| Segment / Quarter | Q4 2022 | Q1 2023 | Q2 2023 | Q3 2023 | Q4 2023 | Q1 2024 | Q2 2024 | Q3 2024 |
|-------------------|---------|---------|---------|---------|---------|---------|---------|---------|
| **Commercial & Industrial Group (Million $)** | **343.2**  **[0000091440-23-000005_sna-20221231.htm:56]**  | **363.8**  **[0000091440-23-000011_sna-20230401.htm:36]**  | **364.2**  **[0001157523-23-001112_a53468831_ex99.htm:1]**  | **366.4**  **[0001157523-23-001504_a53636246ex99.htm:1]**  | **363.9**  **[0000091440-24-000005_sna-20231230.htm:58]**  | **359.9**  **[0000091440-24-000029_sna-20240330.htm:35]**  | **372.0**  **[0000091440-24-000048_q22024pressreleaseforpress.htm:1]**  | **365.7**  **[0000091440-24-000062_sna-20240928.htm:32]**  |
| **Snap-on Tools Group (Million $)** | **542.7**  **[0000091440-23-000005_sna-20221231.htm:56]**  | **537.0**  **[0001157523-23-000583_a53384374_ex99.htm:2]**  | **523.1**  **[0001157523-23-001112_a53468831_ex99.htm:2]**  | **515.4**  **[0000091440-23-000033_sna-20230930.htm:46]**  | **513.3**  **[0000091440-24-000005_sna-20231230.htm:58]**  | **500.1**  **[0000091440-24-000029_sna-20240330.htm:36]**  | **482.0**  **[0000091440-24-000048_q22024pressreleaseforpress.htm:1]**  | **500.5**  **[0000091440-24-000062_sna-20240928.htm:32]**  |
| **Repair Systems & Information Group (Million $)** | **437.9**  **[0000091440-23-000005_sna-20221231.htm:57]**  | **446.6**  **[0001157523-23-000583_a53384374_ex99.htm:2]**  | **452.0**  **[0001157523-23-001112_a53468831_ex99.htm:2]**  | **431.8**  **[0000091440-23-000033_sna-20230930.htm:47]**  | **450.8**  **[0000091440-24-000005_sna-20231230.htm:59]**  | **463.8**  **[0000091440-24-000029_sna-20240330.htm:36]**  | **454.8**  **[0000091440-24-000048_q22024pressreleaseforpress.htm:1]**  | **422.7**  **[0000091440-24-000062_sna-20240928.htm:32]**  |
| **Financial Services (Million $)** | **88.3**  **[0000091440-23-000005_sna-20221231.htm:57]**  | **92.6**  **[0000091440-23-000011_sna-20230401.htm:34]**  | **93.4**  **[0001157523-23-001112_a53468831_ex99.htm:1]**  | **94.9**  **[0001157523-23-001504_a53636246ex99.htm:1]**  | **97.2**  **[0000091440-24-000005_sna-20231230.htm:59]**  | **99.6**  **[0000091440-24-000029_sna-20240330.htm:37]**  | **100.5**  **[0000091440-24-000048_q22024pressreleaseforpress.htm:1]**  | **100.4**  **[0000091440-24-000062_sna-20240928.htm:32]**  |

