Parker Reports Fiscal 2025 Fourth Quarter and Full Year Results

CLEVELAND, Aug. 07, 2025 (GLOBE NEWSWIRE) -- Parker Hannifin Corporation (NYSE: PH), the global leader in motion and control technologies, today reported results for the quarter and fiscal year ended June 30, 2025, that included the following highlights (compared with the prior year period): Fiscal 2025 Fourth Quarter Highlights: Sales were a record $5.2 billion; organic sales growth was 2%Net income was $923 million, an increase of 18%, or $992 million adjusted, an increase of 12%EPS were $7.15, an increase of 19%, or a record $7.69 adjusted, an increase of 14%Segment operating margin was 23.9%, an increase of 170 bps, or 26.9% adjusted, an increase of 160 bpsRepurchased $851 million of sharesAnnounced agreement to acquire Curtis Instruments, Inc., expanding electrification offering Fiscal 2025 Full Year Highlights: Sales were $19.9 billion; organic sales growth was 1%Net income was $3.5 billion, an increase of 24%, or $3.6 billion adjusted, an increase of 7%EPS were $27.12, an increase of 24%, or a record $27.33 adjusted, an increase of 7%EBITDA margin was 27.3%, an increase of 210 bps, or 26.4% adjusted, an increase of 80 bpsSegment operating margin was 23.0%, an increase of 150 bps, or a record 26.1% adjusted, an increase of 120 bpsCash flow from operations increased 12% to $3.8 billion, or 19.0% of salesRepurchased $1.6 billion of shares “Our outstanding performance contributed to a record year for safety, engagement, earnings per share, margins and cash flow,” said Jenny Parmentier, Chairman and Chief Executive Officer. “Delivering strong margin expansion and earnings growth in a dynamic macro environment is a testament to the resilience of our portfolio and the power of our business system, The Win Strategy™. We generated full year cash flow of $3.8 billion and through balanced capital deployment, increased our quarterly cash dividend by 10 percent, repurchased $1.6 billion of shares, and announced an agreement to acquire Curtis Instruments to expand our electrification offering. Thanks to our global team for another record year and the continued transformation of Parker. “Looking ahead to fiscal year 2026, we expect Aerospace to remain our fastest growing business and see a return to positive organic growth in our Industrial businesses. We remain committed to being great generators and deployers of cash to drive shareholder value and look forward to another excellent year powered by our people and our business system.” This news release contains non-GAAP financial measures. Reconciliations of adjusted numbers and certain non-GAAP financial measures are included in the financial tables of this press release. Outlook Parker issued guidance for the fiscal year ending June 30, 2026. The company expects: Sales growth in fiscal 2026 of 2% to 5%, with organic sales growth of approximately 3% at the midpoint; previously completed divestitures of 1% and favorable currency of 1.5%Total segment operating margin of 23.3% to 23.7%, or 26.3% to 26.7% on an adjusted basisEPS of $24.68 to $25.68, or $28.40 to $29.40 on an adjusted basis Segment Results Diversified Industrial Segment North America Businesses $ in mmFY25 Q4 FY24 Q4 Change Organic GrowthSales$2,075 $2,229 -6.9% -1.4%Segment Operating Income$513 $505 1.6% Segment Operating Margin 24.7% 22.7% 200 bps Adjusted Segment Operating Income$555 $558 -0.5% Adjusted Segment Operating Margin 26.7% 25.0% 170 bps Achieved record adjusted segment operating marginGradual broad-based improvement across market verticalsOrder rates positive for third consecutive quarter International Businesses $ in mmFY25 Q4 FY24 Q4 Change Organic GrowthSales$1,492 $1,430 4.3% 0.6%Segment Operating Income$334 $312 7.1% Segment Operating Margin 22.4% 21.8% 60 bps Adjusted Segment Operating Income$369 $342 7.9% Adjusted Segment Operating Margin 24.7% 23.9% 80 bps Achieved record adjusted segment operating marginOrganic growth turned positive in the quarter with 6% APAC; (3%) EMEA; 4% LAOrder rates flat on tougher prior year comparisonFiscal 2025 third quarter included large long-cycle orders Aerospace Systems Segment $ in mmFY25 Q4 FY24 Q4 Change Organic GrowthSales$1,676 $1,528 9.7% 8.6%Segment Operating Income$407 $332 22.6% Segment Operating Margin 24.3% 21.7% 260 bps Adjusted Segment Operating Income$486 $415 17.1% Adjusted Segment Operating Margin 29.0% 27.1% 190 