnerships.
Added
Max Arets 51 Vice President, Chief Information Officer since April 2024. Various positions of increasing responsibility in IT Audit, finance systems, project management and information systems and with Tyco International and Pentair from 2005 to March 2024 ending as Vice President, Digital Enterprise. Amy Gagnon 45 Vice President, Chief Accounting Officer of the Company since January 2024.
Added
Corporate Controller from September 2021 to January 2024 and Assistant Controller from March 2020 to September 2021. Assistant Controller at Vapotherm, Inc. from 2018 until joining the Company in March 2020.
Added
The executive officers are elected each year at the first meeting of the Board of Directors subsequent to the annual meeting of stockholders, to serve for one-year terms of office. There are no family relationships among any of the directors or executive officers of the Company.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

9 edited+0 added−0 removed78 unchanged
Biggest changeIf one or more members of our senior management team or other key personnel were unable or unwilling to continue in their present positions, our business could be seriously harmed.
Biggest changeWhile we engage in ongoing succession planning, if one or more members of our senior management team or other key personnel were unable or unwilling to continue in their present positions, our business could be seriously harmed.
A deterioration in the domestic and international economic environment, whether by way of current inflationary conditions or potential recessionary conditions, could adversely affect our operating results, cash flow and financial condition. Recent inflationary conditions in the United States, Europe and other parts of the world have increased virtually all of our costs including our cost of materials, labor and transportation.
A deterioration in the domestic and international economic environment, whether by way of inflationary conditions or recessionary conditions, could adversely affect our operating results, cash flow and financial condition. Recent inflationary conditions in the United States, Europe and other parts of the world have increased virtually all of our costs including our cost of materials, labor and transportation.
An economic recession could adversely affect our business by: • reducing demand for our products and services, particularly in markets where demand for our products and services is cyclical; • causing delays or cancellations of orders for our products or services; • reducing capital spending by our customers; • increasing price competition in our markets; • increasing difficulty in collecting accounts receivable; • increasing the risk of excess or obsolete inventories; • increasing the risk of impairment to long-lived assets due to reduced use of manufacturing facilities; • increasing the risk of supply interruptions that would be disruptive to our manufacturing processes; and • reducing the availability of credit and spending power for our customers. 9 We rely on our credit facility to provide us with sufficient capital to operate our businesses and to fund acquisitions .
An economic recession could adversely affect our business by: • reducing demand for our products and services, particularly in markets where demand for our products and services is cyclical; • causing delays or cancellations of orders for our products or services; • reducing capital spending by our customers; • increasing price competition in our markets; • increasing difficulty in collecting accounts receivable; • increasing the risk of excess or obsolete inventories; • increasing the risk of impairment to long-lived assets due to reduced use of manufacturing facilities; • increasing the risk of supply interruptions that would be disruptive to our manufacturing processes; and • reducing the availability of credit and spending power for our customers. 10 Table of Contents We rely on our credit facility to provide us with sufficient capital to operate our businesses and to fund acquisitions .
The trading price of our common stock could decline or fluctuate in response to a variety of factors, including: • our failure to meet the performance estimates of securities analysts; • changes in financial estimates of our net sales and operating results or buy/sell recommendations by securities analysts; • fluctuations in our quarterly operating results; • substantial sales of our common stock; • changes in the amount or frequency of our payment of dividends or repurchases of our common stock; • general stock market conditions; or • other economic or external factors. 13 Decreases in discount rates and actual rates of return could require an increase in future pension contributions to our pension plans which could limit our flexibility in managing our Company.
The trading price of our common stock could decline or fluctuate in response to a variety of factors, including: • our failure to meet the performance estimates of securities analysts; • changes in financial estimates of our net sales and operating results or buy/sell recommendations by securities analysts; • fluctuations in our quarterly operating results; • substantial sales of our common stock; • changes in the amount or frequency of our payment of dividends or repurchases of our common stock; • general stock market conditions; or • other economic or external factors. 14 Table of Contents Decreases in discount rates and actual rates of return could require an increase in future pension contributions to our pension plans which could limit our flexibility in managing our Company.
A violation of these laws could subject us to civil or criminal investigations that could result in substantial civil or criminal fines and penalties, and which could damage our reputation. 10 We face significant competition in our markets and, if we are not able to respond to competition in our markets, our net sales, profits and cash flows could decline.
A violation of these laws could subject us to civil or criminal investigations that could result in substantial civil or criminal fines and penalties, and which could damage our reputation. 11 Table of Contents We face significant competition in our markets and, if we are not able to respond to competition in our markets, our net sales, profits and cash flows could decline.
Any of these risks could have a material adverse effect on our financial condition, results of operations and/or value of an investment in the Company. 8 A pandemic or other global health crisis could adversely affect our revenues, operating results, cash flow and financial condition.
Any of these risks could have a material adverse effect on our financial condition, results of operations and/or value of an investment in the Company. 9 Table of Contents A pandemic or other global health crisis could adversely affect our revenues, operating results, cash flow and financial condition.
The costs of curing violations or resolving enforcement actions that might be initiated by government authorities could be substantial. 12 The costs of complying with existing or future regulations applicable to our products, and of correcting any violations of such regulations, could adversely impact our profitability.
The costs of curing violations or resolving enforcement actions that might be initiated by government authorities could be substantial. 13 Table of Contents The costs of complying with existing or future regulations applicable to our products, and of correcting any violations of such regulations, could adversely impact our profitability.
Our global operations subject us to international business risks. We operate in 37 locations outside of the United States in Europe, Canada, China, Japan, India, Singapore, Korea, Mexico, Turkey, Malaysia, and South Africa.
Our global operations subject us to international business risks. We operate in 42 locations outside of the United States in Europe, Canada, China, Japan, India, Singapore, Korea, Mexico, Turkey and Malaysia.
An inability to identify or complete future acquisitions could limit our future growth. 11 We may experience difficulties in integrating acquisitions.
An inability to identify or complete future acquisitions could limit our future growth. 12 Table of Contents We may experience difficulties in integrating acquisitions.

Item 2. Properties

Properties — owned and leased real estate

2 edited+0 added−0 removed1 unchanged
Biggest changeFor the year ended June 30, 2023 , the approximate building space utilized by each segment is as follows: Area in Square Feet (in thousands) Segment Number of Locations Leased Owned Total Asia Pacific 4 133 31 164 EMEA (1) 3 - 125 125 Other Americas 1 - 56 56 United States 6 148 60 208 Electronics 14 281 272 553 Asia Pacific 11 443 - 443 EMEA (1) 13 181 70 251 Other Americas 3 90 - 90 United States 6 142 79 221 Engraving 33 856 149 1,005 United States 1 164 - 164 Scientific 1 164 - 164 EMEA (1) 1 83 - 83 United States 2 107 171 278 Engineering Technologies 3 190 171 361 Asia Pacific 1 76 - 76 United States 2 33 198 231 Specialty Solutions 3 109 198 307 United States 2 20 - 20 Corporate & Other 2 20 - 20 Total 56 1,620 790 2,410 (1) EMEA consists of Europe, Middle East and S.
Biggest changeFor the year ended June 30, 2024 , the approximate building space utilized by each segment is as follows: Area in Square Feet (in thousands) Segment Number of Locations Leased Owned Total Asia Pacific 10 138 177 315 EMEA (1) 3 - 125 125 Other Americas 1 - 56 56 United States 7 148 74 222 Electronics 21 286 432 718 Asia Pacific 11 508 - 508 EMEA (1) 12 176 70 246 Other Americas 3 90 - 90 United States 6 88 79 167 Engraving 32 862 149 1,011 United States 1 164 - 164 Scientific 1 164 - 164 EMEA (1) 1 83 - 83 United States 2 107 171 278 Engineering Technologies 3 190 171 361 Asia Pacific 1 76 - 76 United States 2 33 198 231 Specialty Solutions 3 109 198 307 United States 2 19 - 19 Corporate & Other 2 19 - 19 Total 62 1,630 950 2,580 (1) EMEA consists of Europe, Middle East and S.
