Sector: Industrials|Industry: Specialty Industrial Machinery|Market Cap: $9.99B|Employees: 12K
A. O. Smith Corporation manufactures and markets residential and commercial gas and electric water heaters, boilers, heat pumps, tanks, and water treatment products in North America, China, Europe, and India. The company offers water heaters for residences, restaurants, hotels, office buildings, laundries, car washes, and small businesses; boilers for hospitals, schools, hotels, and other large commercial buildings, as well as homes, apartments, and condominiums; and water treatment products comprising point-of-entry water softeners, well water solutions, and whole-home water filtration products, and point-of-use carbon and reverse osmosis products for residences, restaurants, hotels, and offices. It also provides commercial water treatment and filtration product; expansion tanks, commercial solar water heating systems, swimming pool and spa heaters, and related products and parts; and electric wall-hung, gas tankless, combi-boiler, and heat pump and solar water heaters. The company offers its products under the A. O. Smith, State, Lochinvar, Hague, Water-Right, Master Water, Atlantic Filter, and Water Tec brands. It distributes its products through independent wholesale plumbing distributors, as well as to retail channels consisting of hardware and home center chains, and manufacturer representative firms; and offers Aquasana branded products directly to consumers through e-commerce channels. A. O. Smith Corporation was founded in 1874 and is headquartered in Milwaukee, Wisconsin.
Q2 2024 sales increased 7% YoY to $1,024.3 million, with growth primarily driven by higher volumes of residential and commercial water heaters and pricing actions in North America. However, unfavorable foreign currency translations negatively impacted sales by approximately $8 million. For the first six months of 2024, sales increased 4% YoY to $2,003.1 million.
Gross profit margin decreased from 40.0% in Q2 2023 to 38.7% in Q2 2024, primarily due to higher material costs. Similarly, the gross profit margin for the first six months of 2024 decreased from 39.4% to 39.0% compared to the same period last year.
Net earnings decreased slightly from $157.0 million in Q2 2023 to $156.2 million in Q2 2024. For the first six months, net earnings increased from $283.9 million to $303.8 million. The decrease in Q2 was primarily due to higher material costs and increased SG&A expenses, while the six-month increase was driven by higher sales volumes and pricing actions.