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Q124 SNA earnings

Published: at 07:03 PM

Earnings Results: • Sales of $1.12 billion, flat compared to $1.183 billion last year • Organic sales declined 0.8% • Operating earnings before financial services of $270.9 million, up from $259.8 million • Operating margin before financial services of 22.9%, up 90 basis points • EPS of $4.91, up 6.7% from $4.60 last year

Future Guidance: • Expecting a potential legal payment benefit in Q2 similar to Q1 • Full year capital expenditures expected in the range of $100-110 million
• Full year effective income tax rate anticipated to be in the 22-23% range

Snap-on demonstrated resilience in the first quarter despite facing headwinds across geographies and operations. The company’s strategic breadth and experienced team enabled it to maintain overall strength even with its largest entity, the Tools Group, performing below standard.

The Commercial & Industrial (C&I) Group engaged economic challenges across regions while extending its reach into critical industries, proving Snap-on’s ability to expand beyond the garage profitably. The Tools Group is adapting to accommodate technicians’ current outlook and preference for quick payback products while maintaining enviable margins. The Repair Systems & Information (RS&I) Group capitalized on opportunities with repair shop owners and managers, growing volume and margins in an imperfect environment.

Technician sentiment remains cautious due to economic uncertainty, leading to a preference for quick payback items rather than larger, long-term investments. Snap-on is pivoting its product offerings, design efforts, and selling strategies to match this shift in demand.

The automotive repair market remains favorable overall, with dealerships investing in tools and equipment to prepare for new vehicle models and technologies. RS&I is well-positioned to support both dealers and independent shops in this regard.

Notable quotes: “We believe that our first quarter once again demonstrated Snap-on’s ability to maintain its strength to engage headwinds, to manage challenges and to leverage the multiple opportunities of our markets.” - Nick Pinchuk, CEO

”The real solution to it is, is the pivot. And the more of these small products, these short payback products, and they’re profitable, that we get out, the more sales we’ll have.” - Nick Pinchuk, CEO