BRUNSWICK CORP
For the period ended Jun 29, 2024. Filed Aug 1, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 29, 2024 · Filed Aug 1, 2024
BC$77.23-2.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-30; filed 2024-05-02.
0000014930-24-000103
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-06-29; filed 2024-08-01.
0000014930-24-000126
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 94 previous paragraphs and 110 current paragraphs.
47 unchanged; 40 reworded; 22 added; 7 removed; 0 previous and 1 current paragraphs rearranged.
Tables are not compared: 16 previous and 16 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (22)
Current report
Net sales decreased 15 percent during the second quarter of 2024 when compared with the second quarter of 2023, as the impact of continued lower wholesale ordering by dealers and OEMs, coupled with higher discounts in certain business segments, was only partially offset by annual price increases and benefits from well-received new products. Despite our Propulsion segment delivering lower sales and operating earnings versus the second quarter of 2023, year-to-date we continue to gain share in outboard engines, with more than 48 percent overall share of the U.S. outboard market. In addition, Propulsion's controls, rigging, and propeller product category had a strong quarter with operating margins ahead of the same period in 2023. Our Engine Parts and Accessories (Engine P&A) segment had a strong quarter, with sales and operating earnings up versus the second quarter of 2023, and we completed the full transition of Engine P&A distribution to our new, state-of-the-art facility in Brownsburg, Indiana. As anticipated, our Navico Group segment had lower sales and operating earnings versus the second quarter of 2023, due to reduced marine OEM order rates and persistently slow RV orders but continued to show stability, with sequential improvement in aftermarket sales and overall sales and operating earnings consistent with first quarter results. Our Boat segment had a solid performance given market conditions, with sales and operating earnings below the prior year quarter, consistent with lower planned production levels. Our international net sales decreased 8 percent and 6 percent in the second quarter on a GAAP and constant currency basis, respectively.
Current report
Net sales decreased 19 percent during the first half of 2024, when compared with the first half of 2023, due to the same factors described above. Our international net sales decreased 14 percent and 13 percent in the first half on a GAAP and constant currency basis, respectively.
Current report
Gross margin decreased 120 basis points in the first half of 2024 when compared to the same prior year period, driven by higher manufacturing costs including absorption (120 bps) and depreciation (20 bps) as well as foreign currency exchange-rate fluctuations (20 bps), partially offset by sales-related drivers (25 bps) and acquisitions (15 bps).
Current report
Selling, general and administrative expense as a percentage of net sales was flat during the second quarter of 2024 when compared with the same prior year period, due to lower sales (230 bps), offset by cost control measures across the enterprise, including lower employee compensation costs associated with headcount reductions and lower variable compensation (230 bps). Research and development expense decreased in the second quarter of 2024 versus the same period in 2023.
Current report
Propulsion segment's net sales decreased in the second quarter of 2024 compared to the second quarter of 2023, with lower production rates at OEM boat manufacturers resulting in fewer engine orders in the quarter, while repower shipments were slightly up versus the same prior year period.
Current report
Propulsion segment's net sales decreased in the first half of 2024 versus 2023 due to the same factors described above.
Current report
International sales were 37 percent of the Propulsion segment's net sales in the second quarter of 2024 and were flat from the prior year on a GAAP basis. On a constant currency basis, international sales increased 2 percent.
Current report
International sales were 36 percent of the Propulsion segment's net sales in the first half of 2024 and decreased 12 percent from the prior year on a GAAP basis. On a constant currency basis, international sales decreased 11 percent in the first half of 2024.
Current report
Operating earnings for the first half of 2024 decreased due to the impact of lower net sales and higher manufacturing costs, including absorption from lower production, partially offset by accelerated cost control measures.
Current report
Engine P&A segment's net sales increased in the second quarter of 2024 compared to the second quarter of 2023, due to the completed transition to the Brownsburg, Indiana distribution facility as this business was able to service product to customers around the globe, leading to year-over-year sales increases in both the U.S. and international markets.
