Business Wire | Dec 15, 2021 04:30PM EST

Nordson Corporation Reports Fiscal Year 2021 Fourth Quarter and Record Full Year Results

Dec. 15, 2021

WESTLAKE, Ohio--(BUSINESS WIRE)--Dec. 15, 2021--Nordson Corporation (Nasdaq: NDSN) today reported results for the fiscal fourth quarter ended October 31, 2021. Sales were $599 million, a 7% increase compared to the prior year's fourth quarter sales of $559 million. The increase in fourth quarter 2021 sales included 10% organic volume growth, offset by an unfavorable 4% divestiture impact and favorable currency translation of 1%. Growth was strong in all product lines, particularly electronics and industrial end markets.

Operating profit in the quarter was $151 million, or 25% of sales, a 16% increase compared to the prior year adjusted operating profit of $130 million. Sales volume leverage, in addition to continued benefits from structural cost reduction actions taken in fiscal year 2020 and the divestiture of the screws and barrels product line on February 1, 2021, contributed to the quarterly increase. EBITDA in the quarter totaled $177 million, or 30% of sales, and represents an increase of 11% from the prior year EBITDA of $159 million.

Net income was $110 million, a 19% increase compared to the prior year adjusted earnings of $93 million. Fourth quarter diluted earnings per share were $1.88, an 18% increase over the prior year adjusted earnings of $1.59 per diluted share.

Commenting on the Company's fiscal fourth quarter 2021 results, Nordson President and Chief Executive Officer Sundaram Nagarajan said, "The fourth quarter was a solid finish to an incredible year, where we surpassed our prior record annual performance in sales by $108 million and in operating profit by $111 million. I am very proud of the Nordson team. This growth was across a broad base of end markets and geographies, as a result of leveraging the NBS Next growth framework to fully participate in the accelerated economic recovery."

Fourth Quarter Segment Results

Industrial Precision Solutions sales of $314 million increased 2% compared to the prior year fourth quarter, driven by an 8% organic increase, offset by a divestiture impact of 7% and a favorable currency impact of 1%. This organic sales increase was driven by steady demand across the majority of end markets and geographies served. Operating profit totaled $103 million in the quarter, or 33% of sales, an increase of 12% compared to the prior year adjusted operating profit.

Advanced Technology Solutions sales of $285 million increased 14% compared to the prior year fourth quarter, driven by an organic sales increase of 13% and a favorable currency impact of 1%. Sales growth was strong in all end markets during the current year quarter, with particularly high demand for products serving the electronics and medical end markets. Operating profit totaled $67 million in the quarter, or 24% of sales, an increase of 29% compared to the prior year adjusted operating profit.

"Our fourth quarter 2021 performance was very strong with double digit organic growth and incremental operating profit margins of 52%. Looking sequentially, gross margins were impacted by a spike in logistics costs and non-recurring cost increases associated with divisional alignment efforts around best growth opportunities. Pricing actions are being taken to mitigate these negative impacts on gross margin as we move into the first half of 2022," said Nordson Chief Financial Officer Joseph Kelley.

Fiscal 2021 Full Year Results

Sales for the fiscal year ended October 31, 2021 were $2.4 billion, an increase of 11% compared to the same period a year ago. This increase in sales was driven by an 11% increase in organic volume and a favorable currency impact of 3%, offset by a net unfavorable acquisition and divestiture impact of 3%. Full year operating profit was $615 million, or 26% of sales. Net income for the full year was $454 million and diluted earnings per share were $7.74, a 41% increase from the prior year adjusted diluted earnings per share of $5.48.

Mr. Nagarajan continued, "Looking at the second half of fiscal 2021, we achieved 15% organic sales growth and 36% adjusted profit growth compared to the second half of the prior year. Based on our strong order entry and current backlog, we anticipate carrying this second half of 2021 growth rate into the first quarter of fiscal 2022. Our teams are adapting to a very dynamic macro environment, and they are taking actions to offset cost and supply chain headwinds. The Ascend Strategy with NBS Next at its core will continue to enable us to deliver top tier growth with leading margins and returns."

