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Middleby's Q4 Earnings and Sales Beat Estimates, Increase Y/Y
MIDDMiddleby(MIDD) ZACKS·2025-02-26 17:30

Core Insights - The Middleby Corporation (MIDD) reported fourth-quarter 2024 adjusted earnings of 2.88pershare,exceedingtheZacksConsensusEstimateof2.88 per share, exceeding the Zacks Consensus Estimate of 2.50, with an 8.7% year-over-year increase despite lower sales [1] - Net sales reached 1.01billion,surpassingtheconsensusestimateof1.01 billion, surpassing the consensus estimate of 995 million, marking a 0.5% year-over-year increase, although organic sales decreased by 1.3% [1] Segmental Results - The Commercial Foodservice Equipment Group, accounting for 60.1% of net sales, generated 609.4million,down2.9609.4 million, down 2.9% year over year, with organic sales decreasing by 2.8% [3] - The Residential Kitchen Equipment Group, representing 18.3% of sales, totaled 185 million, a decline of 2.1% year over year, with organic sales plunging by 2.4% [4] - The Food Processing Equipment Group, making up 21.6% of sales, reported 219.4million,anincreaseof14.4219.4 million, an increase of 14.4% year over year, with organic sales rising by 4.7% [5] Margin Profile - Cost of sales increased by 0.5% year over year to 624.9 million, while gross profit rose by 0.6% to 388.9million,maintainingagrossmarginof38.4388.9 million, maintaining a gross margin of 38.4% [6] - Selling, general and administrative expenses decreased by 6.9% year over year to 178.4 million, leading to an operating income increase of 8.2% to 208.5million,withanoperatingmarginof20.6208.5 million, with an operating margin of 20.6% [6] Cash Flow and Balance Sheet - At the end of the first quarter, cash and cash equivalents stood at 689.5 million, up from 247.5millionattheendofDecember2023,whilelong−termdebtdecreasedto247.5 million at the end of December 2023, while long-term debt decreased to 2.35 billion [8] - In 2024, net cash generated from operating activities was 686.8million,comparedto686.8 million, compared to 628.8 million in the previous year, with free cash flow reaching 640million[9]StrategicDevelopments−Middlebyannouncedplanstospinoffitsfoodprocessingbusinessintoastandalonepubliccompany,expectedtobecompletedbyearly2026,aimingtoenhancestrategicfocusandcapitaloptimizationforbothentities[10][11]−Thefoodprocessingbusinessreportedrevenuesof640 million [9] Strategic Developments - Middleby announced plans to spin off its food processing business into a standalone public company, expected to be completed by early 2026, aiming to enhance strategic focus and capital optimization for both entities [10][11] - The food processing business reported revenues of 731 million with a 25% adjusted EBITDA margin, while the commercial foodservice segment achieved $2.4 billion in revenues with a 27% adjusted EBITDA margin [12]