SEC Filing | IDEX Corporation

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iex-20230930

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_____________________________

Form 10-Q


☑	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the quarterly period ended	September 30, 2023


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from	to

Commission File Number: 1-10235

IDEX CORPORATION

(Exact name of registrant as specified in its charter)

Delaware

36-3555336

(State or other jurisdiction of
incorporation or organization)

(I.R.S. Employer
Identification No.)

3100 Sanders Road,

Suite 301,

Northbrook,

Illinois

60062

(Address of principal executive offices)

(Zip Code)

Registrant’s telephone number, including area code: (847) 498-7070

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, par value $.01 per share

IEX

New York Stock Exchange

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,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

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. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ☑

Number of shares of common stock of IDEX Corporation outstanding as of October 20, 2023: 75,625,539.

TABLE OF CONTENTS


Part I. Financial Information
Item 1.	Financial Statements	1
	Condensed Consolidated Statements of Income	1
	Condensed Consolidated Statements of Comprehensive Income	2
	Condensed Consolidated Balance Sheets	3
	Condensed Consolidated Statements of Equity	4
	Condensed Consolidated Statements of Cash Flows	5
	Notes to Condensed Consolidated Financial Statements	6
	Note 1. Basis of Presentation and Significant Accounting Policies	6
	Note 2. Acquisitions and Divestitures	6
	Note 3. Collaborative Investments	11
	Note 4. Business Segments	11
	Note 5. Revenue	13
	Note 6. Earnings Per Common Share	16
	Note 7. Balance Sheet Components	17
	Note 8. Goodwill and Intangible Assets	17
	Note 9. Borrowings	19
	Note 10. Fair Value Measurements	20
	Note 11. Leases	21
	Note 12. Restructuring Expenses and Asset Impairments	22
	Note 13. Other Comprehensive Loss	25
	Note 14. Share Repurchases	25
	Note 15. Share-Based Compensation	25
	Note 16. Retirement Benefits	29
	Note 17. Commitments and Contingencies	30
	Note 18. Income Taxes	30
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	31
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	48
Item 4.	Controls and Procedures	48

Part II. Other Information
Item 1.	Legal Proceedings	49
Item 1A.	Risk Factors	49
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	49
Item 5.	Other Information	49
Item 6.	Exhibits	50
Signatures		51

Table of Contents

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

IDEX CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In millions, except per share amounts)

(unaudited)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Net sales	$	793.4	$	824.0	$	2,485.0	$	2,371.2
Cost of sales	443.8		442.2		1,374.9		1,290.0
Gross profit	349.6		381.8		1,110.1		1,081.2
Selling, general and administrative expenses	165.9		161.9		529.9		483.7
Restructuring expenses and asset impairments	4.1		17.7		8.2		21.1
Operating income	179.6		202.2		572.0		576.4
Gain on sale of business	(93.8)		(34.8)		(93.8)		(34.8)
Other (income) expense - net	(2.1)		(1.0)		5.6		(3.3)
Interest expense	13.7		9.6		40.1		28.6
Income before income taxes	261.8		228.4		620.1		585.9
Provision for income taxes	52.8		49.7		132.8		129.2
Net income	209.0		178.7		487.3		456.7
Net loss attributable to noncontrolling interest	0.1		—		0.2		0.2
Net income attributable to IDEX	$	209.1	$	178.7	$	487.5	$	456.9

Earnings per common share:
Basic earnings per common share attributable to IDEX	$	2.76	$	2.37	$	6.44	$	6.02
Diluted earnings per common share attributable to IDEX	$	2.75	$	2.36	$	6.42	$	6.00

Share data:
Basic weighted average common shares outstanding	75.6		75.4		75.6		75.8
Diluted weighted average common shares outstanding	75.9		75.8		75.9		76.1

See Notes to Condensed Consolidated Financial Statements

Table of Contents

IDEX CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In millions)

(unaudited)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Net income	$	209.0	$	178.7	$	487.3	$	456.7
Other comprehensive loss:
Pension and other postretirement adjustments, net of tax	(0.3)		0.6		(0.8)		1.8
Cumulative translation adjustment	(58.1)		(94.9)		(19.2)		(196.3)
Other comprehensive loss	(58.4)		(94.3)		(20.0)		(194.5)
Comprehensive income	150.6		84.4		467.3		262.2
Comprehensive loss attributable to noncontrolling interest	0.1		—		0.2		0.2
Comprehensive income attributable to IDEX	$	150.7	$	84.4	$	467.5	$	262.4

See Notes to Condensed Consolidated Financial Statements

Table of Contents

IDEX CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(Dollars in millions, except per share amounts)

(unaudited)


	September 30, 2023		December 31, 2022
ASSETS
Current assets
Cash and cash equivalents	$	562.7	$	430.2
Receivables - net of allowance for credit losses of $6.9 and $8.0, respectively	430.6		442.8
Inventories - net	446.6		470.9
Other current assets	78.3		55.4
Total current assets	1,518.2		1,399.3
Property, plant and equipment - net of accumulated depreciation of $539.6 and $516.7, respectively	421.5		382.1
Goodwill	2,677.3		2,638.1
Intangible assets - net	919.6		947.8
Other noncurrent assets	133.0		144.6
Total assets	$	5,669.6	$	5,511.9
LIABILITIES AND EQUITY
Current liabilities
Trade accounts payable	$	176.3	$	208.9
Accrued expenses	262.0		289.1
Current portion of long-term borrowings - net	0.7		—
Dividends payable	48.5		45.6
Total current liabilities	487.5		543.6
Long-term borrowings - net	1,320.8		1,468.7
Deferred income taxes	279.3		264.2
Other noncurrent liabilities	194.8		195.8
Total liabilities	2,282.4		2,472.3
Commitments and contingencies (Note 17)
Shareholders’ equity
Preferred stock:
Authorized: 5,000,000 shares, $.01 per share par value; Issued: None	—		—
Common stock:
Authorized: 150,000,000 shares, $.01 per share par value
Issued: 89,962,648 shares at September 30, 2023 and 90,064,988 shares at December 31, 2022	0.9		0.9
Additional paid-in capital	836.1		817.2
Retained earnings	3,874.0		3,531.7
Treasury stock at cost: 14,337,849 shares at September 30, 2023 and 14,451,032 shares at December 31, 2022	(1,177.7)		(1,184.3)
Accumulated other comprehensive loss	(146.2)		(126.2)
Total shareholders’ equity	3,387.1		3,039.3
Noncontrolling interest	0.1		0.3
Total equity	3,387.2		3,039.6
Total liabilities and equity	$	5,669.6	$	5,511.9

See Notes to Condensed Consolidated Financial Statements

Table of Contents

IDEX CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

(Dollars in millions)

(unaudited)


					Accumulated Other Comprehensive Loss
	Common Stock and Additional Paid-In Capital		Retained Earnings		Cumulative Translation Adjustment		Retirement Benefits Adjustment		Treasury Stock		Total Shareholders’ Equity		Noncontrolling Interest		Total Equity
Balance, June 30, 2023	$	835.1	$	3,713.4	$	(98.2)	$	10.4	$	(1,182.0)	$	3,278.7	$	0.2	$	3,278.9
Net income (loss)	—		209.1		—		—		—		209.1		(0.1)		209.0
Cumulative translation adjustment	—		—		(58.1)		—		—		(58.1)		—		(58.1)
Net change in retirement obligations (net of tax of $—)	—		—		—		(0.3)		—		(0.3)		—		(0.3)
Net issuance of 29,360 shares of common stock (net of tax of $0.4)	—		—		—		—		4.3		4.3		—		4.3
Share-based compensation	1.9		—		—		—		—		1.9		—		1.9
Cash dividends declared - $0.64 per common share outstanding	—		(48.5)		—		—		—		(48.5)		—		(48.5)
Balance, September 30, 2023	$	837.0	$	3,874.0	$	(156.3)	$	10.1	$	(1,177.7)	3,387.1		$	0.1	$	3,387.2


					Accumulated Other Comprehensive Loss
	Common Stock and Additional Paid-In Capital		Retained Earnings		Cumulative Translation Adjustment		Retirement Benefits Adjustment		Treasury Stock		Total Shareholders’ Equity		Noncontrolling Interest		Total Equity
Balance, June 30, 2022	$	810.0	$	3,313.8	$	(163.6)	$	(6.2)	$	(1,165.8)	$	2,788.2	$	(0.2)	$	2,788.0
Net income	—		178.7		—		—		—		178.7		—		178.7
Cumulative translation adjustment	—		—		(94.9)		—		—		(94.9)		—		(94.9)
Net change in retirement obligations (net of tax of $—)	—		—		—		0.6		—		0.6		—		0.6
Net issuance of 28,034 shares of common stock (net of tax of $0.4)	—		—		—		—		3.6		3.6		—		3.6
Repurchase of 166,433 shares of common stock	—		—		—		—		(30.9)		(30.9)		—		(30.9)
Share-based compensation	2.9		—		—		—		—		2.9		—		2.9
Cash dividends declared - $0.60 per common share outstanding	—		(45.4)		—		—		—		(45.4)		—		(45.4)
Balance, September 30, 2022	$	812.9	$	3,447.1	$	(258.5)	$	(5.6)	$	(1,193.1)	$	2,802.8	$	(0.2)	$	2,802.6


					Accumulated Other Comprehensive Loss
	Common Stock and Additional Paid-In Capital		Retained Earnings		Cumulative Translation Adjustment		Retirement Benefits Adjustment		Treasury Stock		Total Shareholders’ Equity		Noncontrolling Interest		Total Equity
Balance, December 31, 2022	$	818.1	$	3,531.7	$	(137.1)	$	10.9	$	(1,184.3)	$	3,039.3	$	0.3	$	3,039.6
Net income (loss)	—		487.5		—		—		—		487.5		(0.2)		487.3
Cumulative translation adjustment	—		—		(19.2)		—		—		(19.2)		—		(19.2)
Net change in retirement obligations (net of tax of $(0.2))	—		—		—		(0.8)		—		(0.8)		—		(0.8)
Net issuance of 120,767 shares of common stock (net of tax of $2.5)	—		—		—		—		7.7		7.7		—		7.7
Repurchase of 5,400 shares of common stock	—		—		—		—		(1.1)		(1.1)		—		(1.1)
Share-based compensation	18.9		—		—		—		—		18.9		—		18.9
Cash dividends declared - $1.92 per common share outstanding	—		(145.2)		—		—		—		(145.2)		—		(145.2)
Balance, September 30, 2023	$	837.0	$	3,874.0	$	(156.3)	$	10.1	$	(1,177.7)	3,387.1		$	0.1	$	3,387.2


					Accumulated Other Comprehensive Loss
	Common Stock and Additional Paid-In Capital		Retained Earnings		Cumulative Translation Adjustment		Retirement Benefits Adjustment		Treasury Stock		Total Shareholders’ Equity		Noncontrolling Interest		Total Equity
Balance, December 31, 2021	$	796.5	$	3,126.5	$	(62.2)	$	(7.4)	$	(1,050.3)	$	2,803.1	$	—	$	2,803.1
Net income (loss)	—		456.9		—		—		—		456.9		(0.2)		456.7
Cumulative translation adjustment	—		—		(196.3)		—		—		(196.3)		—		(196.3)
Net change in retirement obligations (net of tax of $0.7)	—		—		—		1.8		—		1.8		—		1.8
Net issuance of 117,656 shares of common stock (net of tax of $2.5)	—		—		—		—		3.9		3.9		—		3.9
Repurchase of 788,623 shares of common stock	—		—		—		—		(146.7)		(146.7)		—		(146.7)
Share-based compensation	16.4		—		—		—		—		16.4		—		16.4
Cash dividends declared - $1.80 per common share outstanding	—		(136.3)		—		—		—		(136.3)		—		(136.3)
Balance, September 30, 2022	$	812.9	$	3,447.1	$	(258.5)	$	(5.6)	$	(1,193.1)	$	2,802.8	$	(0.2)	$	2,802.6

See Notes to Condensed Consolidated Financial Statements

Table of Contents

IDEX CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

(unaudited)


	Nine Months Ended September 30,
	2023		2022
Cash flows from operating activities
Net income	$	487.3	$	456.7
Adjustments to reconcile net income to net cash flows provided by operating activities:

Gain on sale of business	(93.8)		(34.8)
Asset impairments	0.8		17.0
Credit loss on note receivable from collaborative partner	7.7		—
Depreciation	41.9		37.0
Amortization of intangible assets	70.6		49.2

Share-based compensation expense	18.9		16.4
Deferred income taxes	(1.8)		0.2
Changes in (net of the effect from acquisitions/divestitures and foreign currency translation):
Receivables	11.6		(62.5)
Inventories	24.5		(99.6)
Other current assets	0.3		(4.8)
Trade accounts payable	(30.2)		25.6
Deferred revenue	5.6		(24.7)
Accrued expenses	(34.0)		13.1
Other - net	6.3		1.3
Net cash flows provided by operating activities	515.7		390.1
Cash flows from investing activities
Capital expenditures	(68.3)		(48.0)
Acquisition of businesses, net of cash acquired	(110.3)		(232.6)
Proceeds from sale of business, net of cash remitted	110.3		49.4
Purchases of marketable securities	(24.6)		—
Other - net	2.9		6.8
Net cash flows used in investing activities	(90.0)		(224.4)
Cash flows from financing activities
Borrowings under revolving credit facilities	—		40.0
Payments under revolving credit facilities	—		(40.0)
Proceeds from issuance of 5.13% Senior Notes	100.0		—
Payment of 3.20% Senior Notes	(100.0)		—
Payments under Term Facility	(150.0)		—
Cash dividends paid to shareholders	(142.3)		(132.2)
Net proceeds from stock option exercises	7.7		3.9
Repurchases of common stock	(1.1)		(146.3)
Other - net	(1.0)		—
Net cash flows used in financing activities	(286.7)		(274.6)
Effect of exchange rate changes on cash and cash equivalents	(6.5)		(65.8)
Net increase (decrease) in cash and cash equivalents	132.5		(174.7)
Cash and cash equivalents at beginning of year	430.2		855.4
Cash and cash equivalents at end of period	$	562.7	$	680.7

Supplemental cash flow information
Cash paid for:
Interest	$	30.5	$	18.9
Income taxes	147.1		129.5

See Notes to Condensed Consolidated Financial Statements

Table of Contents

IDEX CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions, except per share amounts)

(unaudited)

1. Basis of Presentation and Significant Accounting Policies

The Condensed Consolidated Financial Statements of IDEX Corporation (“IDEX” or the “Company”) have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) applicable to interim financial information and the instructions to Form 10-Q under the Securities Exchange Act of 1934, as amended. The statements are unaudited but include all adjustments, consisting only of recurring items, except as noted, that the Company considers necessary for a fair presentation of the information set forth herein. The results of operations for the three and nine months ended September 30, 2023 are not necessarily indicative of the results to be expected for the entire year.

The Condensed Consolidated Financial Statements and Management’s Discussion and Analysis of Financial Condition and Results of Operations set forth in this report should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2022.

Recently Adopted Accounting Standards

The Financial Accounting Standards Board establishes changes to U.S. GAAP in the form of accounting standards updates (“ASUs”) to the Accounting Standards Codification (“ASC”). The Company considers the applicability and impact of all ASUs. Any recent ASUs were assessed and determined to be either not applicable or are expected to have an immaterial impact on the Company’s Condensed Consolidated Financial Statements.

2. Acquisitions and Divestitures

All of the Company’s acquisitions of businesses have been accounted for under ASC 805, Business Combinations. Accordingly, the assets and liabilities of the acquired companies, after adjustments to reflect the fair values assigned to the assets and liabilities, have been included in the Company’s Condensed Consolidated Balance Sheets from their respective dates of acquisition. The results of operations of Nexsight, LLC and its businesses Envirosight, WinCan, MyTana and Pipeline Renewal Technologies (“Nexsight”) (acquired February 28, 2022), KZ CO. (“KZValve”) (acquired May 2, 2022), Muon B.V. and its subsidiaries (“Muon Group”) (acquired November 18, 2022) and Iridian Spectral Technologies ("Iridian") (acquired May 19, 2023) have been included in the Company’s Condensed Consolidated Statements of Income since the respective dates of acquisition. The results of operations of Micropump, Inc. (“Micropump”) (sold on August 3, 2023) and Knight LLC (“Knight”) (sold on September 9, 2022) have been included in the Company’s Condensed Consolidated Statements of Income through the respective dates of disposition. Supplemental pro forma information has not been provided as the acquisitions did not have a material impact on the Company’s Condensed Consolidated Financial Statements individually or in the aggregate. In addition, the divestitures did not represent a strategic shift that had a major effect on operations and financial results and, therefore, did not qualify for presentation as discontinued operations.

2023 Acquisitions

Iridian

On May 19, 2023, the Company acquired Iridian in a stock acquisition. Iridian is a global leader in designing and manufacturing thin-film, multi-layer optical filters serving the laser communications, telecommunications and life sciences markets and expands the Company’s array of optical technology offerings. Headquartered in Ottawa, Ontario, Canada, Iridian operates in the Company’s Scientific Fluidics & Optics reporting unit within the Health & Science Technologies (“HST”) segment. Iridian was acquired for cash consideration of $110.3 million. The entire purchase price was funded with cash on hand. Goodwill and intangible assets recognized as part of this transaction were $53.6 million and $45.6 million, respectively. The goodwill is not deductible for tax purposes.