bps Achieved record sales on continued aftermarket strengthDelivered record adjusted segment operating marginAerospace backlog increased to a record $7.4 billion Order Rates FY25 Q4Parker +5%Diversified Industrial Segment - North America Businesses +2%Diversified Industrial Segment - International Businesses 0%Aerospace Systems Segment +12% Parker order rates remain strong at 5% reflecting our transformed portfolioIndustrial Segment order rates remain positive in a dynamic environmentAerospace order rates up 12% driven by continued strength in both commercial and defense About Parker HannifinParker Hannifin is a Fortune 250 global leader in motion and control technologies. For more than a century the company has been enabling engineering breakthroughs that lead to a better tomorrow. Learn more at www.parker.com or @parkerhannifin. Contacts: Media:Financial Analysts:Aidan GormleyJeff Miller216-896-3258216-896-2708aidan.gormley@parker.comjeffrey.miller@parker.com Notice of Webcast Parker Hannifin's conference call and slide presentation to discuss its fiscal 2025 fourth quarter and full year results are available to all interested parties via live webcast today at 11:00 a.m. ET, at investors.parker.com. A replay of the webcast will be available on the site approximately one hour after the completion of the call and will remain available for one year. To register for e-mail notification of future events please visit investors.parker.com. Note on Orders The company reported orders for the quarter ending June 30, 2025, compared with the same quarter a year ago. All comparisons are at constant currency exchange rates, with the prior year quarter restated to the current-year rates, and exclude divestitures. Diversified Industrial comparisons are on 3-month average computations and Aerospace Systems comparisons are on rolling 12-month average computations. Note on Non-GAAP Financial MeasuresThis press release contains references to non-GAAP financial information including (a) adjusted net income; (b) adjusted earnings per share; (c) adjusted segment operating margin for Parker and by segment; (d) adjusted segment operating income for Parker and by segment; (e) organic sales growth; (f) EBITDA margin and (g) adjusted EBITDA margin. The adjusted net income, adjusted earnings per share, adjusted segment operating margin, adjusted segment operating income, organic sales growth, EBITDA margin and adjusted EBITDA margin measures are presented to allow investors and the company to meaningfully evaluate changes in net income, earnings per share and segment operating margins on a comparable basis from period to period. EBITDA is defined as earnings before interest, taxes, depreciation and amortization. Although adjusted net income, adjusted earnings per share, adjusted segment operating margin, adjusted segment operating income, organic sales growth, EBITDA margin and adjusted EBITDA margin are not measures of performance calculated in accordance with GAAP, we believe that they are useful to an investor in evaluating the results of this quarter versus the prior period. Comparable descriptions of record adjusted results in this release refer only to the period from the first quarter of FY2011 to the periods presented in this release. This period coincides with recast historical financial results provided in association with our FY2014 change in segment reporting. A reconciliation of non-GAAP measures is included in the financial tables of this press release. Forward-Looking StatementsForward-looking statements contained in this and other written and oral reports are made based on known events and circumstances at the time of release, and as such, are subject in the future to unforeseen uncertainties and risks. Often but not always, these statements may be identified from the use of forward-looking terminology such as “anticipates,” “believes,” “may,” “should,” “could,” “expects,” “targets,” “is likely,” “will,” or the negative of these terms and similar expressions, and may also include statements regarding future performance, orders, earnings projections, events or developments. Parker cautions readers not to place undue reliance on these statements. It is possible that the future performance may differ materially from expectations, including those based on past performance. Among other factors that may affect future performance are: changes in business relationships