Current report
Engine P&A segment's net sales decreased in the first half of 2024 versus prior year as strong second quarter results only partially offset the lower sales in the first quarter of 2024.
Current report
International sales were 27 percent of the Engine P&A segment's net sales in the second quarter of 2024 and increased 5 percent from the prior year on a GAAP basis. On a constant currency basis, international sales increased 6 percent.
Current report
International sales were 29 percent of the Engine P&A segment's net sales in the first half of 2024 and increased 1 percent from the prior year on a GAAP basis. On a constant currency basis, international sales increased 2 percent in the first half of 2024.
Current report
Operating earnings for the first half of 2024 decreased as strong second quarter results only partially offset the lower operating earnings in the first quarter of 2024.
Current report
Navico Group segment's net sales decreased in the first half of 2024 versus prior yearas a result of the same factors described above.
Current report
International sales were 40 percent of the Navico Group segment's net sales in the second quarter of 2024 and decreased 4 percent year over year on a GAAP basis. On a constant currency basis, international sales decreased 3 percent.
Current report
Operating earnings for the first half of 2024 decreasedas a result of the same factors described above.
Current report
Boat segment's net sales decreased in the first half of 2024 versus the first half of 2023 due to the same factors described above.
Current report
Operating earnings in the first half of 2024 decreased due to the same factors above.
Current report
Corporate operating loss in the second quarter of 2024 decreased when compared to thesecond quarter of 2023, driven by lower variable compensation along with the impact of both the IT security incident and restructuring charges in the prior year.
Current report
Corporate operating loss decreased in the first half of 2024 versus 2023, resulting from the same factors described above.
Current report
We continue to moderate our capital expenditure spending for the year and now anticipate less than $175 million of spending for the year. We have revised our share repurchase plan and now anticipate share repurchases between $200 and $220 million of shares in 2024, consistent with our initial assumptions for the year.
Removed paragraphs (7)
Previous report
Net sales decreased 22 percent during the first quarter of 2024 when compared with the first quarter of 2023. Our Propulsion segment delivered lower sales and operating earnings versus a record first quarter of 2023, as boat manufacturers and dealers moderated orders and managed production of current model-year products and pipelines ahead of the retail season and model-year change-over. However, the Propulsion segment continued to outperform the industry, gaining 200 basis points of U.S. outboard engine market share versus the first quarter of 2023. Our Engine Parts and Accessories (Engine P&A) segment continued its steady performance with sales and operating earnings down modestly from the first quarter of 2023 as anticipated, but increasing sequentially over the prior quarter. As expected, our Navico Group segment had lower sales and operating earnings versus the first quarter of 2023, but delivered sequential sales and operating earnings increases over the prior quarter. Our Boat segment performed to plan, with exceptional retail performance by Boston Whaler and Sea Ray at early season boat shows, while continuing to introduce new models to support market share gains. Sales and operating earnings were below prior year, consistent with lower planned production levels, while operating margins improved sequentially over the prior quarter. Our international net sales decreased 19 percent in the first quarter on a GAAP and constant currency basis when compared to the prior year quarter.
Previous report
Propulsion segment's net sales decreased $173.4 million, or 23 percent, in the first quarter of 2024 compared to the first quarter of 2023, as boat manufacturers and dealers moderated order patterns, managing production of current model-year products and pipelines ahead of the retail season and model-year change-over.
Previous report
International sales were 35 percent of the Propulsion segment's net sales in the first quarter of 2024 and decreased 22 percent year over year on a GAAP and constant currency basis.
Previous report
Engine P&A segment's net sales decreased $26.2 million, or 9 percent, in the first quarter of 2024 compared to the first quarter of 2023, due to lower sales in our Product and Distribution businesses. However, sales in both businesses improved sequentially over the prior quarter.
Previous report
International sales were 32 percent of the Engine P&A segment's net sales in the first quarter of 2024 and decreased 3 percent year over year on a GAAP and constant currency basis.
