cr-20240331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

Mark One:


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended March 31, 2024


☐			TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Transition Period from to

Commission File Number: 1-41570

CRANE COMPANY

(Exact name of registrant as specified in its charter)



Delaware						88-2846451
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)


100 First Stamford Place	Stamford	CT	06902
(Address of principal executive offices)			(Zip Code)

Registrant’s telephone number, including area code: 203-363-7300

(Not Applicable)

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:



Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, par value $1.00	CR	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non–accelerated filer, or a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

(check one):

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of shares outstanding of the issuer’s classes of common stock, as of April 30, 2024

Common stock, $1.00 Par Value – 57,157,884 shares

Crane Company

Table of Contents

Form 10-Q

Page

Part I - Financial Information

Item 1.

Financial Statements

Condensed Consolidated Statements of Operations

Page 3

Condensed Consolidated Statements of Comprehensive Income

Page 4

Condensed Consolidated Balance Sheets

Page 5

Condensed Consolidated Statements of Cash Flows

Page 7

Condensed Consolidated Statements of Changes in Equity

Page 9

Notes to Condensed Consolidated Financial Statements

Page 10

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Page 27

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Page 35

Item 4.

Controls and Procedures

Page 35

Part II - Other Information

Page 36

Page 36

Unregistered Sales of Equity Securities and Use of Proceeds

Page 36

Item 3.

Defaults Upon Senior Securities

Page 36

Item 4.

Mine Safety Disclosures

Page 36

Page 36

Page 37

Page 38

PART I: FINANCIAL INFORMATION

ITEM 1: FINANCIAL STATEMENTS

CRANE COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)


	Three Months Ended
	March 31,
(in millions, except per share data)	2024		2023
Net sales	$	565.3	$	513.8
Operating costs and expenses:
Cost of sales	344.8		306.9
Selling, general and administrative	131.1		129.4


Operating profit	89.4		77.5
Other (expense) income:
Interest income	1.2		0.9
Interest expense	(7.2)		(6.6)

Miscellaneous expense, net	(1.3)		(0.5)
Total other expense, net	(7.3)		(6.2)
Income from continuing operations before income taxes	82.1		71.3
Provision for income taxes	17.3		15.4
Net income from continuing operations attributable to common shareholders	64.8		55.9
Income from discontinued operations, net of tax (Note 3)	—		49.8
Net income attributable to common shareholders	$	64.8	$	105.7

Earnings per basic share:
Earnings per basic share from continuing operations	$	1.14	$	0.99
Earnings per basic share from discontinued operations	—		0.88
Earnings per basic share	$	1.14	$	1.87

Earnings per diluted share:
Earnings per diluted share from continuing operations	$	1.12	$	0.98
Earnings per diluted share from discontinued operations	—		0.86
Earnings per diluted share	$	1.12	$	1.84

Average shares outstanding:
Basic	57.0		56.5
Diluted	58.1		57.3

Dividends per share	$	0.205	$	0.47

See Notes to Condensed Consolidated Financial Statements.

Table of Contents

CRANE COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(UNAUDITED)


	Three Months Ended
	March 31,
(in millions)	2024		2023
Net income before allocation to noncontrolling interests	$	64.8	$	105.7
Components of other comprehensive (loss) income, net of tax
Currency translation adjustment	(12.4)		12.7
Changes in pension and postretirement plan assets and benefit obligation, net of tax	3.0		2.7
Other comprehensive income, net of tax	(9.4)		15.4
Comprehensive income before allocation to noncontrolling interests	55.4		121.1
Less: Noncontrolling interests in comprehensive income	(0.1)		(0.1)
Comprehensive income attributable to common shareholders	$	55.5	$	121.2

See Notes to Condensed Consolidated Financial Statements.

Table of Contents

CRANE COMPANY

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)


(in millions)	March 31, 2024		December 31, 2023
Assets
Current assets:
Cash and cash equivalents	$	219.4	$	329.6
Accounts receivable, net of allowance for doubtful accounts of $8.4 as of March 31, 2024 and December 31, 2023.	356.3		306.4
Inventories, net:
Finished goods	69.2		67.0
Finished parts and subassemblies	48.2		49.9
Work in process	54.0		40.6
Raw materials	212.4		195.6
Inventories, net	383.8		353.1
Other current assets	112.7		101.7

Total current assets	1,072.2		1,090.8
Property, plant and equipment:
Cost	772.6		776.3
Less: accumulated depreciation	498.3		505.8
Property, plant and equipment, net	274.3		270.5
Long-term deferred tax assets	2.5		2.7
Other assets	140.2		134.0
Intangible assets, net	137.6		87.9
Goodwill	791.6		747.7

Total assets	$	2,418.4	$	2,333.6

See Notes to Condensed Consolidated Financial Statements.