Table of Contents

IDEX CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions, except per share amounts)

(unaudited)

The Company made a preliminary allocation of the purchase price for the Iridian acquisition as of the acquisition date based on its understanding of the fair value of the acquired assets and assumed liabilities. These nonrecurring fair value measurements are classified as Level 3 in the fair value hierarchy. As the Company continues to obtain additional information, primarily related to the valuations of these assets and liabilities, and continues to integrate the newly acquired business, the Company will refine the estimates of fair value and more accurately allocate the purchase price. Only items identified as of the acquisition date are considered for subsequent adjustment. The Company will continue to make required adjustments to the purchase price allocation prior to the completion of the measurement period.

The preliminary allocation of the purchase price to the assets acquired and liabilities assumed, based on their estimated fair values at the acquisition date, is as follows:


	Total
Current assets, net of cash acquired	$	10.6
Property, plant and equipment	19.9
Goodwill	53.6
Intangible assets	45.6
Other noncurrent assets	5.4
Total assets acquired	135.1
Current liabilities	(1.2)
Deferred income taxes	(18.7)
Other noncurrent liabilities	(4.9)
Net assets acquired	$	110.3

Acquired intangible assets consist of trade names, customer relationships and unpatented technology. The goodwill recorded for the acquisition reflects the strategic fit, revenue and earnings growth potential of this business.

The acquired intangible assets and weighted average amortization periods are as follows:


	Total		Weighted Average Life
Trade names	$	5.2	15
Customer relationships	29.3		12
Unpatented technology	11.1		11
Acquired intangible assets	$	45.6

2022 Acquisitions

Nexsight

On February 28, 2022, the Company acquired Nexsight in a partial stock and partial asset acquisition. Nexsight complements and creates synergies with the Company’s existing iPEK and ADS business units that design and create sewer crawlers, inspection and monitoring systems and software applications that allow teams to identify, anticipate and correct wastewater system issues remotely. Headquartered in Randolph, New Jersey, Nexsight operates in the Company’s Water reporting unit within the Fluid & Metering Technologies (“FMT”) segment. Nexsight was acquired for cash consideration of $112.5 million. The entire purchase price was funded with cash on hand. Goodwill and intangible assets recognized as part of this transaction were $54.7 million and $49.8 million, respectively. The goodwill is partially deductible for tax purposes.

The Company finalized the allocation of the purchase price for the Nexsight acquisition as of the acquisition date based on its understanding of the fair value of the acquired assets and assumed liabilities. These nonrecurring fair value measurements are classified as Level 3 in the fair value hierarchy.

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IDEX CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions, except per share amounts)

(unaudited)

The final allocation of the purchase price to the assets acquired and liabilities assumed, based on their estimated fair values at the acquisition date, is as follows:


	Total
Current assets, net of cash acquired	$	16.6
Property, plant and equipment	2.0
Goodwill	54.7
Intangible assets	49.8
Other noncurrent assets	4.3
Total assets acquired	127.4
Current liabilities	(9.2)
Deferred income taxes	(1.9)
Other noncurrent liabilities	(3.8)
Net assets acquired	$	112.5

Acquired intangible assets consist of trade names, customer relationships and software. The goodwill recorded for the acquisition reflects the strategic fit, revenue and earnings growth potential of this business.

The acquired intangible assets and weighted average amortization periods are as follows:


	Total		Weighted Average Life
Trade names	$	13.5	15
Customer relationships	31.5		10
Software	4.8		5
Acquired intangible assets	$	49.8

KZValve

On May 2, 2022, the Company acquired KZValve in an asset acquisition. KZValve is a leading manufacturer of electric valves and controllers used primarily in agricultural applications. KZValve augments and expands IDEX’s agricultural portfolio, complementing Banjo’s current fluid management solutions for these applications. Headquartered in Greenwood, Nebraska, KZValve operates in the Company’s Agriculture reporting unit within the FMT segment. KZValve was acquired for cash consideration of $120.1 million. The entire purchase was funded with cash on hand. Goodwill and intangible assets recognized as part of this transaction were $56.4 million and $52.0 million, respectively. The goodwill is deductible for tax purposes.

The Company finalized the allocation of the purchase price for the KZValve acquisition as of the acquisition date based on its understanding of the fair value of the acquired assets and assumed liabilities. These nonrecurring fair value measurements are classified as Level 3 in the fair value hierarchy.

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IDEX CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions, except per share amounts)

(unaudited)

The final allocation of the purchase price to the assets acquired and liabilities assumed, based on their estimated fair values at the acquisition date, is as follows:


	Total
Current assets, net of cash acquired	$	9.7
Property, plant and equipment	1.8
Goodwill	56.4
Intangible assets	52.0
Deferred income taxes	0.2
Other noncurrent assets	1.0
Total assets acquired	121.1
Current liabilities	(1.0)
Net assets acquired	$	120.1

The acquired intangible assets and weighted average amortization periods are as follows:


	Total		Weighted Average Life
Trade names	$	7.5	15
Customer relationships	36.0		13
Unpatented technology	8.5		10
Acquired intangible assets	$	52.0

Muon Group

On November 18, 2022, the Company acquired the stock of Muon Group. Muon Group manufactures highly precise flowpaths in a variety of materials that enable the movement of various liquids and gases in critical applications for medical, semiconductor, food processing, digital printing and filtration technologies. Muon Group maintains operations in Hapert, the Netherlands; Eerbeek, the Netherlands; Wijchen, the Netherlands; Dorset, United Kingdom and Pune, India and operates in the Company’s Scientific Fluidics & Optics reporting unit within the HST segment. Muon Group was acquired for cash consideration of $713.0 million. The purchase price was funded with $342.6 million of cash on hand, $170.4 million of proceeds from the Company's Revolving Credit Facility and $200.0 million of proceeds from the Company's Term Facility. Goodwill and intangible assets recognized as part of this transaction were $394.4 million and $319.1 million, respectively. The goodwill is not deductible for tax purposes.

The Company made a preliminary allocation of the purchase price for the Muon Group acquisition as of the acquisition date based on its understanding of the fair value of the acquired assets and assumed liabilities. These nonrecurring fair value measurements are classified as Level 3 in the fair value hierarchy. As the Company continues to obtain additional information, primarily related to the valuations of these assets and liabilities, and continues to integrate the newly acquired business, the Company will refine the estimates of fair value and more accurately allocate the purchase price. Only items identified as of the acquisition date are considered for subsequent adjustment. The Company will continue to make required adjustments to the purchase price allocation prior to the completion of the measurement period.

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IDEX CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions, except per share amounts)

(unaudited)

The preliminary allocation of the purchase price to the assets acquired and liabilities assumed, based on their estimated fair values at the acquisition date, is as follows:


	Total
Current assets, net of cash acquired	$	52.0
Property, plant and equipment	59.1
Goodwill	394.4
Intangible assets	319.1
Other noncurrent assets	9.6
Total assets acquired	834.2
Current liabilities	(26.7)
Deferred income taxes	(83.8)
Other noncurrent liabilities	(10.7)
Net assets acquired	$	713.0

The acquired intangible assets and weighted average amortization periods are as follows:


	Total		Weighted Average Life
Trade names	$	38.3	15
Customer relationships	212.4		13
Unpatented technology	68.4		11
Acquired intangible assets	$	319.1

Acquisition-Related Costs

The Company incurred $1.8 million and $5.4 million of acquisition-related costs during the three and nine months ended September 30, 2023, respectively, and $2.7 million and $5.3 million of acquisition-related costs during the three and nine months ended September 30, 2022, respectively. These costs were recorded in Selling, general and administrative expenses and were related to completed, pending and potential acquisitions, including those that ultimately were not completed.

The Company also recorded a $1.2 million fair value inventory step-up charge associated with the completed 2023 acquisition of Iridian in Cost of sales during the three and nine months ended September 30, 2023, and $0.1 million and $0.3 million of fair value inventory step-up charges associated with the completed 2022 acquisitions of Nexsight and KZValve, respectively, in Cost of sales during the nine months ended September 30, 2022.

Divestitures

The Company periodically reviews its businesses for their strategic fit within its core businesses and customers and may from time to time sell various businesses or assets for a variety of reasons. Any resulting gain or loss recognized due to divestitures is recorded within Gain on sale of business in the Condensed Consolidated Statements of Income.

On August 3, 2023, the Company completed the sale of Micropump for proceeds of $110.3 million, net of cash remitted, resulting in a pre-tax gain on the sale of $93.8 million. The divestiture resulted in $22.7 million of income tax expense in the Condensed Consolidated Statements of Income during the three and nine months ended September 30, 2023. Micropump was its own reporting unit and its results were reported within the HST segment.

On September 9, 2022, the Company completed the sale of Knight for proceeds of $49.4 million, net of cash remitted, resulting in a pre-tax gain on the sale of $34.8 million. The divestiture resulted in $5.5 million of income tax expense in the

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IDEX CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions, except per share amounts)

(unaudited)

Condensed Consolidated Statements of Income during the three and nine months ended September 30, 2022. The results of Knight were reported in the Water reporting unit within the FMT segment.

3. Collaborative Investments

During 2021 and 2022, a subsidiary of IDEX funded a total of $7.2 million in promissory notes as an investment in a start-up company that provides communication technology to improve individual performance and team coordination for firefighters’ responses, which aligns with IDEX’s Fire & Safety/Diversified Products (“FSDP”) segment’s strategic plan. On a quarterly basis, the Company evaluates whether an allowance for credit losses is required for these promissory notes and measures the allowance using the current expected credit loss model. While the Company continues to retain certain convertible equity rights as well as a secured interest in the intellectual property of the start-up company, during the second quarter of 2023, IDEX concluded it would not provide additional funding to the start-up at that time. As a result of the Company’s analysis of the recoverability of its investment during the second quarter of 2023, IDEX determined that its investment may no longer be recoverable. As a result, IDEX recorded a credit loss of $7.7 million in Other expense (income) - net in the Condensed Consolidated Statements of Income and a reserve in Other noncurrent assets on the Condensed Consolidated Balance Sheets for the full amount of the principal and accrued interest outstanding.

4. Business Segments

IDEX has three reportable business segments: Fluid & Metering Technologies (“FMT”), Health & Science Technologies (“HST”) and Fire & Safety/Diversified Products (“FSDP”).

The FMT segment designs, produces and distributes positive displacement pumps, valves, small volume provers, flow meters, injectors and other fluid-handling pump modules and systems and provides flow monitoring and other services for the food, chemical, general industrial, water and wastewater, agriculture and energy industries. FMT application-specific pump and metering solutions serve a diverse range of end markets, including industrial infrastructure (fossil fuels, refined and alternative fuels and water and wastewater), energy, chemical processing, agriculture, food and beverage, semiconductor, pulp and paper, automotive/transportation, plastics and resins, electronics and electrical, construction and mining, pharmaceutical and biopharmaceutical, machinery and numerous other specialty niche markets.

The HST segment designs, produces and distributes a wide range of precision fluidics, positive displacement pumps, powder and liquid processing technologies, drying systems, micro-precision components, pneumatic components and sealing solutions, high performance molded and extruded sealing components, custom mechanical and shaft seals, engineered hygienic mixers and valves, biocompatible medical devices and implantables, air compressors and blowers, optical components and coatings, laboratory and commercial equipment and precision photonic solutions. HST serves a variety of end markets, including food and beverage, life sciences, analytical instruments, pharmaceutical and biopharmaceutical, industrial, semiconductor, automotive/transportation, medical/dental, energy, cosmetics, marine, chemical, wastewater and water treatment, research and aerospace/defense markets.

The FSDP segment designs, produces and distributes firefighting pumps, valves and controls, rescue tools, lifting bags and other components and systems for the fire and rescue industry, engineered stainless steel banding and clamping devices used in a variety of industrial and commercial applications in the automotive, energy and industrial markets and precision equipment for dispensing, metering and mixing colorants and paints used in a variety of retail and commercial businesses in the paint and industrial markets around the world.

Information on the Company’s business segments is presented below based on the nature of the products and services offered. The Company uses Adjusted EBITDA as its principal measure of segment performance. Intersegment sales are contracted with terms equivalent to those of an arm’s-length transaction.

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IDEX CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions, except per share amounts)

(unaudited)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Net sales
Fluid & Metering Technologies
External customers	$	300.5	$	307.4	$	945.7	$	878.8
Intersegment sales	0.6		0.2		2.3		0.7
Total segment sales	301.1		307.6		948.0		879.5
Health & Science Technologies
External customers	312.7		344.3		1,001.4		984.3
Intersegment sales	0.5		0.7		2.3		1.9
Total segment sales	313.2		345.0		1,003.7		986.2
Fire & Safety/Diversified Products
External customers	180.2		172.3		537.9		508.1
Intersegment sales	0.4		0.1		1.9		0.2
Total segment sales	180.6		172.4		539.8		508.3
Intersegment eliminations	(1.5)		(1.0)		(6.5)		(2.8)
Net sales	$	793.4	$	824.0	$	2,485.0	$	2,371.2
ADJUSTED EBITDA
Fluid & Metering Technologies	$	103.6	$	104.4	$	323.9	$	287.8
Health & Science Technologies	84.4		101.4		278.8		304.8
Fire & Safety/Diversified Products	52.8		47.8		157.0		137.3
Segment Adjusted EBITDA	240.8		253.6		759.7		729.9
Corporate and other(1)	(15.3)		(22.2)		(63.7)		(64.6)
Adjusted EBITDA	225.5		231.4		696.0		665.3
Interest expense	(13.7)		(9.6)		(40.1)		(28.6)
Depreciation	(14.7)		(12.3)		(41.9)		(37.0)
Amortization	(23.8)		(17.0)		(70.6)		(49.2)
Fair value inventory step-up charges	(1.2)		—		(1.2)		(0.4)
Restructuring expenses and asset impairments	(4.1)		—		(8.2)		(2.8)
Net impact from the exit of a COVID-19 testing application(2)	—		1.1		—		1.1
Gain on sale of business	93.8		34.8		93.8		34.8
Gains on sales of assets	—		—		—		2.7
Credit loss on note receivable from collaborative partner(3)	—		—		(7.7)		—
Income before income taxes	$	261.8	$	228.4	$	620.1	$	585.9

(1) Corporate expenses that can be identified with a segment have been included in determining segment results. The remainder is included in Corporate and Other.

(2) Represents the net impact of the acceleration of previously deferred revenue of $17.9 million and an impairment charge of $16.8 million as a result of a customer’s decision to discontinue further investment in commercializing its COVID-19 testing application in the HST segment in 2022 that did not reoccur in 2023. See Note 12 in the Notes to Condensed Consolidated Financial Statements for further detail.

(3) Represents a reserve recorded on an investment with a collaborative partner that may no longer be recoverable. See Note 3 in the Notes to Condensed Consolidated Financial Statements for further detail.

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IDEX CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions, except per share amounts)

(unaudited)


	September 30, 2023		December 31, 2022
ASSETS
Fluid & Metering Technologies	$	1,700.0	$	1,676.9
Health & Science Technologies	2,997.3		2,931.1
Fire & Safety/Diversified Products	797.2		771.8
Corporate and other	175.1		132.1
Total assets	$	5,669.6	$	5,511.9

5. Revenue

Disaggregation of Revenue

The Company has a comprehensive offering of products, including technologies, built to customers’ specifications that are sold in niche markets throughout the world. The Company disaggregates its revenue from contracts with customers by reporting unit and geographical region for each segment as the Company believes it best depicts how the amount, nature, timing and uncertainty of its revenue and cash flows are affected by economic factors. Revenue was attributed to geographical region based on the location of the customer. The following tables present revenue disaggregated by reporting unit and geographical region.

Revenue by reporting unit for the three and nine months ended September 30, 2023 and 2022 was as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Pumps	$	94.7	$	102.6	$	309.0	$	304.5
Water	79.8		82.1		261.2		228.1
Energy	53.7		51.3		160.1		144.3
Agriculture	39.2		42.1		117.9		112.5
Valves	33.7		29.5		99.8		90.1
Intersegment elimination	(0.6)		(0.2)		(2.3)		(0.7)
Fluid & Metering Technologies	300.5		307.4		945.7		878.8
Scientific Fluidics & Optics(1)	162.1		172.4		509.7		462.8
Performance Pneumatic Technologies	60.0		64.1		195.4		191.2
Sealing Solutions	59.2		64.9		186.3		203.1
Material Processing Technologies	29.7		34.6		90.4		103.1
Micropump(2)	2.2		9.0		21.9		26.0
Intersegment elimination	(0.5)		(0.7)		(2.3)		(1.9)
Health & Science Technologies	312.7		344.3		1,001.4		984.3
Fire & Safety	112.0		100.6		328.0		296.1
Dispensing	41.9		42.8		122.8		128.2
BAND-IT	26.7		29.0		89.0		84.0
Intersegment elimination	(0.4)		(0.1)		(1.9)		(0.2)
Fire & Safety/Diversified Products	180.2		172.3		537.9		508.1
Net sales	$	793.4	$	824.0	$	2,485.0	$	2,371.2

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IDEX CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions, except per share amounts)

(unaudited)

(1) The three and nine months ended September 30, 2022 include the acceleration of previously deferred revenue of $17.9 million as a result of a customer’s decision to discontinue further investment in commercializing its COVID-19 testing application. See Note 12 for further detail.