Previous report
Corporate operating loss in the first quarter of 2024 was $32.4 million, a decrease of 3 percent when compared to thefirst quarter of 2023, driven by lower restructuring, exit and impairment charges.
Previous report
We continue to anticipate full-year capital expenditures of approximately $225 million. Additionally, we anticipate share repurchases of approximately $250 million, lowering our expected average diluted shares outstanding for the year to 68 million shares.
Reworded paragraphs (40)
Previous wording
Operating earnings in the first quarter of 2024 were $110.6 million and $141.5 million on a GAAP and As Adjusted basis, respectively. This compares to operating earnings during the first quarter of 2023 of $236.1 million and $262.4 million on a GAAP and As Adjusted basis, respectively.
Current wording
Operating earnings in the second quarter of 2024 were $158.3 million and $180.8 million on a GAAP and As Adjusted basis, respectively. This compares to operating earnings during the second quarter of 2023 of $194.4 million and $234.9 million on a GAAP and As Adjusted basis, respectively.
Previous wording
Changes in Foreign Currency Rates. Percentage changes in net sales expressed in constant currency reflect the impact that changes in currency exchange rates had on comparisons of net sales. To determine this information, net sales transacted in currencies other than the U.S. dollar have been translated to U.S. dollars using the average exchange rates that were in effect during the comparative period. The percentage change in net sales expressed on a constant currency basis better reflects the changes in the underlying business trends, excluding the impact of translation arising from foreign currency exchange rate fluctuations. Approximately 25 percent of our annual net sales are transacted in a currency other than the U.S. dollar. Our most material exposures include sales in Euros, Canadian dollars, Australian dollars, and Brazilian real.
Current wording
Changes in Foreign Currency Rates. Percentage changes in net sales expressed in constant currency reflect the impact that changes in currency exchange rates had on comparisons of net sales. To determine this information, net sales transacted in currencies other than the U.S. dollar have been translated to U.S. dollars using the average exchange rates that were in effect during the comparative period. The percentage change in net sales expressed on a constant currency basis better reflects the changes in the underlying business trends, excluding the impact of translation arising from foreign currency exchange rate fluctuations. Approximately 26 percent of our annual net sales are transacted in a currency other than the U.S. dollar. Our most material exposures include sales in Euros, Canadian dollars, Australian dollars, and Brazilian real.
Previous wording
The following table sets forth certain amounts, ratios and relationships calculated from the Condensed Consolidated Statements of Comprehensive Income for the three months ended:
Current wording
The following table sets forth certain amounts, ratios and relationships calculated from the Condensed Consolidated Statements of Comprehensive Income for the three and six months ended:
Previous wording
The following is a reconciliation of our non-GAAP measures, adjusted operating earnings and adjusted diluted earnings per common share from continuing operations for the three months ended March 30, 2024 when compared with the same prior year comparative period:
Current wording
The following is a reconciliation of our non-GAAP measures, adjusted operating earnings and adjusted diluted earnings per common share from continuing operations for the three and six months ended June 29, 2024 when compared with the same prior year comparative period:
Previous wording
(A) We incurred non-recurring costs related to the 2023 IT security incident during the three months ended March 30, 2024.
Current wording
(A) We incurred non-recurring costs related to the 2023 IT security incident during the six months ended June 29, 2024 as well as during the three and six months ended July 1, 2023.
Previous wording
Net sales decreased 22 percent during the first quarter when compared with the same prior year period. The components of the consolidated net sales change were as follows:
Current wording
Net sales decreased 15 percent during the second quarter of 2024 and 19 percent during the first half of 2024 when compared with the same prior year periods. The components of the consolidated net sales change were as follows:
Previous wording
Gross margin decreased 160 basis points in the first quarter of 2024 when compared to the same prior year period, drivenby higher manufacturing costs including absorption (75 bps), material and labor inflation (65 bps), unfavorable foreign currency exchange-rate fluctuations (50 bps) and depreciation (15 bps), partially offset by sales-related drivers (35 bps) and acquisitions (10 bps).
