The Middleby (MIDD) Q3 2024 earnings summary

Executive summary

• Q3 2024 net sales were $943 million, down 3.9% year-over-year, with declines in Commercial Foodservice and Residential Kitchen, partially offset by growth in Food Processing Equipment.

• Net earnings for Q3 2024 were $114.2 million, up 5.1% year-over-year; diluted EPS was $2.11 and adjusted EPS was $2.33.

• Adjusted EBITDA margin was 22.6% for Q3 2024; operating income was $173.4 million, representing 18.4% of net sales.

• The company remains focused on cost control, innovation, and strategic investments, with a robust product pipeline and ongoing M&A activity.

• Operating cash flow for Q3 was $156.7 million, with year-to-date operating cash flow of $447 million.

Financial highlights

• Q3 2024 net sales: $943 million, down 3.9% year-over-year; nine months sales: $2,861.3 million, down 5.5%.

• Q3 2024 adjusted EBITDA was $213 million (22.6% margin); Q3 gross profit was $355.4 million (37.7% margin).

• Q3 2024 net earnings: $114.2 million; adjusted EPS was $2.33.

• Operating cash flow for Q3 was $156.7 million; trailing 12-month free cash flow exceeded $650 million.

• Net leverage reduced to 2.2x, with net debt at $1.8 billion and borrowing availability of ~$2.8 billion at quarter end.

Outlook and guidance

• Q4 is expected to be the strongest quarter of the year, with revenue potentially reaching $1 billion and sequential growth anticipated.

• Full-year 2024 free cash flow projected to surpass 2023 and prior records.

• Management anticipates challenging macroeconomic conditions to persist through 2024, with improvement and a return to growth expected in 2025.

• Pipeline of customer opportunities and product innovations remains strong, supporting long-term growth.