Business Wire | Aug 30, 2021 04:30PM EDT

Nordson Corporation Reports Record Third Quarter Results and Raises Fiscal Year 2021 Guidance

Aug. 30, 2021

WESTLAKE, Ohio--(BUSINESS WIRE)--Aug. 30, 2021--Nordson Corporation (Nasdaq: NDSN) today reported results for the fiscal third quarter ended July 31, 2021. Sales were a quarterly company record of $647 million, a 20% increase compared to the prior year's third quarter sales of $538 million. The increase in third quarter 2021 sales included organic volume growth of 20% and favorable effects from currency translation of 4%, offset by a net unfavorable impact of acquisitions and divestitures of 4%. The organic sales increase was driven by continued demand across all end markets, including a seasonal increase of quarterly shipments into the electronics end market.

Operating profit in the quarter was $188 million, or 29% of sales, compared to prior year adjusted operating profit of $120 million. This 57% increase in adjusted operating profit was driven by sales volume leverage and benefits from structural cost reduction actions taken in fiscal year 2020, as well as the divestiture of the screws and barrels product line on February 1, 2021. EBITDA for the third quarter of 2021 totaled $215 million, or 33% of sales.

Net income was $142 million, a 71% increase from the prior year adjusted earnings of $83 million. Third quarter 2021 diluted earnings per share were $2.42, a 70% increase over the prior year adjusted diluted earnings per share of $1.42.

"In the fiscal third quarter, we continued to benefit from the robust end market demand and accelerated recovery that we experienced in our second quarter. We were particularly pleased to see strong growth return in our medical, electronics and industrial end markets. Our teams are doing an outstanding job of managing through external supply chain and labor headwinds in order to deliver on the needs of our customers. The comprehensive execution of the Ascend strategy with NBS Next growth framework at its core continues to help us deliver top tier growth with leading margins and returns," said Sundaram Nagarajan, president and chief executive officer.

Third Quarter Segment Results

Industrial Precision Solutions sales of $345 million increased 20% compared to the prior year third quarter, driven by a 22% organic increase and a favorable currency impact of 5%, partially offset by a divestiture impact of 8%. The organic sales increase was driven by continued demand in consumer non-durable and industrial end markets, particularly in China. Operating profit was $124 million, or 36% of sales, an increase of 60% compared to the prior year third quarter adjusted operating profit.

Advanced Technology Solutions sales of $301 million increased 21% compared to the prior year third quarter. Organic sales increased 18% while favorable currency impacts added 2% and acquisitions increased sales by approximately 1%. Sales demand was strong in all product lines including those serving electronics and medical end markets, with the Americas and China leading the growth from a regional perspective. Operating profit totaled $81 million, or 27% of sales, an increase of 51% compared to the prior year third quarter adjusted operating profit.

"I am pleased with the broad-based organic growth and attractive incremental margins in both segments," said Joseph Kelley, executive vice president and chief financial officer. "Rigorous application of the NBS Next growth framework in our divisions is helping us to focus and sustain profitable growth in our greatest opportunities."

Outlook

Backlog entering the fourth quarter of fiscal year 2021 is approximately $700 million, or 70% above the prior year. Customer order patterns have clearly changed in terms of both volume and extended shipment request dates during this dynamic environment. Based on the continued strength in order entry and backlog, the Company is increasing its full-year revenue and earnings guidance.

The Company expects full year sales growth in fiscal 2021 to be approximately 11% to 12% over fiscal year 2020, inclusive of a 3% headwind from the second quarter 2021 divestiture of the screws and barrels product line. Additionally, the Company is now forecasting full year 2021 earnings per diluted share in the range of $7.75 to $7.95. The increased guidance midpoint represents a strong second half of 2021 with year-over-year sales growth of 14% and earnings growth of 47%. The Company is expecting to enter fiscal 2022 with a backlog approximately 70% greater than the prior year.