Outlook

Backlog entering the first quarter of fiscal year 2022 is approximately $800 million, a 90% increase above the prior year. The current macroeconomic environment continues to drive increased order volume and extended shipment request dates. Based on these order entry trends, backlog, and anticipated sales timing, we expect fiscal 2022 first quarter sales growth to be in the range of 14% to 16% as compared to fiscal 2021 first quarter, with adjusted earnings per diluted share in the range of $1.80 to $1.95.

On a full year basis, we expect fiscal 2022 sales growth to be in the range of 6% to 10%, with adjusted earnings per diluted share growth in the range of 8% to 18%, both as compared to fiscal 2021.

Nordson management will provide additional commentary on these results and outlook during its previously announced webcast on Thursday, December 16, 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 STATEMENT OF INCOME (Unaudited)

(Dollars in thousands except for per-share amounts)

Three Months Ended Twelve Months Ended

October 31, October 31, October 31, October 31, 2021 2020 2021 2020



Sales $ 599,247 $ 558,525 $ 2,362,209 $ 2,121,100

Cost of sales 268,097 261,657 1,038,129 990,632

Gross profit 331,150 296,868 1,324,080 1,130,468

Gross margin % 55.3 % 53.2 % 56.1 % 53.3 %



Selling &administrative 179,715 172,129 708,953 693,552 expenses

Assets held for sale - 87,371 - 87,371 impairment charge

Operating profit 151,435 37,368 615,127 349,545



Interest expense - (4,452 ) (6,432 ) (23,341 ) (30,479 )net

Other expense - net (6,874 ) (4,634 ) (17,610 ) (17,577 )

Income before income 140,109 26,302 574,176 301,489 taxes



Income taxes 29,649 7,827 119,808 51,950



Net Income $ 110,460 $ 18,475 $ 454,368 $ 249,539



Weighted-averagecommon shares outstanding:

Basic 58,123 57,988 58,091 57,757

Diluted 58,792 58,679 58,734 58,473



Earnings per share:

Basic earnings $ 1.90 $ 0.32 $ 7.82 $ 4.32

Diluted earnings $ 1.88 $ 0.31 $ 7.74 $ 4.27

NORDSON CORPORATION

CONSOLIDATED BALANCE SHEET (Unaudited)

(Dollars in thousands)

October 31, 2021

October 31, 2020

Cash and cash equivalents

$

299,972

$

208,293

Receivables - net

489,389

471,873

Inventories - net

327,195

277,033

Other current assets

48,282

43,798

Assets held for sale

-

19,615

Total current assets

1,164,838

1,020,612

Property, plant & equipment - net

355,565

358,618

Goodwill

1,713,148

1,713,354

Other assets

557,410

582,072

$

3,790,961

$

3,674,656

Notes payable and debt due within one year

$

34,188

$

38,043

Accounts payable and accrued liabilities

411,206

311,898

Liabilities held for sale

-

13,148

Total current liabilities

445,394

363,089

Long-term debt

781,709

1,067,952

Other liabilities

404,728

484,624

Total shareholders' equity

2,159,130

1,758,991

$

3,790,961

$

3,674,656

NORDSON CORPORATION

CONSOLIDATED BALANCE SHEET (Unaudited)

(Dollars in thousands)

October 31, October 31, 2021 2020



Cash and cash equivalents $ 299,972 $ 208,293

Receivables - net 489,389 471,873

Inventories - net 327,195 277,033

Other current assets 48,282 43,798

Assets held for sale - 19,615

Total current assets 1,164,838 1,020,612



Property, plant & equipment - net 355,565 358,618

Goodwill 1,713,148 1,713,354

Other assets 557,410 582,072

$ 3,790,961 $ 3,674,656



Notes payable and debt due within one year $ 34,188 $ 38,043

Accounts payable and accrued liabilities 411,206 311,898

Liabilities held for sale - 13,148

Total current liabilities 445,394 363,089



Long-term debt 781,709 1,067,952

Other liabilities 404,728 484,624

Total shareholders' equity 2,159,130 1,758,991

$ 3,790,961 $ 3,674,656



NORDSON CORPORATION

CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited)

(Dollars in thousands)

