Divestiture activity decreased net sales by approximately $7 million during the current-year quarter. The company divested its CFC business for $560 million and a non-core filtration business for $66 million, indicating a focus on strategic portfolio management.

The company states that acquisitions will be considered from time to time to the extent there is a strong strategic fit, while at the same time maintaining the company's strong financial position. They also continue to assess existing businesses and initiate efforts to divest businesses that are not considered to be a good long-term strategic fit.

The company states they are investing in organic growth and productivity and are prioritizing those related to safety, strategic investments, and sustainability initiatives.

The company incurred business realignment and acquisition integration charges of $10 million and $11 million for the current and prior-year quarter, respectively. They anticipate incurring approximately $41 million of additional charges in the remainder of fiscal 2025.

Selling, general, and administrative expenses decreased in the current-year quarter primarily due to lower intangible asset amortization, stock-based compensation expense, and research and development expense.

The company states that they are monitoring inflation and managing its impact through a variety of cost and pricing measures, including continuous improvement and lean initiatives. Additionally, they are strategically managing their workforce and discretionary spending.

The company acknowledges that the extent to which their business and results of operations will be impacted by economic and political uncertainty, geopolitical risks, and public health crises depends on future developments that remain uncertain.

The company's debt portfolio contains variable rate debt, inherently exposing the Company to interest rate risk. A 100 basis point increase in near-term interest rates would increase annual interest expense on variable rate debt by approximately $23 million.

The company manages foreign currency transaction and translation risk by utilizing derivative and non-derivative financial instruments, including forward exchange contracts, cross-currency swap contracts and certain foreign currency denominated debt designated as net investment hedges.

Aerospace Systems Segment sales increased $219 million in the current-year quarter, driven by higher volume in the commercial and defense aftermarket, as well as the commercial original equipment manufacturer (OEM) market segment.

Diversified Industrial Segment sales decreased $162 million from the prior-year quarter, primarily due to lower demand from end users in the energy, in-plant and industrial equipment, off-highway and transportation markets.

The company serves a variety of markets including aerospace and defense, in-plant and industrial equipment, transportation, off-highway, energy, and HVAC and refrigeration markets, demonstrating a diverse customer base.

The company mentions benefits from cost containment initiatives as contributing to operating margin improvements in both segments.

The company continues to focus on managing inventory and other working capital requirements. Days supply of inventory on hand was 91 days at September 30, 2024, compared to 96 days at September 30, 2023.

The company has supply chain financing programs with financial intermediaries, which provide certain suppliers the option to be paid by the financial intermediaries earlier than the due date on the applicable invoice.

The company mentions research and development expense as a component of SG&A, indicating continued investment in this area.

The company states they are engineering innovative systems and products to provide superior customer value through improved service, efficiency and productivity.

The company operates in two reportable business segments that utilize eight core technologies, including hydraulics, pneumatics, electromechanical, filtration, fluid and gas handling, process control, engineered materials and climate control.

The company declared a quarterly cash dividend of $1.63 per share, and they have paid dividends for 297 consecutive quarters, including a yearly increase for the last 68 years.

The company has a program to repurchase its common shares, and they repurchased 88,821 shares during the three months ended September 30, 2024.

The company is targeting two percent of sales for capital expenditures and are prioritizing those related to safety, strategic investments and sustainability initiatives.

The company mentions prioritizing capital expenditures related to sustainability initiatives and enabling a sustainable future by providing innovative technology solutions that offer a positive global environmental impact and operating responsibly by reducing energy use and emissions.

The company is creating a culture of empowerment through their values, inclusion and diversity, accountability and teamwork.

The company states they are operating responsibly by reducing energy use and emissions.

The company states that they will continue to monitor the global environment and manage their business with the goal to minimize unfavorable impacts on operations and financial results.

The company states that a change in the economic conditions in individual markets may have a particularly volatile effect on segment performance.

The company mentions legal and regulatory developments and other government actions, including related to environmental protection, and associated compliance costs as a risk factor.