Nordson management will provide additional commentary on these results and outlook during its previously announced webcast on Tuesday, August 31, 2021 at 8:30 a.m. eastern time, which can be accessed at https://investors.nordson.com. For persons unable to listen to the live broadcast, a replay will be available for 14 days after the event. Information about Nordson's investor relations and shareholder services is available from Lara Mahoney, vice president, investor relations and corporate communications at (440) 204-9985 or lara.mahoney@nordson.com.

Certain statements contained in this release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by terminology such as "may," "will," "should," "could," "expects," "anticipates," "believes," "projects," "forecasts," "outlook," "guidance," "continue," "target," or the negative of such terms or comparable terminology. These statements reflect management's current expectations and involve a number of risks and uncertainties. These risks and uncertainties include, but are not limited to, U.S. and international economic conditions; financial and market conditions; currency exchange rates and devaluations; possible acquisitions including the Company's ability to successfully integrate acquisitions; the Company's ability to successfully divest or dispose of businesses that are deemed not to fit with its strategic plan; the effects of changes in U.S. trade policy and trade agreements; the effects of changes in tax law; and the possible effects of events beyond our control, such as political unrest, acts of terror, natural disasters and pandemics, including the current coronavirus (COVID-19) pandemic and the other factors discussed in Item 1A (Risk Factors) in the Company's most recently filed Annual Report on Form 10-K and in its Forms 10-Q filed with the Securities and Exchange Commission, which should be reviewed carefully. The Company undertakes no obligation to update or revise any forward-looking statement in this press release.

Nordson Corporation is an innovative precision technology company that leverages a scalable growth framework to deliver top tier growth with leading margins and returns. The Company's direct sales model and applications expertise serves global customers through a wide variety of critical applications. Its diverse end market exposure includes consumer non-durable, medical, electronics and industrial end markets. Founded in 1954 and headquartered in Westlake, Ohio, the Company has operations and support offices in over 35 countries. Visit Nordson on the web at www.nordson.com, www.twitter.com/Nordson_Corp or www.facebook.com/nordson.

NORDSON CORPORATION

CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

(Dollars in thousands except for per-share amounts)

Three months ended Nine months ended

July 31, July 31, July 31, 2021 July 31, 2020 2021 2020



Sales $ 646,858 $ 538,181 $ 1,762,962 $ 1,562,575

Cost of sales 281,587 257,373 770,032 728,975

Gross profit 365,271 280,808 992,930 833,600

Gross margin % 56.5 % 52.2 % 56.3 % 53.3 %



Selling &administrative 176,995 168,753 529,238 521,423 expenses

Operating profit 188,276 112,055 463,692 312,177



Interest expense - (5,647 ) (6,880 ) (18,889 ) (24,047 )net

Other expense - net (2,232 ) (9,668 ) (10,736 ) (12,943 )

Income before income 180,397 95,507 434,067 275,187 taxes



Income taxes 38,215 8,526 90,159 44,123



Net income $ 142,182 $ 86,981 $ 343,908 $ 231,064



Weighted-averagecommon shares outstanding:

Basic 58,112 57,693 58,080 $ 57,679

Diluted 58,735 58,427 58,714 58,404



Earnings per share:

Basic earnings $ 2.45 $ 1.51 $ 5.92 $ 4.01

Diluted earnings $ 2.42 $ 1.49 $ 5.86 $ 3.96

NORDSON CORPORATION

CONSOLIDATED BALANCE SHEETS (Unaudited)

(Dollars in thousands)

July 31, 2021

October 31, 2020

Cash and cash equivalents

$

174,235

$

208,293

Receivables - net

516,685

471,873

Inventories - net

303,977

277,033

Other current assets

50,866

43,798

Assets held for sale

-

19,615

Total current assets

1,045,763

1,020,612

Property, plant & equipment - net

358,208

358,618

Goodwill

1,718,565

1,713,354

Other assets

547,544

582,072

$

3,670,080

$

3,674,656

Current maturities of long-term debt and notes payable

$

31,385

$

38,043

Accounts payable and accrued liabilities

389,437

311,898

Liabilities held for sale

-

13,148

Total current liabilities

420,822

363,089

Long-term debt

789,731

1,067,952

Other liabilities

396,349

484,624

Total shareholders' equity

2,063,178

1,758,991

$

3,670,080

$

3,674,656

NORDSON CORPORATION

CONSOLIDATED BALANCE SHEETS (Unaudited)

