Crane NXT : 2024 Annual ReportPDF, 888 KB
CXT
Annual Report
2024
Aaron W. Saak
President & Chief Executive Officer
2024 Annual Report CEO Letter
Dear Fellow Shareholders,
As we reflect on Crane NXT's first full year as an independent company, I am incredibly proud of the progress we have made on our mission to provide trusted technology solutions that secure, detect and authenticate what matters most to our customers.
In 2024, we took meaningful steps to grow and diversify our portfolio through strategic M&A, while continuing to invest in our core and drive continuous improvement with the Crane Business System (CBS). Underpinning this progress is our longstanding commitment to living our core values: People Matter, Do the Right Thing, Trusted Partner, Innovate for Growth, and Always Improving.
2024 Financial Performance
Our 2024 financial performance reflects our team's operating rigor and was in line with our expectations. For the full year, sales increased by approximately 7% year-over-year to nearly $1.5 billion, with core sales growth of approximately 1%, and we delivered adjusted segment operating margin1 of approximately 27% and adjusted EPS1 of $4.26.
We continue to execute our strategy, positioning the company for long-term success and building on our position as a technology leader, highlighted by a number of exciting operational and commercial achievements 2024:
In our Security & Authentication Technologies segment, we continued to win share with our leading technology, and in 2024 we won a total of 13 new currency denominations specifying our proprietary micro-optic security technology.
We also won our first contract selling micro-optics through the OpSec channel. This expansion of our product portfolio will drive greater recurring revenue and highlights the unique value proposition we are now able to offer our customers through our full suite of authentication solutions.
In our Crane Payment Innovations segment, we expanded our service offering with the opening of our first service center which provides our customers with a faster, more cost-effective solution for repairs and complements our onsite field service offerings.
Maintaining a Disciplined Approach to Capital Allocation
As we continue to build on our strong and resilient foundation, we maintain a disciplined approach to capital allocation focusing on three areas:
We will continue to be committed to a balanced capital allocation strategy and to maintaining ample capacity to deploy capital toward strategic acquisitions that meet our strategic and financial criteria.
Growing Through Strategic M&A
When we launched Crane NXT in April 2023, we outlined our plans to grow and diversify the company into near-adjacent markets building on our technology and operational capabilities. In 2024, we made significant progress executing on this strategy.
We expanded our capabilities across the entire authentication value chain with the acquisition of OpSec Security, a global leader in brand protection and authentication solutions. Through this acquisition, we created a leading product authentication platform and extended our authentication market leadership to include software solutions that track and trace goods and provide customer analytics and online brand protection solutions.
We also acquired TruTag Smart Packaging, a unique technology that provides secure digitization of physical products through proprietary secure marking and smartphone authentication.
Finally, we announced our entry into an agreement to acquire De La Rue Authentication Solutions, with an anticipated closing in Q2 2025. De La Rue's Authentication Solutions business complements the authentication and online brand protection solutions of OpSec and expands Crane NXT's portfolio to include technologies for securing government-issued identification documents and credentials. We look forward to welcoming the De La Rue Authentication team to the company in 2025.
These acquisitions have bolstered our position as a technology leader and further enhance our ability to provide differentiated and innovative solutions to our customers. Going forward, we will continue to evaluate opportunities to further expand and diversify the portfolio through disciplined M&A. Our robust pipeline of strategic targets coupled with our strong balance sheet and free cash flow generation position us well to continue to grow the business.
Driving Efficiencies with the Crane Business System
Every day, we live our Always Improving value to better serve our customers, improve productivity, and generate cash for investment in growth. Our teams are trained in CBS tools and methodology to drive differentiated operational performance, including increased operating margins, improved productivity and free cash flow generation. In 2024, approximately 30% of our associates participated in continuous improvement events, including 150 kaizens, and over 200 associates worldwide are certified tool champions trained to use CBS to solve problems and drive results.
Supporting Our People and Our Communities
Our associates are critical to the success of our business. Their health, safety, and well-being are foundational to our operations, and their engagement, innovation, and creativity power our ability to solve our customers' most complex needs. In 2024, we launched our first employee engagement survey and had strong participation from our global employees, garnering valuable insights on how we can continue to enhance our culture and empower our teams to ensure we are creating value for all our stakeholders.
We believe our greatest returns come from investing in our communities. In 2024, Crane NXT associates contributed a total of nearly 8,000 volunteer hours at over 300 volunteer events. Also in 2024, the Crane Fund for Widows and Children donated approximately $1.7 million to over 300 organizations selected by Crane NXT associates. Our inaugural Environmental, Social and Governance (ESG) Report, published in September 2024, further highlights our impact, anchored in our Crane NXT values.
Looking Ahead
I am confident that through continuing to invest in our businesses, driving profitable growth through CBS, and executing disciplined M&A to further expand our portfolio we are on a clear path to achieve our vision and create meaningful long-term shareholder value.
Thank you for your continued support in Crane NXT.
Aaron W. Saak
President & Chief Executive Officer
Crane NXT
2024 Form 10-K
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
Commission file number 1-1657
CRANE NXT, CO.
