epac-20250228

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

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FORM 10-Q

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(Mark One)


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

For the quarterly period ended February 28, 2025


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

Commission File No. 1-11288

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ENERPAC TOOL GROUP CORP.

(Exact name of registrant as specified in its charter)

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Wisconsin						39-0168610
(State of incorporation)						(I.R.S. Employer Id. No.)

N86 W12500 WESTBROOK CROSSING

MENOMONEE FALLS, WISCONSIN 53051

Mailing address: P. O. Box 3241, Milwaukee, Wisconsin 53201

(Address of principal executive offices)

(262) 293-1500

(Registrant’s telephone number, including area code)

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


Title of each class	Ticker Symbol(s)	Name of each exchange on which registered
Class A common stock, $0.20 par value per share	EPAC	NYSE

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 x 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 x No ¨

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

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 registrant’s Class A Common Stock as of March 24, 2025 was 54,084,914.

Table of Contents

TABLE OF CONTENTS


			Page No.

Forward-Looking Statements and Cautionary Factors			1

Part I—Financial Information

Item 1—Condensed Consolidated Financial Statements (Unaudited)

Condensed Consolidated Statements of Earnings			3

Condensed Consolidated Statements of Comprehensive Income			4

Condensed Consolidated Balance Sheets			5

Condensed Consolidated Statements of Cash Flows			6

Notes to the Condensed Consolidated Financial Statements			7

Item 2—Management’s Discussion and Analysis of Financial Condition and Results of Operations			18

Item 3—Quantitative and Qualitative Disclosures about Market Risk			23

Item 4—Controls and Procedures			23

Part II—Other Information

Item 1A—Risk Factors			24

Item 2—Unregistered Sales of Equity Securities and Use of Proceeds			24

Item 5 —Other Information			24

Item 6—Exhibits			25

FORWARD-LOOKING STATEMENTS AND CAUTIONARY FACTORS

This quarterly report on Form 10-Q contains certain statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties. The terms “may,” “should,” “could,” “anticipate,” “believe,” “estimate,” “expect,” “objective,” “plan,” “project” and similar expressions are intended to identify forward-looking statements. Such forward-looking statements include statements regarding expected financial results and other planned events, including, but not limited to, anticipated liquidity, anticipated restructuring costs and related savings, anticipated future charges and anticipated capital expenditures. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions that are difficult to predict. Therefore, actual future events or results may differ materially from these statements. We disclaim any obligation to publicly update or revise any forward-looking statements as a result of new information, future events or any other reason.

The following is a list of factors, among others, that could cause actual results to differ materially from the forward-looking statements:

•supply chain issues, including shortages of adequate component supply or that increase our costs or cause delays in our ability to fulfill orders;

•failure to estimate customer demand properly may result in or could have an adverse impact on our business and operating results and our relationship with customers;

•the deterioration of, or instability in, the domestic and international economy and challenging end-market conditions, including as a result of geopolitical activity, including but not limited to, the invasion of Ukraine by Russia and international sanctions imposed in response thereto, as well as armed conflicts in the Middle East;

•decreased demand from customers in the oil & gas industry, including as a result of significant volatility in oil prices resulting from disruptions in the oil markets and imposition of climate-related laws and regulations that disadvantage the oil & gas industry;

•uncertainty over global tariffs or the financial impact of tariffs;

•our ability to maintain operational improvements from our continuous improvement program and from prior restructuring actions;

•logistics challenges, such as global freight capacity shortages, significant increases in freight costs or other delays in our ability to fulfill orders, including as a result of attacks on commercial ships in the Red Sea and adverse weather conditions;

•failure to collect on accounts receivable, including in certain foreign jurisdictions where sales are concentrated to a limited number of distributors or agents;

•risks related to our reliance on independent agents and distributors for the distribution and service of products;

•a significant failure in our information technology (IT) infrastructure, such as unauthorized access to financial and other sensitive data or cybersecurity threats;

•a material disruption at a significant manufacturing facility;

•competition in the markets we serve;

•currency exchange rate fluctuations, export and import restrictions, transportation disruptions or shortages, and other risks inherent in our international operations;

•regulatory and legal developments, including litigation, such as product liability and warranty claims, and contractual exposure to liabilities;

•unfavorable tax law changes may adversely affect results;

•failure to develop new products and the extent of market acceptance of new products and price increases;

•our ability to execute on our growth strategy;

•our ability to successfully identify, consummate and integrate acquisitions and realize anticipated benefits/results from acquired companies as part of our portfolio management process;

•the effects of divestitures and/or discontinued operations, including retained liabilities from, or indemnification obligations with respect to, disposed businesses;