Table of Contents

CRANE COMPANY

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)


(in millions, except per share and share data)	March 31, 2024		December 31, 2023
Liabilities and equity
Current liabilities:
Short-term borrowings	$	110.0	$	—
Accounts payable	156.0		179.1
Accrued liabilities	214.4		273.7
U.S. and foreign taxes on income	12.4		14.3

Total current liabilities	492.8		467.1
Long-term debt, net	246.8		248.5
Accrued pension and postretirement benefits	110.7		115.0
Long-term deferred tax liability	48.6		37.1
Other liabilities	112.5		105.6

Total liabilities	1,011.4		973.3
Commitments and contingencies (Note 12)
Equity:

Common shares, par value $1.00; 66,475,307 shares authorized; 57,111,810 and 56,919,443 shares issued and outstanding, respectively	57.1		56.9
Capital surplus	401.0		398.2
Retained earnings	1,013.8		960.7
Accumulated other comprehensive loss	(67.3)		(58.0)

Total shareholders’ equity	1,404.6		1,357.8
Noncontrolling interests	2.4		2.5
Total equity	1,407.0		1,360.3
Total liabilities and equity	$	2,418.4	$	2,333.6

See Notes to Condensed Consolidated Financial Statements.

Table of Contents

CRANE COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)


	Three Months Ended
	March 31,
(in millions)	2024		2023
Operating activities:
Net income from continuing operations attributable to common shareholders	$	64.8	$	55.9


Depreciation and amortization	12.9		9.2
Stock-based compensation expense	6.6		5.6
Defined benefit plans and postretirement cost	0.9		2.9
Deferred income taxes	0.1		1.6
Cash used for operating working capital	(162.4)		(184.6)
Defined benefit plans and postretirement contributions	(0.6)		(0.3)
Environmental payments, net of reimbursements	(1.4)		(1.3)


Other	(0.8)		5.6
Total used for operating activities from continuing operations	(79.9)		(105.4)
Investing activities:
Payment for acquisition - net of cash acquired	(105.6)		—

Capital expenditures	(9.1)		(8.9)

Other investing activities	0.2		0.2


Total used for investing activities from continuing operations	(114.5)		(8.7)
Financing activities:
Dividends paid	(11.7)		(26.6)

Net (payments) proceeds related to employee stock plans	(8.5)		12.9
Debt issuance costs	—		(4.1)



Proceeds from long-term debt	140.0		—


Proceeds from term facility of discontinued operations	—		350.0
Repayments of long-term debt	(31.9)		(400.0)

Total provided by (used for) financing activities from continuing and discontinued operations	87.9		(67.8)
Discontinued Operations:
Total provided by operating activities	—		34.6
Total used for investing activities	—		(4.1)
Increase in cash and cash equivalents from discontinued operations	—		30.5
Effect of exchange rates on cash and cash equivalents	(3.7)		4.0
Decrease in cash and cash equivalents	(110.2)		(147.4)
Cash and cash equivalents at beginning of period (a)	329.6		657.6
Cash and cash equivalents at end of period	219.4		510.2
Less: Cash and cash equivalents of discontinued operations	—		218.0
Cash and cash equivalents of continuing operations at end of period	$	219.4	$	292.2
(a) 2023 Includes cash and cash equivalents of discontinued operations.

See Notes to Condensed Consolidated Financial Statements.

Table of Contents

CRANE COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)


	Three Months Ended
	March 31,
(in millions)	2024		2023
Detail of cash used for operating working capital from continuing operations:
Accounts receivable	$	(46.3)	$	(43.4)
Inventories	(19.0)		(38.2)
Other current assets	(11.9)		(12.1)
Accounts payable	(23.5)		(27.8)
Accrued liabilities	(58.9)		(42.3)
U.S. and foreign taxes on income	(2.8)		(20.8)
Total	$	(162.4)	$	(184.6)

Supplemental disclosure of cash flow information:
Interest paid	$	5.8	$	7.0
Income taxes paid	$	20.0	$	33.6

See Notes to Condensed Consolidated Financial Statements.

Table of Contents

CRANE COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(UNAUDITED)


(in millions, except share data)	Common Shares Issued at Par Value	Capital Surplus		Retained Earnings		Accumulated Other Comprehensive Loss		Total Share- holders’ Equity		Non-controlling Interest		Total Equity
BALANCE DECEMBER 31, 2023	56.9	$	398.2	$	960.7	$	(58.0)	$	1,357.8	$	2.5	$	1,360.3
Net income	—	—		64.8		—		64.8		—		64.8
Cash dividends ($0.205 per share)	—	—		(11.7)		—		(11.7)		—		(11.7)

Exercise of stock options	0.1	2.4		—		—		2.5		—		2.5
Impact from settlement of share-based awards, net of shares acquired	0.1	(11.1)		—		—		(11.0)		—		(11.0)
Impact from settlement of liability PRSUs (Note 1)	—	6.1		—		—		6.1		—		6.1
Stock-based compensation expense	—	5.4		—		—		5.4		—		5.4
Changes in pension and postretirement plan assets and benefit obligation, net of tax	—	—		—		3.0		3.0		—		3.0
Currency translation adjustment	—	—		—		(12.3)		(12.3)		(0.1)		(12.4)
BALANCE MARCH 31, 2024	57.1	$	401.0	$	1,013.8	$	(67.3)	$	1,404.6	$	2.4	$	1,407.0

SEC Form 10-Q filed by Crane Company