(Exact name of Registrant as specified in its charter)
Delaware
88-0706021
State of or other jurisdiction of incorporation or organization:
(I.R.S. Employer identification No.)
950 Winter Street 4th Floor North
Waltham
MA
02451
(Address of principal executive offices)
(Zip Code)
Registrant's telephone number, including area code: (781) 755-6868
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol
Name of each exchange on which registered
Common Stock, par value $1.00
CXT
New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act:
None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act Yes ☒
No ☐
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15 (d) of the Act Yes ☐ No ☒
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer", "accelerated filer", "non-accelerated filer,", "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act).:
(check one):
Large accelerated filer
☒
Accelerated filer
☐
Non-accelerated filer
☐
Smaller reporting company
☐
Emerging growth company
☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the Registrant has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant's executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐
No ☒
Based on the closing stock price of $61.42 on June 30, 2024, the last business day of the registrant's most recently completed second fiscal quarter, the aggregate market value of the voting common equity held by non-affiliates of the registrant was $3,002,579,092.
The number of shares outstanding of the registrant's common stock, par value $1.00, was 57,236,301 at January 31, 2025.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the registrant's Proxy Statement for the 2025 Annual Meeting of Stockholders are incorporated herein by reference in Part III of this Annual Report on Form 10-K to the extent stated herein. Such proxy statement will be filed with the Securities and Exchange Commission within 120 days of the registrant's fiscal year ended December 31, 2024.
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Index
Page
Part I
Item 1.
Business
Page 7
Item 1A.
Risk Factors
Page 11
Item 1B.
Unresolved Staff Comments
Page 16
Item 1C.
Cybersecurity
Page 16
Item 2.
Properties
Page 18
Item 3.
Legal Proceedings
Page 19
Item 4.
Mine Safety Disclosures
Page 19
Part II
Item 5.
Market for Registrant's Common Equity, Related Stockholder Matters and
Page 20
Issuer Purchases of Equity Securities
Item 6.
[Reserved]
Page 21
Item 7.
Management's Discussion and Analysis of Financial Condition and Results of
Page 22
Operations
Item 7A.
Quantitative and Qualitative Disclosures About Market Risk
Page 35
Item 8.
Financial Statements and Supplementary Data
Page 36
Item 9.
Changes in and Disagreement with Accountants on Accounting and Financial
Page 79
Disclosure
Item 9A.
Controls and Procedures
Page 79
Item 9B.
Other Information
Page 81
Item 9C.
Disclosure Regarding Foreign Jurisdictions That Prevent Inspections
Page 81
Part III
Item 10.
Directors, Executive Officers and Corporate Governance
Page 81
Item 11.
Executive Compensation
Page 81
Item 12.
Security Ownership of Certain Beneficial Owners and Management and
Page 81
Related Stockholder Matters
Item 13.
Certain Relationships and Related Transactions, and Director Independence
Page 81
Item 14.
Principal Accountant Fees and Services
Page 82
Part IV
Item 15.
Exhibits and Financial Statement Schedules
Page 82
Item 16.
Form 10-K Summary
Page 84
Signatures
Page 85
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FORWARD-LOOKING INFORMATION
This Annual Report on Form 10-K contains information about Crane NXT, Co., some of which includes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements other than historical information or statements about our current condition. You can identify forward-looking statements by the use of terms such as: "intends," "believes," "contemplates," "expects," "may," "plans," "seeks," "will," "could," "should," "would," or "anticipates," other similar phrases, or the negatives of these terms. Any forward-looking statement speaks only as of the date of this report, and we undertake no obligation to update any forward-looking statement, whether as a result of new information, future events or otherwise. You are advised, however, also to consult any further disclosures we make on related subjects in our reports to the Securities and Exchange Commission.
We have based the forward-looking statements relating to our operations on our current expectations, estimates and projections about us and the markets we serve. We caution you that these statements are not guarantees of future performance and involve risks and uncertainties. These statements should be considered in conjunction with the discussion in Part I, the information set forth under Item 1A, "Risk Factors" and with the discussion of the business included in Part II, Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations." We have based many of these forward-looking statements on assumptions about future events that may prove to be inaccurate. Accordingly, our actual outcomes and results may differ materially from what we have expressed or forecast in the forward-looking statements. Any differences could result from a variety of factors, including the following:
3
While the list of factors presented here and elsewhere in this report is considered representative, no such list should be considered to be a complete statement of all potential risks and uncertainties. Unlisted factors may present significant additional obstacles to the realization of forward-looking statements.
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Part I
References herein to "Crane NXT," "we," "us" and "our" refer to Crane NXT, Co. and its subsidiaries, including when Crane NXT, Co. was named "Crane Holdings, Co." unless the context implies otherwise. References to the "Business" refer to our business, including prior to the Separation (as defined herein) when it was a business of Crane Holdings, Co. References herein to "Holdings" refer to Crane Holdings, Co. and its subsidiaries prior to the consummation of the Separation unless the context implies otherwise. Amounts in the following discussion are presented in millions, except employee, square feet, number of properties, share and per share data, or unless otherwise stated.
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Disclaimer
Crane NXT Co. published this content on March 12, 2025, and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on March 12, 2025 at 17:13:09.196.