Current wording
Gross margin decreased 60 basis points in the second quarter of 2024 when compared to the same prior year period, driven by higher manufacturing costs including absorption (210 bps), material and labor inflation (65 bps) and depreciation (15 bps), partially offset by unfavorable timing of capitalized variances in the prior year (170 bps), favorable foreign currency exchange-rate fluctuations (20 bps), sales-related drivers (20 bps) and acquisitions (20 bps).
Previous wording
Selling, general and administrative expense as a percentage of net sales increased 280 basis points during the first quarter of 2024 when compared with the same prior year period, due to lower sales (340 bps), partially offset by lower employee compensation costs associated with headcount reductions (60 bps). Research and development expense decreased in the first quarter of 2024 versus the same period in 2023.
Current wording
Selling, general and administrative expense as a percentage of net sales increased 130 basis points during the first half of 2024 when compared with the same prior year period, due to lower sales (280 bps), partially offset by cost control measures across the enterprise, including lower employee compensation costs associated with headcount reductions and lower variable compensation (150 bps). Research and development expense decreased in the first half of 2024 versus the same period in 2023.
Previous wording
We recorded Restructuring, exit and impairment charges of $13.5 million and $9.5 million during the three months ended March 30, 2024 and April 1, 2023, respectively. We estimate the first quarter 2024 actions will result in approximately $12 million of annualized cost savings. Refer to Note 3 – Restructuring, Exit and Impairment Activities in the Notes to Condensed Consolidated Financial Statements for further information.
Current wording
We recorded Restructuring, exit and impairment charges of $7.9 million and $21.4 million during the three and six months ended June 29, 2024, respectively. We recorded Restructuring, exit and impairment charges of $13.9 million and $23.4 million during the three and six months ended July 1, 2023, respectively. We estimate the first half 2024 actions will result in approximately $14 million of cost savings. Refer to Note 3 – Restructuring, Exit and Impairment Activities in the Notes to Condensed Consolidated Financial Statements for further information.
Previous wording
We recorded Equity earnings of $2.5 million and $2.2 million in the three months ended March 30, 2024 and April 1, 2023, respectively, which were primarily related to our marine and technology-related joint ventures.
Current wording
We recorded Equity earnings of $2.9 million and $5.4 million in the three and six months ended June 29, 2024, respectively, which were primarily related to our marine and technology-related joint ventures. This compares with Equity earnings of $2.2 million and $4.4 million in the three and six months ended July 1, 2023, respectively.
Previous wording
We recognized $0.0 million and $(0.9) million of Other expense, net in the three months ended March 30, 2024 and April 1, 2023, respectively. Other expense, net primarily includes remeasurement gains and losses resulting from changes in foreign currency rates and other postretirement benefit costs.
Current wording
We recognized $(0.8) million of Other (expense) income, net in the three and six months ended June 29, 2024, respectively. This compares with $1.8 million and $0.9 million of Other (expense) income, net in the three and six months ended July 1, 2023, respectively. Other (expense) income, net primarily includes remeasurement gains and losses resulting from changes in foreign currency rates and other postretirement benefit costs.
Previous wording
Net interest expense increased for the three months ended March 30, 2024 when compared with the same prior year period due to an increase in average daily debt outstanding, which was influenced by the timing of debt issuances. Refer to Note 12 – Debt in the Notes to Condensed Consolidated Financial Statements and Note 14 – Debt in the Notes to Consolidated Financial Statements in the 2023 Form 10-K.
Current wording
Net interest expense increased for the three and six months ended June 29, 2024 when compared with the same prior year period due to an increase in average daily debt outstanding, which was influenced by the timing of debt issuances. Refer to Note 12 – Debt in the Notes to Condensed Consolidated Financial Statements and Note 14 – Debt in the Notes to Consolidated Financial Statements in the 2023 Form 10-K.