Item 2. Properties We operate a total of 56 facilities including manufacturing plants, service centers, and warehouses located throughout the United States, Europe, Canada, Southeast Asia, Korea, Japan, China, India, Brazil, South Africa, and Mexico. The Company owns 16 of the facilities and the others are leased.
Item 2. Properties We operate a total of 62 facilities including manufacturing plants, service centers, and warehouses located throughout the United States, Europe, Canada, Southeast Asia, Korea, Japan, China, India, Brazil, and Mexico. The Company owns 20 of the facilities and the others are leased.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

3 edited+1 added−0 removed2 unchanged
Biggest changeThe Company is not obligated to acquire a particular number of shares, and the program may be discontinued at any time at the Company’s discretion. 16 The following graph compares the cumulative total stockholder return on the Company’s Common Stock as of the end of each of the last five fiscal years, with the cumulative total stockholder return on the Standard & Poor’s Small Cap 600 (Industrial Segment) Index and on the Russell 2000 Index, assuming an investment of $100 in each at their closing prices on June 30, 2018 and the reinvestment of all dividends.
Biggest changeThe Company is not obligated to acquire a particular number of shares, and the program may be discontinued at any time at the Company’s discretion. 17 Table of Contents The graph below matches Standex International Corporation's cumulative 5-Year total shareholder return on common stock with the cumulative total returns of the Russell 2000 index and the S&P 600 Industrials index.
Item 5. Market for Standex Common Stock Related Stockholder Matters and Issuer Purchases of Equity Securities The principal market in which the Common Stock of Standex is traded is the New York Stock Exchange under the ticker symbol “SXI”. The approximate number of stockholders of record on July 31, 2023 was 1,170 .
Item 5. Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities The principal market in which the Common Stock of Standex is traded is the New York Stock Exchange under the ticker symbol “SXI”. The approximate number of stockholders of record on July 31, 2024 was 1,092.
Additional information regarding our equity compensation plans is presented in the Notes to Consolidated Financial Statements under the caption “Stock-Based Compensation and Purchase Plans” and Item 12 “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.” Issuer Purchases of Equity Securities (1) Quarter Ended June 30, 2023 Period (a) Total Number of Shares (or units) Purchased (b) Average Price Paid per Share (or unit) (c) Total Number of Shares (or units) Purchased as Part of Publicly Announced Plans or Programs (d) Maximum Number (or Appropriate Dollar Value) of Shares (or units) that May Yet Be Purchased Under the Plans or Programs April 1 - April 30, 2023 242 $ 122.44 242 $ 72,086 May 1 - May 31, 2023 50,000 137.46 50,000 65,213 June 1 - June 30, 2023 628 141.47 628 65,124 TOTAL 50,870 $ 137.44 50,870 $ 65,124 (1) The Company has a Stock Buyback Program (the “Program”) which was originally announced on January 30, 1985 and most recently amended on April 28, 2022.
Additional information regarding our equity compensation plans is presented in the Notes to Consolidated Financial Statements under the caption “Stock-Based Compensation and Purchase Plans” and Item 12 “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.” Issuer Purchases of Equity Securities (1) Quarter Ended June 30, 2024 Period (a) Total Number of Shares (or units) Purchased (b) Average Price Paid per Share (or unit) (c) Total Number of Shares (or units) Purchased as Part of Publicly Announced Plans or Programs (d) Maximum Number (or Appropriate Dollar Value) of Shares (or units) that May Yet Be Purchased Under the Plans or Programs April 1 - April 30, 2024 242 $ 173.11 242 $ 33,301 May 1 - May 31, 2024 - - - 33,301 June 1 - June 30, 2024 - - - 33,301 TOTAL 242 $ 173.11 242 $ 33,301 (1) The Company has a Stock Buyback Program (the “Program”) which was originally announced on January 30, 1985 and most recently amended on April 28, 2022.
Added
The graph tracks the performance of a $100 investment in our common stock and in each index (with the reinvestment of all dividends) from 6/30/2019 to 6/30/2024.

Item 7. Management's Discussion & Analysis

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

82 edited+17 added−20 removed71 unchanged
Biggest changeThe income tax provision from continuing operations for the fiscal year ended June 30, 2021 was impacted by the following items: (i) a tax provision of $5.1 million due to the mix of income in various jurisdictions, (ii) a tax benefit of $1.0 million from our 2019 and 2020 tax losses that the CARES Act allows to be carried back to 2014 and 2015, when the U.S. federal income tax rate was 35%, (iii) a tax benefit of $0.8 million related to Federal R&D credit and Foreign Tax Credit, (iv) a tax benefit of $1.7 million related to return-to-accrual adjustments to true-up up prior-period provision amounts, and (v) the tax expense of $1.2 million attributable to the divestiture of the Enginetics Corporation during the year.
Biggest changeThe income tax provision from continuing operations for the fiscal year ended June 30, 2024 was impacted by the following items: (i) a tax provision of $3.1 million due to the mix of income in various jurisdictions, (ii) tax benefits of $2.8 million related to foreign tax credits of $0.7 million, as well as Federal R&D tax credits of $2.1 million, (iii) a tax provision of $3.8 million related to officers’ compensation, and (iv) a tax benefit of $3.9 million relating to share-based compensation.
Income from Operations Income from operations for the fiscal year 2023 was $171.1 million, compared to $88.3 million during the prior year.
Income from operations for the fiscal year 2023 was $171.1 million, compared to $88.3 million during the prior year.
Net sales decreased as expected due to lower demand for cold storage surrounding COVID-19 vaccine distribution partially offset by pricing actions. 24 Income from operations in fiscal year 2023 decreased by $0.8 million, or 4.2%, when compared to the prior year. Operating income decrease reflects lower sales volume, partially offset by pricing and productivity actions and lower oceanic freight costs.
Net sales decreased as expected due to lower demand for cold storage surrounding COVID-19 vaccine distribution partially offset by pricing actions. Income from operations in fiscal year 2023 decreased $0.8 million or 4.2%, when compared to the prior year. Operating income decrease reflects lower sales volume, partially offset by pricing and productivity actions and lower oceanic freight costs.
Our annual impairment testing at each reporting unit relied on assumptions surrounding general market conditions, short-term growth rates, a terminal growth rate of 2.5%, and detailed management forecasts of future cash flows prepared by the relevant reporting unit. Fair values were determined primarily by discounting estimated future cash flows at a weighted average cost of capital of 11.5%.
Our annual impairment testing at each reporting unit relied on assumptions surrounding general market conditions, short-term growth rates, a terminal growth rate of 2.5%, and detailed management forecasts of future cash flows prepared by the relevant reporting unit. Fair values were determined primarily by discounting estimated future cash flows at a weighted average cost of capital of 11.0%.
While Standex considers our relationship with our suppliers to be good, there can be no assurances that we will not experience any supply shortage. Foreign Currency Translation – Our primary functional currencies used by our non-U.S. subsidiaries are the Euro, British Pound Sterling (Pound), Japanese (Yen), and Chinese (Yuan).
While Standex considers our relationship with our suppliers to be good, there can be no assurances that we will not experience any supply shortage. Foreign Currency Translation – Our primary functional currencies used by our non-U.S. subsidiaries are the Euro, British Pound Sterling (Pound), Japanese (Yen), Peso and Chinese (Yuan).
A twenty-five-basis point change in our discount rate, holding all other assumptions constant, would have no impact on 2023 pension expense as changes to amortization of net losses would be offset by changes to interest cost. In future years, the impact of discount rate changes could yield different sensitivities.
A twenty-five-basis point change in our discount rate, holding all other assumptions constant, would have no impact on 2024 pension expense as changes to amortization of net losses would be offset by changes to interest cost. In future years, the impact of discount rate changes could yield different sensitivities.
We have evaluated the current and long-term cash requirements of our defined benefit and defined contribution plans as of June 30, 2023 and determined our operating cash flows from continuing operations and available liquidity are expected to be sufficient to cover the required contributions under ERISA and other governing regulations.