Twelve Months Ended

October 31, 2021

October 31, 2020

Cash flows from operating activities:

Net Income

$

454,368

$

249,539

Depreciation and amortization

103,883

113,302

Impairment loss on assets held for sale

-

87,371

Other non-cash items

32,356

5,278

Changes in working capital

29,011

45,113

Other - principally pension plan

(73,691

)

1,818

Net cash provided by operating activities

545,927

502,421

Cash flows from investing activities:

Additions to property, plant and equipment

(38,303

)

(50,535

)

Acquisitions

-

(142,414

)

Other - net

5,134

(1,160

)

Net cash used in investing activities

(33,169

)

(194,109

)

Cash flows from financing activities:

Repayment of long-term debt

(289,416

)

(153,816

)

Repayment of finance lease obligations

(6,624

)

(7,605

)

Dividends paid

(97,683

)

(88,347

)

Issuance of common shares

31,780

50,853

Purchase of treasury shares

(60,970

)

(52,614

)

Net cash used in financing activities

(422,913

)

(251,529

)

Effect of exchange rate change on cash

1,834

346

Net change in cash and cash equivalents

91,679

57,129

Cash and cash equivalents:

Beginning of period

208,293

151,164

End of period

$

299,972

$

208,293

NORDSON CORPORATION

CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited)

(Dollars in thousands)

Twelve Months Ended

October 31, October 31, 2021 2020



Cash flows from operating activities:

Net Income $ 454,368 $ 249,539

Depreciation and amortization 103,883 113,302

Impairment loss on assets held for sale - 87,371

Other non-cash items 32,356 5,278

Changes in working capital 29,011 45,113

Other - principally pension plan (73,691 ) 1,818

Net cash provided by operating activities 545,927 502,421



Cash flows from investing activities:

Additions to property, plant and equipment (38,303 ) (50,535 )

Acquisitions - (142,414 )

Other - net 5,134 (1,160 )

Net cash used in investing activities (33,169 ) (194,109 )



Cash flows from financing activities:

Repayment of long-term debt (289,416 ) (153,816 )

Repayment of finance lease obligations (6,624 ) (7,605 )

Dividends paid (97,683 ) (88,347 )

Issuance of common shares 31,780 50,853

Purchase of treasury shares (60,970 ) (52,614 )

Net cash used in financing activities (422,913 ) (251,529 )



Effect of exchange rate change on cash 1,834 346

Net change in cash and cash equivalents 91,679 57,129



Cash and cash equivalents:

Beginning of period 208,293 151,164

End of period $ 299,972 $ 208,293



NORDSON CORPORATION

SALES BY GEOGRAPHIC SEGMENT (Unaudited)

(Dollars in thousands)