(2) Revenue from Micropump (sold on August 3, 2023) has been included in the Company’s Condensed Consolidated Statements of Income through the date of disposition. See Note 2 for further detail.

Revenue by geographical region for the three and nine months ended September 30, 2023 and 2022 was as follows:



	Three Months Ended September 30, 2023
	FMT		HST		FSDP		IDEX
U.S.	$	168.4	$	139.2	$	94.4	$	402.0
North America, excluding U.S.	15.5		3.2		8.8		27.5
Europe	52.3		106.0		39.0		197.3
Asia	43.1		57.8		29.0		129.9
Other(1)	21.8		7.0		9.4		38.2
Intersegment elimination	(0.6)		(0.5)		(0.4)		(1.5)
Net sales	$	300.5	$	312.7	$	180.2	$	793.4



	Three Months Ended September 30, 2022
	FMT		HST		FSDP		IDEX
U.S.(2)	$	178.4	$	175.0	$	93.5	$	446.9
North America, excluding U.S.	20.4		3.3		8.4		32.1
Europe(2)	47.2		93.0		36.8		177.0
Asia	39.1		67.4		25.4		131.9
Other(1)	22.5		6.3		8.3		37.1
Intersegment elimination	(0.2)		(0.7)		(0.1)		(1.0)
Net sales	$	307.4	$	344.3	$	172.3	$	824.0



	Nine Months Ended September 30, 2023
	FMT		HST		FSDP		IDEX
U.S.	$	525.9	$	437.3	$	280.5	$	1,243.7
North America, excluding U.S.	52.8		16.6		25.4		94.8
Europe	163.0		338.1		126.1		627.2
Asia	137.0		189.6		80.4		407.0
Other(1)	69.3		22.1		27.4		118.8
Intersegment elimination	(2.3)		(2.3)		(1.9)		(6.5)
Net sales	$	945.7	$	1,001.4	$	537.9	$	2,485.0

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions, except per share amounts)

(unaudited)



	Nine Months Ended September 30, 2022
	FMT		HST		FSDP		IDEX
U.S.(2)	$	498.9	$	484.7	$	255.0	$	1,238.6
North America, excluding U.S.	54.3		20.3		27.8		102.4
Europe(2)	147.7		276.8		123.8		548.3
Asia	116.8		187.0		75.4		379.2
Other(1)	61.8		17.4		26.3		105.5
Intersegment elimination	(0.7)		(1.9)		(0.2)		(2.8)
Net sales	$	878.8	$	984.3	$	508.1	$	2,371.2

(1) Other includes: South America, Middle East, Australia and Africa.

(2) The HST segment includes the acceleration of $17.9 million of previously deferred revenue related to a customer’s decision to discontinue further investment in commercializing its COVID-19 testing application, of which $9.5 million was recognized in the U.S. and $8.4 million was recognized in Europe in both the three and nine months ended September 30, 2022. See Note 12 for further detail.

Performance Obligations

A majority of the Company's contracts have a single performance obligation which represents, in most cases, the product being sold to the customer. Some contracts include multiple performance obligations such as a product and the related installation, extended warranty, software and/or maintenance services. For contracts with multiple performance obligations, the Company allocates the total transaction price to each performance obligation in an amount based on the estimated relative standalone selling prices of the promised products or services underlying each performance obligation.

The Company’s performance obligations are satisfied either at a point in time or over time as work progresses. For performance obligations satisfied at a point in time, revenue is recognized when control transfers to the customer, typically upon shipment. For performance obligations in which the Company transfers control of a product or service over time, revenue is recognized over time as work is performed. Typically, this results when the Company performs services over time or the Company creates a product with no alternative use and has an enforceable right to payment for its performance to date. Revenue from products and services transferred to customers at a point in time and over time was as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Revenue from products transferred at a point in time	95	%	96	%	95	%	96	%
Revenue from products and services transferred over time	5	%	4	%	5	%	4	%

Contract Balances

The timing of billings and cash collections can result in customer receivables, billings in excess of revenue recognized, advance payments or deposits. Customer receivables include both amounts billed and currently due from customers as well as unbilled amounts (contract assets) and are included in Receivables on the Condensed Consolidated Balance Sheets.

The composition of customer receivables was as follows:


	September 30, 2023		December 31, 2022
Billed receivables	$	413.4	$	421.3
Unbilled receivables	9.4		10.0
Total customer receivables	$	422.8	$	431.3

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IDEX CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions, except per share amounts)

(unaudited)

Billings in excess of revenue recognized, advance payments and deposits represent contract liabilities and are included in deferred revenue which is classified as current or noncurrent based on when the Company expects to recognize the revenue. The current portion is included in Accrued expenses and the noncurrent portion is included in Other noncurrent liabilities on the Condensed Consolidated Balance Sheets.

The composition of deferred revenue was as follows:


	September 30, 2023		December 31, 2022
Deferred revenue - current	$	48.9	$	44.7
Deferred revenue - noncurrent	15.8		15.0
Total deferred revenue	$	64.7	$	59.7

6. Earnings Per Common Share

Diluted earnings per common share (“EPS”) attributable to IDEX is computed by dividing Net income attributable to IDEX by the weighted average number of common shares outstanding (basic) plus common stock equivalents outstanding (diluted) for the period. Common stock equivalents consist of restricted stock, performance share units and stock options, which have been included in the calculation of weighted average common shares outstanding using the treasury stock method.

ASC 260, Earnings Per Share, concludes that all outstanding unvested share-based payment awards that contain rights to non-forfeitable dividends participate in undistributed earnings with common shareholders. If awards are considered participating securities, the Company is required to apply the two-class method of computing basic and diluted earnings per share. The Company has determined that its outstanding shares of restricted stock are participating securities. Accordingly, Diluted EPS attributable to IDEX was computed using the two-class method prescribed by ASC 260.

Basic weighted average common shares outstanding reconciles to diluted weighted average common shares outstanding as follows:


	Three Months Ended September 30,		Nine Months Ended September 30,
	2023	2022	2023	2022
Basic weighted average common shares outstanding	75.6	75.4	75.6	75.8
Dilutive effect of restricted stock, performance share units and stock options	0.3	0.4	0.3	0.3
Diluted weighted average common shares outstanding	75.9	75.8	75.9	76.1

Options to purchase shares of common stock that were not included in the computation of Diluted EPS attributable to IDEX because the effect of their inclusion would have been antidilutive were as follows:


	Three Months Ended September 30,		Nine Months Ended September 30,
	2023	2022	2023	2022
Antidilutive shares not included in Diluted EPS attributable to IDEX	0.2	0.5	0.2	0.5

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IDEX CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions, except per share amounts)

(unaudited)

7. Balance Sheet Components


	September 30, 2023		December 31, 2022
INVENTORIES
Raw materials and component parts	$	289.7	$	301.2
Work in process	47.0		54.3
Finished goods	109.9		115.4
Inventories - net	$	446.6	$	470.9
ACCRUED EXPENSES
Payroll and related items	$	91.7	$	102.7
Management incentive compensation	9.7		26.4
Income taxes payable	17.9		30.2
Insurance	10.6		11.2
Warranty	8.0		8.1
Deferred revenue	48.9		44.7
Lease liability	21.0		21.6
Restructuring	3.4		1.4
Accrued interest	13.6		5.5
Pension and retiree medical obligations	3.3		3.3
Other	33.9		34.0
Accrued expenses	$	262.0	$	289.1
OTHER NONCURRENT LIABILITIES
Pension and retiree medical obligations	$	53.4	$	55.1
Transition tax payable	5.0		9.1
Deferred revenue	15.8		15.0
Lease liability	96.9		96.6
Other	23.7		20.0
Other noncurrent liabilities	$	194.8	$	195.8

8. Goodwill and Intangible Assets

The changes in the carrying amount of goodwill for the nine months ended September 30, 2023, by reportable business segment, were as follows:


	FMT		HST		FSDP		IDEX
Goodwill	$	800.9	$	1,644.8	$	393.0	$	2,838.7
Accumulated goodwill impairment losses	(20.7)		(149.8)		(30.1)		(200.6)
Balance at January 1, 2023	780.2		1,495.0		362.9		2,638.1
Foreign currency translation	(1.3)		(6.1)		(1.3)		(8.7)
Acquisitions	—		53.6		—		53.6
Measurement period adjustments	(1.8)		3.3		—		1.5
Divestitures	—		(7.2)		—		(7.2)
Balance at September 30, 2023	$	777.1	$	1,538.6	$	361.6	$	2,677.3

ASC 350, Goodwill and Other Intangible Assets, requires that goodwill be tested for impairment at the reporting unit level on an annual basis and between annual tests if an event occurs or circumstances change that would more likely than not reduce

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IDEX CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions, except per share amounts)

(unaudited)

the fair value of the reporting unit below its carrying value. In the first nine months of 2023, there were no events or circumstances that would have required an interim impairment test. Annually, on October 31, goodwill and other acquired intangible assets with indefinite lives are tested for impairment. Based on the results of the Company’s annual impairment test at October 31, 2022, all reporting units had fair values in excess of their carrying values.

The following table provides the gross carrying value and accumulated amortization for each major class of intangible asset at September 30, 2023 and December 31, 2022:


	At September 30, 2023							At December 31, 2022
	Gross Carrying Amount		Accumulated Amortization		Net		Weighted Average Life	Gross Carrying Amount		Accumulated Amortization		Net
Amortized intangible assets:
Patents	$	2.8	$	(2.0)	$	0.8	12	$	2.9	$	(1.8)	$	1.1
Trade names	180.8		(71.5)		109.3		15	186.5		(71.4)		115.1
Customer relationships	793.7		(225.0)		568.7		13	772.2		(184.9)		587.3
Unpatented technology	210.5		(63.9)		146.6		12	207.1		(57.8)		149.3
Software	4.8		(1.5)		3.3		5	4.8		(0.7)		4.1
Total amortized intangible assets	1,192.6		(363.9)		828.7			1,173.5		(316.6)		856.9
Indefinite-lived intangible assets:
Banjo trade name	62.1		—		62.1			62.1		—		62.1
Akron Brass trade name	28.8		—		28.8			28.8		—		28.8
Total intangible assets	$	1,283.5	$	(363.9)	$	919.6		$	1,264.4	$	(316.6)	$	947.8

The Banjo trade name and the Akron Brass trade name are indefinite-lived intangible assets which are tested for impairment on an annual basis in accordance with ASC 350 or more frequently if events or changes in circumstances indicate that the assets might be impaired. Based on the results of the Company’s annual impairment test at October 31, 2022, these indefinite-lived intangible assets had fair values in excess of their carrying values. In the first nine months of 2023, there were no events or circumstances that would have required an interim impairment test on these indefinite-lived intangible assets.

Amortization of intangible assets was $23.8 million and $70.6 million for the three and nine months ended September 30, 2023, respectively. Amortization of intangible assets was $17.0 million and $49.2 million for the three and nine months ended September 30, 2022, respectively. Based on the intangible asset balances as of September 30, 2023, expected amortization expense for the remaining three months of 2023 and for the years 2024 through 2027 is as follows:


Maturity of Intangible Assets	Estimated Amortization
2023 (excluding the nine months ended September 30, 2023)	$	23.4
2024	90.2
2025	88.8
2026	87.0
2027	83.2

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IDEX CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions, except per share amounts)

(unaudited)

9. Borrowings

Borrowings at September 30, 2023 and December 31, 2022 consisted of the following:


	September 30, 2023		December 31, 2022

3.20% Senior Notes, due June 2023	$	—	$	100.0
3.37% Senior Notes, due June 2025	100.0		100.0
5.13% Senior Notes, due June 2028	100.0		—
3.00% Senior Notes, due May 2030	500.0		500.0
2.625% Senior Notes, due June 2031	500.0		500.0
$800.0 million Revolving Credit Facility, due November 2027(1)	76.9		77.7
$200.0 million Term Facility, due November 2027(2)	50.0		200.0
Other borrowings	2.5		0.1
Total borrowings	1,329.4		1,477.8
Less current portion	0.7		—
Less deferred debt issuance costs	6.8		7.9
Less unaccreted debt discount	1.1		1.2
Long-term borrowings	$	1,320.8	$	1,468.7

(1) At September 30, 2023, there was $76.9 million outstanding under the Revolving Credit Facility with a weighted average interest rate of 2.95% and $7.2 million of outstanding letters of credit, resulting in a net available borrowing capacity under the Revolving Credit Facility of approximately $715.9 million.

(2) The Term Facility has a weighted average interest rate of 6.10%. During the third quarter of 2023, the Company repaid $150.0 million of the $200.0 million previously outstanding under the Term Facility.

At September 30, 2023, the Company was in compliance with covenants contained in the credit agreement associated with the Revolving Credit Facility as well as other long-term debt agreements.

Issuance of 5.13% Senior Notes in 2023

On June 13, 2023, the Company completed a private placement of $100 million aggregate principal amount of 5.13% Senior Notes due June 13, 2028 (the “5.13% Senior Notes”) pursuant to a Note Purchase and Master Note Agreement, dated as of June 13, 2023 (the “Purchase Agreement”), among the Company, NYL Investors LLC (“New York Life”) and certain affiliates of New York Life identified as Purchasers of the 5.13% Senior Notes therein. The 5.13% Senior Notes are unsecured obligations of the Company and rank pari passu in right of payment with all of the Company’s other unsecured, unsubordinated debt. The Company used the proceeds from the 5.13% Senior Notes issuance to repay the 3.20% Senior Notes due June 13, 2023.

The Company may at any time prepay all, or any portion of the 5.13% Senior Notes, provided that such portion is not less than 5% of the aggregate principal amount of all notes then outstanding under the Purchase Agreement. In the event of a prepayment, the Company will pay an amount equal to par plus accrued interest plus a make-whole amount. The Company also has the ability to make certain other offers to repurchase any notes outstanding under the Purchase Agreement.

The Purchase Agreement contains certain covenants that restrict the Company’s and its subsidiaries’ ability to, among other things, transfer or sell assets, create liens, incur indebtedness, transact with affiliates and engage in certain mergers or consolidations. In addition, the Company must comply with a leverage ratio, interest coverage ratio and priority debt ratio as set forth in the Purchase Agreement. The Purchase Agreement provides for customary events of default. In the case of an event of default arising from specified events of bankruptcy or insolvency, all notes then outstanding under the Purchase Agreement will become due and payable immediately without further action or notice. In the case of payment events of default, any holder of

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IDEX CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions, except per share amounts)

(unaudited)

such notes affected thereby may declare all of the notes outstanding under the Purchase Agreement held by it due and payable immediately. In the case of any other event of default, a majority of the holders of the notes then outstanding under the Purchase Agreement may declare all of such notes to be due and payable immediately, in each case subject to certain cure and notice provisions.

10. Fair Value Measurements

ASC 820, Fair Value Measurements and Disclosures, defines fair value, provides guidance for measuring fair value and requires certain disclosures. This standard discusses valuation techniques, such as the market approach (comparable market prices), the income approach (present value of future income or cash flow) and the cost approach (cost to replace the service capacity of an asset or replacement cost). The standard utilizes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The following is a brief description of those three levels:

•Level 1: Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities.

•Level 2: Inputs, other than quoted prices that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active.

•Level 3: Unobservable inputs that reflect the reporting entity’s own assumptions.

The following table summarizes the basis used to measure the Company’s financial assets (liabilities) at fair value on a recurring basis in the balance sheets at September 30, 2023 and December 31, 2022:


	Basis of Fair Value Measurements
	September 30, 2023		December 31, 2022
	Level 1		Level 1
Trading securities - mutual funds held in nonqualified SERP(1)	$	9.1	$	7.5
Available-for-sale securities - equities(2)	24.6		—

(1) The Supplemental Executive Retirement Plan (“SERP”) investment assets are offset by a SERP liability which represents the Company’s obligation to distribute SERP funds to participants.

(2) At September 30, 2023, the securities are included in Other current assets on the Company’s Condensed Consolidated Balance Sheets and are available for overnight cash settlement, if necessary, to fund current operations.

There were no transfers of assets or liabilities between Level 1 and Level 2 during the three and nine months ended September 30, 2023 or the year ended December 31, 2022.

The carrying values of the Company’s cash and cash equivalents, accounts receivable, marketable securities, accounts payable and accrued expenses approximate fair value because of the short-term nature of these instruments.

The following table provides the fair value of the outstanding indebtedness described in Note 9, which is based on quoted market prices and current market rates for debt with similar credit risk and maturity, as well as the carrying value. These fair value measurements are classified as Level 2 within the fair value hierarchy since they are determined based upon significant inputs observable in the market, including interest rates on recent financing transactions to entities with a credit rating similar to the Company’s rating.


	September 30, 2023				December 31, 2022
	Fair Value		Carrying Amount		Fair Value		Carrying Amount
Total Borrowings, less deferred debt issuance costs	$	1,135.4	$	1,328.3	$	1,328.7	$	1,476.6

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IDEX CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions, except per share amounts)

(unaudited)

11. Leases

The Company has commitments under operating leases for certain office facilities, warehouses, manufacturing plants, equipment (which includes both office and plant equipment) and vehicles used in its operations. Leases with an initial term of 12 months or less are not recorded on the balance sheet and the Company recognizes lease expense for these leases on a straight-line basis over the lease term.