We have evaluated the current and long-term cash requirements of our defined benefit and defined contribution plans as of June 30, 2024 and determined our operating cash flows from continuing operations and available liquidity are expected to be sufficient to cover the required contributions under ERISA and other governing regulations.
The most significant assumption involved in the Company’s determination of fair value is the cash flow projections of each reporting unit. As a result of our annual assessment in the fourth quarter of fiscal year 2023, the Company determined that the fair value of the six reporting units substantially exceeded their respective carrying values.
The most significant assumption involved in the Company’s determination of fair value is the cash flow projections of each reporting unit. As a result of our annual assessment in the fourth quarter of fiscal year 2024, the Company determined that the fair value of the six reporting units substantially exceeded their respective carrying values.
Therefore, no impairment charges were recorded in connection with our annual assessment during the fourth quarter of fiscal year 2023. Cost of Employee Benefit Plans – We provide a range of benefits to certain retirees, including pensions and some postretirement benefits.
Therefore, no impairment charges were recorded in connection with our annual assessment during the fourth quarter of fiscal year 2024. Cost of Employee Benefit Plans – We provide a range of benefits to certain retirees, including pensions and some postretirement benefits.
A twenty-five-basis point change in the U.S. expected return on plan assets assumptions, holding our discount rate and other assumptions constant, would increase or decrease pension expense by approximately $0.5 million per year.
A twenty-five-basis point change in the U.S. expected return on plan assets assumptions, holding our discount rate and other assumptions constant, would increase or decrease pension expense by approximately $0.4 million per year.
The expected return on plan assets assumption of 6.5% in the U.S. is based on our expectation of the long-term average rate of return on assets in the pension funds and is reflective of the current and projected asset mix of the funds and considers the historical returns earned on the funds.
The expected return on plan assets assumption of 6.4% in the U.S. is based on our expectation of the long-term average rate of return on assets in the pension funds and is reflective of the current and projected asset mix of the funds and considers the historical returns earned on the funds.
Summary of Accounting Policies” for information regarding the effect of recently issued accounting pronouncements on our consolidated statements of operations, comprehensive income, stockholders’ equity, cash flows, and notes for the year ended June 30, 2023.
Summary of Accounting Policies” for information regarding the effect of recently issued accounting pronouncements on our consolidated statements of operations, comprehensive income, stockholders’ equity, cash flows, and notes for the year ended June 30, 2024.
This estimate is based upon effective interest rates as of June 30, 2023 and excludes any interest rate swaps which are assets to us. See Item 7A for further discussions surrounding interest rate exposure on our variable rate borrowings. Post-retirement benefits and pension plan contribution payments represents future pension payments to comply with local funding requirements.
This estimate is based upon effective interest rates as of June 30, 2024 and excludes any interest rate swaps which are assets to us. See Item 7A for further discussions surrounding interest rate exposure on our variable rate borrowings. Post-retirement benefits and pension plan contribution payments represent future pension payments to comply with local funding requirements.
The Company’s current financial covenants under the facility are as follows: 27 Interest Coverage Ratio - The Company is required to maintain a ratio of Earnings Before Interest and Taxes, as Adjusted (“Adjusted EBIT per the Credit Facility”), to interest expense for the trailing twelve months of at least 2.75:1.
The Company’s current financial covenants under the facility are as follows: 28 Table of Contents Interest Coverage Ratio - The Company is required to maintain a ratio of Earnings Before Interest and Taxes, as Adjusted (“Adjusted EBIT per the Credit Facility”), to interest expense for the trailing twelve months of at least 2.75:1.
Adjusted EBIT per the Credit Facility specifically excludes extraordinary and certain other defined items such as cash restructuring and acquisition related charges up to the lower of $20.0 million or 10% of EBITDA. The facility allows for unlimited non-cash charges including purchase accounting and goodwill adjustments. At June 30, 2023, the Company’s Interest Coverage Ratio was 20.61:1.
Adjusted EBIT per the Credit Facility specifically excludes extraordinary and certain other defined items such as cash restructuring and acquisition related charges up to the lower of $20.0 million or 10% of EBITDA. The facility allows for unlimited non-cash charges including purchase accounting and goodwill adjustments. At June 30, 2024, the Company’s Interest Coverage Ratio was 25.15.:1.
We are not able to provide a reasonable estimate of the timing of future payments related to these obligations. 28 Other Matters Inflation – Certain of our expenses, such as wages and benefits, occupancy costs, freight and equipment repair and replacement, are subject to normal inflationary pressures.
We are not able to provide a reasonable estimate of the timing of future payments related to these obligations. 29 Table of Contents Other Matters Inflation – Certain of our expenses, such as wages and benefits, occupancy costs, freight and equipment repair and replacement, are subject to normal inflationary pressures.
Discussion of the performance of each of our reportable segments is fully explained in the segment analysis that follows. Interest Expense Interest expense for fiscal year 2023 was $5.4 million a decrease of $0.5 million as compared to the prior year. Our effective interest rate was 2.97%.
Discussion of the performance of each of our reportable segments is fully explained in the segment analysis that follows. Interest Expense Interest expense for fiscal year 2024 was $4.5 million, a decrease of $0.9 million as compared to the prior year. Our effective interest rate was 2.46%.
During fiscal year 2022, we incurred restructuring expenses of $4.4 million, primarily related to productivity improvements, facility rationalization activities, and global headcount reductions within our Engraving and Electronics segments. (Gain) Loss on Sale of Business We recorded a pre-tax gain on sale of the Procon business of $62.1 million for fiscal year 2023.
During fiscal year 2023, we incurred restructuring expenses of $3.8 million, primarily related to productivity improvements, facility rationalization activities, and global headcount reductions primarily within our Engraving and Electronics segments and Corporate headquarters. (Gain) Loss on Sale of Business We recorded a pre-tax gain on sale of the Procon business of $62.1 million for fiscal year 2023.
Based on information provided by our actuaries and other relevant sources, we believe that our assumptions are reasonable. 30 The cost of employee benefit plans includes the selection of assumptions noted above.
Based on information provided by our actuaries and other relevant sources, we believe that our assumptions are reasonable. 31 Table of Contents The cost of employee benefit plans includes the selection of assumptions noted above.
During fiscal year 2023, capital expenditures were $24.3 million or 3.3% of net sales, as compared to $23.9 million, or 3.2%, of net sales in the prior year. We expect 2024 capital spending to be between $35 million and $40 million. Backlog Backlog includes all active or open orders for goods and services.
During fiscal year 2024, capital expenditures were $20.3 million or 2.8% of net sales, as compared to $24.3 million, or 3.3%, of net sales in the prior year. We expect 2025 capital spending to be between $35 million and $40 million. Backlog Backlog includes all active or open orders for goods and services.
Under certain circumstances in connection with a Material Acquisition (as defined in the Facility), the Facility allows for the leverage ratio to go as high as 4.0:1 for a four-fiscal quarter period. At June 30, 2023, the Company’s Leverage Ratio was 0.84:1. As of June 30, 2023, we had borrowings under our facility of $175.0 million.
Under certain circumstances in connection with a Material Acquisition (as defined in the Facility), the Facility allows for the leverage ratio to go as high as 4.0:1 for a four-fiscal quarter period. At June 30, 2024, the Company’s Leverage Ratio was 0.65:1. As of June 30, 2024, we had borrowings under our facility of $150.0 million.
Assurance type warranties do not represent a separate performance obligation. 29 In general, the Company recognizes revenue at the point in time control transfers to their customer based on predetermined shipping terms.
Assurance type warranties do not represent a separate performance obligation. 30 Table of Contents In general, the Company recognizes revenue at the point in time control transfers to their customer based on predetermined shipping terms.
At June 30, 2023, the underlying policies had a cash surrender value of $11.7 million and are reported net of loans of $5.0 million for which we have the legal right of offset. These amounts are reported net on our balance sheet.