(Dollars in thousands)

July 31, 2021 October 31, 2020



Cash and cash equivalents $ 174,235 $ 208,293

Receivables - net 516,685 471,873

Inventories - net 303,977 277,033

Other current assets 50,866 43,798

Assets held for sale - 19,615

Total current assets 1,045,763 1,020,612



Property, plant & equipment - net 358,208 358,618

Goodwill 1,718,565 1,713,354

Other assets 547,544 582,072

$ 3,670,080 $ 3,674,656



Current maturities of long-term debt and notes $ 31,385 $ 38,043 payable

Accounts payable and accrued liabilities 389,437 311,898

Liabilities held for sale - 13,148

Total current liabilities 420,822 363,089



Long-term debt 789,731 1,067,952

Other liabilities 396,349 484,624

Total shareholders' equity 2,063,178 1,758,991

$ 3,670,080 $ 3,674,656



NORDSON CORPORATION

CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited)

(Dollars in thousands)

Nine Months Ended

July 31, 2021

July 31, 2020

Cash flows from operating activities:

Net income

$

343,908

$

231,064

Depreciation and amortization

78,233

84,164

Other non-cash items

18,947

8,751

Changes in working capital

12,565

2,455

Pension and postretirement plans

(82,604

)

(24,657

)

Other long-term assets and liabilities

4,407

8,181

Net cash provided by operating activities

375,456

309,958

Cash flows from investing activities:

Additions to property, plant and equipment

(28,073

)

(36,096

)

Acquisitions

-

(125,260

)

Other - net

5,076

(1,836

)

Net cash used in investing activities

(22,997

)

(163,192

)

Cash flows from financing activities:

Issuance (repayment) of long-term debt

(292,290

)

1,740

Repayment of finance lease obligations

(5,111

)

(5,814

)

Dividends paid

(68,021

)

(65,737

)

Issuance of common shares

24,136

46,304

Purchase of treasury shares

(46,840

)

(51,897

)

Net cash used in financing activities

(388,126

)

(75,404

)

Effect of exchange rate change on cash

1,609

(743

)

Net change in cash and cash equivalents

(34,058

)

70,619

Cash and cash equivalents:

Beginning of period

208,293

151,164

End of period

$

174,235

$

221,783

NORDSON CORPORATION

CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited)

(Dollars in thousands)

Nine Months Ended

July 31, 2021 July 31, 2020

Cash flows from operating activities:

Net income $ 343,908 $ 231,064

Depreciation and amortization 78,233 84,164

Other non-cash items 18,947 8,751

Changes in working capital 12,565 2,455

Pension and postretirement plans (82,604 ) (24,657 )

Other long-term assets and liabilities 4,407 8,181

Net cash provided by operating activities 375,456 309,958



Cash flows from investing activities:

Additions to property, plant and equipment (28,073 ) (36,096 )

Acquisitions - (125,260 )

Other - net 5,076 (1,836 )

Net cash used in investing activities (22,997 ) (163,192 )



Cash flows from financing activities:

Issuance (repayment) of long-term debt (292,290 ) 1,740

Repayment of finance lease obligations (5,111 ) (5,814 )

Dividends paid (68,021 ) (65,737 )

Issuance of common shares 24,136 46,304

Purchase of treasury shares (46,840 ) (51,897 )

Net cash used in financing activities (388,126 ) (75,404 )



Effect of exchange rate change on cash 1,609 (743 )

Net change in cash and cash equivalents (34,058 ) 70,619



Cash and cash equivalents:

Beginning of period 208,293 151,164

End of period $ 174,235 $ 221,783



NORDSON CORPORATION

SALES BY GEOGRAPHIC SEGMENT (Unaudited)

(Dollars in thousands)

Three Months Ended

Sales Variance

July 31,

2021

July 31,

2020

Organic

Acquisitions /

Divestitures

Currency

Total

SALES BY SEGMENT

Industrial precision solutions

$

345,449

$

288,965

22.4

%

(8.0

)%

5.1

%

19.5

%

Advanced technology solutions

301,409

249,216

17.8

%

0.8

%

2.3

%

20.9

%

Total sales

$

646,858

$

538,181

20.2

%

(3.8

)%

3.8

%

20.2

%

SALES BY GEOGRAPHIC REGION

United States

$

201,531

$

183,508

15.7

%

(5.9

)%

-

%

9.8

%

Americas

47,717

38,265

22.0

%

(2.3

)%

5.0

%

24.7

%

Europe

162,298

132,107

17.5

%

(2.1

)%

7.5

%

22.9

%

Japan

24,946

31,226

(13.3

)%

(4.8

)%

(2.0

)%

(20.1

)%

Asia Pacific

210,366

153,075

34.0

%

(2.3

)%

5.7

%

37.4

%

Total sales

$

646,858

$

538,181

20.2

%

(3.8

)%

3.8

%

20.2

%

Nine Months Ended

Sales Variance

July 31,

2021

July 31,

2020

Organic

Acquisitions /

Divestitures

Currency

Total

SALES BY SEGMENT

Industrial precision solutions

$

932,640

$

835,038

13.0

%

(5.8

)%

4.5

%

11.7

%

Advanced technology solutions

830,322

727,537

10.0

%

1.8

%

2.3

%

14.1

%

Total sales

$

1,762,962

$

1,562,575

11.6

%

(2.2

)%

3.4

%

12.8

%

SALES BY GEOGRAPHIC REGION

United States

$

589,771

$

560,941

8.5

%

(3.4

)%

-

%

5.1

%

Americas

128,769

106,021

16.8

%

3.2

%

1.5

%

21.5

%

Europe

453,900

394,554

9.2

%

(1.9

)%

7.7

%

15.0

%

Japan

79,913

90,353

(9.0

)%

(3.6

)%

1.0

%

(11.6

)%

Asia Pacific

510,609

410,706

21.1

%

(1.7

)%

4.9

%

24.3

%

Total sales

$

1,762,962

$

1,562,575

11.6

%

(2.2

)%

3.4

%

12.8

%

NORDSON CORPORATION

SALES BY GEOGRAPHIC SEGMENT (Unaudited)

(Dollars in thousands)