Three Months Ended

Sales Variance

October 31, 2021

October 31, 2020

Organic

Acquisitions / Divestitures

Currency

Total

SALES BY SEGMENT

Industrial precision solutions

$

314,307

$

308,385

8.0

%

(6.6

)%

0.5

%

1.9

%

Advanced technology solutions

284,940

250,140

13.3

%

-

%

0.6

%

13.9

%

Total sales

$

599,247

$

558,525

10.4

%

(3.7

)%

0.6

%

7.3

%

SALES BY GEOGRAPHIC REGION

United States

$

199,532

$

194,701

7.8

%

(5.3

)%

-

%

2.5

%

Americas

51,038

35,452

47.2

%

(5.9

)%

2.7

%

44.0

%

Europe

163,592

142,082

17.6

%

(2.7

)%

0.2

%

15.1

%

Japan

27,659

36,248

(16.0

)%

(3.5

)%

(4.2

)%

(23.7

)%

Asia Pacific

157,426

150,042

4.6

%

(2.0

)%

2.3

%

4.9

%

Total sales

$

599,247

$

558,525

10.4

%

(3.7

)%

0.6

%

7.3

%

Twelve Months Ended

Sales Variance

October 31, 2021

October 31, 2020

Organic

Acquisitions / Divestitures

Currency

Total

SALES BY SEGMENT

Industrial precision solutions

$

1,246,947

$

1,143,423

11.7

%

(6.0

)%

3.4

%

9.1

%

Advanced technology solutions

1,115,262

977,677

10.9

%

1.3

%

1.9

%

14.1

%

Total sales

$

2,362,209

$

2,121,100

11.3

%

(2.6

)%

2.7

%

11.4

%

SALES BY GEOGRAPHIC REGION

United States

$

789,303

$

755,642

8.3

%

(3.8

)%

-

%

4.5

%

Americas

179,807

141,473

24.4

%

0.9

%

1.8

%

27.1

%

Europe

617,492

536,636

11.4

%

(2.0

)%

5.7

%

15.1

%

Japan

107,572

126,601

(11.0

)%

(3.5

)%

(0.5

)%

(15.0

)%

Asia Pacific

668,035

560,748

16.7

%

(1.8

)%

4.2

%

19.1

%

Total sales

$

2,362,209

$

2,121,100

11.3

%

(2.6

)%

2.7

%

11.4

%

NORDSON CORPORATION

SALES BY GEOGRAPHIC SEGMENT (Unaudited)

(Dollars in thousands)

Three Months Ended Sales Variance

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

SALES BY SEGMENT

Industrialprecision $ 314,307 $ 308,385 8.0 % (6.6 )% 0.5 % 1.9 %solutions

Advancedtechnology 284,940 250,140 13.3 % - % 0.6 % 13.9 %solutions

Total $ 599,247 $ 558,525 10.4 % (3.7 )% 0.6 % 7.3 %sales



SALES BYGEOGRAPHIC REGION

United $ 199,532 $ 194,701 7.8 % (5.3 )% - % 2.5 %States

Americas 51,038 35,452 47.2 % (5.9 )% 2.7 % 44.0 %

Europe 163,592 142,082 17.6 % (2.7 )% 0.2 % 15.1 %

Japan 27,659 36,248 (16.0 ) (3.5 )% (4.2 )% (23.7 ) % %

Asia 157,426 150,042 4.6 % (2.0 )% 2.3 % 4.9 %Pacific

Total $ 599,247 $ 558,525 10.4 % (3.7 )% 0.6 % 7.3 %sales





Twelve Months Ended Sales Variance

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

SALES BY SEGMENT

Industrialprecision $ 1,246,947 $ 1,143,423 11.7 % (6.0 )% 3.4 % 9.1 %solutions

Advancedtechnology 1,115,262 977,677 10.9 % 1.3 % 1.9 % 14.1 %solutions

Total $ 2,362,209 $ 2,121,100 11.3 % (2.6 )% 2.7 % 11.4 %sales



SALES BYGEOGRAPHIC REGION

United $ 789,303 $ 755,642 8.3 % (3.8 )% - % 4.5 %States

Americas 179,807 141,473 24.4 % 0.9 % 1.8 % 27.1 %

Europe 617,492 536,636 11.4 % (2.0 )% 5.7 % 15.1 %

Japan 107,572 126,601 (11.0 ) (3.5 )% (0.5 )% (15.0 ) % %

Asia 668,035 560,748 16.7 % (1.8 )% 4.2 % 19.1 %Pacific

Total $ 2,362,209 $ 2,121,100 11.3 % (2.6 )% 2.7 % 11.4 %sales



NORDSON CORPORATION

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

(Dollars in thousands)

Three Months Ended

Twelve Months Ended

October 31, 2021

October 31, 2020

October 31, 2021

October 31, 2020

SALES BY SEGMENT

Industrial precision solutions

$

314,307

$

308,385

$

1,246,947

$

1,143,423

Advanced technology solutions

284,940

250,140

1,115,262

977,677

Total sales

$

599,247

$

558,525

$

2,362,209

$

2,121,100

OPERATING PROFIT

Industrial precision solutions

$

102,677

$

425

$

414,192

$

208,028

Advanced technology solutions

67,104

50,674

271,660

191,602

Corporate

(18,346

)

(13,731

)

(70,725

)

(50,085

)

Total operating profit

$

151,435

$

37,368

$

615,127

$

349,545

OPERATING PROFIT ADJUSTMENTS (1)