At June 30, 2024, the underlying policies had a cash surrender value of $11.7 million and are reported net of loans of $4.9 million for which we have the legal right of offset. These amounts are reported net on our balance sheet.
The fair value of the Company's U.S. defined benefit pension plan assets was $142.1 million at June 30, 2023, as compared to $157.9 million as of June 30, 2022. We participate in two multi-employer pension plans and sponsor five defined benefit plans including two in the U.S. and one each in the U.K., Germany and Japan.
The fair value of the Company's U.S. defined benefit pension plan assets was $142.3 million at June 30, 2024, as compared to $142.1 million as of June 30, 2023. We participate in two multi-employer pension plans and sponsor six defined benefit plans including two in the U.S. and Japan and one each in the U.K. and Germany.
The Company's net (cash) debt to capital percentage changed to (3.8)% as of June 30, 2023 from 12.3% in the prior year. At June 30, 2023, we expect to pay estimated interest payments of $7.9 million within the next five years.
The Company's net (cash) debt to capital percentage changed to (0.9)% as of June 30, 2024 from (3.8)% in the prior year. At June 30, 2024, we expect to pay estimated interest payments of $2.8 million within the next five years.
Leases" for additional information regarding these obligations. At June 30, 2023 , we had $9.5 million of non-current liabilities for uncertain tax positions.
Leases" for additional information regarding these obligations. At June 30, 2024 , we had $ 9.8 million of non-current liabilities for uncertain tax positions.
In order to manage our interest rate exposure on these borrowings, we are party to $175.0 million of active floating to fixed rate swaps. These swaps convert our interest payments from SOFR to a weighted average rate of 1.13%. The effective rate of interest for our outstanding borrowings, including the impact of the interest rate swaps, was 2.97%.
In order to manage our interest rate exposure on these borrowings, we are party to $150.0 million of active floating to fixed rate swaps. These swaps convert our interest payments from SOFR to a weighted average rate of 0.85%. The effective rate of interest for our outstanding borrowings, including the impact of the interest rate swaps, was 2.46%.
The repatriation of cash balances from certain of our subsidiaries could have adverse tax consequences or be subject to capital controls; however, those balances are generally available without legal restrictions to fund ordinary business operations. 26 Cash Flow Net cash provided by continuing operating activities for the year ended June 30, 2023 was $90.8 million compared to net cash provided by continuing operating activities of $78.1 million in the prior year.
The repatriation of cash balances from certain of our subsidiaries could have adverse tax consequences or be subject to capital controls; however, those balances are generally available without legal restrictions to fund ordinary business operations. 27 Table of Contents Cash Flow Net cash provided by continuing operating activities for the year ended June 30, 2024 was $93.3 million compared to net cash provided by continuing operating activities of $90.8 million in the prior year.
At June 30, 2023, we expect to pay estimated post-retirement benefit payments of $10.2 million during fiscal year 2024. See "Item 8. Financial Statements and Supplementary Data, Note 16. Employee Benefit Plans" for additional information regarding these obligations. At June 30, 2023, we had $33.8 million of operating lease obligations. See "Item 8. Financial Statements and Supplementary Data, Note 20.
At June 30, 2024, we expect to pay estimated post-retirement benefit payments of $6.0 million during fiscal year 2025. See "Item 8. Financial Statements and Supplementary Data, Note 16. Employee Benefit Plans" for additional information regarding these obligations. At June 30, 2024, we had $39.0 million of operating lease obligations. See "Item 8. Financial Statements and Supplementary Data, Note 20.
As of June 30, 2023, the Company has used $3.0 million against the letter of credit sub-facility and had the ability to borrow $371.5 million under the facility based on our current trailing twelve-month EBITDA. The facility contains customary representations, warranties and restrictive covenants, as well as specific financial covenants.
As of June 30, 2024, the Company has used $2.7 million against the letter of credit sub-facility and had the ability to borrow $347.3 million under the facility based on our current trailing twelve-month EBITDA. The facility contains customary representations, warranties and restrictive covenants, as well as specific financial covenants.
Interest expense for fiscal year 2022 was $5.9 million a decrease of $0.1 million as compared to the prior year. 21 Income Taxes The income tax provision from continuing operations for the fiscal year ended June 30, 2023 was $24.8 million, or an effective rate of 15.1%, compared to $19.8 million, or an effective rate of 24.4%, for the year ended June 30, 2022, and $14.2 million, or an effective rate of 26.9%, for the year ended June 30, 2021.
Interest expense for fiscal year 2023 was $5.4 million, a decrease of $0.5 million as compared to the prior year. 22 Table of Contents Income Taxes The income tax provision from continuing operations for the fiscal year ended June 30, 2024 was $21.5 million, or an effective rate of 22.6%, compared to $24.8 million, or an effective rate of 15.1%, for the year ended June 30, 2023, and $19.8 million, or an effective rate of 24.4%, for the year ended June 30, 2022.
In general, for fiscal year 2024, we expect: ● continued growth in transportation markets from electric vehicle program with a ramp up of new business opportunities, including sensors for charger plugs and soft trim growth; ● vaccine storage demand to remain stable after the record COVID-19 related surge in fiscal year 2021 and early fiscal year 2022; ● commercial aviation and defense end markets demand to increase based on current program expectations; ● space markets to remain attractive, with volume to slightly increase from fiscal year 2023 due to new product development for existing customers; ● refuse and dump end markets to remain stable while being supported by investments in the U.S. infrastructure bill; ● stable demand levels in food service equipment markets.
In general, for fiscal year 2025, we expect: ● continued growth in transportation markets from hybrid and electric vehicle program with a ramp up of new business opportunities; ● soft trim end market growth in APAC; ● vaccine and cold storage demand to remain stable; ● commercial aviation, space and defense end markets demand to increase based on current program expectations and new product development; ● space markets to remain attractive, with volume to slightly increase from fiscal year 2023 due to new product development for existing customers; ● refuse and dump end markets to remain stable while being supported by future investments in the U.S. infrastructure bill; ● stable demand levels in food service equipment markets.
Renco’s results are reported within our Electronics segment beginning in fiscal year 2021. 18 As a result of these portfolio moves, we have transformed Standex to a company with a more focused group of businesses selling customized solutions to high value end markets via a compelling customer value proposition.
Its results are reported within our Electronics segment. 19 Table of Contents As a result of these portfolio moves, we have transformed Standex to a company with a more focused group of businesses selling customized solutions to high value end markets via a compelling customer value proposition.
Engineering Technologies 2023 compared to 2022 2022 compared to 2021 (in thousands except % % percentages) 2023 2022 Change 2022 2021 Change Net sales $81,079 $78,117 3.8% $78,117 $75,562 3.4% Income from operations 11,050 8,776 25.9% 8,776 6,164 42.4% Operating income margin 13.6% 11.2% 11.2% 8.2% Net sales in fiscal year 2023 increased $3.0 million, or 3.8%, when compared to the prior year.
Engineering Technologies 2024 compared to 2023 2023 compared to 2022 (in thousands except % % percentages) 2024 2023 Change 2023 2022 Change Net sales $83,476 $81,079 3.0% $81,079 $78,117 3.8% Income from operations 15,216 11,050 37.7% 11,050 8,776 25.9% Operating income margin 18.2% 13.6% 13.6% 11.2% Net sales in fiscal year 2024 increased $2.4 million, or 3.0%, when compared to the prior year.
Organic sales increases were attributed to $82.5 million to fast growth markets, targeted pricing initiatives in most of our businesses and volume in each business, with the exception of Scientific. Gross profit was also negatively impacted by the divestiture of the Procon business.
Organic sales increases were attributed to $82.5 million to fast growth markets, targeted pricing initiatives in most of our businesses and volume in each business, with the exception of Scientific.
We discuss our results and outlook for each segment below. Gross Profit Gross profit in fiscal year 2023 increased to $285.1 million, or a gross margin of 38.5%, as compared to $269.9 million, or a gross margin of 36.7%, for the prior year period.
Gross profit in fiscal year 2023 increased to $285.1 million, or a gross margin of 38.5%, as compared to $269.9 million, or a gross margin of 36.7%, for the prior year period.