Certain leases can include one or more options to renew. The exercise of lease renewal options is at the Company’s sole discretion. The Company does not include renewal periods in any of the leases’ terms until the renewal is executed as they are generally not reasonably certain of being exercised. The Company does not have any material purchase options.

Certain of the Company’s lease agreements contain provisions for future rent increases or have rental payments that are adjusted periodically for inflation or based on usage. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.

The Company does not have any significant leases that have not yet commenced.

Supplemental balance sheet information related to leases as of September 30, 2023 and December 31, 2022 was as follows:


	Balance Sheet Caption	September 30, 2023		December 31, 2022
Right-of-Use (“ROU”) Assets:
Building ROU assets - net	Other noncurrent assets	$	106.3	$	104.4
Equipment ROU assets - net	Other noncurrent assets	6.5		5.6
Total ROU assets - net		$	112.8	$	110.0
Lease Liabilities:
Current lease liabilities	Accrued expenses	$	21.0	$	21.6
Noncurrent lease liabilities	Other noncurrent liabilities	96.9		96.6
Total lease liabilities		$	117.9	$	118.2

The components of lease cost for the three and nine months ended September 30, 2023 and 2022 were as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Fixed lease cost (1)	$	8.5	$	11.4	$	24.2	$	27.8
Variable lease cost	0.6		0.6		1.9		1.8
Total lease cost	$	9.1	$	12.0	$	26.1	$	29.6

(1) Includes short-term leases, which are immaterial.

Supplemental cash flow information related to leases for the nine months ended September 30, 2023 and 2022 was as follows:


	Nine Months Ended September 30,
	2023		2022
Cash paid for amounts included in the measurement of lease liabilities	$	24.8	$	28.1
Right-of-use assets obtained in exchange for new lease liabilities	17.6		7.1

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IDEX CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions, except per share amounts)

(unaudited)

Other supplemental information related to leases as of September 30, 2023 and December 31, 2022 was as follows:


Lease Term and Discount Rate	September 30, 2023		December 31, 2022
Weighted-average remaining lease term (years):
Building and equipment	7.14		7.43
Vehicles	2.61		2.14
Weighted-average discount rate:
Building and equipment	3.68	%	3.41	%
Vehicles	2.81	%	1.70	%

The Company uses its incremental borrowing rate to determine the present value of the lease payments.

Total lease liabilities at September 30, 2023 have scheduled maturities as follows:


Maturity of Lease Liabilities
2023 (excluding the nine months ended September 30, 2023)	$	6.4
2024	19.6
2025	22.3
2026	19.5
2027	15.5
Thereafter	52.0
Total lease payments	135.3
Less: Imputed interest	(17.4)
Present value of lease liabilities	$	117.9

12. Restructuring Expenses and Asset Impairments

From time to time, the Company incurs expenses to facilitate long-term sustainable growth through cost reduction actions, consisting of employee reductions, facility rationalization and contract termination costs. These costs include severance costs, exit costs and asset impairments and are included in Restructuring expenses and asset impairments in the Condensed Consolidated Statements of Income. Severance costs primarily consist of severance benefits through payroll continuation, COBRA subsidies, outplacement services, conditional separation costs and employer tax liabilities, while exit costs primarily consist of lease exit and contract termination costs.

2023 Initiative

During the three and nine months ended September 30, 2023, the Company incurred severance costs related to employee reductions in conjunction with cost mitigation efforts as a result of current market conditions, contract termination costs and asset impairments.

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IDEX CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions, except per share amounts)

(unaudited)

Pre-tax restructuring expenses and asset impairments by segment for the three and nine months ended September 30, 2023 were as follows:



	Three Months Ended September 30, 2023
	Severance Costs		Exit Costs		Asset Impairments		Total
Fluid & Metering Technologies	$	0.8	$	0.6	$	0.3	$	1.7
Health & Science Technologies	1.5		—		—		1.5
Fire & Safety/Diversified Products	0.4		—		—		0.4
Corporate/Other	0.5		—		—		0.5
Restructuring expenses and asset impairments	$	3.2	$	0.6	$	0.3	$	4.1



	Nine Months Ended September 30, 2023
	Severance Costs		Exit Costs		Asset Impairments		Total
Fluid & Metering Technologies	$	1.0	$	0.6	$	0.8	$	2.4
Health & Science Technologies	4.5		—		—		4.5
Fire & Safety/Diversified Products	0.8		—		—		0.8
Corporate/Other	0.5		—		—		0.5
Restructuring expenses and asset impairments	$	6.8	$	0.6	$	0.8	$	8.2

2022 Initiative

During the three and nine months ended September 30, 2022, the restructuring costs incurred by the Company primarily related to asset impairments. In addition, the Company also incurred severance costs related to employee reductions.

In the second quarter of 2020, the Company engaged in the development of a COVID-19 testing application with a customer at one of the Company’s businesses in the HST segment. As part of this contract, the customer fully funded the $28.7 million investment needed to complete the development and production of microfluidic cartridges during 2020 and 2021. The costs incurred by the Company were primarily recorded as Property, plant and equipment – net in the Condensed Consolidated Balance Sheets and were being depreciated over the expected life of the assets, while the reimbursement was recorded as Deferred revenue in the Condensed Consolidated Balance Sheets and was being recognized as units were shipped.

In the third quarter of 2022, the Company was informed by the customer of its decision to discontinue further investment in commercializing its COVID-19 testing application. This event was deemed a triggering event, which required an interim impairment test be performed on the Property, plant and equipment related to this contract, resulting in an impairment charge of $16.8 million that was recorded as Restructuring expenses and asset impairments in the Condensed Consolidated Statements of Income during three and nine months ended September 30, 2022. In addition, the Company accelerated previously deferred revenue of $17.9 million related to units that are no longer expected to be shipped and recorded it as Net sales in the Condensed Consolidated Statements of Income during the three and nine months ended September 30, 2022.

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IDEX CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions, except per share amounts)

(unaudited)

Pre-tax restructuring expenses and asset impairments by segment for the three and nine months ended September 30, 2022 were as follows:



	Three Months Ended September 30, 2022
	Severance Costs		Exit Costs		Asset Impairments		Total
Fluid & Metering Technologies	$	0.1	$	—	$	—	$	0.1
Health & Science Technologies	0.4		—		16.8		17.2
Fire & Safety/Diversified Products	0.4		—		—		0.4
Corporate/Other	—		—		—		—
Restructuring expenses and asset impairments	$	0.9	$	—	$	16.8	$	17.7



	Nine Months Ended September 30, 2022
	Severance Costs		Exit Costs		Asset Impairments		Total
Fluid & Metering Technologies	$	1.6	$	0.3	$	0.2	$	2.1
Health & Science Technologies	0.6		—		16.8		17.4
Fire & Safety/Diversified Products	1.4		—		—		1.4
Corporate/Other	0.2		—		—		0.2
Restructuring expenses and asset impairments	$	3.8	$	0.3	$	17.0	$	21.1

Restructuring accruals reflected in Accrued expenses in the Company’s Condensed Consolidated Balance Sheets are as follows:


	Restructuring Initiatives
Balance at January 1, 2023	$	1.4
Restructuring expenses	7.4
Payments, utilization and other	(5.4)
Balance at September 30, 2023	$	3.4

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IDEX CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions, except per share amounts)

(unaudited)

13. Other Comprehensive Loss

The components of Other comprehensive loss are as follows:


	Three Months Ended September 30, 2023						Three Months Ended September 30, 2022
	Pre-tax		Tax		Net of tax		Pre-tax		Tax		Net of tax
Cumulative translation adjustment	$	(58.1)	$	—	$	(58.1)	$	(94.9)	$	—	$	(94.9)
Pension and other postretirement adjustments	(0.3)		—		(0.3)		0.6		—		0.6
Total other comprehensive loss	$	(58.4)	$	—	$	(58.4)	$	(94.3)	$	—	$	(94.3)


	Nine Months Ended September 30, 2023						Nine Months Ended September 30, 2022
	Pre-tax		Tax		Net of tax		Pre-tax		Tax		Net of tax
Cumulative translation adjustment	$	(19.2)	$	—	$	(19.2)	$	(196.3)	$	—	$	(196.3)
Pension and other postretirement adjustments	(1.0)		0.2		(0.8)		2.5		(0.7)		1.8
Total other comprehensive loss	$	(20.2)	$	0.2	$	(20.0)	$	(193.8)	$	(0.7)	$	(194.5)

The amounts reclassified from Accumulated other comprehensive loss to Net income during the three and nine months ended September 30, 2023 and 2022 are as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022		Income Statement Caption
Pension and other postretirement plans:
Amortization of actuarial (gains) losses and prior service costs	$	(0.3)	$	0.6	$	(1.0)	$	2.5	Other (income) expense - net
Total before tax	(0.3)		0.6		(1.0)		2.5
Provision for income taxes	—		—		0.2		(0.7)
Total net of tax	$	(0.3)	$	0.6	$	(0.8)	$	1.8

14. Share Repurchases

On March 17, 2020, the Company’s Board of Directors approved an increase of $500.0 million in the authorized level of repurchases of common stock. This approval is in addition to the prior repurchase authorization of the Board of Directors of $300.0 million on December 1, 2015. These authorizations have no expiration date. Repurchases under the program will be funded with future cash flow generation or borrowings available under the Revolving Credit Facility. During the nine months ended September 30, 2023, the Company repurchased a total of 5,400 shares at a cost of $1.1 million. During the nine months ended September 30, 2022, the Company repurchased a total of 788,623 shares at a cost of $146.3 million, of which $0.5 million was settled in October 2022. As of September 30, 2023, the amount of share repurchase authorization remaining was $562.8 million.

15. Share-Based Compensation

The Company typically grants equity awards annually at its regularly scheduled first quarter meeting of the Board of Directors based on the recommendation from the Compensation Committee.

The Company’s policy is to recognize compensation cost on a straight-line basis, assuming forfeitures, over the requisite service period for the entire award. Classification of stock compensation cost within the Condensed Consolidated Statements of Income is consistent with the classification of cash compensation for the same employees.

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IDEX CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions, except per share amounts)

(unaudited)

Stock Options

Stock options granted under the Company’s plans are generally non-qualified and are granted with an exercise price equal to the market price of the Company’s stock on the date of grant. The fair value of each option grant was estimated on the date of the grant using the Black Scholes valuation model. Stock options generally vest ratably over four years, with vesting beginning one year from the date of grant, and generally expire 10 years from the date of grant. The service period for certain retiree eligible participants is accelerated. Weighted average stock option fair values and assumptions for the periods presented are disclosed below.


	Three Months Ended September 30,		Nine Months Ended September 30,
	2023	2022	2023	2022
Weighted average fair value of grants	$56.47	$52.91	$60.49	$41.90
Dividend yield	1.20%	1.16%	1.07%	1.14%
Volatility	26.78%	25.99%	27.17%	25.16%
Risk-free interest rate	4.26%	3.35%	4.12%	1.87%
Expected life (in years)	4.50	4.90	4.50	4.90

Total compensation cost for stock options is recorded in the Condensed Consolidated Statements of Income as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Cost of sales	$	0.1	$	0.1	$	0.5	$	0.4
Selling, general and administrative expenses(1)	1.0		0.7		8.2		6.6
Total expense before income taxes	1.1		0.8		8.7		7.0
Income tax benefit	(0.2)		(0.1)		(0.8)		(0.6)
Total expense after income taxes	$	0.9	$	0.7	$	7.9	$	6.4

(1) The three months ended September 30, 2023 include $0.4 million of higher expense due to timing of accelerated stock compensation costs for retiree eligible participants, net of $0.2 million of executive forfeitures compared with the same period in 2022. The nine months ended September 30, 2023 include $1.5 million of higher expense compared with the same period in 2022 as it relates to the timing of accelerated stock compensation costs for retiree eligible participants.

A summary of the Company’s stock option activity as of September 30, 2023 and changes during the nine months ended September 30, 2023 are presented in the following table:


Stock Options	Shares	Weighted Average Price		Weighted-Average Remaining Contractual Term	Aggregate Intrinsic Value
	(Dollars in millions except weighted average price)
Outstanding at January 1, 2023	1,015,572	$	161.45	6.94	$	67.9
Granted	225,115	224.90
Exercised	(87,217)	143.37
Forfeited	(71,833)	200.60
Outstanding at September 30, 2023	1,081,637	$	173.52	6.82	$	40.9
Vested and expected to vest as of September 30, 2023	1,048,823	$	172.37	6.76	$	40.7
Exercisable at September 30, 2023	595,028	$	148.02	5.44	$	35.8

As of September 30, 2023, there was $10.0 million of total unrecognized compensation cost related to stock options that is expected to be recognized over a weighted-average period of 1.5 years.

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IDEX CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions, except per share amounts)

(unaudited)

Restricted Stock

Restricted stock awards generally cliff vest after three years for employees and non-employee directors. The service period for certain retiree eligible participants is accelerated. Unvested restricted stock carries dividend and voting rights and the sale of the shares is restricted prior to the date of vesting. Dividends are paid on restricted stock awards and their fair value is equal to the market price of the Company’s stock at the date of the grant. A summary of the Company’s restricted stock activity as of September 30, 2023 and changes during the nine months ended September 30, 2023 are presented in the following table:


Restricted Stock	Shares	Weighted-Average Grant Date Fair Value
Unvested at January 1, 2023	104,382	$	179.45
Granted	41,075	219.72
Vested	(22,992)	173.91
Forfeited	(12,220)	201.97
Unvested at September 30, 2023	110,245	$	193.11

Total compensation cost for restricted stock is recorded in the Condensed Consolidated Statements of Income as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Cost of sales	$	0.1	$	—	$	0.4	$	0.2
Selling, general and administrative expenses(1)	1.0		2.2		4.0		5.4
Total expense before income taxes	1.1		2.2		4.4		5.6
Income tax benefit	(0.2)		(0.4)		(0.9)		(1.0)
Total expense after income taxes	$	0.9	$	1.8	$	3.5	$	4.6

(1) The three and nine months ended September 30, 2023 include $1.1 million and $0.6 million, respectively, of lower expense due to timing of accelerated stock compensation costs for retiree eligible participants compared with the same period in 2022.

As of September 30, 2023, there was $7.3 million of total unrecognized compensation cost related to restricted stock that is expected to be recognized over a weighted-average period of 1.1 years.

Cash-Settled Restricted Stock

The Company also maintains a cash-settled share-based compensation plan for certain employees. Cash-settled restricted stock awards generally cliff vest after three years. The service period for certain retiree eligible participants is accelerated. Cash-settled restricted stock awards are recorded at fair value on a quarterly basis using the market price of the Company’s stock on the last day of the quarter. Dividend equivalents are paid on certain cash-settled restricted stock awards. A summary of the Company’s unvested cash-settled restricted stock activity as of September 30, 2023 and changes during the nine months ended September 30, 2023 are presented in the following table:

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IDEX CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions, except per share amounts)

(unaudited)


Cash-Settled Restricted Stock	Shares	Weighted-Average Fair Value
Unvested at January 1, 2023	57,356	$	228.33
Granted	20,705	225.34
Vested	(15,981)	229.03
Forfeited	(3,420)	208.02
Unvested at September 30, 2023	58,660	$	208.02

Total compensation cost for cash-settled restricted stock is recorded in the Condensed Consolidated Statements of Income as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Cost of sales	$	—	$	—	$	0.2	$	—
Selling, general and administrative expenses	0.6		1.1		2.1		1.1
Total expense before income taxes	0.6		1.1		2.3		1.1
Income tax benefit	—		—		(0.1)		—
Total expense after income taxes	$	0.6	$	1.1	$	2.2	$	1.1

As of September 30, 2023, there was $4.8 million of total unrecognized compensation cost related to cash-settled restricted shares that is expected to be recognized over a weighted-average period of 1.1 years.

Performance Share Units

Weighted average performance share unit fair values and assumptions for the periods specified are disclosed below. The performance share units are market condition awards and have been assessed at fair value on the date of grant using a Monte Carlo simulation model.


	Nine Months Ended September 30,
	2023	2022
Weighted average fair value of grants	$308.18	$235.54
Dividend yield	—%	—%
Volatility	27.00%	28.09%
Risk-free interest rate	4.37%	1.73%
Expected life (in years)	2.94	2.93

A summary of the Company’s performance share unit activity as of September 30, 2023 and changes during the nine months ended September 30, 2023 are presented in the following table:


Performance Share Units	Shares	Weighted-Average Grant Date Fair Value
Unvested at January 1, 2023	70,915	$	236.66
Granted	28,030	308.18
Vested	(18,105)	226.86
Forfeited	(12,050)	262.44
Unvested at September 30, 2023	68,790	$	265.22

On January 31, 2023, 18,105 performance share units vested. Based on the Company’s relative total shareholder return rank during the three year period ended January 31, 2023, the Company achieved a 173% payout factor and issued 31,334 common shares in February 2023 for awards that vested in 2023.

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IDEX CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions, except per share amounts)

(unaudited)

Total compensation cost for performance share units is recorded in the Condensed Consolidated Statements of Income as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Cost of sales	$	—	$	—	$	—	$	—
Selling, general and administrative expenses(1)	(0.3)		0.2		5.7		4.0
Total expense before income taxes	(0.3)		0.2		5.7		4.0
Income tax benefit	(0.1)		—		(0.3)		(0.1)
Total expense after income taxes	$	(0.4)	$	0.2	$	5.4	$	3.9

(1) The three months ended September 30, 2023 include $1.0 million of lower expense due to executive forfeitures, net of $0.4 million of higher expense due to timing of accelerated stock compensation costs for retiree eligible participants compared with the same period in 2022. The nine months ended September 30, 2023 include $2.0 million of higher expense as it relates to the timing of accelerated stock compensation costs for retiree eligible participants, net of $0.7 million of executive forfeitures when compared with the same period in 2022.