faaf7318050e2e80c85c51e5f9f0afc4d15288dfab22150b80b6300ec41cfdb3

f4ca2ad32ee07a65e12aac4949ad76ddba287e1f4aa2dfab993e1013354db453

| Geographical Segment | Q4 2023 | Q3 2023 | Q2 2023 | Q1 2023 | Q4 2022 | Q3 2022 | Q2 2022 | Q1 2022 |
|----------------------|---------|---------|---------|---------|---------|---------|---------|---------|
| **North America (USD millions)** | **3,566.2**  **[0000091440-24-000005_sna-20231230.htm:157]**  | **879.8**  **[0000091440-23-000033_sna-20230930.htm:7]**  | **889.5**  **[0000091440-23-000025_sna-20230701.htm:7]**  | **893.3**  **[0000091440-23-000011_sna-20230401.htm:6]**  | N/A | N/A | N/A | N/A |
| **Europe (USD millions)** | **688.9**  **[0000091440-24-000005_sna-20231230.htm:157]**  | **161.1**  **[0000091440-23-000033_sna-20230930.htm:7]**  | **178.1**  **[0000091440-23-000025_sna-20230701.htm:7]**  | **173.9**  **[0000091440-23-000011_sna-20230401.htm:6]**  | N/A | N/A | N/A | N/A |
| **All Other (USD millions)** | **475.1**  **[0000091440-24-000005_sna-20231230.htm:157]**  | **118.4**  **[0000091440-23-000033_sna-20230930.htm:7]**  | **123.7**  **[0000091440-23-000025_sna-20230701.htm:7]**  | **115.8**  **[0000091440-23-000011_sna-20230401.htm:6]**  | N/A | N/A | N/A | N/A |

409f6848188fc5ca1654b9f9b35d84778192a91e64b4ed48e40c1ea83d7727df

Adjustments for Non-Cash Items [USD, Millions]

Stock-Based Compensation [USD, Millions]

Changes in Working Capital [USD, Millions]

19a221222245d2d609fe4706465df36a7a3819cc3f2196d5c1f47ad7bb9ead77

Snap-on Incorporated is a global innovator, manufacturer, and marketer of tools, equipment, diagnostics, repair information, and systems solutions for professional users performing critical tasks in various industries, including vehicle repair, aerospace, military, natural resources, and manufacturing **[0000091440-24-000005_sna-20231230.htm:5]**. The company operates through four main business segments: the Commercial & Industrial Group, the Snap-on Tools Group, the Repair Systems & Information Group, and Financial Services **[0000091440-24-000005_sna-20231230.htm:6]** **[0000091440-24-000005_sna-20231230.htm:156]**. Snap-on's product lines are categorized into tools, diagnostics, information and management systems, and equipment **[0000091440-24-000005_sna-20231230.htm:157]**.

1. **Tools** - Provides a wide range of hand and power tools for professional users across various industries.
2. **Snap-on Tools Group** - Primarily serves vehicle service and repair technicians through a multinational mobile tool distribution channel.
3. **Repair Systems & Information Group** - Offers solutions for professional vehicle repair customers, including independent repair shops and OEM dealerships.
4. **Commercial & Industrial Group** - Serves a broad range of industrial and commercial customers, including critical industries.
5. **Equipment** - Supplies equipment necessary for professional repair and maintenance tasks.
6. **Diagnostics and Information Systems** - Delivers diagnostic tools and information systems to enhance repair efficiency and accuracy.
7. **Financial Services** - Supports the sales of Snap-on products through financing programs.

2a89d8664e74f8fc1180255c2b73dbe2b53a5bdca6ea8bb6c622f7eb268284f4

1. Recent comments indicate that technicians are hesitant to invest in big-ticket items due to economic uncertainties, leading the Tools Group to pivot towards shorter payback products; how sustainable is this strategy in driving growth, and what are the potential risks if the economic environment doesn't improve?  **[SNA_3402964_2]** ,  **[SNA_3402964_3]** ,  **[SNA_3402964_6]** 

2. With sluggish performance in the RS&I segment's hardware business, particularly in capital-intensive undercar equipment, how do you plan to address the hesitation from repair shops to invest amid high interest rates and uncertainty, and mitigate the impact on your growth?  **[SNA_3402964_26]** 

3. Considering that SFC order growth was flat year-over-year, do you see this as an indication of potential stagnation in demand, and what strategies are you implementing to reinvigorate order momentum among franchisees?  **[SNA_3402964_15]** 