Previous wording
We recognized an income tax provision for the three months ended March 30, 2024 of $18.6 million, compared to $99.0 million for the three months ended April 1, 2023. The decrease in the income tax provision for the three months ended March 30, 2024 is due to a discrete income tax expense recorded in connection with the intercompany sale of intellectual property rights in the first quarter of 2023. We have also evaluated the effects of Pillar Two legislation and concluded that the tax effects are not material to the financial statements. Refer to Note 11 – Income Taxesin the Notes to Condensed Consolidated Financial Statements for further information.
Current wording
We recognized an income tax provision for the three and six months ended June 29, 2024 of $27.7 million and $46.3 million, respectively, compared to $36.3 million and $135.3 million for the three and six months ended July 1, 2023, respectively. The decrease in the income tax provision for the three months ended June 29, 2024 is due to lower pretax income in high tax jurisdictions. The decrease in the income tax provision for the six months ended June 29, 2024 is due to the prior year intercompany sale of certain intellectual property rights and lower pretax income in high tax jurisdictions. We have also evaluated the effects of Pillar Two legislation and concluded that the tax effects are not material to the financial statements. Refer to Note 11 – Income Taxesin the Notes to Condensed Consolidated Financial Statements for further information.
Previous wording
The effective tax rate, which is calculated as the income tax provision as a percentage of earnings before income taxes, was 21.4 percent and 46.8 percent for the three months ended March 30, 2024 and April 1, 2023, respectively.
Current wording
The effective tax rate, which is calculated as the income tax provision as a percentage of earnings before income taxes, was 20.9 percent and 21.1 percent for the three and six months ended June 29, 2024, respectively. The effective tax rate for the three and six months ended July 1, 2023 was 21.2 percent and 35.3 percent, respectively.
Previous wording
Due to the factors described in the preceding paragraphs, operating earnings, net earnings from continuing operations, and diluted earnings per common share from continuing operations decreased during the three months ended March 30, 2024 when compared with the same prior year period.
Current wording
Due to the factors described in the preceding paragraphs, operating earnings, net earnings from continuing operations, and diluted earnings per common share from continuing operations decreased during both the three and six months ended June 29, 2024 when compared with the same prior year period.
Previous wording
The following table sets forth Propulsion segment results and a reconciliation to our non-GAAP measure of adjusted operating earnings for the three months ended:
Current wording
The following table sets forth Propulsion segment results and a reconciliation to our non-GAAP measure of adjusted operating earnings for the three and six months ended:
Previous wording
Propulsion segment's operating earnings in the first quarter of 2024 were $82.8 million, a decrease of 45 percent when compared to the first quarter of 2023, as prior year pricing gains and aggressive cost control measures partially offset the impact of lower sales, unfavorable changes in foreign currency exchange rates, the lapping of prior year favorable variances related to timing of capitalized inventory, and lower absorption from reduced production.
Current wording
Propulsion segment's operating earnings in the second quarter of 2024 decreased when compared to the second quarter of 2023, due to the impact of lower net sales and higher manufacturing costs, including absorption from lower production, partially offset by the lapping of prior year unfavorable capitalized inventory variances and accelerated cost control measures.
Previous wording
The following table sets forth Engine P&A segment results and a reconciliation to our non-GAAP measure of adjusted operating earnings for the three months ended:
Current wording
The following table sets forth Engine P&A segment results and a reconciliation to our non-GAAP measure of adjusted operating earnings for the three and six months ended:
Previous wording
Engine P&A segment's operating earnings in the first quarter of 2024 were $33.2 million, a decrease of 31 percent compared to the first quarter of 2023, due to the sales declines which more than offset the impact of pricing and cost control.
Current wording
Engine P&A segment's operating earnings in the second quarter of 2024 increased compared to the second quarter of 2023, due to increased sales and the impact of pricing and cost control.