As of September 30, 2023, there was $3.1 million of total unrecognized compensation cost related to performance share units that is expected to be recognized over a weighted-average period of 1.1 years.

16. Retirement Benefits

The Company sponsors several qualified and nonqualified defined benefit and defined contribution pension plans as well as other post-retirement plans for its employees. The following tables provide the components of net periodic benefit cost for its major defined benefit plans and its other postretirement plans.



	Pension Benefits
	Three Months Ended September 30,
	2023				2022
	U.S.		Non-U.S.		U.S.		Non-U.S.
Service cost	$	0.1	$	0.3	$	—	$	0.5
Interest cost	0.1		0.6		0.1		0.2
Expected return on plan assets	(0.1)		(0.4)		(0.1)		(0.4)
Net amortization	—		(0.1)		0.1		0.2
Net periodic cost	$	0.1	$	0.4	$	0.1	$	0.5



	Pension Benefits
	Nine Months Ended September 30,
	2023				2022
	U.S.		Non-U.S.		U.S.		Non-U.S.
Service cost	$	0.1	$	0.9	$	0.1	$	1.4
Interest cost	0.3		2.0		0.2		0.7
Expected return on plan assets	(0.2)		(1.2)		(0.2)		(1.0)
Net amortization	0.1		(0.4)		0.2		0.6
Net periodic cost	$	0.3	$	1.3	$	0.3	$	1.7

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IDEX CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions, except per share amounts)

(unaudited)


	Other Postretirement Benefits
	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Service cost	$	0.1	$	0.2	$	0.3	$	0.5
Interest cost	0.2		0.1		0.6		0.4
Net amortization	(0.2)		(0.1)		(0.7)		(0.3)
Net periodic cost	$	0.1	$	0.2	$	0.2	$	0.6

The Company recognizes the service cost component in both Cost of sales and Selling, general and administrative expenses in the Condensed Consolidated Statements of Income depending on the functional area of the underlying employees and the interest cost, expected return on plan assets and net amortization components in Other expense (income) - net in the Condensed Consolidated Statements of Income.

The Company expects to contribute approximately $3.9 million to its defined benefit plans and $1.1 million to its other post-retirement benefit plans in 2023. During the first nine months of 2023, the Company contributed a total of $3.9 million to fund these plans.

17. Commitments and Contingencies

The Company and certain of its subsidiaries are involved in pending and threatened legal, regulatory and other proceedings arising in the ordinary course of business. These proceedings may pertain to matters such as product liability or contract disputes, and may also involve governmental inquiries, inspections, audits or investigations relating to issues such as tax matters, intellectual property, environmental, health and safety issues, governmental regulations, employment and other matters. Although the results of such legal proceedings cannot be predicted with certainty, the Company believes that the ultimate disposition of these matters will not have a material adverse effect, individually or in the aggregate, on the Company’s business, financial condition, results of operations or cash flows.

18. Income Taxes

The Company’s provision for income taxes is based upon estimated annual tax rates for the year applied to federal, state and foreign income. The provision for income taxes and the effective tax rates were as follows:


	Three Months Ended September 30,						Nine Months Ended September 30,
	2023			2022			2023			2022
Provision for income taxes	$	52.8		$	49.7		$	132.8		$	129.2
Effective tax rate	20.2		%	21.8		%	21.4		%	22.1		%

The decrease in the effective tax rate for both the three and nine months ended September 30, 2023 is primarily due to the tax benefit related to the finalization of the impact of research expenditure capitalization on the foreign derived intangible income deduction and the reduction of Global Intangible Low-Tax Income (“GILTI”) as a result of the tax amortization of goodwill related to the Muon Group acquisition.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis should be read in conjunction with the Company’s Condensed Consolidated Financial Statements and related notes in this quarterly report. This discussion may contain forward-looking statements based upon current expectations that involve risks and uncertainties. The Company’s actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of several factors, including those set forth under Item 1A, “Risk Factors” in the Company’s most recent annual report on Form 10-K and under the heading “Cautionary Statement Under the Private Securities Litigation Reform Act” discussed elsewhere in this quarterly report.

This discussion includes certain non-GAAP financial measures that have been defined and reconciled to the most directly comparable financial measure prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) under the headings “Non-GAAP Disclosures” and “Free Cash Flow.” This discussion also includes Operating working capital, which has been defined under the heading “Liquidity and Capital Resources.” The non-GAAP financial measures disclosed by the Company should not be considered a substitute for, or superior to, financial measures prepared in accordance with U.S. GAAP. The financial results prepared in accordance with U.S. GAAP and the reconciliations from these results should be carefully evaluated.

Overview

IDEX is an applied solutions company specializing in the manufacture of fluid and metering technologies, health and science technologies and fire, safety and other diversified products built to customers’ specifications. IDEX’s products are sold in niche markets across a wide range of industries throughout the world. Accordingly, IDEX’s businesses are affected by levels of industrial activity and economic conditions in the U.S. and in other countries where it does business as well as by the relationship of the U.S. dollar to other currencies. Levels of capacity utilization and capital spending in certain industries and overall industrial activity are important factors that influence the demand for IDEX’s products.

Third Quarter Highlights

Select key financial results for the three months ended September 30, 2023 when compared to the same period in the prior year are as follows:


	Three Months Ended September 30,
(Dollars in millions, except per share amounts)	2023		2022		% / bps Change
Net sales	$	793.4	$	824.0	(4%)
Adjusted net sales*	793.4		806.1		(2%)
Organic net sales growth*					(6%)
Gross profit	349.6		381.8		(8%)
Adjusted gross profit*	350.8		363.9		(4%)
Net income attributable to IDEX	209.1		178.7		17%
Adjusted net income attributable to IDEX*	160.6		161.9		(1%)
Adjusted EBITDA*	225.5		231.4		(3%)
Diluted EPS attributable to IDEX	2.75		2.36		17%
Adjusted diluted EPS attributable to IDEX*	2.12		2.14		(1%)
Cash flows from operating activities	226.6		198.1		14%
Free cash flow*	206.5		181.8		14%
Gross margin	44.1%		46.3%		(220) bps
Adjusted gross margin*	44.2%		45.1%		(90) bps
Net income margin	26.3%		21.7%		460 bps
Adjusted EBITDA margin*	28.4%		28.7%		(30) bps

*These are non-GAAP measures. See the definitions of these non-GAAP measures and reconciliations to their most directly comparable GAAP financial measures under the headings “Non-GAAP Disclosures” and “Free Cash Flow.”

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During the three months ended September 30, 2023, the Company delivered strong operating performance. While continued customer inventory recalibration, largely within the Company’s Health & Science Technologies segment, resulted in lower sales volumes, the Company realized strong price/cost and achieved favorable operational productivity across its segments. Net income attributable to IDEX also reflects a $71.1 million gain, net of tax, on the divestiture of the Company’s Micropump business, which was sold in August 2023. Cash flow from operating activities was $226.6 million during the quarter, an increase of 14% compared to the same prior year period, driven primarily by inventory reduction efforts. Strong operating cash flow resulted in record free cash flow of $206.5 million during the quarter.

The Company believes its customer destocking efforts are largely complete and expects orders to begin to stabilize and lead times to return to more normalized levels during the fourth quarter of 2023.

Results of Operations

The following is a discussion and analysis of the Company’s results of operations for the three and nine months ended September 30, 2023 compared with the three and nine months ended September 30, 2022.


	Three Months Ended September 30,								Nine Months Ended September 30,
(Dollars in millions, except per share amounts)	2023			2022			% / bps Change		2023			2022			% / bps Change
Net sales	$	793.4		$	824.0		(4	%)	$	2,485.0		$	2,371.2		5	%
Cost of sales	443.8			442.2			—	%	1,374.9			1,290.0			7	%
Gross profit	349.6			381.8			(8	%)	1,110.1			1,081.2			3	%
Gross margin	44.1		%	46.3		%	(220) bps		44.7		%	45.6		%	(90) bps
Selling, general and administrative expenses	165.9			161.9			2	%	529.9			483.7			10	%
Restructuring expenses and asset impairments	4.1			17.7			(77	%)	8.2			21.1			(61	%)
Operating income	179.6			202.2			(11	%)	572.0			576.4			(1	%)
Gain on sale of business	(93.8)			(34.8)			170	%	(93.8)			(34.8)			170	%
Other (income) expense - net	(2.1)			(1.0)			110	%	5.6			(3.3)			(270	%)
Interest expense	13.7			9.6			43	%	40.1			28.6			40	%
Income before income taxes	261.8			228.4			15	%	620.1			585.9			6	%
Provision for income taxes	52.8			49.7			6	%	132.8			129.2			3	%
Effective tax rate	20.2		%	21.8		%	(160) bps		21.4		%	22.1		%	(70) bps
Net income attributable to IDEX	$	209.1		$	178.7		17	%	$	487.5		$	456.9		7	%
Diluted earnings per common share attributable to IDEX	$	2.75		$	2.36		17	%	$	6.42		$	6.00		7	%

Net Sales

Net sales for the three months ended September 30, 2023 decreased 4% as compared to the same prior year period. Organic sales decreased 6% driven by the impact of current market conditions on volumes in the Health & Science Technologies businesses, partially offset by price capture across all segments. This decrease, combined with the acceleration of previously deferred revenue related to the exit of a COVID-19 testing application in 2022 that did not reoccur in 2023 (see Note 12 in the Notes to Condensed Consolidated Financial Statements for further detail), was partially offset by acquisition-related growth, net of divestitures, of 3% (see Note 2 in the Notes to Condensed Consolidated Financial Statements for further detail on acquisitions and divestitures) and a favorable impact from foreign currency translation.

Net sales for the nine months ended September 30, 2023 increased 5% as compared to the same prior year period driven by a 5% increase in acquisitions, net of divestitures, and a 1% increase in organic sales. Price capture offset the impact of lower volumes in the Health & Science Technologies segment as well as the acceleration of previously deferred revenue in 2022 that did not reoccur in 2023, both of which are discussed above.

In the three months ended September 30, 2023, net sales decreased 10% domestically and increased 4% internationally, and sales to customers outside the U.S. were approximately 49% of total sales in the third quarter of 2023 compared with 46% during the same period in 2022. In the nine months ended September 30, 2023, net sales were flat domestically and increased 10% internationally, and sales to customers outside the U.S. were approximately 50% of total sales in the first nine months of 2023 compared with 48% during the same period in 2022.

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Cost of Sales

Cost of sales for both the three and nine months ended September 30, 2023 increased due to acquisitions, net of divestitures, inflation and higher employee-related costs, partially offset by lower sales volume.

Gross Profit and Gross Margin

Gross profit and Gross margin for the three and nine months ended September 30, 2023 were positively impacted by strong operational productivity and price/cost and negatively impacted by lower volume leverage, unfavorable mix and higher employee-related costs. While acquisitions, net of divestitures, as well as the acceleration of previously deferred revenue related to the exit of a COVID-19 testing application in 2022 that did not reoccur in 2023 also positively impacted Gross profit, they resulted in a dilutive impact to overall Gross margin.

Selling, General and Administrative Expenses

Selling, general and administrative expenses in the three months ended September 30, 2023 increased primarily due to the $11.0 million impact from acquisitions, including amortization, net of divestitures. Excluding this impact, selling, general and administrative expenses decreased by $7.0 million as compared with the same prior year period primarily due to lower employee-related costs, including the impact of executive forfeitures recorded during the current year period as well as the timing of retirement eligibility of participants.

Selling, general and administrative expenses in the nine months ended September 30, 2023 increased primarily due to the $40.0 million impact from acquisitions, including amortization, net of divestitures, as well as increases in employee-related costs, which include accelerated stock compensation costs for retiree eligible participants.

Restructuring Expenses and Asset Impairments

Restructuring expenses and asset impairments decreased in both the three and nine months ended September 30, 2023 primarily due to an asset impairment charge of $16.8 million related to the exit of a COVID-19 testing application in 2022, partially offset by higher severance costs in 2023 incurred in conjunction with cost mitigation efforts as a result of current market conditions. See Note 12 in the Notes to Condensed Consolidated Financial Statements for further detail.

Gain on Sale of Business

In the third quarter of 2023, the Company completed the sale of Micropump for proceeds of $110.3 million, net of cash remitted, resulting in a pre-tax gain on the sale of $93.8 million. In the third quarter of 2022, the Company completed the sale of Knight for proceeds of $49.4 million, net of cash remitted, resulting in a pre-tax gain on the sale of $34.8 million.

Other (Income) Expense - Net

Other (income) expense - net increased to $2.1 million of income in the three months ended September 30, 2023 compared to $1.0 million of income during the same period in 2022. The increase was primarily due to higher interest earned in 2023.

Other (income) expense - net decreased to $5.6 million of expense in the nine months ended September 30, 2023 compared to $3.3 million of income during the same period in 2022. The increase in expense was primarily due to a $7.7 million credit loss reserve on a note receivable from a collaborative partner (see N ote 3 in the Notes to Condensed Consolidated Financial Statements for further detail), higher foreign currency transaction losses and $2.7 million of gains on the sale of assets in 2022 that did not reoccur in 2023, partially offset by higher interest earned in 2023.

Interest Expense

Interest expense for the three and nine months ended September 30, 2023 increased compared to the same period in 2022 due to the borrowings incurred under the Revolving Credit Facility and the Term Facility in connection with the Muon Group acquisition in November 2022 as well as higher interest rates on the Company’s indebtedness.

Income Taxes

The effective tax rates of 20.2% and 21.4% for the three and nine months ended September 30, 2023, respectively, decreased as compared with the effective tax rates of 21.8% and 22.1% during the same periods in 2022 primarily due to the

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finalization of both research expenditure capitalization on foreign derived income as well as the reduction of tax related to the treatment of the acquisition of Muon Group acquisition.

Results of Reportable Business Segments

The Company has three reportable segments: Fluid & Metering Technologies (“FMT”), Health & Science Technologies (“HST”) and Fire & Safety/Diversified Products (“FSDP”). For a detailed description of the operations within each segment, refer to Note 4 in the Notes to Condensed Consolidated Financial Statements.

Within its three reportable segments, the Company maintains 12 reporting units where the Company focuses on organic growth and strategic acquisitions. Management’s primary measurements of segment performance are sales, adjusted earnings before interest, income taxes, depreciation and amortization (“Adjusted EBITDA”) and Adjusted EBITDA margin.

FMT

HST(1)

FSDP

Pumps

Scientific Fluidics & Optics

Fire & Safety

Water

Sealing Solutions

Dispensing

Energy

Performance Pneumatic Technologies

BAND-IT

Valves

Material Processing Technologies

Agriculture

(1) The results of operations of Micropump (sold on August 3, 2023) have been included in the Company’s Condensed Consolidated Statements of Income through the date of disposition.

The table below illustrates the share of Net sales and Adjusted EBITDA contributed by each segment on the basis of total segments (not total Company) for the three and nine months ended September 30, 2023.


	Three Months Ended September 30, 2023								Nine Months Ended September 30, 2023
	FMT		HST		FSDP		IDEX		FMT		HST		FSDP		IDEX
Net sales	38	%	39	%	23	%	100	%	38	%	40	%	22	%	100	%
Adjusted EBITDA(1)	43	%	35	%	22	%	100	%	42	%	37	%	21	%	100	%

(1) Segment Adjusted EBITDA excludes the impact of unallocated corporate costs of $15.3 million and $63.7 million for the three and nine months ended September 30, 2023, respectively.

Fluid & Metering Technologies Segment


	Three Months Ended September 30,							Components of Change
(Dollars in millions)	2023			2022			Change	Organic	Acq/Div(1)	Foreign Currency	Total
Domestic sales	$	168.4		$	178.4		(6%)
International sales	132.7			129.2			3%
Net sales(2)	301.1			307.6			(2%)	(1%)	(2%)	1%	(2%)
Adjusted EBITDA	$	103.6		$	104.4		(1%)	—	(1%)	—	(1%)
Adjusted EBITDA margin	34.4		%	33.9		%	50 bps	50 bps	—	—	50 bps

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	Nine Months Ended September 30,							Components of Change
(Dollars in millions)	2023			2022			Change	Organic(3)	Acq/Div(1)(3)	Foreign Currency	Total
Domestic sales	$	525.9		$	498.9		5%
International sales	422.1			380.6			11%
Net sales(2)	948.0			879.5			8%	6%	2%	—	8%
Adjusted EBITDA	$	323.9		$	287.8		13%	11%	2%	—	13%
Adjusted EBITDA margin	34.2		%	32.7		%	150 bps	170 bps	(20) bps	—	150 bps

(1) Divestitures included Knight sold in September 2022.

(2) Net sales to customers outside the U.S. were approximately 44% of total segment sales in the third quarter of 2023 compared with 42% during the same period in 2022 and approximately 45% of total segment sales in the first nine months of 2023 compared with 43% during the same period in 2022.