with and orders by or from major customers, suppliers or distributors, including delays or cancellations in shipments; disputes regarding contract terms, changes in contract costs and revenue estimates for new development programs; changes in product mix; ability to identify acceptable strategic acquisition targets; uncertainties surrounding timing, successful completion or integration of acquisitions and similar transactions, including the acquisition of Curtis Instruments, Inc.; ability to successfully divest businesses planned for divestiture and realize the anticipated benefits of such divestitures; the determination and ability to successfully undertake business realignment activities and the expected costs, including cost savings, thereof; ability to implement successfully business and operating initiatives, including the timing, price and execution of share repurchases and other capital initiatives; availability, cost increases of or other limitations on our access to raw materials, component products and/or commodities if associated costs cannot be recovered in product pricing; ability to manage costs related to insurance and employee retirement and health care benefits; legal and regulatory developments and other government actions, including related to environmental protection, and associated compliance costs; supply chain and labor disruptions, including as a result of tariffs and labor shortages; threats associated with international conflicts and cybersecurity risks and risks associated with protecting our intellectual property; uncertainties surrounding the ultimate resolution of outstanding legal proceedings, including the outcome of any appeals; effects on market conditions, including sales and pricing, resulting from global reactions to U.S. trade policies; manufacturing activity, air travel trends, currency exchange rates, difficulties entering new markets and economic conditions such as inflation, deflation, interest rates and credit availability; inability to obtain, or meet conditions imposed for, required governmental and regulatory approvals; changes in the tax laws in the United States and foreign jurisdictions and judicial or regulatory interpretations thereof; and large scale disasters, such as floods, earthquakes, hurricanes, industrial accidents and pandemics. Readers should also consider forward-looking statements in light of risk factors discussed in Parker’s Annual Report on Form 10-K for the fiscal year ended June 30, 2024 and other periodic filings made with the SEC. CONSOLIDATED STATEMENT OF INCOME Three Months Ended Twelve Months Ended(Unaudited)June 30, June 30,(In millions, except per share amounts) 2025 2024 2025 2024 Net sales$5,243 $5,187 $19,850 $19,930 Cost of sales 3,285 3,323 12,535 12,802 Selling, general and administrative expenses 839 818 3,255 3,315 Interest expense 99 119 409 506 Other income, net (51) (59) (456) (288)Income before income taxes 1,071 986 4,107 3,595 Income taxes 148 201 575 750 Net income 923 785 3,532 2,845 Less: Noncontrolling interests — — 1 1 Net income attributable to common shareholders$923 $785 $3,531 $2,844 Earnings per share attributable to common shareholders: Basic$7.25 $6.10 $27.52 $22.13 Diluted$7.15 $6.01 $27.12 $21.84 Weighted average shares outstanding: Basic 127.2 128.6 128.3 128.5 Diluted 129.0 130.6 130.2 130.2 Cash dividends per common share$1.80 $1.63 $6.69 $6.07 BUSINESS SEGMENT INFORMATION Three Months Ended Twelve Months Ended(Unaudited)June 30, June 30,(Dollars in millions) 2025 2024 2025 2024 Net sales Diversified Industrial$3,567 $3,659 $13,665 $14,458 Aerospace Systems 1,676 1,528 6,185 5,472 Total net sales$5,243 $5,187 $19,850 $19,930 Segment operating income Diversified Industrial$847 $817 $3,120 $3,176 Aerospace Systems 407 332 1,441 1,111 Total segment operating income 1,254 1,149 4,561 4,287 Corporate general and administrative expenses 65 56 214 218 Income before interest expense and other expense (income), net 1,189 1,093 4,347 4,069 Interest expense 99 119 409 506 Other expense (income), net 19 (12) (169) (32)Income before income taxes$1,071 $986 $4,107 $3,595 SUPPLEMENTAL FINANCIAL INFORMATION AND NON-GAAP RECONCILIATIONS ADJUSTED SEGMENT OPERATING INCOME AND ORGANIC SALES GROWTH RECONCILIATION Three Months Ended June 30, 2025 Three Months Ended June 30, 2024 Diversified Industrial SegmentAerospace Systems Segment Diversified Industrial SegmentAerospace