Graco (GGG) investor relations material

Executive summary

• Third-quarter net sales increased 5% year-over-year to $543.4 million, with acquisitions contributing 6 percentage points and currency 1 point, while organic sales declined 2%.

• Net earnings rose 13% to $137.6 million ($0.82 per diluted share), including a $14 million non-cash gain from contingent consideration reduction.

• Gross profit margin remained flat as pricing and favorable mix offset higher product costs and lower margins from acquisitions.

• Adjusted non-GAAP net earnings per share increased 3% to $0.73, excluding tax benefits and the contingent gain.

• Operating expenses decreased 5% due to the non-cash gain; adjusted net earnings were flat as higher sales offset increased expenses and lower non-operating income.

Financial highlights

• Q3 2025 net sales: $543.4M (+5% YoY); YTD net sales: $1,643.4M (+5% YoY).

• Q3 2025 operating earnings: $164.7M (+13% YoY); adjusted operating earnings: $150.6M (+3% YoY).

• Diluted EPS: $0.82 for Q3 (+15% YoY); adjusted diluted EPS: $0.73 for Q3 (+3% YoY).

• Operating cash flow for nine months: $487M, up $51M YoY.

• Share repurchases totaled $361M (4.4 million shares) YTD; dividends paid: $138M; capex: $34M YTD.

Outlook and guidance

• Full-year guidance reaffirmed for low single-digit organic constant currency sales growth.

• Q4 expected to benefit from incremental pricing actions and easier contractor segment comparisons.

• Currency expected to have a 1% favorable impact on full-year net sales and earnings.

• Projected unallocated corporate expenses: $35–$38 million; capex: $50–$60 million for the year.

• Effective tax rate for Q4 and full year anticipated at 19.5%–20.5%.