Three Months Ended Sales Variance

July 31, July 31, Acquisitions Organic / Currency Total 2021 2020 Divestitures

SALES BY SEGMENT

Industrialprecision $ 345,449 $ 288,965 22.4 % (8.0 )% 5.1 % 19.5 %solutions

Advancedtechnology 301,409 249,216 17.8 % 0.8 % 2.3 % 20.9 %solutions

Total $ 646,858 $ 538,181 20.2 % (3.8 )% 3.8 % 20.2 %sales



SALES BYGEOGRAPHIC REGION

United $ 201,531 $ 183,508 15.7 % (5.9 )% - % 9.8 %States

Americas 47,717 38,265 22.0 % (2.3 )% 5.0 % 24.7 %

Europe 162,298 132,107 17.5 % (2.1 )% 7.5 % 22.9 %

Japan 24,946 31,226 (13.3 ) (4.8 )% (2.0 )% (20.1 ) % %

Asia 210,366 153,075 34.0 % (2.3 )% 5.7 % 37.4 %Pacific

Total $ 646,858 $ 538,181 20.2 % (3.8 )% 3.8 % 20.2 %sales





Nine Months Ended Sales Variance

July 31, July 31, Acquisitions Organic / Currency Total 2021 2020 Divestitures

SALES BY SEGMENT

Industrialprecision $ 932,640 $ 835,038 13.0 % (5.8 )% 4.5 % 11.7 %solutions

Advancedtechnology 830,322 727,537 10.0 % 1.8 % 2.3 % 14.1 %solutions

Total $ 1,762,962 $ 1,562,575 11.6 % (2.2 )% 3.4 % 12.8 %sales



SALES BYGEOGRAPHIC REGION

United $ 589,771 $ 560,941 8.5 % (3.4 )% - % 5.1 %States

Americas 128,769 106,021 16.8 % 3.2 % 1.5 % 21.5 %

Europe 453,900 394,554 9.2 % (1.9 )% 7.7 % 15.0 %

Japan 79,913 90,353 (9.0 ) (3.6 )% 1.0 % (11.6 ) % %

Asia 510,609 410,706 21.1 % (1.7 )% 4.9 % 24.3 %Pacific

Total $ 1,762,962 $ 1,562,575 11.6 % (2.2 )% 3.4 % 12.8 %sales



NORDSON CORPORATION

RECONCILIATION OF NON-GAAP MEASURES - ADJUSTED OPERATING PROFIT AND EBITDA (Unaudited)

(Dollars in thousands)

Three months ended

Nine months ended

July 31, 2021

July 31, 2020

July 31, 2021

July 31, 2020

SALES BY SEGMENT

Industrial precision solutions

$

345,449

$

288,965

$

932,640

$

835,038

Advanced technology solutions

301,409

249,216

830,322

727,537

Total sales

$

646,858

$

538,181

$

1,762,962

$

1,562,575

OPERATING PROFIT

Industrial precision solutions

$

123,829

$

74,744

$

311,515

$

207,603

Advanced technology solutions

80,769

49,952

204,556

140,928

Corporate

(16,322

)

(12,641

)

(52,379

)

(36,354

)

Total operating profit

$

188,276

$

112,055

$

463,692

$

312,177

OPERATING PROFIT ADJUSTMENTS (1)

Industrial precision solutions

$

-

$

2,813

$

-

$

3,477

Advanced technology solutions

-

3,413

-

6,383

Corporate

-

1,387

-

1,387

Total adjustments

$

-

$

7,613

$

-

$

11,247

ADJUSTED OPERATING PROFIT (NON-GAAP) (2)

% of

Sales

% of

Sales

% of

Sales

% of

Sales

Industrial precision solutions

$

123,829

36

%

$

77,557

27

%

$

311,515

33

%

$

211,080

25

%

Advanced technology solutions

80,769

27

%

53,365

21

%

204,556

25

%

147,311

20

%

Corporate

(16,322

)

(11,254

)

(52,379

)

(34,967

)

Total operating profit - adjusted

$

188,276

29

%

$

119,668

22

%

$

463,692

26

%

$

323,424

21

%

DEPRECIATION & AMORTIZATION

Industrial precision solutions

$

5,964

$

9,865

$

19,414

$

28,990

Advanced technology solutions

18,474

16,266

51,439

47,832

Corporate

2,460

2,369

7,380

7,342

Total depreciation & amortization

$

26,898

$

28,500

$

78,233

$

84,164

EBITDA (NON-GAAP) (2)

Industrial precision solutions

$

129,793

38

%

$

87,422

30

%

$

330,929

35

%

$

240,070

29

%

Advanced technology solutions

99,243

33

%

69,631

28

%

255,995

31

%

195,143

27

%

Corporate

(13,862

)

(8,885

)

(44,999

)

(27,625

)

Total EBITDA

$

215,174

33

%

$

148,168

28

%

$

541,925

31

%

$

407,588

26

%

NORDSON CORPORATION

RECONCILIATION OF NON-GAAP MEASURES - ADJUSTED OPERATING PROFIT AND EBITDA(Unaudited)

(Dollars in thousands)

