10-K: Crane Company Reports Strong 2024 Results, Driven by Aerospace & Electronics and Process Flow Technologies Segments

• Crane Company's net sales for 2024 increased by 14.5% to $2,131.2 million.
• Core sales grew by 8.4%, driven by higher pricing and, to a lesser extent, higher volumes.
• Acquisitions, including Technifab, CryoWorks, and Vian, contributed $110.2 million to sales.
• Operating profit increased by 42.1% to $355.8 million, benefiting from productivity gains and higher pricing.
• The Aerospace & Electronics segment saw an 18.2% increase in sales, while Process Flow Technologies increased by 11.7%.
• The company completed the sale of the Engineered Materials segment on January 1, 2025, for approximately $208.0 million.
• Net debt was $247.0 million as of December 31, 2024, with a total debt to total capitalization ratio of 13.1%.
• For 2025, the company expects a total year-over-year sales increase of approximately 5%.

Score: 8

Explanation: The document presents a positive outlook with strong financial results and strategic initiatives. While there are some risks and challenges, the overall tone is optimistic and indicates confidence in the company's future performance.

• Strong sales growth in both Aerospace & Electronics and Process Flow Technologies segments.
• Significant increase in operating profit due to productivity gains and higher pricing.
• Successful integration of recent acquisitions.
• Strategic divestiture of the Engineered Materials segment.
• Positive outlook for 2025 with expected sales growth and improved operating profit.

• The Marion site was affected by flooding from Hurricane Helene, resulting in losses and expenses of $23.3 million, though insurance recoveries mitigated some of the impact.
• Unfavorable mix in Process Flow Technologies negatively impacted operating profit by $25.9 million.
• The company is subject to extensive governmental regulations, and failure to comply could adversely affect its financial condition.

• Macroeconomic fluctuations and geopolitical risks could harm the business.
• Demand for products is variable and subject to factors beyond the company's control.
• The company faces risks inherent in non-domestic operations, including currency fluctuations and economic instability.
• The company may be unable to identify or successfully integrate acquisitions.
• Supply chain disruptions could adversely affect the company's results of operations.
• The company faces significant competition which may adversely impact its financial condition.
• Information systems and technology networks failures and breaches in data security could adversely affect the company.

For 2025, the company expects a total year-over-year sales increase of approximately 5%, driven by approximately 4% to 6% core growth, and an acquisition benefit of approximately 1% to 2%, partially offset by an approximate 1% headwind from foreign exchange. We expect an improvement in operating profit driven primarily by productivity benefits, operating leverages on higher volumes, lower transaction related expenses, higher pricing net of inflation and contributions from the Technifab and CryoWorks acquisitions, partially offset by unfavorable mix mainly in our Aerospace & Electronics segment.

Crane operates in the highly competitive aerospace, defense, and process industries. The company's performance is influenced by factors such as commercial air traffic levels, defense spending, and global economic conditions. Strategic acquisitions and divestitures are common in these industries as companies seek to optimize their portfolios and expand their market presence.

• Crane's Aerospace & Electronics segment competes with companies like TransDigm Group and HEICO Corporation, known for their high margins and focus on aftermarket sales.
• In the Process Flow Technologies segment, Crane competes with flow control giants such as Emerson Electric and Pentair, which also target the chemical, pharmaceutical, and industrial sectors.
• Crane's strategy of focusing on highly engineered components and niche markets aligns with the approach of successful industrial companies that prioritize differentiation and customer service.
• The company's commitment to the Crane Business System reflects a focus on operational excellence similar to lean manufacturing principles adopted by industry leaders.

• Shareholders can expect continued focus on earnings growth and value creation.
• Employees may experience changes due to restructuring activities and facility consolidations.
• Customers can anticipate continued innovation and technology-led solutions.
• Suppliers may be affected by the company's efforts to source components and raw materials from fewer suppliers.
• Creditors should be aware of the company's debt levels and compliance with covenants.

• Continue to execute the strategy of growing earnings and cash flow by focusing on the development and manufacturing of highly engineered industrial products.
• Focus on productivity and continuous improvement through the Crane Business System.
• Monitor and manage risks related to macroeconomic conditions, supply chain disruptions, and governmental regulations.

• Crane Company, along with certain of its subsidiaries, were added as defendants in ongoing product liability/personal injury lawsuits filed by 58 victims of a 2021 chemical leak incident that occurred at a LyondellBasell facility in La Porte, Texas.
• An initial settlement agreement was reached with a portion of the claimants in September 2024, and final settlement agreements were reached with all remaining claimants in February 2025.

• April 3, 2023: Crane Holdings, Co. completed the Separation into two independent, publicly-traded companies, Crane NXT, Co. and Crane Company.
• November 1, 2024: The Company completed the acquisition of Technifab Products, Inc.
• January 1, 2025: The Company completed the sale of the Engineered Materials segment.