Scientific 2023 compared to 2022 2022 compared to 2021 (in thousands except % % percentages) 2023 2022 Change 2022 2021 Change Net sales $74,924 $83,850 (10.6%) $83,850 $79,421 5.6% Income from operations 17,109 17,861 (4.2%) 17,861 18,240 (2.1%) Operating income margin 22.8% 21.3% 21.3% 23.0% Net sales in fiscal year 2023 decreased by $8.9 million, or 10.6% when compared to the prior year.
Scientific 2024 compared to 2023 2023 compared to 2022 (in thousands except % % percentages) 2024 2023 Change 2023 2022 Change Net sales $68,931 $74,924 (8.0%) $74,924 $83,850 (10.6%) Income from operations 19,000 17,109 11.1% 17,109 17,861 (4.2%) Operating income margin 27.6% 22.8% 22.8% 21.3% Net sales in fiscal year 2024 decreased by $6.0 million, or 8.0% when compared to the prior year.
Activity related to discontinued operations is as follows (in thousands): Year Ended June 30, 2023 2022 2021 Profit (loss) before taxes $ (204 ) $ (113 ) $ (2,620 ) Benefit (provision) for taxes 43 24 550 Net income (loss) from discontinued operations $ (161 ) $ (89 ) $ (2,070 ) Liquidity and Capital Resources At June 30, 2023, our total cash balance was $195.7 million, of which $98.6 million was held outside of the United States.
Activity related to discontinued operations is as follows (in thousands): Year Ended June 30, 2024 2023 2022 (Loss) before taxes $ (654 ) $ (204 ) $ (113 ) Benefit for taxes 137 43 24 Net (loss) from discontinued operations $ (517 ) $ (161 ) $ (89 ) Liquidity and Capital Resources At June 30, 2024, our total cash balance was $154.2 million, of which $128.1 million was held outside of the United States.
The Company expects to make contributions during fiscal year 2024 of $0.2 million and $0.2 million to its unfunded defined benefit plans in the U.S. and Germany, respectively. Any subsequent plan contributions will depend on the results of future actuarial valuations.
There are required contributions of $5.8 million to the United States funded pension plan for fiscal year 2025. The Company expects to make contributions during fiscal year 2025 of $0.2 million and $0.3 million to its unfunded defined benefit plans in the U.S. and Germany, respectively. Any subsequent plan contributions will depend on the results of future actuarial valuations.
The goodwill balance of $0.2 million was written off as a part of the transaction. The sale transaction and financial results of Procon are classified as continuing operations in the Consolidated Financial Statements. We recorded a pre-tax loss on sale of the Enginetics business of $14.6 million for fiscal year 2021.
The goodwill balance of $0.2 million was written off as a part of the transaction. The sale transaction and financial results of Procon are classified as continuing operations in the Consolidated Financial Statements. We recorded an additional pre-tax gain on sale of the Procon business of $0.3 million for fiscal year 2024 due to closing cash adjustments.
Acquisitions had a $1.9 million, or 0.3%, positive impact on sales, offset by negative impacts on sales for divestitures of $11.9 million, or 1.9%, and foreign currency of $23.9 million, or 3.3%. Net sales increased for fiscal year 2022 by $79.1 million or 12.1% when compared to the prior year.
Acquisitions had a $40.4 million, or 5.5%, positive impact on sales, offset by negative impacts on sales for divestitures of $21.3 million, or 2.9%, and foreign currency of $1.8 million, or 0.3%. Net sales increased for fiscal year 2023 by $5.7 million, or 0.8%, when compared to the prior year period.
Specialty Solutions 2023 compared to 2022 2022 compared to 2021 (in thousands except % % percentages) 2023 2022 Change 2022 2021 Change Net sales $127,106 $122,827 3.5% $122,827 $100,864 21.8% Income from operations 25,368 15,579 62.8% 15,579 14,358 8.5% Operating income margin 20.0% 12.7% 12.7% 14.2% Net sales for fiscal year 2023 increased $4.3 million, or 3.5% when compared to the prior year.
Specialty Solutions 2024 compared to 2023 2023 compared to 2022 (in thousands except % % percentages) 2024 2023 Change 2023 2022 Change Net sales $95,587 $127,106 (24.8%) $127,106 $122,827 3.5% Income from operations 19,631 25,368 (22.6%) 25,368 15,579 62.8% Operating income margin 20.5% 20.0% 20.0% 12.7% Net sales for fiscal year 2024 decreased $31.5 million, or 24.8% when compared to the prior year.
We generated $116.6 million from income statement activities and used $18.2 million of cash to fund working capital and other balance sheet account increases. Cash flow provided by investing activities for the year ended June 30, 2023 totaled $41.6 million.
Net cash provided by continuing operating activities for the year ended June 30, 2023 was $90.8 million compared to net cash provided by continuing operating activities of $78.1 million in the prior year. We generated $116.6 million from income statement activities and used $18.2 million of cash to fund working capital and other balance sheet account increases.
Unless otherwise noted, references to years are to fiscal years. 19 Consolidated Results from Continuing Operations (in thousands): 2023 2022 2021 Net sales $ 741,048 $ 735,339 $ 656,232 Gross profit margin 38.5 % 36.7 % 36.8 % Restructuring costs 3,831 4,399 3,478 Acquisition related expenses 557 1,618 931 Other operating (income) expense, net (611 ) 5,745 - (Gain) loss on sale of business (62,105 ) - 14,624 Income from operations 171,089 88,294 59,165 Backlog (realizable within 1 year) $ 238,050 $ 256,248 $ 210,491 2023 2022 2021 Net sales $ 741,048 $ 735,339 $ 656,232 Components of change in sales: Effect of acquisitions 1,919 1,918 25,554 Effect of exchange rates (23,902 ) (9,874 ) 14,471 Effect of business divestitures (11,947 ) (9,239 ) (3,633 ) Organic sales change 39,639 96,302 15,305 Net sales increased for fiscal year 2023 by $5.7 million, or 0.8%, when compared to the prior year period.
Unless otherwise noted, references to years are to fiscal years. 20 Table of Contents Consolidated Results from Continuing Operations (in thousands): 2024 2023 2022 Net sales $ 720,635 $ 741,048 $ 735,339 Gross profit margin 39.1 % 38.5 % 36.7 % Restructuring costs 8,206 3,831 4,399 Acquisition related expenses 2,622 557 1,618 Other operating (income) expense, net 110 (611 ) 5,745 (Gain) loss on sale of business (274 ) (62,105 ) - Income from operations 101,738 171,089 88,294 Backlog (realizable within 1 year) $ 185,296 $ 274,902 $ 256,248 2024 2023 2022 Net sales $ 720,635 $ 741,048 $ 735,339 Components of change in sales: Effect of acquisitions 40,427 1,919 1,918 Effect of exchange rates (1,842 ) (23,902 ) (9,874 ) Effect of business divestitures (21,259 ) (11,947 ) (9,239 ) Organic sales change (37,739 ) 39,639 96,302 Net sales decreased for fiscal year 2024 by $20.4 million, or 2.8%, when compared to the prior year period.
Engraving 2023 compared to 2022 2022 compared to 2021 (in thousands except % % percentages) 2023 2022 Change 2022 2021 Change Net sales $152,067 $146,255 4.0% $146,255 $147,016 (0.5%) Income from operations 25,462 21,825 16.7% 21,825 22,510 (3.0%) Operating income margin 16.7% 14.9% 14.9% 15.3% Net sales in fiscal year 2023 increased by $5.8 million, or 4.0%, compared to the prior year.
Engraving 2024 compared to 2023 2023 compared to 2022 (in thousands except % % percentages) 2024 2023 Change 2023 2022 Change Net sales $150,685 $152,067 (0.9%) $152,067 $146,255 4.0% Income from operations 26,708 25,462 4.9% 25,462 21,825 16.7% Operating income margin 17.7% 16.7% 16.7% 14.9% Net sales in fiscal year 2024 decreased by $1.4 million, or 0.9%, compared to the prior year.