Previous wording
The following table sets forth Navico Group segment results and a reconciliation to our non-GAAP measure of adjusted operating earnings for the three months ended:
Current wording
The following table sets forth Navico Group segment results and a reconciliation to our non-GAAP measure of adjusted operating earnings for the three and six months ended:
Previous wording
Navico Group segment's net sales decreased $66.4 million, or 24 percent, in the first quarter of 2024 compared to the first quarter of 2023, driven by reduced sales to marine OEMs as they moderate orders to control the pipeline of their current model-year products, partially offset by strong new product momentum and slightly improved RV sales trends.
Current wording
Navico Group segment's net sales decreased in the second quarter of 2024 compared to the second quarter of 2023, driven by reduced sales to marine OEMs as they balance production levels to match retail ordering patterns, partially offset by strong new product momentum and, while slow, some improvements in RV sales trends.
Previous wording
International sales were 41 percent of the Navico Group segment's net sales in the first quarter of 2024 and decreased 8 percent year over year on a GAAP basis. On a constant currency basis, international sales decreased 9 percent.
Current wording
International sales were 41 percent of the Navico Group segment's net sales in the first half of 2024 and decreased 6 percent year over year on a GAAP and constant currency basis.
Previous wording
Navico Group segment's operating loss in the first quarter of 2024 was $2.4 million, a decrease from operating earnings of $12.8 million in the first quarter of 2023, as the impact from lower sales and increased discount activity was partially offset by lower operating expenses.
Current wording
Navico Group segment's operating earnings in the second quarter of 2024 decreased when compared to the second quarter of 2023, as the impact from lower sales and increased discount activity was only partially offset by lower operating expenses.
Previous wording
The following table sets forth Boat segment results and a reconciliation to our non-GAAP measure of adjusted operating earnings for the three months ended:
Current wording
The following table sets forth Boat segment results and a reconciliation to our non-GAAP measure of adjusted operating earnings for the three and six months ended:
Previous wording
Boat segment's net sales decreased $149.5 million, or 26 percent, in the first quarter of 2024 compared to the first quarter of 2023, due to softer wholesale orders, as its channel partners continue to order cautiously ahead of the model-year change-over, partially offset by the favorable impact of carry-over pricing and share gains.
Current wording
Boat segment's net sales decreased in the second quarter of 2024 compared to the second quarter of 2023, due to softer wholesale orders as channel partners continue to order cautiously, partially offset by the favorable impact of modest model-year pricing and share gains.
Previous wording
International sales were 22 percent of the Boat segment's net sales in the first quarter of 2024 and decreased 32 percent on a GAAP and constant currency basis.
Current wording
International sales were 22 percent of the Boat segment's net sales in both the second quarter and first half of 2024 and decreased 32 percent on a GAAP and constant currency basis versus the same periods in 2023.
Previous wording
Boat segment's operating earnings in the first quarter of 2024 were $29.4 million, a decrease of 49 percent when compared to the first quarter of 2023, due to lower sales and lower absorption from reduced production, partially offset by focused cost reduction activities.
Current wording
Boat segment's operating earnings in the second quarter of 2024 decreased when compared to the second quarter of 2023, as the impact of the net sales declines and lower absorption from reduced production were only partially offset by pricing and continued cost control.
Previous wording
The following table sets forth Corporate/Other results and a reconciliation to our non-GAAP measure of adjusted operating loss for the three months ended:
Current wording
The following table sets forth Corporate/Other results and a reconciliation to our non-GAAP measure of adjusted operating loss for the three and six months ended:
Previous wording
The following table sets forth an analysis of free cash flow for the three months ended:
Current wording
The following table sets forth an analysis of free cash flow for the six months ended:
Previous wording
Net cash used for operating activities of continuing operations in the three months ended March 30, 2024 totaled $148.1 million compared to $14.5 million in the three months ended April 1, 2023. The increase is primarily due to increases in working capital usage and lower net earnings. Working capital is defined as Accounts and notes receivable, Inventories and Prepaid expenses and other, net of Accounts payable and Accrued expenses as presented in the Condensed Consolidated Balance Sheets, excluding the impact of acquisitions and non-cash adjustments.