•if the operating performance of our businesses were to fall significantly below normalized levels, the potential for a non-cash impairment charge of goodwill and/or other intangible assets, as they represent a substantial amount of our total assets;

•a global economic recession;

•the impact of elevated interest rates and material, labor, or overhead cost increases;

•our ability to comply with the covenants in our debt agreements and fluctuations in interest rates;

•our ability to attract, develop, and retain qualified employees;

•inadequate intellectual property protection or infringement of the intellectual property of others;

•our ability to access capital markets; and

•other matters, including those of a political, economic, business, competitive and regulatory nature contained from time to time in our U.S. Securities and Exchange Commission ("SEC") filings, including, but not limited to, those factors listed in the "Risk Factors" section within Item 1A of Part I of our Form 10-K for the fiscal year ended August 31, 2024 filed with the SEC on October 21, 2024 (the “fiscal 2024 Annual Report on Form 10-K”).

When used herein, the terms “we,” “us,” “our” and the “Company” refer to Enerpac Tool Group Corp. and its subsidiaries. Reference to fiscal years, such as "fiscal 2025," are to the fiscal year ending on August 31 of the specified year. Enerpac Tool Group Corp. provides free-of-charge access to its Annual Report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and all amendments thereto, through its website, www.enerpactoolgroup.com, as soon as reasonably practicable after such reports are electronically filed with the SEC.

PART I—FINANCIAL INFORMATION

Item 1—Financial Statements

ENERPAC TOOL GROUP CORP.

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

(In thousands, except per share amounts)

(Unaudited)


	Three Months Ended				Six Months Ended
	February 28, 2025		February 29, 2024		February 28, 2025		February 29, 2024
Net sales	$	145,528	$	138,437	$	290,724	$	280,406
Cost of products sold	72,097		66,962		142,641		134,681
Gross profit	73,431		71,475		148,083		145,725

Selling, general and administrative expenses	41,423		40,723		83,741		82,938
Amortization of intangible assets	1,188		833		2,390		1,657
Restructuring charges	—		398		—		2,799
Impairment & divestiture charges	—		—		—		147
Operating profit	30,820		29,521		61,952		58,184
Financing costs, net	2,371		3,711		5,140		7,408
Other expense, net	750		543		1,237		1,535
Earnings before income tax expense	27,699		25,267		55,575		49,241
Income tax expense	6,798		7,396		12,951		13,064
Net earnings from continuing operations	20,901		17,871		42,624		36,177
Earnings (loss) from discontinued operations, net of income taxes	—		(54)		—		(622)
Net earnings	$	20,901	$	17,817	$	42,624	$	35,555

Earnings per share from continuing operations
Basic	$	0.38	$	0.33	$	0.78	$	0.67
Diluted	$	0.38	$	0.33	$	0.78	$	0.66

Earnings (loss) per share from discontinued operations
Basic	$	0.00	$	(0.00)	$	0.00	$	(0.01)
Diluted	$	0.00	$	(0.00)	$	0.00	$	(0.01)

Earnings per share
Basic	$	0.38	$	0.33	$	0.78	$	0.65
Diluted	$	0.38	$	0.33	$	0.78	$	0.65

Weighted average common shares outstanding
Basic	54,397		54,213		54,319		54,370
Diluted	54,808		54,685		54,810		54,846

The accompanying notes are an integral part of these condensed consolidated financial statements.

ENERPAC TOOL GROUP CORP.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands)

(Unaudited)


	Three Months Ended				Six Months Ended
	February 28, 2025		February 29, 2024		February 28, 2025		February 29, 2024
Net earnings	$	20,901	$	17,817	$	42,624	$	35,555
Other comprehensive earnings (loss), net of tax
Foreign currency translation adjustments	(5,056)		(2,921)		(15,102)		(2,883)
Pension and other postretirement benefit plans	283		1,965		581		1,060
Cash flow hedges	(54)		(251)		18		986
Total other comprehensive loss, net of tax	(4,827)		(1,207)		(14,503)		(837)
Comprehensive income	$	16,074	$	16,610	$	28,121	$	34,718

The accompanying notes are an integral part of these condensed consolidated financial statements.