(3) Based on the timing of the acquisitions, Nexsight results for the first three months of 2023 and KZValve results for the first four months of 2023 are reflected in the acquisitions/divestitures column while the remaining year-over-year impact is included in the organic column.

•Organic net sales for both the three and nine months ended September 30, 2023 was positively impacted by the following:

◦Water reporting unit driven by price capture, favorability in the municipal water market, targeted growth performance and operational execution;

◦Energy reporting unit driven by operational execution related to backlog reduction, improved supply chain conditions, price capture and growth initiatives; and

◦Valves reporting unit driven by strong price capture and demand in Asia.

Organic net sales for both the three and nine months ended September 30, 2023 was negatively impacted by the Agriculture reporting unit driven by distribution inventory recalibration, partially offset by positive OEM demand.

In addition, within the Pumps reporting unit, strong price capture only partially offset the impact of softness in the industrial market during the three months ended September 30, 2023, while strong price capture and operational execution more than offset the impact of softness in the industrial market during the nine months ended September 30, 2023.

•The increase in Adjusted EBITDA margin for both the three and nine months ended September 30, 2023 was primarily due to strong price/cost, favorable operational productivity and lower discretionary spending, partially offset by lower volume leverage and higher employee-related costs. In addition, unfavorable mix negatively impacted the nine months ended September 30, 2023.

Health & Science Technologies Segment


	Three Months Ended September 30,							Components of Change
(Dollars in millions)	2023			2022			Change	Organic	Acq/Div(1)	Other(2)	Foreign Currency	Total
Domestic sales	$	139.2		$	175.0		(20%)
International sales	174.0			170.0			2%
Net sales(3)	313.2			345.0			(9%)	(15%)	10%	(5%)	1%	(9%)
Adjusted net sales(4)	313.2			327.1			(4%)	(15%)	10%	—	1%	(4%)
Adjusted EBITDA	84.4			101.4			(17%)	(25%)	8%	—	—	(17%)
Adjusted EBITDA margin	26.9		%	31.0		%	(410) bps	(370) bps	(40) bps	—	—	(410) bps

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	Nine Months Ended September 30,							Components of Change
(Dollars in millions)	2023			2022			Change	Organic	Acq/Div(1)	Other(2)	Foreign Currency	Total
Domestic sales	$	437.3		$	484.7		(10%)
International sales	566.4			501.5			13%
Net sales(3)	1,003.7			986.2			2%	(6%)	10%	(2%)	—	2%
Adjusted net sales(4)	1,003.7			968.3			4%	(6%)	10%	—	—	4%
Adjusted EBITDA	278.8			304.8			(9%)	(18%)	9%	—	—	(9%)
Adjusted EBITDA margin	27.8		%	31.5		%	(370) bps	(370) bps	(10) bps	—	10 bps	(370) bps

(1) Acquisitions included Iridian acquired in May 2023 and Muon Group acquired in November 2022. Divestitures included Micropump sold in August 2023.

(2) Includes the impact of the acceleration of previously deferred revenue of $17.9 million as a result of a customer’s decision to discontinue further investment in commercializing its COVID-19 testing application in 2022 that did not reoccur in 2023. See Note 1 2 in the Notes to Consolidated Financial Statements for further detail.

(3) Net sales to customers outside the U.S. were approximately 56% of total segment sales in the third quarter of 2023 compared with 49% during the same period in 2022 and approximately 56% of total segment sales in the first nine months of 2023 compared with 51% during the same period in 2022.

(4) Adjusted net sales is a non-GAAP measure. Adjusted net sales is calculated as net sales less the acceleration of previously deferred revenue related to the exit of a COVID-19 testing application. See the reconciliation of adjusted net sales to its most directly comparable financial measure under the heading “Non-GAAP Disclosures.” Adjusted net sales is used in the calculation of Adjusted EBITDA margin for the three and nine months ended September 30, 2022. See Note 12 in the Notes to Consolidated Financial Statements for further detail.

•The decrease in organic net sales for both the three and nine months ended September 30, 2023 was attributed to decreases in the following:

◦Scientific Fluidics & Optics reporting unit driven by lower demand from Analytical Instrumentation and Life Science original equipment manufacturers due to customer inventory recalibration and market slowing, partially offset by price capture;

◦Sealing Solutions reporting unit driven by softness in the semiconductor market; and

◦Material Processing Technologies reporting unit driven by lower demand in the pharma/biopharma and food/nutrition markets, partially offset by operational execution related to backlog reduction and price capture.

In addition, within the Performance Pneumatics Technologies reporting unit, price capture only partially offset the impact of softness in the industrial market during the three months ended September 30, 2023, while targeted growth performance and price capture more than offset the impact of softness in the industrial market during the nine months ended September 30, 2023.

•The decrease in Adjusted EBITDA margin for both the three and nine months ended September 30, 2023 was primarily due to lower volume leverage and unfavorable mix, partially offset by strong price/cost, favorable operational productivity and lower discretionary spending. In addition, higher employee-related costs negatively impacted Adjusted EBITDA during the nine months ended September 30, 2023.

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Fire & Safety/Diversified Products Segment


	Three Months Ended September 30,							Components of Change
(Dollars in millions)	2023			2022			Change	Organic	Acq/Div	Foreign Currency	Total
Domestic sales	$	94.4		$	93.5		1%
International sales	86.2			78.9			9%
Net sales(1)	180.6			172.4			5%	3%	—	2%	5%
Adjusted EBITDA	52.8			47.8			10%	8%	—	2%	10%
Adjusted EBITDA margin	29.3		%	27.8		%	150 bps	150 bps	—	—	150 bps


	Nine Months Ended September 30,							Components of Change
(Dollars in millions)	2023			2022			Change	Organic	Acq/Div	Foreign Currency	Total
Domestic sales	$	280.5		$	255.0		10%
International sales	259.3			253.3			2%
Net sales(1)	539.8			508.3			6%	7%	—	(1%)	6%
Adjusted EBITDA	157.0			137.3			14%	14%	—	—	14%
Adjusted EBITDA margin	29.1		%	27.0		%	210 bps	210 bps	—	—	210 bps

(1) Net sales to customers outside the U.S. were approximately 48% of total segment sales in the third quarter of 2023 compared with 46% during the same period in 2022 and approximately 48% of total segment sales in the first nine months of 2023 compared with 50% during the same period in 2022.

•The change in organic net sales for both the three and nine months ended September 30, 2023 was attributed to an increase in the Fire & Safety reporting unit driven by price capture, continued demand for rescue tools, improved supply chain conditions and operational execution. This increase was partially offset by a decrease in the Dispensing report unit driven by timing of deliveries within Europe and Asia, partially offset by higher North American project sales. In addition, within the BAND-IT reporting unit, continued share gain in an otherwise flat automotive market positively impacted the three months ended September 30, 2023 while a decline in the aerospace and energy markets negatively impacted the three and nine months ended September 30, 2023.

•The increase in Adjusted EBITDA margin for both the three and nine months ended September 30, 2023 was primarily due to strong price/cost and favorable operational productivity, partially offset by unfavorable mix as well as higher employee-related costs and discretionary spending. In addition, lower volume leverage negatively impacted the three months ended September 30, 2023, while higher volume leverage positively impacted the nine months ended September 30, 2023.

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Liquidity and Capital Resources

Liquidity

Based on management’s current expectations and currently available information, the Company believes current cash, cash from operations and cash available under the Revolving Credit Facility will be sufficient to meet its operating cash requirements, planned capital expenditures, interest and principal payments on all borrowings, pension and postretirement funding requirements, share repurchases and quarterly dividend payments to holders of the Company’s common stock for the foreseeable future. Additionally, in the event that suitable businesses are available for acquisition upon acceptable terms, the Company may obtain all or a portion of the financing for these acquisitions through the incurrence of additional borrowings.

Select key liquidity metrics at September 30, 2023 are as follows:


(In millions)	September 30, 2023
Working capital	$	1,030.7
Current ratio	3.1 to 1
Cash and cash equivalents	$	562.7
Cash held outside of the United States	427.7
Revolving Credit Facility capacity	$	800.0
Borrowings	76.9
Letters of credit	7.2
Revolving Credit Facility availability	$	715.9

The Company believes that additional borrowings through various financing alternatives remain available, if required.

Operating Working Capital

Operating working capital, calculated as Receivables plus Inventories minus Trade accounts payable, is used by management as a measurement of operational results as well as the short-term liquidity of the Company. The following table details operating working capital as of September 30, 2023 and December 31, 2022:


(In millions)	September 30, 2023		December 31, 2022
Receivables	$	430.6	$	442.8
Inventories	446.6		470.9
Less: Trade accounts payable	176.3		208.9
Operating working capital	$	700.9	$	704.8

Operating working capital decreased $3.9 million to $700.9 million during the nine months ended September 30, 2023. Acquisitions, divestitures and foreign currency translation contributed $3.7 million to the decrease in Operating working capital. Reduced inventory levels were largely offset by lower levels of accounts payable and strong price capture partially offset the impact of lower volume on Receivables.

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Cash Flow Summary

The following table is derived from the Condensed Consolidated Statements of Cash Flows:


	Nine Months Ended September 30,
(In millions)	2023		2022
Net cash flows provided by (used in):
Operating activities	$	515.7	$	390.1
Investing activities	(90.0)		(224.4)
Financing activities	(286.7)		(274.6)

Operating Activities

Cash flows provided by operating activities increased $125.6 million to $515.7 million in the nine months ended September 30, 2023 primarily due to lower investments in working capital in 2023 as a result of efforts to recalibrate inventory levels in response to normalizing market conditions. The prior year period included investments in operating working capital related to higher volumes and increased inventories to support production amid supply chain challenges.

Investing Activities

Cash flows used in investing activities decreased during the nine months ended September 30, 2023 primarily due to the purchase of Iridian in 2023 for $110.3 million as compared with the purchases of Nexsight and KZValve in 2022 for $232.6 million as well as proceeds of $110.3 million in 2023 from the sale of Micropump as compared with $49.4 million in 2022 from the sale of Knight. These decreases in cash flows used in investing activities were partially offset by higher capital expenditures of $68.3 million in 2023 as compared with $48.0 million in 2022 and the purchase of marketable securities in 2023 for $24.6 million.

Financing Activities

Cash flows used in financing activities during the nine months ended September 30, 2023 primarily consisted of payments of $150.0 million on the Term Facility and dividends of $142.3 million paid to common shareholders. Cash flows used in financing activities during the nine months ended September 30, 2022 primarily consisted of the repurchase of 788,623 shares for $146.3 million and dividends of $132.2 million paid to common shareholders.

Free Cash Flow

The Company believes free cash flow, a non-GAAP measure, is an important measure of performance because it provides a measurement of cash generated from operations that is available for payment obligations such as operating cash requirements, planned capital expenditures, interest and principal payments on all borrowings, pension and postretirement funding requirements and quarterly dividend payments to holders of the Company’s common stock as well as for funding acquisitions and share repurchases. Free cash flow is calculated as cash flows provided by operating activities less capital expenditures.

The following table reconciles free cash flow to cash flows provided by operating activities:


	Nine Months Ended September 30,
(Dollars in millions)	2023			2022
Cash flows provided by operating activities	$	515.7		$	390.1
Less: capital expenditures	68.3			48.0
Free cash flow	$	447.4		$	342.1
Free cash flow as a percent of adjusted net income attributable to IDEX	92.3		%	73.5		%

The increase in free cash flow as compared to 2022 is due to lower investments in working capital in 2023 as discussed above as compared with 2022, partially offset by higher capital expenditures.

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Cash Requirements

Capital Expenditures

Capital expenditures generally include machinery and equipment that support growth and improved productivity, tooling, business system technology, replacement of equipment and investments in new facilities. The Company believes it has sufficient operating cash flows to continue to meet current obligations and invest in planned capital expenditures. Cash flows from operations were more than adequate to fund capital expenditures of $68.3 million and $48.0 million in the first nine months of 2023 and 2022, respectively.

Share Repurchases

During the nine months ended September 30, 2023, the Company repurchased 5,400 shares at a cost of $1.1 million. As of September 30, 2023, the amount of share repurchase authorization remaining was $562.8 million. For additional information regarding the Company’s share repurchase program, refer to Note 14 in the Notes to Condensed Consolidated Financial Statements.

Dividends

Total dividend payments to common shareholders were $142.3 million during the nine months ended September 30, 2023 compared with $132.2 million during the nine months ended September 30, 2022.

Covenants

The key financial covenants that the Company is required to maintain in connection with the Revolving Credit Facility, the Term Facility, the 3.37% Senior Notes and the 5.13% Senior Notes, are a minimum interest coverage ratio of 3.0 to 1 and a maximum leverage ratio of 3.50 to 1. At September 30, 2023, the Company was in compliance with these financial covenants, as the Company’s interest coverage ratio was 18.62 to 1 for covenant calculation purposes and the leverage ratio was 1.42 to 1. There are no financial covenants relating to the 2.625% Senior Notes or the 3.00% Senior Notes; however, both are subject to cross-default provisions.

Credit Ratings

The Company’s credit ratings, which were independently developed by the following credit agencies, are detailed below:

•S&P Global Ratings reaffirmed the Company’s corporate credit rating of BBB (stable outlook) in August 2023.

•Moody’s Investors Service affirmed the Company’s corporate credit rating of Baa2 (stable outlook) in December 2021.

•Fitch Ratings reaffirmed the Company’s corporate credit rating of BBB+ (stable outlook) in April 2023.

Critical Accounting Estimates

As discussed in the Annual Report on Form 10-K for the year ended December 31, 2022, the preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and judgments that affect the reported amount of assets and liabilities, disclosure of contingent assets and liabilities, and reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. There have been no changes to the Company’s critical accounting estimates described in the Annual Report on Form 10-K for the year ended December 31, 2022.

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Non-GAAP Disclosures

Set forth below are reconciliations of Organic net sales, Adjusted net sales, Adjusted gross profit, Adjusted gross margin, Adjusted net income attributable to IDEX, Adjusted diluted earnings per share (“EPS”) attributable to IDEX, Consolidated Adjusted earnings before interest, income taxes, depreciation and amortization (“Adjusted EBITDA”) and Consolidated Adjusted EBITDA margin to their respective most directly comparable U.S. GAAP measure. Management uses these metrics to measure performance of the Company since they exclude items that are not reflective of ongoing operations, as identified in the reconciliations below. Management also supplements its U.S. GAAP financial statements with adjusted information to provide investors with greater insight, transparency and a more comprehensive understanding of the information used by management in its financial and operational decision making.

This report references organic sales, a non-GAAP measure, that excludes (1) the impact of foreign currency translation and (2) sales from acquired or divested businesses during the first 12 months of ownership or prior to divestiture and (3) the impact from the exit of a COVID-19 testing application. The portion of sales attributable to foreign currency translation is calculated as the difference between (a) the period-to-period change in organic sales and (b) the period-to-period change in organic sales after applying prior period foreign exchange rates to the current year period. Management believes that reporting organic sales provides useful information to investors by helping to identify underlying growth trends in the Company’s business and facilitating easier comparisons of the Company’s revenue with prior and future periods and to its peers. The Company excludes the effect of foreign currency translation from organic sales because foreign currency translation is not under management’s control, is subject to volatility and can obscure underlying business trends. The Company excludes the effect of acquisitions and divestitures because they can obscure underlying business trends and make comparisons of long-term performance difficult due to the varying nature, size and number of transactions from period to period and between the Company and its peers. The Company excludes the impact from the exit of a COVID-19 testing application because it is not reflective of ongoing operations and can obscure underlying business trends.

Management believes that Adjusted EBITDA, which is EBITDA adjusted for items that are not reflective of ongoing operations, is useful as a performance indicator of ongoing operations. The Company believes that Adjusted EBITDA is useful to investors as an indicator of the strength and performance of the Company and its segments’ ongoing business operations as well as a way to evaluate and compare operating performance and value companies within the Company’s industry. Management believes that Adjusted EBITDA margin is useful for the same reason as Adjusted EBITDA. The definition of Adjusted EBITDA used here may differ from that used by other companies.

This report also references free cash flow. This non-GAAP measure is discussed and reconciled to its most directly comparable U.S. GAAP measure in the section titled “Free Cash Flow.”

The non-GAAP financial measures disclosed by the Company should not be considered a substitute for, or superior to, financial measures prepared in accordance with U.S. GAAP. Due to rounding, numbers presented throughout this and other documents may not add up or recalculate precisely. The financial results prepared in accordance with U.S. GAAP and the reconciliations from these results should be carefully evaluated.


1. Reconciliations of the Change in Net Sales to Organic Net Sales

	Three Months Ended September 30, 2023
	FMT		HST		FSDP		IDEX
Change in net sales	(2	%)	(9	%)	5	%	(4	%)
Net impact from acquisitions/divestitures	2	%	(10	%)	—	%	(3	%)
Impact from foreign currency	(1	%)	(1	%)	(2	%)	(1	%)
Impact from the exit of a COVID-19 testing application(1)	—	%	5	%	—	%	2	%
Change in organic net sales	(1	%)	(15	%)	3	%	(6	%)

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	Nine Months Ended September 30, 2023
	FMT		HST		FSDP		IDEX
Change in net sales	8	%	2	%	6	%	5	%
Net impact from acquisitions/divestitures	(2	%)	(10	%)	—	%	(5	%)
Impact from foreign currency	—	%	—	%	1	%	—	%
Impact from the exit of a COVID-19 testing application(1)	—	%	2	%	—	%	1	%
Change in organic net sales	6	%	(6	%)	7	%	1	%

(1) Represents the acceleration of previously deferred revenue of $17.9 million as a result of a customer’s decision to discontinue further investment in commercializing its COVID-19 testing application in 2022 that did not reoccur in 2023. See Note 12 in the Notes to Condensed Consolidated Financial Statements for further detail.