Industrial precision solutions

$

-

$

91,419

$

-

$

94,896

Advanced technology solutions

-

1,424

-

7,807

Corporate

-

-

-

1,387

Total adjustments

$

-

$

92,843

$

-

$

104,090

ADJUSTED OPERATING PROFIT (NON-GAAP)

% of Sales

% of Sales

% of Sales

% of Sales

Industrial precision solutions

$

102,677

33

%

$

91,844

30

%

$

414,192

33

%

$

302,924

26

%

Advanced technology solutions

67,104

24

%

52,098

21

%

271,660

24

%

199,409

20

%

Corporate

(18,346

)

(13,731

)

(70,725

)

(48,698

)

Total operating profit - adjusted

$

151,435

25

%

$

130,211

23

%

$

615,127

26

%

$

453,635

21

%

DEPRECIATION & AMORTIZATION

Industrial precision solutions

$

6,259

$

9,951

$

25,673

$

38,939

Advanced technology solutions

16,987

16,710

68,426

64,543

Corporate

2,404

2,477

9,784

9,820

Total depreciation & amortization

$

25,650

$

29,138

$

103,883

$

113,302

EBITDA (NON-GAAP) (2)

Industrial precision solutions

$

108,936

35

%

$

101,795

33

%

$

439,865

35

%

$

341,863

30

%

Advanced technology solutions

84,091

30

%

68,808

28

%

340,086

30

%

263,952

27

%

Corporate

(15,942

)

(11,254

)

(60,941

)

(38,878

)

Total EBITDA

$

177,085

30

%

$

159,349

29

%

$

719,010

30

%

$

566,937

27

%

NORDSON CORPORATION

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

(Dollars in thousands)

Three Months Ended Twelve Months Ended

October 31, October 31, October 31, October 31, 2021 2020 2021 2020

SALES BY SEGMENT

Industrialprecision $ 314,307 $ 308,385 $ 1,246,947 $ 1,143,423 solutions

Advancedtechnology 284,940 250,140 1,115,262 977,677 solutions

Total sales $ 599,247 $ 558,525 $ 2,362,209 $ 2,121,100



OPERATING PROFIT

Industrialprecision $ 102,677 $ 425 $ 414,192 $ 208,028 solutions

Advancedtechnology 67,104 50,674 271,660 191,602 solutions

Corporate (18,346 ) (13,731 ) (70,725 ) (50,085 )

Totaloperating $ 151,435 $ 37,368 $ 615,127 $ 349,545 profit



OPERATINGPROFIT ADJUSTMENTS^(1)

Industrialprecision $ - $ 91,419 $ - $ 94,896 solutions

Advancedtechnology - 1,424 - 7,807 solutions

Corporate - - - 1,387

Total $ - $ 92,843 $ - $ 104,090 adjustments



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

Industrialprecision $ 102,677 33 % $ 91,844 30 % $ 414,192 33 % $ 302,924 26 %solutions

Advancedtechnology 67,104 24 % 52,098 21 % 271,660 24 % 199,409 20 %solutions

Corporate (18,346 ) (13,731 ) (70,725 ) (48,698 )

Totaloperating $ 151,435 25 % $ 130,211 23 % $ 615,127 26 % $ 453,635 21 %profit -adjusted



DEPRECIATION& AMORTIZATION

Industrialprecision $ 6,259 $ 9,951 $ 25,673 $ 38,939 solutions

Advancedtechnology 16,987 16,710 68,426 64,543 solutions

Corporate 2,404 2,477 9,784 9,820

Totaldepreciation $ 25,650 $ 29,138 $ 103,883 $ 113,302 &amortization



EBITDA(NON-GAAP)^ (2)

Industrialprecision $ 108,936 35 % $ 101,795 33 % $ 439,865 35 % $ 341,863 30 %solutions

Advancedtechnology 84,091 30 % 68,808 28 % 340,086 30 % 263,952 27 %solutions

Corporate (15,942 ) (11,254 ) (60,941 ) (38,878 )

Total EBITDA $ 177,085 30 % $ 159,349 29 % $ 719,010 30 % $ 566,937 27 %



(1)

Represents assets held for sale impairment charge, 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 the assets held for sale impairment charge, cost structure simplification actions, and non-cash inventory charges related to acquisitions. EBITDA is defined as adjusted operating profit plus depreciation and amortization.