Three months ended Nine months ended

July 31, 2021 July 31, 2020 July 31, 2021 July 31, 2020

SALES BY SEGMENT

Industrialprecision $ 345,449 $ 288,965 $ 932,640 $ 835,038 solutions

Advancedtechnology 301,409 249,216 830,322 727,537 solutions

Total sales $ 646,858 $ 538,181 $ 1,762,962 $ 1,562,575



OPERATING PROFIT

Industrialprecision $ 123,829 $ 74,744 $ 311,515 $ 207,603 solutions

Advancedtechnology 80,769 49,952 204,556 140,928 solutions

Corporate (16,322 ) (12,641 ) (52,379 ) (36,354 )

Totaloperating $ 188,276 $ 112,055 $ 463,692 $ 312,177 profit



OPERATINGPROFIT ADJUSTMENTS^(1)

Industrialprecision $ - $ 2,813 $ - $ 3,477 solutions

Advancedtechnology - 3,413 - 6,383 solutions

Corporate - 1,387 - 1,387

Total $ - $ 7,613 $ - $ 11,247 adjustments



ADJUSTEDOPERATING % of % of % of % ofPROFIT (NON-GAAP)^ Sales Sales Sales Sales(2)

Industrialprecision $ 123,829 36 % $ 77,557 27 % $ 311,515 33 % $ 211,080 25 %solutions

Advancedtechnology 80,769 27 % 53,365 21 % 204,556 25 % 147,311 20 %solutions

Corporate (16,322 ) (11,254 ) (52,379 ) (34,967 )

Totaloperating $ 188,276 29 % $ 119,668 22 % $ 463,692 26 % $ 323,424 21 %profit -adjusted



DEPRECIATION& AMORTIZATION

Industrialprecision $ 5,964 $ 9,865 $ 19,414 $ 28,990 solutions

Advancedtechnology 18,474 16,266 51,439 47,832 solutions

Corporate 2,460 2,369 7,380 7,342

Totaldepreciation $ 26,898 $ 28,500 $ 78,233 $ 84,164 &amortization



EBITDA(NON-GAAP)^ (2)

Industrialprecision $ 129,793 38 % $ 87,422 30 % $ 330,929 35 % $ 240,070 29 %solutions

Advancedtechnology 99,243 33 % 69,631 28 % 255,995 31 % 195,143 27 %solutions

Corporate (13,862 ) (8,885 ) (44,999 ) (27,625 )

Total EBITDA $ 215,174 33 % $ 148,168 28 % $ 541,925 31 % $ 407,588 26 %

(1)

Represents costs and adjustments related to cost structure simplification actions, and charges associated with our 2020 acquisition.

(2)

Adjusted operating profit and EBITDA are non-GAAP measures used by management to evaluate the Company's ongoing operations. Adjusted operating profit is defined as operating profit plus certain adjustments, such as cost structure simplification actions. EBITDA is defined as adjusted operating profit plus depreciation and amortization.

^ Represents costs and adjustments related to cost structure simplification(1) actions, and charges associated with our 2020 acquisition.

Adjusted operating profit and EBITDA are non-GAAP measures used by^ management to evaluate the Company's ongoing operations. Adjusted(2) operating profit is defined as operating profit plus certain adjustments, such as cost structure simplification actions. EBITDA is defined as adjusted operating profit plus depreciation and amortization.

NORDSON CORPORATION

RECONCILIATION OF NON-GAAP MEASURES - PROFITABILITY (Unaudited)

(Dollars in thousands)

Three Months Ended

Nine Months Ended

July 31, 2021

July 31, 2020

July 31, 2021

July 31, 2020

GAAP AS REPORTED

Operating profit

$

188,276

$

112,055

$

463,692

$

312,177

Other / interest expense - net

(7,879

)

(16,548

)

(29,625

)

(36,990

)