2. Reconciliations of Reported-to-Adjusted Gross Profit, Net Sales and Gross Margin (dollars in millions)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2023			2022			2023			2022
Gross profit	$	349.6		$	381.8		$	1,110.1		$	1,081.2
Impact from the exit of a COVID-19 testing application(1)	—			(17.9)			—			(17.9)
Fair value inventory step-up charges	1.2			—			1.2			0.4
Adjusted gross profit	$	350.8		$	363.9		$	1,111.3		$	1,063.7

Net sales	$	793.4		$	824.0		$	2,485.0		$	2,371.2
Impact from the exit of a COVID-19 testing application(1)	—			(17.9)			—			(17.9)
Adjusted net sales	$	793.4		$	806.1		$	2,485.0		$	2,353.3

Gross margin	44.1		%	46.3		%	44.7		%	45.6		%
Adjusted gross margin	44.2		%	45.1		%	44.7		%	45.2		%

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3. Reconciliations of Reported-to-Adjusted Net Income Attributable to IDEX and Diluted EPS Attributable to IDEX (in millions)

	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Reported net income attributable to IDEX	$	209.1	$	178.7	$	487.5	$	456.9
Fair value inventory step-up charges	1.2		—		1.2		0.4
Tax impact on fair value inventory step-up charges	(0.3)		—		(0.3)		(0.1)
Restructuring expenses and asset impairments	4.1		—		8.2		2.8
Tax impact on restructuring expenses and asset impairments	(0.9)		—		(1.8)		(0.7)
Net impact from the exit of a COVID-19 testing application(1)	—		(1.1)		—		(1.1)
Tax impact on the exit of a COVID-19 testing application	—		0.3		—		0.3
Gain on sale of business	(93.8)		(34.8)		(93.8)		(34.8)
Tax impact on gain on sale of business	22.7		5.5		22.7		5.5
Gains on sales of assets	—		—		—		(2.7)
Tax impact on gains on sales of assets	—		—		—		0.6
Credit loss on note receivable from collaborative partner(2)	—		—		7.7		—
Tax impact on credit loss on note receivable from collaborative partner	—		—		(1.6)		—
Acquisition-related intangible asset amortization	23.8		17.0		70.6		49.2
Tax impact on acquisition-related intangible asset amortization	(5.3)		(3.7)		(15.8)		(11.0)
Adjusted net income attributable to IDEX	$	160.6	$	161.9	$	484.6	$	465.3

(1) Represents the net impact of the acceleration of previously deferred revenue of $17.9 million and an impairment charge of $16.8 million as a result of a customer’s decision to discontinue further investment in commercializing its COVID-19 testing application in 2022 that did not reoccur in 2023. See Note 12 in the Notes to Condensed Consolidated Financial Statements for further detail.

(2) Represents a reserve recorded on an investment with a collaborative partner that may no longer be recoverable. See Note 3 in the Notes to Condensed Consolidated Financial Statements for further detail.

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3. Reconciliations of Reported-to-Adjusted Net Income Attributable to IDEX and Diluted EPS Attributable to IDEX (continued)

	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Reported diluted EPS attributable to IDEX	$	2.75	$	2.36	$	6.42	$	6.00
Fair value inventory step-up charges	0.02		—		0.02		—
Tax impact on fair value inventory step-up charges	—		—		—		—
Restructuring expenses and asset impairments	0.06		—		0.11		0.04
Tax impact on restructuring expenses and asset impairments	(0.01)		—		(0.03)		(0.01)
Net impact from the exit of a COVID-19 testing application(1)	—		(0.01)		—		(0.01)
Tax impact on the exit of a COVID-19 testing application	—		—		—		—
Gain on sale of business	(1.24)		(0.46)		(1.24)		(0.46)
Tax impact on gain on sale of business	0.30		0.07		0.30		0.07
Gains on sales of assets	—		—		—		(0.03)
Tax impact on gains on sales of assets	—		—		—		0.01
Credit loss on note receivable from collaborative partner(2)	—		—		0.10		—
Tax impact on credit loss on note receivable from collaborative partner	—		—		(0.02)		—
Acquisition-related intangible asset amortization	0.31		0.23		0.93		0.65
Tax impact on acquisition-related intangible asset amortization	(0.07)		(0.05)		(0.21)		(0.14)
Adjusted diluted EPS attributable to IDEX	$	2.12	$	2.14	$	6.38	$	6.12

Diluted weighted average shares outstanding	75.9		75.8		75.9		76.1

(1) Represents the net impact of the acceleration of previously deferred revenue of $17.9 million and an impairment charge of $16.8 million as a result of a customer’s decision to discontinue further investment in commercializing its COVID-19 testing application in 2022 that did not reoccur in 2023. See Note 1 2 in the Notes to Condensed Consolidated Financial Statements for further detail.

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4. Reconciliations of Net Income to Adjusted EBITDA and Net Sales to Adjusted Net Sales (dollars in millions)

	Three Months Ended September 30,
	2023														2022
	FMT			HST			FSDP			Corporate		IDEX			FMT			HST			FSDP			Corporate		IDEX
Reported net income	$	—		$	—		$	—		$	—	$	209.0		$	—		$	—		$	—		$	—	$	178.7
Provision for income taxes	—			—			—			—		52.8			—			—			—			—		49.7
Interest expense	—			—			—			—		13.7			—			—			—			—		9.6
Other (income) expense - net	—			—			—			—		(2.1)			—			—			—			—		(1.0)
(Gain) on sale of business	—			—			—			—		(93.8)			—			—			—			—		(34.8)
Operating income (loss)	92.1			54.7			48.4			(15.6)		179.6			94.5			85.6			43.6			(21.5)		202.2
Other income (expense) - net	1.1			1.3			0.2			(0.5)		2.1			0.2			1.1			0.5			(0.8)		1.0
Depreciation	3.1			9.0			2.3			0.3		14.7			3.9			6.2			2.1			0.1		12.3
Amortization	5.6			16.7			1.5			—		23.8			5.8			9.6			1.6			—		17.0
Fair value inventory step-up charges	—			1.2			—			—		1.2			—			—			—			—		—
Restructuring expenses and asset impairments	1.7			1.5			0.4			0.5		4.1			—			—			—			—		—
Net impact from the exit of a COVID-19 testing application(1)	—			—			—			—		—			—			(1.1)			—			—		(1.1)
Adjusted EBITDA	$	103.6		$	84.4		$	52.8		$	(15.3)	$	225.5		$	104.4		$	101.4		$	47.8		$	(22.2)	$	231.4

Net sales (eliminations)	$	301.1		$	313.2		$	180.6		$	(1.5)	$	793.4		$	307.6		$	345.0		$	172.4		$	(1.0)	$	824.0
Impact from the exit of a COVID-19 testing application(1)	—			—			—			—		—			—			(17.9)			—			—		(17.9)
Adjusted net sales (eliminations)	$	301.1		$	313.2		$	180.6		$	(1.5)	$	793.4		$	307.6		$	327.1		$	172.4		$	(1.0)	$	806.1

Net income margin												26.3		%												21.7		%
Adjusted EBITDA margin	34.4		%	26.9		%	29.3		%	n/m		28.4		%	33.9		%	31.0		%	27.8		%	n/m		28.7		%

(1) The net impact in the Adjusted EBITDA reconciliation represents the acceleration of previously deferred revenue of $17.9 million less the impairment charge of $16.8 million related to a customer's decision to discontinue further investment in commercializing its COVID-19 testing application in 2022 that did not reoccur in 2023, while the impact in the Adjusted net sales reconciliation represents only the acceleration of previously deferred revenue of $17.9 million discussed above. See Note 12 in the Notes to Condensed Consolidated Financial Statements for further detail.

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4. Reconciliations of Net Income to Adjusted EBITDA and Net Sales to Adjusted Net Sales (dollars in millions) (continued)

	Nine Months Ended September 30,
	2023														2022
	FMT			HST			FSDP			Corporate		IDEX			FMT			HST			FSDP			Corporate		IDEX
Reported net income	$	—		$	—		$	—		$	—	$	487.3		$	—		$	—		$	—		$	—	$	456.7
Provision for income taxes	—			—			—			—		132.8			—			—			—			—		129.2
Interest expense	—			—			—			—		40.1			—			—			—			—		28.6
Other (income) expense - net	—			—			—			—		5.6			—			—			—			—		(3.3)
(Gain) on sale of business	—			—			—			—		(93.8)			—			—			—			—		(34.8)
Operating income (loss)	291.9			199.7			145.0			(64.6)		572.0			257.8			255.7			124.0			(61.1)		576.4
Other income (expense) - net	2.0			0.8			(0.3)			(8.1)		(5.6)			2.0			2.5			2.6			(3.8)		3.3
Depreciation	10.3			24.1			6.7			0.8		41.9			12.0			18.4			6.3			0.3		37.0
Amortization	17.3			48.5			4.8			—		70.6			15.1			29.2			4.9			—		49.2
Fair value inventory step-up charges	—			1.2			—			—		1.2			0.4			—			—			—		0.4
Restructuring expenses and asset impairments	2.4			4.5			0.8			0.5		8.2			1.7			0.1			1.0			—		2.8
Net impact from the exit of a COVID-19 testing application(1)	—			—			—			—		—			—			(1.1)			—			—		(1.1)
Gains on sales of assets	—			—			—			—		—			(1.2)			—			(1.5)			—		(2.7)
Credit loss on note receivable from collaborative partner(2)	—			—			—			7.7		7.7			—			—			—			—		—
Adjusted EBITDA	$	323.9		$	278.8		$	157.0		$	(63.7)	$	696.0		$	287.8		$	304.8		$	137.3		$	(64.6)	$	665.3

Net sales (eliminations)	$	948.0		$	1,003.7		$	539.8		$	(6.5)	$	2,485.0		$	879.5		$	986.2		$	508.3		$	(2.8)	$	2,371.2
Impact from the exit of a COVID-19 testing application(1)	—			—			—			—		—			—			(17.9)			—			—		(17.9)
Adjusted net sales (eliminations)	$	948.0		$	1,003.7		$	539.8		$	(6.5)	$	2,485.0		$	879.5		$	968.3		$	508.3		$	(2.8)	$	2,353.3

Net income margin												19.6		%												19.3		%
Adjusted EBITDA margin	34.2		%	27.8		%	29.1		%	n/m		28.0		%	32.7		%	31.5		%	27.0		%	n/m		28.3		%

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Cautionary Statement Under the Private Securities Litigation Reform Act

This quarterly report on Form 10-Q, including the “Overview,” “Results of Operations” and “Liquidity and Capital Resources” sections of this Management’s Discussion and Analysis of Financial Condition and Results of Operations, contains “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. These statements may relate to, among other things, anticipated changes in the fourth quarter of 2023, anticipated future acquisition behavior, expectations regarding customer destocking efforts and future order stabilization and lead time, availability of cash and financing alternatives and the anticipated benefits of the Company’s recent acquisitions, and are indicated by words or phrases such as “anticipates,” “estimates,” “plans,” “guidance,” “expects,” “projects,” “forecasts,” “should,” “could,” “will,” “management believes,” “the Company believes,” “the Company intends” and similar words or phrases. These statements are subject to inherent uncertainties and risks that could cause actual results to differ materially from those anticipated at the date of this report.

The risks and uncertainties include, but are not limited to, the following: levels of industrial activity and economic conditions in the U.S. and other countries around the world, including uncertainties in the financial markets and adverse developments affecting the financial services industry; pricing pressures, including inflation and rising interest rates, and other competitive factors and levels of capital spending in certain industries, all of which could have a material impact on order rates and the Company’s results; the impact of health epidemics and pandemics and terrorist attacks and wars, which could have an adverse impact on the Company's business by creating disruptions in the global supply chain and by potentially having an adverse impact on the global economy; the Company’s ability to make acquisitions and to integrate and operate acquired businesses on a profitable basis; the relationship of the U.S. dollar to other currencies and its impact on pricing and cost competitiveness; political and economic conditions in foreign countries in which the Company operates; developments with respect to trade policy and tariffs; capacity utilization and the effect this has on costs; labor markets; supply chain conditions; market conditions and material costs; risks related to environmental, social and corporate governance issues, including those related to climate change and sustainability; and developments with respect to contingencies, such as litigation and environmental matters.

Additional factors that could cause actual results to differ materially from those reflected in the forward-looking statements include, but are not limited to, the risks discussed in the “Risk Factors” section included in the Company’s most recent annual report on Form 10-K and the Company’s subsequent quarterly reports filed with the Securities and Exchange Commission (“SEC”) and the other risks discussed in the Company’s filings with the SEC. The forward-looking statements included here are only made as of the date of this report, and management undertakes no obligation to publicly update them to reflect subsequent events or circumstances, except as may be required by law. Investors are cautioned not to rely unduly on forward-looking statements when evaluating the information presented here.

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

There have been no material changes with respect to market risks disclosed in the Company's Annual Report on Form 10-K for the year ended December 31, 2022.

Item 4. Controls and Procedures

The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the Company’s Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to the Company’s management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

As required by SEC Rule 13a-15(b), the Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures as of the end of the period covered by this report. Based on the foregoing, the Company’s Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of September 30, 2023.

There has been no change in the Company’s internal control over financial reporting during the Company’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

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PART II. OTHER INFORMATION

Item 1. Legal Proceedings

The Company and its subsidiaries are party to legal proceedings arising in the ordinary course of business as described in Note 17 in Part I, Item 1, “Commitments and Contingencies,” and such disclosure is incorporated by reference into this Item 1. “Legal Proceedings.”

The Company’s threshold for disclosing material environmental legal proceedings involving a government authority where potential monetary sanctions are involved is $1.0 million.

In addition, the Company and six of its subsidiaries are presently named as defendants in a number of lawsuits claiming various asbestos-related personal injuries, allegedly as a result of exposure to products manufactured with components that contained asbestos. These components were acquired from third party suppliers and were not manufactured by the Company or any of the defendant subsidiaries. To date, the majority of the Company’s settlements and legal costs, except for costs of coordination, administration, insurance investigation and a portion of defense costs, have been covered in full by insurance, subject to applicable deductibles. However, the Company cannot predict whether and to what extent insurance will be available to continue to cover these settlements and legal costs, or how insurers may respond to claims that are tendered to them. Asbestos-related claims have been filed in jurisdictions throughout the United States and the United Kingdom. Most of the claims resolved to date have been dismissed without payment. The balance of the claims have been settled for various immaterial amounts. Only one case has been tried, resulting in a verdict for the Company’s business unit. No provision has been made in the financial statements of the Company, other than for insurance deductibles in the ordinary course, and the Company does not currently believe the asbestos-related claims will have a material adverse effect on the Company’s business, financial position, results of operations or cash flows.

Item 1A. Risk Factors

There have been no material changes with respect to risk factors disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

The following table provides information about the Company’s purchases of its common stock during the quarter ended September 30, 2023:


Period	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Approximate Dollar Value that May Yet be Purchased Under the Plans or Programs(1)
July 1, 2023 to July 31, 2023	—	$	—	—	$	562,763,657
August 1, 2023 to August 31, 2023	—	—		—	562,763,657
September 1, 2023 to September 30, 2023	—	—		—	562,763,657
Total	—	$	—	—	$	562,763,657

(1)On March 17, 2020, the Company’s Board of Directors approved an increase of $500.0 million in the authorized level of repurchases of common stock. This approval is in addition to the prior repurchase authorization of the Board of Directors of $300.0 million on December 1, 2015. These authorizations have no expiration date.

Item 5. Other Information

During the quarter ended September 30, 2023, none of the Company’s directors or executive officers adopted or terminated any contract, instruction or written plan for the purchase or sale of Company securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule 10b5-1 trading arrangement” as defined in Item 408 of Regulation S-K under the Securities Exchange Act of 1934, as amended.

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Item 6. Exhibits


Exhibit Number						Description



10.1,*						Termination and Release Agreement between Fast & Fluid Management B.V. and M.A. Uleman, dated as of August 31, 2023

31.1*						Certification of Chief Executive Officer Pursuant to Section 302 of Sarbanes Oxley Act of 2002

31.2*						Certification of Chief Financial Officer Pursuant to Section 302 of Sarbanes Oxley Act of 2002

32.1*						Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350

32.2*						Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350

101*						The following financial information from IDEX Corporation's Quarterly Report on Form 10-Q for the quarter ended September 30, 2023 formatted in Inline eXtensible Business Reporting Language (iXBRL) includes: (i) the Cover Page, (ii) the Condensed Consolidated Balance Sheets, (iii) the Condensed Consolidated Statements of Income, (iv) the Condensed Consolidated Statements of Comprehensive Income, (v) the Condensed Consolidated Statements of Equity, (vi) the Condensed Consolidated Statements of Cash Flows, and (vii) Notes to Condensed Consolidated Financial Statements.

