The Company acquired Iridian Spectral Technologies and STC Material Solutions during the year, expanding its offerings in optical filters and technical ceramics. These acquisitions are expected to contribute to future growth and market diversification.

The Company completed the sale of Micropump and Novotema, resulting in a pre-tax gain of $93.8 million and a loss of $9.1 million, respectively. These divestitures reflect a strategic decision to streamline the business portfolio and focus on core operations.

The Company completed an expansion of its China facility in late 2022 and its India facility in 2023. This expansion is aimed at increasing the Company's footprint in these emerging markets, reflecting a belief in significant growth potential across all segments.

Despite sharp volume declines due to customer inventory recalibration, the Company delivered strong operating performance. This was achieved through strong price/cost management and favorable operational productivity across its segments.

The Company remains focused on delivering products and services to customers and continues to actively manage inventory levels. Backlog was elevated in recent years due to global supply chain constraints, which extended lead times, shifted customer order patterns and resulted in increased inventory to support production.

The Company recognizes that its success would not be possible without the valuable contributions of its workforce and is committed to creating a work environment where employees can thrive and grow. Our workplaces promote entrepreneurialism and autonomy while providing a strong safety net of benefits, training and personal development.

The company acknowledges increasing reliance on IT systems and a growing digital footprint, making it vulnerable to cybersecurity attacks. A successful attack could result in production downtimes, data compromise, financial losses, and reputational damage.

Increased public awareness and concern regarding environmental risks, including global climate change and the potential global transition to a lower-carbon economy, may result in more international, regional, federal and/or state requirements or industry standards to reduce or mitigate global warming and other environmental risks.

The company's largest end markets include industrial, fire and safety, energy, life sciences, water and wastewater treatment, semiconductor, automotive, analytical instruments, food and pharmaceuticals, paint, agriculture and chemical processing. A slowdown in the U.S. or global economy and, in particular, any of these specific end markets could materially reduce the Company's sales and profitability.

The Company's businesses participate in highly competitive markets. IDEX believes that the principal points of competition are product quality, design and engineering capabilities, product development, conformity to customer specifications, quality of post-sale support, timeliness of delivery and effectiveness of the Company's distribution channels.

The Company's ability to continue to grow organically is tied in large part to its ability to continue to develop new products. A failure to continue to develop and deliver new, innovative and competitive products to the market could limit sales growth and negatively impact the Company and its financial condition, results of operations and cash flow.

Principal competitors of the FMT segment are the Pumps Group (Blackmer, Wilden and Ebsray products) of Dover Corporation (with respect to pumps and small horsepower compressors used in liquefied petroleum gas distribution facilities, rotary gear pumps and air-operated double-diaphragm pumps); and Ingersoll Rand's Precision and Science Technologies (PST) division (with respect to metering, control, rotary gear pumps and air operated double-diaphragm pumps).

Gross profit and Gross margin were positively impacted by price/cost and strong operational productivity as well as lower fair value inventory step-up charges, and negatively impacted by lower volume leverage, higher employee-related costs, unfavorable mix and the acceleration of previously deferred revenue related to the exit of a COVID-19 testing application in 2022 that did not reoccur in 2023.

The Company is exposed to fluctuations in commodity pricing and inflation and attempts to control these impacts through increased prices to customers and various other programs with its suppliers.

The Company believes it has a sufficient number of suppliers necessary to meet demand but continues to actively evaluate its current suppliers and identify alternative sources to manage supply chain constraints, if needed.

Total engineering expenses, which include research and development as well as application and support engineering, were $107.5 million, $95.4 million and $82.9 million in 2023, 2022 and 2021, respectively. Research and development expenses, which include costs associated with developing new products and major improvements to existing products, were $68.4 million, $61.4 million and $50.1 million in 2023, 2022 and 2021, respectively.

Additionally, the Company's competitors may adopt new technologies and technological advancements using artificial intelligence and machine learning to pursue new products and approaches more quickly, successfully and effectively than the Company.

The Company owns patents, trademarks, licenses and other forms of intellectual property related to its products and continuously invests in research and development that may result in technological innovations and general intellectual property rights.

The Company repurchased 124,600 shares at a cost of $24.2 million in 2023. As of December 31, 2023, the amount of share repurchase authorization remaining was $539.7 million.

The Company increased its quarterly cash dividend by 7% from $0.60 per common share in 2022 to $0.64 per common share in 2023. Total dividend payments to common shareholders were $190.7 million in 2023 compared with $177.4 million in 2022.

Capital expenditures generally include machinery and equipment that support growth and improved productivity, tooling, business system technology, replacement of equipment and investments in new facilities. Cash flows from operations were more than adequate to fund capital expenditures of $89.9 million and $68.0 million in 2023 and 2022, respectively.

The commitment to Environmental, Health, and Safety ("EH&S") begins at the corporate and executive level. The program is overseen by the EH&S Senior Director and the Chief Sustainability Officer, both of whom are part of the Legal Department.

The Company has policies, procedures and regular training in place to protect its workforce and prevent workplace harassment and discrimination. This includes a global Code of Business Conduct & Ethics policy where employees agree to follow and receive annual training.

The Company's Board of Directors now comprises 30% women and 30% members who identify with racial/ethnic minority groups. Additionally, the representation of women in leadership at the Company remained steady in 2023.

IDEX's businesses are affected by levels of industrial activity and economic conditions in the U.S. and in other countries where it does business, as well as by the relationship of the U.S. dollar to other currencies. Levels of capacity utilization and capital spending in certain industries and overall industrial activity are important factors that influence the demand for IDEX's products.

The Company faces various risks related to the occurrence of catastrophic weather events or significant natural disasters, including earthquakes, wildfires, droughts, fires, power-outages or other catastrophic events, in areas in which we have manufacturing facilities or from which we obtain products.

The Company expects international operations and export sales to continue to be significant for the foreseeable future. The Company's sales from international operations and sales from export are both subject in varying degrees to risks inherent in doing business outside the U.S.