Applied Industrial Technologies Inc (NYSE:AIT) stock fell 0.19% (As on August 16, 11:25:02 AM UTC-4, Source: Google Finance) after the company posted mixed results for the fourth quarter of FY 24. EBITDA and EPS increased a respective 10% and 13% over the prior year on total sales that were relatively unchanged. Gross margins exceeded 30% and EBITDA margins exceeded 13% for the first time, both significant milestones.

Further, the Company today has also announced the acquisitions of Total Machine Solutions (TMS) and Stanley Proctor. Based in Faireld, NJ, TMS is a provider of electrical and mechanical power transmission products and solutions including bearings, drives, motors, conveyor components, and related repair services. TMS will be integrated into Applied’s U.S. Service Center operations. Combined, the Companies are expected to generate annual sales of approximately $17 million in the first year.

AIT in the fourth quarter of FY 24 has reported the adjusted earnings per share of $2.64, beating the analysts’ estimates for the adjusted earnings per share of $2.52, according to the Zacks Consensus Estimate. The company had reported the adjusted revenue growth of 0.2 percent to $1.16 billion in the fourth quarter of FY 24, missing the analysts’ estimates for revenue by 2.20%. However, sales declined 2.0% on an organic daily basis due to a 0.7% decrease in the Service Center segment and a 4.6% decrease in the Engineered Solutions segment. The organic sales declines were greatest within the Fluid Power operations of the Engineered Solutions segment due to ongoing inventory destocking and reduced production across OEM customers.

The Company reported net income of $ 103.5 million, or $2.64 per share, and EBITDA of $153.5 million. On a pre-tax basis, results include $0.3 million ($0.01 after tax per share) of LIFO expense compared to $8.1 million ($0.15 after tax per share) of LIFO expense in the prior year period. In addition, billing activity within our Service Center segment was more mixed as customers conservatively managed MRO spending within the uncertain business environment. Softer demand conditions have sustained into early fiscal 2025 with organic sales through mid-August trending down by a mid single-digit percent compared to prior-year levels.

For fiscal 2025, the company is expecting EPS to be in the range of $9.20 to $9.95 based on assumptions for total sales of down 2.5% to up 2.5% including down 4.0% to up 1.0% on an organic daily basis, as well as EBITDA margins of 12.1% to 12.3%.