Current wording
Net cash provided by operating activities of continuing operations in the six months ended June 29, 2024 totaled $67.6 million compared to $254.4 million in the six months ended July 1, 2023. The decrease is primarily due to a higher build of working capital and lower net earnings. Working capital is defined as Accounts and notes receivable, Inventories and Prepaid expenses and other, net of Accounts payable and Accrued expenses as presented in the Condensed Consolidated Balance Sheets, excluding the impact of acquisitions and non-cash adjustments.
Previous wording
The primary drivers of net cash used for operating activities of continuing operations in the three months ended March 30, 2024 was working capital usage partially offset by net earnings, net of non-cash items. Accounts and notes receivable increased $130.4 million, primarily due to the timing of collections. Inventory increased $104.8 million due to seasonal inventory build. Accounts payable decreased $28.8 million, primarily due to timing of payments. Accrued expenses decreased $29.6 million, primarily driven by lower accrued variable compensation expense, including the payment of the prior year's variable compensation which had been accrued as of December 31, 2023.
Current wording
The primary drivers of net cash provided by operating activities of continuing operations in the six months ended June 29, 2024 was net earnings, net of non-cash items, partially offset by working capital. Accounts and notes receivable increased $46.0 million, primarily due to the timing of collections. Inventory increased $87.3 million due to seasonal inventory build. Accounts payable decreased $88.1 million, primarily due to timing of payments. Accrued expenses decreased $29.9 million, primarily driven by lower accrued variable compensation expense.
Previous wording
Net cash used for investing activities was $55.4 million, primarily related to $54.0 million of capital expenditures. Our capital spending was focused on investments in new products and technologies.
Current wording
Net cash used for investing activities was $176.0 million, primarily related to $101.1 million of capital expenditures and $80.9 million of purchases of marketable securities. Our capital spending was focused on investments in new products and technologies.
Previous wording
Net cash provided by financing activities was $294.1 million and primarily related to long-term debt issuances, partially offset by common stock repurchases and cash dividends paid to common shareholders.
Current wording
Net cash provided by financing activities was $157.2 million and primarily related to long-term debt issuances, partially offset by common stock repurchases and cash dividends paid to common shareholders.
Previous wording
Net cash used for operating activities of continuing operations in the three months ended April 1, 2023 totaled $14.5 million versus $140.9 million in the comparable period of 2022. The decrease is primarily due to decreases in working capital usage and income taxes, partially offset by lower net earnings.
Current wording
Net cash provided by operating activities of continuing operations in the six months ended July 1, 2023 totaled $254.4 million versus $149.4 million in the comparable period of 2022. The increase is primarily due to decreases in working capital usage, partially offset by lower net earnings.
Previous wording
The primary drivers of net cash used for operating activities of continuing operations in the three months ended April 1, 2023 were seasonal increases in working capital, partially offset by net earnings, net of non-cash items. Accounts and notes receivable increased $153.8 million, primarily due to increased sales. Inventory increased $38.0 million, driven by seasonal inventory purchases and cost inflation. Accounts payable decreased $59.1 million, primarily due to timing of payments. Accrued expenses decreased $17.4 million, primarily driven by lower accrued variable compensation expense, including the payment of the prior year's variable compensation which had been accrued as of December 31, 2022.
Current wording
The primary drivers of net cash provided by operating activities of continuing operations in the six months ended July 1, 2023 were net earnings, net of non-cash items, partially offset by seasonal increases in working capital. Accounts and notes receivable increased $69.0 million, primarily due to timing of sales. Inventory increased $22.0 million, driven by seasonal inventory purchases and cost inflation. Accounts payable decreased $93.2 million, primarily due to timing of payments. Accrued expenses increased $16.1 million, primarily driven by increased expenses associated with restructuring actions executed during the year and the IT security incident.