^ Represents assets held for sale impairment charge, costs and adjustments(1) related to cost structure simplification 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 operating^ profit is defined as operating profit plus certain adjustments, such as the(2) assets held for sale impairment charge, cost structure simplification actions, and non-cash inventory charges related to acquisitions. 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

Twelve Months Ended

October 31, 2021

October 31, 2020

October 31, 2021

October 31, 2020

GAAP AS REPORTED

Operating profit

$

151,435

$

37,368

$

615,127

$

349,545

Other / interest expense - net

(11,326

)

(11,066

)

(40,951

)

(48,056

)

Net income

110,460

18,475

454,368

249,539

Diluted earnings per share

$

1.88

$

0.31

$

7.74

$

4.27

Shares outstanding - diluted

58,792

58,679

58,734

58,473

OPERATING PROFIT ADJUSTMENTS

Inventory step-up amortization

$

-

$

1,298

$

-

$

2,527

Severance and other

-

4,174

-

14,192

Assets held for sale impairment charge

-

87,371

-

87,371

NON-OPERATING EXPENSE ADJUSTMENTS

Pension settlement loss

$

-

$

-

$

-

$

2,508

Total adjustments

$

-

$

92,843

$

-

$

106,598

Adjustments net of tax

$

-

$

76,390

$

-

$

87,214

Other discrete tax items

$

-

$

(1,820

)

$

-

$

(16,311

)

EPS effect of adjustments and other discrete tax items

$

-

$

1.27

$

-

$

1.21

NON-GAAP MEASURES-ADJUSTED PROFITABILITY

Operating profit (1)

$

151,435

$

130,211

$

615,127

$

453,635

Operating profit % of sales

25.3

%

23.3

%

26.0

%

21.4

%

Net income (2)

$

110,460

$

93,045

$

454,368

$

320,442

Diluted earnings per share (3)

$

1.88

$

1.59

$

7.74

$

5.48

NORDSON CORPORATION

RECONCILIATION OF NON-GAAP MEASURES - PROFITABILITY (Unaudited)

(Dollars in thousands)

Three Months Ended Twelve Months Ended

October 31, October 31, October 31, October 31, 2021 2020 2021 2020

GAAP AS REPORTED

Operating profit $ 151,435 $ 37,368 $ 615,127 $ 349,545

Other / interest expense (11,326 ) (11,066 ) (40,951 ) (48,056 )- net

Net income 110,460 18,475 454,368 249,539

Diluted earnings per $ 1.88 $ 0.31 $ 7.74 $ 4.27 share



Shares outstanding - 58,792 58,679 58,734 58,473 diluted



OPERATING PROFIT ADJUSTMENTS

Inventory step-up $ - $ 1,298 $ - $ 2,527 amortization

Severance and other - 4,174 - 14,192

Assets held for sale - 87,371 - 87,371 impairment charge



NON-OPERATING EXPENSE ADJUSTMENTS

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



Total adjustments $ - $ 92,843 $ - $ 106,598



Adjustments net of tax $ - $ 76,390 $ - $ 87,214

Other discrete tax items $ - $ (1,820 ) $ - $ (16,311 )

EPS effect of adjustmentsand other discrete tax $ - $ 1.27 $ - $ 1.21 items



NON-GAAPMEASURES-ADJUSTED PROFITABILITY

Operating profit ^(1) $ 151,435 $ 130,211 $ 615,127 $ 453,635

Operating profit % of 25.3 % 23.3 % 26.0 % 21.4 %sales

Net income ^(2) $ 110,460 $ 93,045 $ 454,368 $ 320,442

Diluted earnings per $ 1.88 $ 1.59 $ 7.74 $ 5.48 share ^(3)

(1)

Adjusted operating profit is defined as operating profit plus certain adjustments such as the assets held for sale impairment charge, cost structure simplification actions and non-cash inventory charges related to acquisitions. 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 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.

View source version on businesswire.com: https://www.businesswire.com/news/home/20211215005835/en/

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