4. Given the mixed economic landscape in Europe with technical recessions in northern countries and challenges in China’s recovery, how do you intend to navigate these geographical headwinds to sustain growth in your critical industries segment?  **[SNA_3402964_2]** ,  **[SNA_3402964_16]** 

5. The industrial division showed strong profitability partly due to the acquisition of Mautz and growth in specialty torque products; can you elaborate on how you plan to maintain this momentum, and are there any concerns about over-reliance on specific product lines or acquisitions for growth?  **[SNA_3402964_16]** 

b902a38afbf24c92b568b3f07a5fe4fc8934ce24a055dfdc584f7862c55aadf5

e69281e1d53a7f612361dec093553fa5fbe59e402d7cf406d77182f0e2a67b15

### Q3 2024 Earnings Call
   - **Issued Period**: Q3 2024
   - **Guided Period**: FY 2024
   - **Guidance**:
     - **Capital Expenditures**: Expected to be approximately **$100 million** for the full year.
     - **Effective Income Tax Rate**: Anticipated to be in the range of **22% to 23%** for the full year.
     - **Corporate Costs**: Expected expenses in the upcoming fourth quarter to be more in line with those incurred in the third quarter of 2024, as the fourth quarter of 2023 included some benefit for the recovery of costs associated with a legal matter, which will not repeat  **[SNA_3402964_19]** **[SNA_3402964_9]** .

### Q2 2024 Earnings Call
   - **Issued Period**: Q2 2024
   - **Guided Period**: FY 2024
   - **Guidance**:
     - **Capital Expenditures**: Expected to be in the range of **$100 million to $110 million** for the full year.
     - **Effective Income Tax Rate**: Anticipated to be in the range of **22% to 23%** for the full year  **[SNA_3393415_9]** .

### Q1 2024 Earnings Call
   - **Issued Period**: Q1 2024
   - **Guided Period**: FY 2024
   - **Guidance**:
     - **Capital Expenditures**: Expected to be in the range of **$100 million to $110 million** for the full year.
     - **Effective Income Tax Rate**: Anticipated to be in the range of **22% to 23%** for the full year  **[SNA_3379994_8]** .

### Q4 2023 Earnings Call
   - **Issued Period**: Q4 2023
   - **Guided Period**: FY 2024
   - **Guidance**:
     - No specific financial metrics guidance was provided. The CEO mentioned expectations for the Tools Group to grow and meet their expectations, but no explicit guidance on financial metrics such as revenue, earnings, or margins was provided  **[SNA_3372460_18]** **[SNA_3372460_8]** .

32da1213fc253e2f6de982f02a48714c1b603e69ba4061af86af0a9ac7a154d2

North America

United States

Europe

All Other

Total Net Sales

Financial Services Revenue

Total Revenue

c035fbb4e32b40714f79f74854433da493a86456681809fc2a95469b7471f56b

142008d3631350b07b70d0618c3d840807250f0060167acf29e433e9313cd61b

**Quarterly guidance for Q4 2024:**
- **Corporate Costs**: Expected expenses in the upcoming fourth quarter to be more in line with those incurred in Q3 2024  **[SNA_3402964_19]** **[SNA_3402964_9]**  (no prior guidance)

**Annual guidance for FY 2024:**
- **Capital Expenditures**: $100 million  **[SNA_3402964_19]** **[SNA_3402964_9]**  (lowered from $100 million to $110 million  **[SNA_3393415_9]** )  
- **Effective Income Tax Rate**: 22% to 23%  **[SNA_3402964_19]** **[SNA_3402964_9]**  (no change from prior guidance  **[SNA_3393415_9]** )