ENERPAC TOOL GROUP CORP.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share amounts)


	(Unaudited)
	February 28, 2025		August 31, 2024
ASSETS
Current assets
Cash and cash equivalents	$	119,509	$	167,094
Accounts receivable, net	111,993		104,335
Inventories, net	80,431		72,887
Other current assets	37,466		27,942
Total current assets	349,399		372,258
Property, plant and equipment, net	49,026		40,285
Goodwill	277,241		269,597
Other intangible assets, net	46,682		36,058
Other long-term assets	54,279		59,130
Total assets	$	776,627	$	777,328
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Current maturities of long-term debt	$	5,000	$	5,000
Trade accounts payable	43,903		43,368
Accrued compensation and benefits	19,080		25,856

Income taxes payable	3,207		5,321
Other current liabilities	42,842		49,848
Total current liabilities	114,032		129,393
Long-term debt, net	187,086		189,503
Deferred income taxes	8,632		3,696
Pension and postretirement benefit liabilities	8,449		10,073
Other long-term liabilities	52,450		52,684
Total liabilities	370,649		385,349

Shareholders’ equity
Class A common stock, $0.20 par value per share, authorized 168,000,000 shares, issued 54,258,795 and 54,234,660 shares, respectively	10,852		10,847
Additional paid-in capital	236,019		235,660
Retained earnings	290,008		261,870
Accumulated other comprehensive loss	(130,901)		(116,398)
Stock held in trust	(3,575)		(3,777)
Deferred compensation liability	3,575		3,777
Total shareholders' equity	405,978		391,979
Total liabilities and shareholders’ equity	$	776,627	$	777,328

The accompanying notes are an integral part of these condensed consolidated financial statements.

ENERPAC TOOL GROUP CORP.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)


	Six Months Ended
	February 28, 2025		February 29, 2024
Operating Activities
Net earnings	$	42,624	$	35,555
Less: Earnings (loss) from discontinued operations, net of income taxes	—		(622)
Net earnings from continuing operations	42,624		36,177
Adjustments to reconcile net earnings to net cash provided by operating activities - continuing operations:
Impairment & divestiture charges	—		147
Depreciation and amortization	6,985		6,754
Stock-based compensation expense	6,186		5,527
Benefit for deferred income taxes	3,089		418
Amortization of debt issuance costs	293		292
Other non-cash expenses	(15)		1,954
Changes in components of working capital and other, excluding acquisitions and divestitures:
Accounts receivable	(6,830)		(375)
Inventories	(9,426)		(7,818)
Trade accounts payable	(1,658)		(6,514)
Prepaid expenses and other assets	(5,224)		(5,806)
Income tax accounts	(5,297)		1,345
Accrued compensation and benefits	(6,170)		(12,625)
Other accrued liabilities	(8,449)		(7,411)
Cash provided by operating activities - continuing operations	16,108		12,065
Cash used in operating activities - discontinued operations	—		(5,413)
Cash provided by operating activities	16,108		6,652

Investing Activities
Capital expenditures	(11,517)		(3,152)
Cash paid for business acquisitions, net of cash acquired	(27,196)		—
Working capital adjustment from sale of business assets	—		(1,133)
Purchase of business assets	—		(1,402)
Cash used in investing activities - continuing operations	(38,713)		(5,687)
Cash used in investing activities	(38,713)		(5,687)

Financing Activities
Borrowings on revolving credit facility	14,421		48,000
Principal repayments on revolving credit facility	(14,421)		(16,000)
Principal repayments on term loan	(2,500)		(1,250)




Purchase of treasury shares	(14,555)		(30,108)
Taxes paid related to the net share settlement of equity awards	(7,401)		(3,076)
Stock option exercises & other	1,554		2,871
Payment of cash dividend	(2,167)		(2,178)
Cash used in financing activities - continuing operations	(25,069)		(1,741)
Cash used in financing activities	(25,069)		(1,741)

Effect of exchange rate changes on cash	89		54
Net decrease in cash and cash equivalents	(47,585)		(722)
Cash and cash equivalents - beginning of period	167,094		154,415
Cash and cash equivalents - end of period	$	119,509	$	153,693

The accompanying notes are an integral part of these condensed consolidated financial statements.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 1. Basis of Presentation

General

Enerpac Tool Group Corp. (the "Company") is a premier industrial tools, services, technology and solutions company serving a broad and diverse set of customers in more than 100 countries. The Company has one reportable segment, Industrial Tools & Services ("IT&S"), and an Other operating segment, which does not meet the criteria to be considered a reportable segment.

The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with United States generally accepted accounting principles ("GAAP") for interim financial reporting and with the instructions of Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. The condensed consolidated balance sheet data as of August 31, 2024 was derived from the Company’s audited financial statements but does not include all disclosures required by GAAP. For additional information, including the Company’s significant accounting policies, refer to the consolidated financial statements and related footnotes in the Company’s fiscal 2024 Annual Report on Form 10-K.

In the opinion of management, all adjustments considered necessary for a fair statement of financial results have been made. Such adjustments consist of onl

SEC Form 10-Q filed by Enerpac Tool Group Corp.