Systems Segment (Unaudited)(Dollars in millions)North AmericaInt'lTotalTotal North AmericaInt'lTotalTotalNet sales$2,075 $1,492 $3,567 $1,676 $5,243 $2,229 $1,430 $3,659 $1,528 $5,187 Segment operating income$513 $334 $847 $407 $1,254 $505 $312 $817 $332 $1,149 Adjustments: Amortization of acquired intangibles 41 23 64 75 139 42 22 64 75 139 Business realignment charges 2 12 14 — 14 10 8 18 — 18 Integration costs to achieve (1) — (1) 4 3 1 — 1 8 9 Adjusted segment operating income$555 $369 $924 $486 $1,410 $558 $342 $900 $415 $1,315 Segment operating margin 24.7% 22.4% 23.7% 24.3% 23.9% 22.7% 21.8% 22.3% 21.7% 22.2%Adjusted segment operating margin 26.7% 24.7% 25.9% 29.0% 26.9% 25.0% 23.9% 24.6% 27.1% 25.3% Reported sales growth (6.9)% 4.3% (2.5)% 9.7% 1.1% Currency (0.3)% 3.7% 1.3% 1.1% 1.2% Divestitures (5.2)% —% (3.1)% —% (2.2)% Organic sales growth (1.4)% 0.6% (0.7)% 8.6% 2.1% Twelve Months Ended June 30, 2025 Twelve Months Ended June 30, 2024 Diversified Industrial SegmentAerospace Systems Segment Diversified Industrial SegmentAerospace Systems Segment (Unaudited)(Dollars in millions)North AmericaInt'lTotalTotal North AmericaInt'lTotalTotalNet sales$8,134 $5,531 $13,665 $6,185 $19,850 $8,801 $5,657 $14,458 $5,472 $19,930 Segment operating income$1,891 $1,229 $3,120 $1,441 $4,561 $1,963 $1,213 $3,176 $1,111 $4,287 Adjustments: Amortization of acquired intangibles 165 88 253 300 553 176 90 266 312 578 Business realignment charges 15 38 53 — 53 19 32 51 — 51 Integration costs to achieve 2 1 3 19 22 3 1 4 34 38 Adjusted segment operating income$2,073 $1,356 $3,429 $1,760 $5,189 $2,161 $1,336 $3,497 $1,457 $4,954 Segment operating margin 23.2% 22.2% 22.8% 23.3% 23.0% 22.3% 21.4% 22.0% 20.3% 21.5%Adjusted segment operating margin 25.5% 24.5% 25.1% 28.5% 26.1% 24.6% 23.6% 24.2% 26.6% 24.9% Reported sales growth (7.6)% (2.2)% (5.5)% 13.0% (0.4)% Currency (0.5)% (0.3)% (0.5)% 0.4% (0.2)% Divestitures (3.4)% —% (2.0)% —% (1.5)% Organic sales growth (3.7)% (1.9)% (3.0)% 12.6% 1.3% DIVERSIFIED INDUSTRIAL INTERNATIONAL BUSINESSES - ORGANIC SALES GROWTH SUPPLEMENT Three Months Ended June 30, 2025 Twelve Months Ended June 30, 2025(Unaudited)EuropeAsia PacificLatin AmericaTotal EuropeAsia PacificLatin AmericaTotalReported sales growth 3.0% 6.9% —% 4.3% (5.3)% 2.3% (2.2)% (2.2)%Currency 6.2% 1.3% (3.8)% 3.7% 1.3% (1.1)% (11.5)% (0.3)%Organic sales growth (3.2)% 5.6% 3.8% 0.6% (6.6)% 3.4% 9.3% (1.9)% ADJUSTED NET INCOME1AND ADJUSTED DILUTED EARNINGS PER SHARE RECONCILIATION Three Months Ended June 30, Twelve Months Ended June 30,(Unaudited) 2025 2024 2025 2024 (Dollars in millions, except per share amounts)Net Income1Diluted EPS Net Income1Diluted EPS Net Income1Diluted EPS Net Income1Diluted EPSAs reported$923 $7.15 $785 $6.01 $3,531 $27.12 $2,844 $21.84 Adjustments: Amortization of acquired intangibles 139 1.08 139 1.07 553 4.25 578 4.43 Business realignment charges 16 0.12 18 0.13 56 0.43 54 0.40 Integration costs to achieve 3 0.03 9 0.07 22 0.17 38 0.30 Gain on sale of buildings (14) (0.10) — — (24) (0.18) — — Gain on divestitures (2) (0.02) — — (252) (1.94) (26) (0.20)Saegertown incident — — — — 8 0.06 — — Tax effect of adjustments2 (38) (0.30) (40) (0.30) (120) (0.93) (148) (1.12)Discrete tax benefits3 (35) (0.27) (27) (0.21) (215) (1.65) (27) (0.21)As adjusted$992 $7.69 $884 $6.77 $3,559 $27.33 $3,313 $25.44 1Represents net income attributable to common shareholders.2This line item reflects the aggregate tax effect of all non-tax adjustments reflected in the preceding line items of the table. We estimate the tax effect of each adjustment item by applying our overall effective tax rate for continuing operations to the pre-tax amount, unless the nature of the item and/or the tax jurisdiction in which the item has been recorded requires application of a specific tax rate or tax treatment, in which case the tax effect of such item is estimated by applying such specific tax rate or tax treatment.3Fiscal year 2025 relates to a deferred tax adjustment and release of a tax valuation allowance. Fiscal year 2024 reflects a Swiss tax law change which resulted in the recording of a deferred tax asset. ADJUSTED EBITDA RECONCILIATION (Unaudited)Three Months Ended June 30, Twelve Months Ended June 30,(Dollars in millions) 2025 2024 2025 2024 Net sales$5,243 $5,187 $19,850 $19,930 Net income$923 $785 $3,532 $2,845 Income taxes 148 201 575 750 Depreciation 91 91 