104*						Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

* Filed herewith.
** Management contract or compensatory plan or agreement.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


			IDEX Corporation

			By:			/s/ ALLISON S. LAUSAS
						Allison S. Lausas
						Interim Chief Financial Officer and Chief Accounting Officer (Principal Financial and Accounting Officer)

Date: October 26, 2023

ex101-ulemanterminationa

Page 1 of 7 THE UNDERSIGNED: Fast & Fluid Management B.V., a private company with limited liability, having its corporate seat in Sassenheim, The Netherlands and its formal place of business at Hub van Doorneweg 31, (2171KZ) Sassenheim, The Netherlands, for purpose of this agreement duly represented by Ms. Melissa Flores, hereinafter the “Company”; and Mr. M.A. Uleman, born on [Redacted], currently residing at [Redacted] in The Netherlands, hereinafter “Uleman”; The parties to this Agreement are hereinafter collectively referred to as the “Parties” and individually as a “Party”; PARTIES HAVE AGREED AS FOLLOWS: RECITALS: (1) Uleman entered the employment of the Company on 9 January 2012 and currently holds the position of Senior Vice President, Group Executive, Health & Science Technologies (the “Role”) based on an employment agreement for an indefinite period of time (the “Employment Agreement”); (2) The salary most recently earned by Uleman is EUR 43.334,- gross per month (the “Salary”), including vacation allowance of 8% and excluding other fringe benefits; (3) The Company is a subsidiary of the ultimate parent company IDEX Corporation (IDEX). In this Agreement the “Group” refers to the Company as well as to all companies affiliated to the Company (both in and outside of The Netherlands), which includes but is not limited to direct and indirect subsidiaries, parent companies and other companies within the IDEX group of companies including the parent company IDEX as well as all their legal predecessors and successors; (4) Due to a restructuring the Role is eliminated and consequently Uleman will become redundant effective 11 September 2023; (5) The Company has investigated whether it can redeploy Uleman in another position but had to conclude that alternative suitable employment is not available for Uleman, nor will such position become available in the near future. Consequently, the elimination of Uleman's Role results in the inevitable termination of the Employment Agreement; (6) As the Company seeks to terminate the Employment Agreement, the Parties have discussed the conditions for such termination. In view of the above, and to end all points of dispute regarding the consequences of the termination of the Employment Agreement, the Parties have reached EX-10.1

Page 2 of 7 the agreement as set out in this settlement agreement (the “Agreement”); (7) The decision to grant Uleman the terms set out in this Agreement has been taken by the competent body of the Company; (8) Uleman is fully aware of the content of this Agreement and its consequences and has been given the opportunity to consider and receive expert legal advice (the “Representative”) prior to signing this Agreement; (9) Within 14 (fourteen) days as from the date that Parties have reached full agreement about the terms and conditions set out in this Agreement, Uleman has the right to withdraw his acceptance of the subject Agreement and rescind it extra-judicially. The rescission must be made in writing and must be delivered to the Company per e-mail with a confirm delivery and read option at the notice of Melissa Flores, Senior Vice President, Chief Human Resources Officer (the “Rescission of Acceptance”). 1. TERMINATION OF EMPLOYMENT BY MUTUAL CONSENT 1.1 Termination Date. The Employment Agreement will end with mutual consent effective 31 December 2023 (the “Termination Date”). 1.2 Transfer of Duties and Support to BUs. Uleman agrees to ensure that his duties are properly finalized and transferred to the designated business leaders as per the instructions of IDEX by 11 September 2023. From 11 September 2023 until and including 20 November 2023, Uleman agrees to provide transitional support for the businesses within the Health and Science Segment moving under new leadership with an emphasis on completing the first-year integration plan for the Muon businesses in collaboration with the corresponding Group President. 1.3 Cooperation in Deregistration. Uleman agrees to collaborate fully and timely with IDEX and FFM HR and Legal teams in relation to any required deregistrations from any roles or titles that Uleman holds resulting from the termination of his Employment Agreement. 2. SEVERANCE PACKAGE — OTHER EMPLOYMENT BENEFITS - REFERENCE LETTER 2.1 Severance Package. In consideration for the promises and benefits made herein, the Company agrees to provide the following “Severance Package” if Uleman signs, does not deliver a Recission of Acceptance, and complies with this Agreement: a. Release from duties. As per 21 November 2023 Uleman shall be released from duties (the “Release Date”) with entitlement to his full pay (but excluding expense allowances, travel allowances, and other allowances related to active duty) until the Termination Date (the “Release Period”). During the Release Period, Uleman is not allowed to perform any form of paid work or commercial/economically valuable side activities in the broadest sense of the word. b. Contractual Severance. Pursuant to article 3.2 of the Employment Agreement, the

Page 3 of 7 Company will pay Uleman an amount of EUR 910,000,- gross (the “Contractual Severance”), under the condition that the Employment Agreement terminates in accordance with Clause 1.1 of this Agreement and Uleman properly fulfills his obligations as stipulated in Clause 1.2. The Severance Payment is intended to supplement any benefits under social security laws or a lower salary earned elsewhere. c. Outplacement. The Company will provide Uleman with outplacement services for a period of six (6) months. Outplacement services will be provided by Robertson Lowstuter, Inc., with an executive package selected and paid by the Company directly to the outplacement service provider. Uleman is not able to initiate outplacement services until this Agreement has been signed and returned to the Company and the fourteen (14) day recission period has passed without Uleman's recission thereof (provided Uleman does not breach the Agreement). Uleman is required to initiate outplacement services within ninety (90) days following the Termination Date or the benefit described in this Clause 2.1 (c) will be waived. d. MICP and IAP. Nothing in this Agreement shall alter or reduce any vested benefits (if any) to which Uleman may be entitled under any equity-related agreement between IDEX and Uleman, which shall be subject to the terms of the applicable plan documents and/or equity agreements. For the avoidance of doubt, Uleman's MICP for 2023 will be governed according to the Plan as applicable to active employees, using the IDEX factor and payable no later than April 30, 2024. Uleman may confirm the factor applied via the Company's annual proxy statement. As set forth in the applicable Plan documents, Uleman is eligible for retirement classification with respect to bonus and equity grants. The requirements to exercise the grants are as set forth in the Plan documents. Uleman may continue to access his UBS account and PSU tracking systems following his Termination Date on the same terms as any non-employee investor. The Company will not take any action to disable his UBS account. e. Legal Advice. As far as Uleman is not insured for legal aid, the Company will compensate the costs for legal counsel incurred up to a maximum amount of EUR 2.000,- excluding VAT (one thousand euros) (the “Contribution”). Uleman shall pay his lawyer's invoice and shall submit the invoice in accordance with the Company's Business Expenses Policy before the Release Date. The Company shall reimburse the Contribution to Uleman within 30 days from submission of the expense claim, but not earlier than after the 14-days reconsideration period as reflected in Recital (9) of this Agreement. 2.2 Waiver. As per the agreed terms in the Employment Agreement, Uleman accepts the Contractual Severance as full and final compensation for the termination of his Employment Agreement and any benefits connected thereto, and waives any other claims or rights to other financial compensation (such as, but not limited to, pay out of vacation days, vacation allowance, future bonus (MICP), stock and equity grants (IAP), damages etc.). 2.3 Positive Reference. At Uleman's request, the Company shall issue a positive letter of recommendation in conformity with the provisions of The Netherlands law. The Company is willing to provide references in accordance thereto.

Page 4 of 7 2.4 Collective Schemes. Uleman's participation in any collective Company scheme and/or Group insurance — including pension through PME, and the pension allowance - will continue under the applicable terms and conditions of the scheme until the Termination Date. Effective the Termination Date, Uleman's participation in all collective schemes will cease. 3. EXPENSES — COMPANY PROPERTY 3.1 Expenses. Uleman shall submit all business expenses claims (if any) properly incurred up to the Release Date by submitting all his expenses through Concur before the Termination Date. The Company shall reimburse Uleman for any such expenses in the usual way in accordance with Company policy. 3.2 Return of Company Property. Uleman agrees to return all Company property which is still in his possession and control as of 20 November 2023. Company property includes, but is not limited to, all equipment that has become available to Uleman during his tenure at the Company such as, but not limited to, Company-issued office entrance badge(s), laptop, laptop charger, laptop head phones, and mobile phones, for any business related systems and accounts. Uleman may port his mobile phone number to a private telecommunications provider to allow his private use of the number upon his return of the Company-issued phone. Uleman further agrees to return or destroy by 20 November 2023 the original and any copies of Confidential Information as defined in the employment agreement and Parties' Confidential Information, Work Product and Restrictive Covenant (CWR) Agreement, as amended and incorporated into the Employment Agreement and trade secret information in the broadest sense of the word, including but not limited to IDEX and Group data, e-mails, files, agendas and any other record, or document relating to the Company, the Group or their business, products, or services. Any damages to or loss of Company and/or Group property shall be deducted from the final settlement of accounts. 4. RESTRICTIONS AND POST-CONTRACTUAL ARRANGEMENTS 4.1 Contractual Restrictions. Until and after the Termination Date, Uleman remains bound by all (post-) contractual restrictions and any penalty clause connected thereto as agreed in this Agreement, the Employment Agreement and including the CWR Agreement, albeit that, with respect to Paragraphs 5(a) and (b) of the CWR Agreement, the Company agrees to enter into good faith discussions with Uleman in connection with his desire to obtain a waiver of the obligations contained in Paragraphs 5(a) and (b) in the event Uleman is presented with a viable employment opportunity. The Company agrees to take into consideration the facts and circumstances relating to Uleman's employment opportunity during these discussions. Uleman agrees that he shall contact Melissa Flores, SVP, Chief Human Resources Officer, should he desire to obtain such a waiver. 4.1 Confidentiality. The Parties represent and warrant that they have not disclosed, and agree not to disclose, any and all matters concerning this Agreement and the Employment Agreement, as well as the facts, circumstances, and contents leading up to this Agreement and any related negotiations, except that Uleman may disclose such information about this Agreement and the Employment Agreement to his lawyer(s), tax advisor(s), other professional(s) providing services

Page 5 of 7 to Uleman and to his partner/spouse. Uleman may disclose to others the fact that there is a separation agreement and that its terms are confidential, and Uleman may provide UWV with a copy of this Agreement if and insofar as he applies for social security benefits. The Company may disclose the same to any advisors, executives, or employees of the Company/Group on a need-to-know basis as determined at the Company's discretion. Nothing in this Agreement shall prohibit either Party from complying with any legal requirement to disclose information relating to any matter concerning this Agreement, including, but not limited to, IDEX's disclosure obligations pursuant to the rules and requirements of the United States Securities and Exchange Commission. Moreover, to the extent Uleman is required to disclose this Agreement pursuant to a legal obligation, Uleman agrees to immediately notify the Company both verbally and in writing by contacting the CHRO of IDEX per email. Uleman further acknowledges that maintaining the confidentiality of this Agreement is a critical consideration for the Company entering into this Agreement. 4.2 Non-Disparagement. Uleman promises and agrees that he shall not, directly or indirectly, to any person or entity, including but not limited to, present or former employees of the Company, customers or vendors of the Company, make any disparaging oral or written statements about the Company or Group, or its or their employees or customers, or do anything which damages the Company or Group or its or their services, reputation, financial status, or business relationships. 4.3 Social Media. Effective the Termination Date, Uleman shall adjust his LinkedIn profile to reflect that the Company no longer employs him and shall remove all references to his continued association with the Company and the Group from all social media channels which he uses (which may include, but are not limited to, LinkedIn, Twitter, Facebook etc.). Following the Termination Date, Uleman may continue to mention on his LinkedIn that he was previously employed by the Company. 5. FULL AND FINAL DISCHARGE 5.1 Released Parties. Uleman accepts the terms and conditions laid down in this Agreement in full and final settlement of any claims and/or rights of action that he has or may have against the Company or Group, and its or their current, former, or future officers, directors, employees and/or shareholders (the “Released Parties”) and declares that he has no further right to any payments (including but not limited to the statutory transition fee (‘transitievergoeding’)) or any other financial compensation in relation to the Employment Agreement and the termination thereof, which includes but is not limited to payments under any bonus or profit sharing scheme (ex gratia or otherwise), grants or allowances, all unless explicitly agreed otherwise in this Agreement. To the extent that any such claim or right exists or may exist, Uleman hereby irrevocably and unconditionally waives, releases, acquits, and forever discharges the Released Parties from any such claims or rights. 5.2 Full & Final Discharge. In the negotiations, the Parties have had the opportunity to address all existing or potential rights, obligations, and points of dispute. Except for the observance of the rights and obligations set forth in this Agreement, the Parties hereby grant each other full and

Page 6 of 7 final discharge with respect to the Employment Agreement, the termination thereof and otherwise. This discharge by Uleman also pertains to the Group as well as all Released Parties. 6. FINAL SETTLEMENT OF ACCOUNTS 6.1 Settlement of Accounts. The Company will prepare a final settlement of accounts with respect to the amounts that are still due as per the Termination Date in connection with the Employment Agreement and the termination thereof as reflected in this Agreement. Uleman is not eligible for any other payments after the Termination Date, other than as specifically provided herein. No Contractual Severance or any other payment under the Severance Package will be paid or provided to Uleman until all expense reports have been received, reviewed, and finalized as provided in Clause 3.1 of this Agreement, and all Company property has been returned or destroyed as provided in Clause 3.2 of this Agreement. All payments under this Agreement will be made within 30 days from the Termination Date, unless explicitly agreed otherwise in this Agreement. 6.2 Payment to Estate. In the event Uleman is deceased before the payments described in Clause 2.1 (b) and (e) of this Agreement are made, and the Agreement has been timely executed and not revoked or breached, the Company agrees to pay remaining unpaid amounts, if any, to Uleman's estate upon receipt of proper proof of authority to collect payment on behalf of Uleman's estate. 6.3 Taxes. All payments pursuant to this Agreement will be made after deduction of the applicable withholdings of taxes and premiums. If changes in payroll or income tax regulations have any tax consequences for this Agreement, these will be exclusively for the account of Uleman. 7. LEGAL FRAMEWORK 7.1 Entire Agreement & Any Prior Written Agreements. This Agreement sets forth the entire agreement and understanding of the Parties and supersedes all prior agreements or understandings regarding the matters covered herein, except as otherwise provided for in this Agreement. 7.2 Invalidity. The invalidity of any provision or part of a provision of this Agreement will not affect the validity of the other provisions or parts thereof. 7.3 Termination for Cause and Recission of Acceptance. The Company is entitled to terminate this Agreement if the characteristics or conduct of Uleman constitute an urgent cause to terminate the Employment Agreement with immediate effect and such urgent cause has become known to the Company after signing this Agreement. Breach by Uleman of the terms of this Agreement prior to the Termination Date shall qualify as an urgent cause. In case of instant dismissal or if Uleman opts for a Rescission of Acceptance, the performances already delivered and the performances that still need to be delivered by the Company, will no longer be due and, to the extent already delivered, such performances will be undone. In all other respects, the Parties explicitly waive their right to terminate (‘ontbinden’) this Agreement or to request dissolution of this Agreement in court.

Page 7 of 7 7.4 Settlement Agreement. This Agreement is a settlement agreement to end a dispute as referred to in Article 7:900 up to and including Article 7:906 of the Dutch Civil Code. 8. APPLICABLE LAW AND DISPUTES 8.1 Governing Law. This Agreement shall be governed exclusively by The Netherlands law, except for the provisions of private international law concerning the law applicable on contractual obligations. 8.2 Competent Court. Any dispute in relation to and arising from this Agreement shall be brought exclusively before the competent court in The Netherlands. SIGNATURES This Agreement may be executed in any number of counterparts, each of which, when executed, shall be an original, and all the counterparts together shall constitute one and the same instrument. Thus, executed in counterparts: on 30 August 2023 Fast & Fluid Management B.V. /s/ Melissa Flores Ms. Melissa Flores, CHRO IDEX Corporation on 31 August 2023 Mr. M.A. Uleman /s/ Marc Uleman

Document

Exhibit 31.1

Certification of Chief Executive Officer Pursuant to Section 302 of the

Sarbanes-Oxley Act of 2002

I, Eric D. Ashleman, certify that:

1. I have reviewed this quarterly report on Form 10-Q of IDEX Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.



						/s/ ERIC D. ASHLEMAN
						Eric D. Ashleman
						Chief Executive Officer and President

Date: October 26, 2023

Document

Exhibit 31.2

Certification of Chief Financial Officer Pursuant to Section 302 of the

Sarbanes-Oxley Act of 2002

I, Allison S. Lausas, certify that:

1. I have reviewed this quarterly report on Form 10-Q of IDEX Corporation;

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.



						/s/ ALLISON S. LAUSAS
						Allison S. Lausas
						Interim Chief Financial Officer and Chief Accounting Officer

Date: October 26, 2023

Document

Exhibit 32.1

Certification of Chief Executive Officer

Pursuant to 18 U.S.C. § 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned officer of IDEX Corporation (the “Company”) hereby certifies, to such officer's knowledge, that:

(i) the accompanying Quarterly Report on Form 10-Q of the Company for the quarterly period ended September 30, 2023 (the “Report”) fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and

(ii) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.



						/s/ ERIC D. ASHLEMAN
						Eric D. Ashleman
						Chief Executive Officer and President

Date: October 26, 2023

Document

Exhibit 32.2

Certification of Chief Financial Officer

(ii) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.



						/s/ ALLISON S. LAUSAS
						Allison S. Lausas
						Interim Chief Financial Officer and Chief Accounting Officer

Date: October 26, 2023