Income from operations in fiscal year 2023 increased $2.3 million, or 25.9%, when compared to the prior year. The increase was primarily due to productivity initiatives, volume increases and the impact of a one-time project related charge in first quarter of fiscal year 2022 that did not repeat.
The increase was primarily due to productivity initiatives, volume increases and the impact of a one-time project related charge in first quarter of fiscal year 2022 that did not repeat.
SG&A expenses during the period were primarily impacted by increased research and development spending to drive future product initiatives. Selling, general, and administrative expenses, (“SG&A”) for the fiscal year 2022 were $169.9 million, or 23.1% of sales compared to $163.1 million, or 24.8% of sales during the prior year.
SG&A expenses during the period were impacted by a reduction in general and administrative expenses partially offset by increased research and development spending. Selling, general, and administrative expenses, (“SG&A”) for the fiscal year 2023 were $172.3 million, or 23.3% of sales, compared to $169.9 million, or 23.1% of sales, during the prior year period.
The following table sets forth our capitalization at June 30: 2023 2022 Long-term debt $ 173,441 $ 174,830 Less cash and cash equivalents 195,706 104,844 Net (cash) debt (22,265 ) 69,986 Stockholders' equity 607,449 499,343 Total capitalization $ 585,184 $ 569,329 Stockholders’ equity increased year over year by $108.1 million, primarily as a result of current year net income of $139.0 million offset by $38.5 million of cash returned to shareholders in the form of dividends and stock repurchases.
The following table sets forth our capitalization at June 30: 2024 2023 Long-term debt $ 148,876 $ 173,441 Less cash and cash equivalents 154,203 195,706 Net (cash) debt (5,327 ) (22,265 ) Stockholders' equity 621,503 607,449 Total capitalization $ 616,176 $ 585,184 Stockholders’ equity increased year over year by $14.0 million, primarily as a result of current year net income of $73.1 million offset by $45.7 million of cash returned to shareholders in the form of dividends and stock repurchases.
Organic sales increased $16.7 million, or 13.6% excluding Procon, as compared to the prior year period. The increased sales volume is primarily due to pricing realization, strong market demand and the absence of the labor work stoppage in two plants during the prior year. The impact of the Procon divestiture partially offset the organics sales increase.
The increased sales volume is primarily due to pricing realization, strong market demand and the absence of the labor work stoppage in two plants during the prior year. The impact of the Procon divestiture partially offset the organics sales increase. Income from operations for fiscal year 2023 increased $9.8 million, or 62.8%, when compared to the prior year.
Corporate, Restructuring and Other 2023 compared to 2022 2022 compared to 2021 (in thousands except % % percentages) 2023 2022 Change 2022 2021 Change Corporate $ (35,207) $ (34,413) 2.3% $ (34,413) $ (29,674) 16.0% Gain (loss) on sale of business 62,105 - 100.0% - (14,624) 100.0% Restructuring costs (3,831) (4,399) (12.9%) (4,399) (3,478) 26.5% Acquisition related costs (557) (1,618) (65.6%) (1,618) (931) 73.8% Other operating income (expense), net 611 (5,745) 100.0% (5,745) - - Corporate expenses in fiscal year 2023 increased $0.8 million, or 2.3%, when compared to the prior year, primarily due to employee related compensation accruals and research and development costs.
Corporate, Restructuring and Other 2024 compared to 2023 2023 compared to 2022 (in thousands except % % percentages) 2024 2023 Change 2023 2022 Change Corporate $ (32,183) $ (35,207) (8.6%) $ (35,207) $ (34,413) 2.3% Gain (loss) on sale of business 274 62,105 (99.6%) 62,105 - 100.0% Restructuring costs (8,206) (3,831) 114.2% (3,831) (4,399) (12.9%) Acquisition related costs (2,622) (557) 370.7% (557) (1,618) (65.6%) Other operating income (expense), net (110) 611 (118.0%) 611 (5,745) (110.6%) Corporate expenses in fiscal year 2024 decreased $3.0 million, or 8.6%, when compared to the prior year.
Electronics 2023 compared to 2022 2022 compared to 2021 (in thousands except % % percentages) 2023 2022 Change 2022 2021 Change Net sales $305,872 $304,290 0.5% $304,290 $253,369 20.1% Income from operations 68,979 70,428 (2.1%) 70,428 46,600 51.1% Operating income margin 22.6% 23.1% 23.1% 18.4% 23 Net sales in fiscal year 2023 increased $1.6 million, or 0.5%, when compared to the prior year.
Electronics 2024 compared to 2023 2023 compared to 2022 (in thousands except % % percentages) 2024 2023 Change 2023 2022 Change Net sales $321,956 $305,872 5.3% $305,872 $304,290 0.5% Income from operations 64,030 68,979 (7.2%) 68,979 70,428 (2.1%) Operating income margin 19.9% 22.6% 22.6% 23.1% 24 Table of Contents Net sales in fiscal year 2024 increased $16.1 million, or 5.3%, when compared to the prior year.
We generated $67.0 million in proceeds from the divestiture of the Procon business and $24.3 million was used for capital expenditures.
We used $48.8 million for the purchase of acquisitions in the fiscal year and $20.3 million was used for capital expenditures. We generated $7.8 million in the fiscal year of proceeds from the divestiture of the Procon business.
In the first quarter of fiscal year 2024, on a sequential basis, we expect similar revenue and operating margin. Net sales in fiscal year 2022 increased by $4.4 million, or 5.6% when compared to the prior year.
In the first quarter of fiscal year 2025, on a sequential basis, we expect similar revenue and slightly lower operating margin due to investments in research and development and higher freight cost. Net sales in fiscal year 2023 increased by $8.9 million, or 10.6% when compared to the prior year.
Operating income increased due to sales increases in Display Merchandising, pricing actions and the impact of the labor work stoppage in two plants during the prior year. 25 In the first quarter of fiscal year 2024, on a sequential basis, we expect a slight decrease in revenue and operating margin.
Operating income increased due to sales increases in Display Merchandising, pricing actions and the impact of the labor work stoppage in two plants during the prior year.
Cash used by financing activities for the year ended June 30, 2022 were $69.4 million and included stock repurchases of $31.4 million, repayments of debt of $25.0 million, cash paid for dividends of $12.2 million, and contingent consideration payments due to the seller of the Renco business of $2.2 million.
Cash used by financing activities for the year ended June 30, 2024 was $69.2 million and included stock repurchases of $31.8 million, repayments of debt of $25.0 million and cash paid for dividends of $13.9 million.
Organic sales increased by $13.7 million, or 4.5%, reflecting positive trends in end markets like industrial applications, power management, renewable energy technologies, and electric vehicle related applications. Sensor Solutions was acquired in the third quarter of fiscal year 2022, adding $1.9 million, or 0.6%, in sales for the period. The foreign currency impact decreased sales by $14.0 million, or 4.6%.
Net sales in fiscal year 2023 increased 1.6 million, or 0.5%, when compared to the prior year. Organic sales increased by $13.7 million, or 4.5%, reflecting positive trends in end markets like industrial applications, power management, renewable energy technologies, and electric vehicle related applications.
Organic sales increased by $4.1 million, or 5.3%, offset by foreign currency impacts of $1.1 million, or 1.5%, as compared to the prior year period. Organic sales change was primarily due to increases in new product development of new solutions provided to customers in the aerospace and defense markets.
Organic sales change was primarily due to increases in new product development of new solutions provided to customers in the aerospace and defense markets. Income from operations in fiscal year 2023 increased $2.3 million, or 25.9%, when compared to the prior year.