Previous wording
Net cash used for investing activities was $94.6 million, which included $93.5 million of capital expenditures and $7.6 million of investment in our joint venture, partially offset by $3.8 million of sales or maturities of marketable securities and $2.7 million of sales of property, plant and equipment. Our capital spending was focused on investments in capacity expansion, new products and technologies.
Current wording
Net cash used for investing activities was $169.7 million, which included $173.4 million of capital expenditures and $6.4 million of investment in our joint venture, partially offset by $6.3 million of sales of property, plant and equipment and $3.8 million of sales or maturities of marketable securities. Our capital spending was focused on investments in capacity expansion, new products and technologies.
Previous wording
Net cash used for financing activities was $100.9 million and primarily related to common stock repurchases and cash dividends paid to common shareholders.
Current wording
Net cash used for financing activities was $204.0 million and primarily related to common stock repurchases and cash dividends paid to common shareholders.
Previous wording
Cash, cash equivalents and mark etable securities totaled $549.2 million as of March 30, 2024, an increase of $80.6 million from $468.6 million as of December 31, 2023, and an increase of $160.6 million from $388.6 million as of April 1, 2023. Total debt as of March 30, 2024, December 31, 2023 and April 1, 2023 was $2,827.3 million, $2,430.4 million and $2,510.3 million, respectively. Our debt-to-capitalization ratio was 58 percent as of March 30, 2024, an increase from 54 percent as of December 31, 2023 and from 55 percent as of April 1, 2023.
Current wording
Cash, cash equivalents and mark etable securities totaled $577.0 millionas of June 29, 2024, an increase of $108.4 million from $468.6 million as of December 31, 2023, and an increase of $98.7 million from $478.3 million as of July 1, 2023. Total debt as of June 29, 2024, December 31, 2023 and July 1, 2023 was $2,827.1 million, $2,430.4 million and $2,510.3 million, respectively. Our debt-to-capitalization ratio was 58 percent as of June 29, 2024, an increase from 54 percent as of both December 31, 2023 and July 1, 2023.
Previous wording
There were no borrowings under the Revolving Credit Agreement (Credit Facility) during the three months ended March 30, 2024 and we did not have any borrowings outstanding as of March 30, 2024. Available borrowing capacity under the Credit Facility as of March 30, 2024 totaled $741.7 million, net of $8.3 million of letters of credit outstanding. During the three months ended March 30, 2024, the maximum amount utilized under the CP Program was $225.0 million. Refer to Note 12 – Debt in the Notes to Condensed Consolidated Financial Statements and Note 14 - Debt in the Notes to Consolidated Financial Statements in the 2023 Form 10-K, for further details.
Current wording
There were no borrowings under the Revolving Credit Agreement (Credit Facility) during the six months ended June 29, 2024 and we did not have any borrowings outstanding as of June 29, 2024. Available borrowing capacity under the Credit Facility as of June 29, 2024 totaled $747.0 million, net of $3.0 million of letters of credit outstanding. During the six months ended June 29, 2024, the maximum amount utilized under the CP Program was $225.0 million, all of which was repaid during the period. Refer to Note 12 – Debt in the Notes to Condensed Consolidated Financial Statements and Note 14 - Debt in the Notes to Consolidated Financial Statements in the 2023 Form 10-K, for further details.
Previous wording
Recent accounting pronouncements that have been adopted during the three months ended March 30, 2024, or will be adopted in future periods, are included in Note 1 – Significant Accounting Policies in the Notes to Condensed Consolidated Financial Statements.
Current wording
Recent accounting pronouncements that have been adopted during the six months ended June 29, 2024, or will be adopted in future periods, are included in Note 1 – Significant Accounting Policies in the Notes to Condensed Consolidated Financial Statements.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Operating earnings in the first half of 2024 were $268.9 million and $322.3 million on a GAAP and As Adjusted basis, respectively. This compares to operating earnings during the first half of 2023 of $430.5 million and $497.3 million on a GAAP and As Adjusted basis, respectively.