354 349 Amortization 139 139 553 578 Interest expense 99 119 409 506 EBITDA 1,400 1,335 5,423 5,028 Adjustments: Business realignment charges 16 18 56 54 Integration costs to achieve 3 9 22 38 Gain on sale of buildings (14) — (24) — Gain on divestitures (2) — (252) (26)Saegertown incident — — 8 — Adjusted EBITDA$1,403 $1,362 $5,233 $5,094 EBITDA margin 26.7% 25.8% 27.3% 25.2%Adjusted EBITDA margin 26.8% 26.3% 26.4% 25.6% CONSOLIDATED BALANCE SHEET (Unaudited)June 30, June 30,(Dollars in millions) 2025 2024 Assets Current assets: Cash and cash equivalents$467 $422 Trade accounts receivable, net 2,910 2,866 Non-trade and notes receivable 318 331 Inventories 2,839 2,787 Prepaid expenses 263 253 Other current assets 153 140 Total current assets 6,950 6,799 Property, plant and equipment, net 2,937 2,876 Deferred income taxes 270 93 Other assets 1,269 1,207 Intangible assets, net 7,374 7,816 Goodwill 10,694 10,507 Total assets$29,494 $29,298 Liabilities and equity Current liabilities: Notes payable and long-term debt payable within one year$1,791 $3,403 Accounts payable, trade 2,126 1,992 Accrued payrolls and other compensation 587 581 Accrued domestic and foreign taxes 382 355 Other accrued liabilities 933 982 Total current liabilities 5,819 7,313 Long-term debt 7,494 7,157 Pensions and other postretirement benefits 267 437 Deferred income taxes 1,490 1,584 Other liabilities 733 726 Shareholders' equity 13,682 12,072 Noncontrolling interests 9 9 Total liabilities and equity$29,494 $29,298 CONSOLIDATED STATEMENT OF CASH FLOWS Twelve Months Ended(Unaudited)June 30,(Dollars in millions) 2025 2024 Cash flows from operating activities: Net income$3,532 $2,845 Depreciation and amortization 907 927 Stock incentive plan compensation 159 155 Gain on sale of businesses (253) (24)(Gain) loss on property, plant and equipment and intangible assets (20) 12 Net change in receivables, inventories and trade payables 31 (28)Net change in other assets and liabilities (336) (517)Other, net (244) 14 Net cash provided by operating activities 3,776 3,384 Cash flows from investing activities: Capital expenditures (435) (400)Proceeds from property, plant and equipment 32 9 Proceeds from sale of businesses 623 78 Other, net 4 15 Net cash provided by (used in) investing activities 224 (298)Cash flows from financing activities: Net payments for common stock activity (1,762) (328)Acquisition of noncontrolling interests — (3)Net payments for debt (1,354) (2,002)Dividends paid (861) (782)Net cash used in financing activities (3,977) (3,115)Effect of exchange rate changes on cash 22 (24)Net increase (decrease) in cash and cash equivalents 45 (53)Cash and cash equivalents at beginning of year 422 475 Cash and cash equivalents at end of period$467 $422 RECONCILIATION OF FORECASTED SALES GROWTH TO ORGANIC SALES GROWTH (Unaudited) (Amounts in percentages)Fiscal Year 2026Forecasted net sales2.0% to 5.0%Adjustments: Currency~(1.5)%Divestitures~1.0%Adjusted forecasted net sales1.5% to 4.5% RECONCILIATION OF FORECASTED SEGMENT OPERATING MARGIN TO ADJUSTED FORECASTED SEGMENT OPERATING MARGIN (Unaudited) (Amounts in percentages)Fiscal Year 2026Forecasted segment operating margin23.3% to 23.7%Adjustments: Business realignment charges~0.3%Amortization of acquired intangibles~2.7%Adjusted forecasted segment operating margin26.3% to 26.7% RECONCILIATION OF FORECASTED EARNINGS PER DILUTED SHARE TO ADJUSTED FORECASTED EARNINGS PER DILUTED SHARE (Unaudited) (Amounts in dollars)Fiscal Year 2026Forecasted earnings per diluted share$24.68 to $25.68Adjustments: Business realignment charges0.54Amortization of acquired intangibles4.26Tax effect of adjustments1(1.08)Adjusted forecasted earnings per diluted share$28.40 to $29.40 1This line item reflects the aggregate tax effect of all non-tax adjustments reflected in the preceding line items of the table. We estimate the tax effect of each adjustment item by applying our overall effective tax rate for continuing operations to the pre-tax amount, unless the nature of the item and/or the tax jurisdiction in which the item has been recorded requires application of a specific tax rate or tax treatment, in which case the tax effect of such item is estimated by applying such specific tax rate or tax treatment. Note: Totals may not foot due to rounding

Parker Reports Fiscal 2025 Fourth Quarter and Full Year Results

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