Due to the nature of long-term agreements in the Engineering Technologies segment, the timing of orders and delivery dates can vary considerably resulting in significant backlog changes from one period to another. 22 Backlog orders are as follows (in thousands): As of June 30, 2023 As of June 30, 2022 Total Backlog under Total Backlog under Backlog 1 year Backlog 1 year Electronics $ 150,061 $ 129,911 $ 179,778 $ 149,247 Engraving 36,817 31,434 19,794 14,250 Scientific 2,506 2,506 4,356 4,356 Engineering Technologies 63,769 52,565 49,990 43,644 Specialty Solutions 21,749 21,634 47,569 44,751 Total $ 274,902 $ 238,050 $ 301,487 $ 256,248 Total backlog realizable within one year decreased $18.2 million, or 7.1% to $238.1 million at June 30, 2023 from $256.3 million at June 30, 2022.
Due to the nature of long-term agreements in the Engineering Technologies segment, the timing of orders and delivery dates can vary considerably resulting in significant backlog changes from one period to another. 23 Table of Contents Backlog orders are as follows (in thousands): As of June 30, 2024 As of June 30, 2023 Total Backlog under Total Backlog under Backlog 1 year Backlog 1 year Electronics $ 107,006 $ 94,982 $ 150,061 $ 129,911 Engraving 22,483 20,874 36,817 31,434 Scientific 2,646 2,646 2,506 2,506 Engineering Technologies 64,592 50,122 63,769 52,565 Specialty Solutions 16,691 16,672 21,749 21,634 Total $ 213,418 $ 185,296 $ 274,902 $ 238,050 Total backlog realizable within one year decreased $52.8 million, or 22.2% to $185.2 million at June 30, 2024 from $238.1 million at June 30, 2023.
Income from operations in the fiscal year 2023 decreased $1.4 million, or 2.1%, when compared to the prior year. The operating income decrease was the result of inflationary impacts, mix and foreign exchange offset partially by organic sales growth and various cost saving initiatives.
The operating income decrease was the result of inflationary impacts, mix and foreign exchange offset partially by organic sales growth and various cost saving initiatives.
The Company’s pension plan is frozen for U.S. employees and participants in the plan ceased accruing future benefits. Our primary U.S. defined benefit plan is not 100% funded under ERISA rules at June 30, 2023. Obligations under our defined benefit plan operated in Ireland have been transferred to the buyer of the Procon business as part of the divestiture.
The Company’s pension plan is frozen for U.S. employees and participants in the plan ceased accruing future benefits. Our primary U.S. defined benefit plan is not 100% funded under ERISA rules at June 30, 2024. U.S. defined benefit plan contributions of $10.0 million were made during fiscal year 2024 compared to $0.2 million during fiscal year 2023.
Business, above, for additional information regarding our segment structure and management strategy. As part of our ongoing strategy: o O n July 31, 2023, we acquired Minntronix, a privately held company. Minntronix designs and manufactures customized as well as standard magnetics components and products including transformers, inductors, current sensors, coils, chokes, and filters.
Its results are reported in the Electronics segment. o On July 31, 2023, we acquired Minntronix, a privately held company. Minntronix designs and manufactures customized as well as standard magnetics components and products including transformers, inductors, current sensors, coils, chokes, and filters.
Acquisition related costs typically consist of due diligence, integration, and valuation expenses incurred in connection with recent or pending acquisitions. Other Operating (Income) Expense, Net We incurred expense of $5.7 million in fiscal year 2022 related to a litigation accrual.
Acquisition Related Costs We incurred acquisition related expenses of $2.6 million and $0.6 million in fiscal year 2024 and 2023, respectively. Acquisition related costs typically consist of due diligence, integration, and valuation expenses incurred in connection with recent or pending acquisitions.
Discontinued Operations In pursing our business strategy, the Company may divest certain businesses. Future divestitures may be classified as discontinued operations based on their strategic significance to the Company.
The gain on sale of business, restructuring costs, acquisition related costs and other operating income (expense), net have been discussed above in the Company Overview. Discontinued Operations In pursing our business strategy, the Company may divest certain businesses. Future divestitures may be classified as discontinued operations based on their strategic significance to the Company.
Operating income increased during the period reflecting the organic sales increase and productivity actions, offsetting the foreign exchange impacts. In the first quarter of fiscal year 2024, we expect slightly lower revenue reflecting timing of customer projects and slightly higher operating margin. Net sales in fiscal year 2022 decreased by $0.8 million or 0.5% compared to the prior year.
Operating income increased during the period reflecting productivity actions, offsetting slower demand in North America sales. In the first quarter of fiscal year 2025, we expect moderately higher revenue and operating margin due to more favorable project timing in Europe and Asia. Net sales in fiscal year 2023 increased by $5.8 million or 4.0% compared to the prior year.
Income from operations for the fiscal year 2022 was $88.3 million, compared to $59.2 million during the prior year.
Income from Operations Income from operations for the fiscal year 2024 was $101.7 million, compared to $171.1 million during the prior year.
During fiscal years 2023, 2022 and 2021, we repatriated $29.1 million, $30.8 million, and $37.6 million of our cash previously held outside of the United States, respectively. The amount and timing of cash repatriation is dependent upon foreign exchange rates and each business unit’s operational needs including requirements to fund working capital, capital expenditure, and jurisdictional tax payments.
The amount and timing of cash repatriation is dependent upon foreign exchange rates and each business unit’s operational needs including requirements to fund working capital, capital expenditure, and jurisdictional tax payments.
Changes in backlog under 1 year are as follows (in thousands): As of June 30, 2023 Backlog under 1 year, prior year period $ 256,248 Components of change in backlog: Organic change (10,817 ) Effect of divestitures (7,381 ) Backlog under 1 year, current period $ 238,050 Segment Analysis (in thousands) Overall Outlook Looking forward to fiscal year 2024, we expect to be well-positioned, with anticipated continued improvement in key financial metrics, supported by productivity initiatives.
Changes in backlog under 1 year are as follows (in thousands): As of June 30, 2024 Backlog under 1 year, prior year period $ 238,050 Components of change in backlog: Organic change (68,898 ) Effect of acquisitions 16,144 Backlog under 1 year, current period $ 185,296 Segment Analysis (in thousands) Overall Outlook Looking forward to fiscal year 2025, we expect to be well-positioned for growth in the second half of the year, with anticipated continued improvement in general market conditions supported by planned new product releases in each segment throughout the year.
Income from operations for fiscal year 2023 increased $9.8 million, or 62.8%, when compared to the prior year.
Income from operations for fiscal year 2024 decreased $5.7 million, or 22.6%, when compared to the prior year.
Organic sales increased by $0.9 million, or 0.6%, as a result of timing of projects. The sales increase was offset by foreign exchange impacts of $1.6 million, or 1.1%. Income from operations in fiscal year 2022 decreased by $0.7 million, or 3.0%, when compared to the prior year. The decrease reflected geographic mix, partially offset by productivity initiatives.
Organic sales decreased by $1.0 million, or 0.7%, as a result of delays in new platform rollouts in North America. Foreign exchange impacts were $0.4 million, or 0.2%. Income from operations in fiscal year 2024 increased by $1.2 million, or 4.9%, when compared to the prior year.
Acquisitions in fiscal year 2022 added $1.9 million, or 0.8% in sales. The foreign currency impact decreased sales by $7.1 million, or 2.8%. Income from operations in the fiscal year 2022 increased $23.8 million, or 51.1% when compared to the prior year.
Sensor Solutions was acquired in the third quarter of fiscal year 2022, adding $1.9 million, or 0.6%, in sales for the period. The foreign currency impact decreased sales by $14.0 million, or 4.6%. Income from operations in the fiscal year 2023 decreased $1.4 million, or 2.1% when compared to the prior year.
Restructuring Costs During fiscal year 2023, we incurred restructuring expenses of $3.8 million, primarily related to productivity improvements, facility rationalization activities, and global headcount reductions primarily within our Engraving and Electronics segments and Corporate headquarters.
SG&A expenses during the period were primarily impacted by increased research and development spending to drive future product initiatives. Restructuring Costs During fiscal year 2024, we incurred restructuring expenses of $8.2 million, primarily related to facility rationalization activities, and global headcount reductions primarily within our Engraving, Electronics and Engineering Technologies segments and as well as the Corporate headquarters.