Net income

142,182

86,981

343,908

231,064

Diluted earnings per share

$

2.42

$

1.49

$

5.86

$

3.96

Shares outstanding - diluted

58,735

58,427

58,714

58,404

OPERATING PROFIT ADJUSTMENTS

Inventory step-up amortization

$

-

$

1,229

$

-

$

1,229

Severance and other

$

-

$

6,384

$

-

$

10,018

NON-OPERATING EXPENSE ADJUSTMENTS

Pension settlement loss

$

-

$

2,508

$

-

$

2,508

Total adjustments

$

-

$

10,121

$

-

$

13,755

Adjustments net of tax

$

-

$

7,966

$

-

$

10,825

Other discrete tax items

$

-

$

(11,816

)

$

-

$

(14,491

)

EPS effect of adjustments and other discrete tax items

$

-

$

(0.07

)

$

-

$

(0.06

)

NON-GAAP MEASURES-ADJUSTED PROFITABILITY

Operating profit (1)

$

188,276

$

119,668

$

463,692

$

323,424

Operating profit % of sales

29.1

%

22.2

%

26.3

%

20.7

%

Net income (2)

$

142,182

$

83,131

$

343,908

$

227,398

Diluted earnings per share (3)

$

2.42

$

1.42

$

5.86

$

3.89

NORDSON CORPORATION

RECONCILIATION OF NON-GAAP MEASURES - PROFITABILITY (Unaudited)

(Dollars in thousands)

Three Months Ended Nine Months Ended

July 31, July 31, July 31, July 31, 2021 2020 2021 2020

GAAP AS REPORTED

Operating profit $ 188,276 $ 112,055 $ 463,692 $ 312,177

Other / interest expense (7,879 ) (16,548 ) (29,625 ) (36,990 )- net

Net income 142,182 86,981 343,908 231,064

Diluted earnings per $ 2.42 $ 1.49 $ 5.86 $ 3.96 share



Shares outstanding - 58,735 58,427 58,714 58,404 diluted



OPERATING PROFIT ADJUSTMENTS

Inventory step-up $ - $ 1,229 $ - $ 1,229 amortization

Severance and other $ - $ 6,384 $ - $ 10,018



NON-OPERATING EXPENSE ADJUSTMENTS

Pension settlement loss $ - $ 2,508 $ - $ 2,508



Total adjustments $ - $ 10,121 $ - $ 13,755



Adjustments net of tax $ - $ 7,966 $ - $ 10,825

Other discrete tax items $ - $ (11,816 ) $ - $ (14,491 )

EPS effect of adjustmentsand other discrete tax $ - $ (0.07 ) $ - $ (0.06 )items



NON-GAAPMEASURES-ADJUSTED PROFITABILITY

Operating profit^ (1) $ 188,276 $ 119,668 $ 463,692 $ 323,424

Operating profit % of 29.1 % 22.2 % 26.3 % 20.7 %sales

Net income ^(2) $ 142,182 $ 83,131 $ 343,908 $ 227,398

Diluted earnings per $ 2.42 $ 1.42 $ 5.86 $ 3.89 share^ (3)

(1)

Adjusted operating profit is defined as operating profit plus certain adjustments such as cost structure simplification actions. Adjusted operating profit as a percentage of sales is defined as adjusted operating profit divided by sales.

(2)

Adjusted net income is defined as net income plus tax effected adjustments and other discrete tax items.

(3)

Adjusted earnings per share is defined as GAAP EPS adjusted for tax effected adjustments and other discrete tax items.

Management uses these non-GAAP measures internally to make strategic decisions, forecast future results, and evaluate the Company's current performance. Given management's use of these non-GAAP measures, the Company believes these measures are important to investors in understanding the Company's current and future operating results as seen through the eyes of management. In addition, management believes these non-GAAP measures are useful to investors in enabling them to better assess changes in the Company's core business across different time periods. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures to other companies' non-GAAP financial measures, even if they have similar names. Amounts may not add due to rounding.

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CONTACT: Lara Mahoney Vice President, Investor Relations & Corporate Communications 440.204.9985 Lara.Mahoney@nordson.com