Our primary sources of cash are cash flows from continuing operations and borrowings under the facility. We expect that fiscal year 2024 depreciation and amortization expense will be between $22.0 million and $24.0 million and $8.0 million and $10.0 million, respectively.
We expect that fiscal year 2025 depreciation and amortization expense will be between $24.0 million and $28.0 million and $8.0 million and $10.0 million, respectively.
In the first quarter of fiscal year 2024, on a sequential basis, we expect slightly higher revenue primarily due to the recently announced acquisition and continued strength in our fast growth end markets, partially offset by continued slow recovery in China and Europe. Sequentially, we expect similar operating margin.
In the first quarter of fiscal year 2025, on a sequential basis, we expect similar to slightly higher revenue, driven by higher sales into fast growth end markets, and similar operating margin, as higher investments in selling, marketing and R&D offset pricing and productivity initiatives.
Net cash provided by continuing operating activities for the year ended June 30, 2022 was $78.1 million compared to net cash provided by continuing operating activities of $81.9 million in the prior year. We generated $101.7 million from income statement activities and used $23.1 million of cash to fund working capital increases.
We generated $111.4 million from income statement activities and used $5.1 million of cash to fund working capital and other balance sheet account increases. Cash flow used in investing activities for the year ended June 30, 2024 totaled $61.6 million.
In the first quarter of fiscal year 2024, on a sequential basis, we expect a significant decrease in revenue reflecting timing of projects and a slight to moderate decrease in operating margin, with productivity initiatives mostly offsetting the impact of volume decline and higher mix of development projects.
The increase was primarily due to the impact of pricing and productivity initiatives, partially offset by research and development. In the first quarter of fiscal year 2025, on a sequential basis, we expect moderately to significantly lower revenue and slightly lower operating margin due to unfavorable project timing.
This increase was a result of organic sales increases of $96.3 million, productivity initiatives and targeted prices increases to offset approximately $38 million of inflationary impacts in the areas of ocean freight, raw material, and labor.
This decrease was a result of organic sales decreases of $37.6 million, approximately $2.8 million of net inflationary impacts in the areas of labor and raw material and by the divestiture of the Procon business. The decreases were partially offset by contributions from the Minntronix acquisition, pricing actions and productivity initiatives.
Our primary cash requirements in addition to day-to-day operating needs include interest payments, capital expenditures, acquisitions, share repurchases, and dividends. In connection with the acquisition of Renco, we assumed $0.7 million of debt under the Paycheck Protection Program, within the United States Coronavirus Aid, Relief, and Economic Security ("CARES") Act. These borrowings were forgiven in June 2021.
Our primary cash requirements in addition to day-to-day operating needs include interest payments, capital expenditures, acquisitions, share repurchases, and dividends. Our primary sources of cash are cash flows from continuing operations and borrowings under the facility.
Cash flow used in investing activities for the year ended June 30, 2022 totaled $31.0 million.
Cash flow provided by investing activities for the year ended June 30, 2023 totaled $41.6 million. We generated $67.0 million in proceeds from the divestiture of the Procon business and $24.3 million was used for capital expenditures.
Corporate expenses in fiscal year 2022 increased $4.7 million, or 16%, when compared to the prior year, primarily due to employee related compensation accruals and research and development costs. The gain on sale of business, restructuring costs, acquisition related costs and other operating income (expense), net have been discussed above in the Company Overview.
Corporate expenses in fiscal year 2024 reflect reductions in professional service fees and incentive compensation. Corporate expenses in fiscal year 2023 increased $0.8 million, or 2.3%, when compared to the prior year, primarily due to employee related compensation accruals and research and development costs.
Income from operations for fiscal year 2022 increased $1.2 million, or 8.5%, when compared to the prior year primarily as a result of increased sales volume in the Pumps and Merchandising businesses, partially offset by higher costs of labor, including the temporary work stoppage in the first quarter and higher raw material and ocean freight costs.
Net sales decreased reflecting general market softness, including purchases by retail pharmacies. 25 Table of Contents Income from operations in fiscal year 2024 increased by $1.9 million, or 11.1%, when compared to the prior year. Operating income increase reflects productivity initiatives and lower freight costs, partially offset by lower volume.

… 39 more changes not shown on this page.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

7 edited+0 added−0 removed9 unchanged
Biggest changeHowever, any such losses or gains would generally be offset by corresponding gains and losses, respectively, on the related hedged asset or liability. At June 30, 2023 and 2022, the fair value, in the aggregate, of the Company’s open foreign exchange contracts was a liability of $1.7 million and $0.6 million respectively.
Biggest changeHowever, any such losses or gains would generally be offset by corresponding gains and losses, respectively, on the related hedged asset or liability. At June 30, 2024 and 2023, the fair value, in the aggregate, of the Company’s open foreign exchange contracts was an asset of less than $0.1 million and liability of $1.7 million respectively.
Our primary translation risk is with the Euro, British Pound Sterling, Peso, Japanese Yen and Chinese Yuan. A hypothetical 10% appreciation or depreciation of the value of any these foreign currencies to the U.S. Dollar at June 30, 2023, would not result in a material change in our operations, financial position, or cash flows.
Our primary translation risk is with the Euro, British Pound Sterling, Peso, Japanese Yen and Chinese Yuan. A hypothetical 10% appreciation or depreciation of the value of any these foreign currencies to the U.S. Dollar at June 30, 2024, would not result in a material change in our operations, financial position, or cash flows.
As of June 30, 2023, no one customer accounted for more than 5% of our consolidated outstanding receivables or of our sales. Commodity Prices The Company is exposed to fluctuating market prices for all commodities used in its manufacturing processes.
As of June 30, 2024, no one customer accounted for more than 5% of our consolidated outstanding receivables or of our sales. Commodity Prices The Company is exposed to fluctuating market prices for all commodities used in its manufacturing processes.
Our interest rate exposure is limited primarily to interest rate changes on our variable rate borrowings and is mitigated by our use of interest rate swap agreements to modify our exposure to interest rate movements. At June 30, 2023, we have $175.0 million of active floating to fixed rate swaps with terms ranging from one to three years.
Our interest rate exposure is limited primarily to interest rate changes on our variable rate borrowings and is mitigated by our use of interest rate swap agreements to modify our exposure to interest rate movements. At June 30, 2024, we have $150.0 million of active floating to fixed rate swaps with terms ranging from one to three years.
These materials are some of the key elements in the products manufactured in these segments. Wherever possible, we will implement price increases to offset the impact of changing prices. The ultimate acceptance of these price increases, if implemented, will be impacted by our affected divisions’ respective competitors and the timing of their price increases. 32
These materials are some of the key elements in the products manufactured in these segments. Wherever possible, we will implement price increases to offset the impact of changing prices. The ultimate acceptance of these price increases, if implemented, will be impacted by our affected divisions’ respective competitors and the timing of their price increases. 33 Table of Contents
These swaps convert our interest payments from SOFR to a weighted average rate of 1.13%. At June 30, 2023, the fair value, in the aggregate, of the Company’s interest rate swaps were assets of $10.2 million. At June 30, 2022, the fair value, in the aggregate, of the Company’s interest rate swaps were assets of $8.4 million.
These swaps convert our interest payments from SOFR to a weighted average rate of 2.46%. At June 30, 2024, the fair value, in the aggregate, of the Company’s interest rate swaps were assets of $4.7 million. At June 30, 2023, the fair value, in the aggregate, of the Company’s interest rate swaps were assets of $10.2 million.
We hedge our most significant foreign currency translation risks primarily through cross currency swaps and other instruments, as appropriate. 31 Interest Rate The Company’s effective interest rate on borrowings was 2.97% and 2.53% at June 30, 2023 and 2022, respectively.
We hedge our most significant foreign currency translation risks primarily through cross currency swaps and other instruments, as appropriate. 32 Table of Contents Interest Rate The Company’s effective interest rate on borrowings was 2.46% and 2.97% at June 30, 2024 and 2023, respectively.

Other SXI 10-K year-over-year comparisons