3019324d2b69f2b6c2564a16cb590f737448130d8a54e70fe0568bab2ea75958

| Name                | Position                                                                 | Start Date | Short Bio                                                                                                                                                       |
|---------------------|--------------------------------------------------------------------------|------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Nicholas T. Pinchuk | Chairman of the Board, President, and Chief Executive Officer            | 2007       | Nicholas T. Pinchuk has been serving as Chairman of the Board since 2009 and as President and CEO since December 2007. He previously held various roles at Carrier Corporation  **[0000091440-24-000005_sna-20231230.htm:86]** **[0001193125-24-065013_d590659ddef14a.htm:8]** . |
| Aldo J. Pagliari    | Senior Vice President – Finance and Chief Financial Officer               | 2010       | Aldo J. Pagliari has been serving as the Senior Vice President – Finance and CFO since 2010, overseeing the company's financial operations  **[0000091440-24-000005_sna-20231230.htm:86]** **[0000091440-23-000005_sna-20221231.htm:84]** .               |
| Jesus M. Arregui    | Senior Vice President and President – Commercial Group                    | 2019       | Jesus M. Arregui has been serving as Senior Vice President and President – Commercial Group since 2019. He was previously President of SNA Europe from 2015 to 2019  **[0000091440-24-000005_sna-20231230.htm:86]** . |
| Anup R. Banerjee    | Senior Vice President – Human Resources and Chief Development Officer     | 2015       | Anup R. Banerjee has been serving as Senior Vice President – Human Resources and Chief Development Officer since 2015, contributing to leadership and development strategies  **[0000091440-24-000005_sna-20231230.htm:86]** . |
| Iain Boyd           | Vice President – Operations Development                                   | 2015       | Iain Boyd has been serving as Vice President – Operations Development since 2015. As of December 30, 2023, he is 61 years old  **[0000091440-24-000005_sna-20231230.htm:86]** .                               |
| Timothy L. Chambers | Senior Vice President and President – Snap-on Tools Group                 | 2019       | Timothy L. Chambers has been serving as Senior Vice President and President – Snap-on Tools Group since 2019. He was previously President of the Commercial Group from 2015 to 2019  **[0000091440-24-000005_sna-20231230.htm:86]** . |
| June C. Lemerand    | Vice President and Chief Information Officer                              | 2017       | June C. Lemerand has been serving as Vice President and Chief Information Officer since 2017, with over 20 years of experience in information technology  **[0000091440-24-000005_sna-20231230.htm:86]** **[0000091440-24-000005_sna-20231230.htm:37]** . |
| Richard T. Miller   | Vice President, General Counsel and Secretary                             | 2018       | Richard T. Miller has served as Vice President, General Counsel and Secretary since 2018. He was previously Associate General Counsel from 2012 to 2018  **[0000091440-24-000005_sna-20231230.htm:86]** **[0000091440-23-000005_sna-20221231.htm:84]** .  |
| Marty V. Ozolins    | Vice President and Controller                                             | 2021       | Marty V. Ozolins has been serving as Vice President and Controller since 2021. He was previously Vice President and Director of Internal Audit from 2016 to 2021  **[0000091440-24-000005_sna-20231230.htm:86]** . |
| Thomas J. Ward      | Senior Vice President and President – Repair Systems & Information Group  | 2010       | Thomas J. Ward has been serving as Senior Vice President and President – Repair Systems & Information Group since 2010  **[0000091440-24-000005_sna-20231230.htm:86]** .                                      |

76f313a580f0aa61e543d680300a850a171a729eafa0c72bb454b2775dafcff8

| Program Details          | Program 1       | Program 2       |
|--------------------------|-----------------|-----------------|
| Approval Date            | 2021-11-04  **[0000091440-24-000062_sna-20240928.htm:54]**   | 2024-08-08  **[0000091440-24-000062_sna-20240928.htm:54]**   |
| End Date/Duration        | Until limit met  **[0000091440-24-000062_sna-20240928.htm:54]**  | Until limit met  **[0000091440-24-000062_sna-20240928.htm:54]**  |
| Total additional amount  | $500 million  **[0000091440-24-000062_sna-20240928.htm:54]**  | $500 million  **[0000091440-24-000062_sna-20240928.htm:54]**  |
| Remaining authorization amount | $0  **[0000091440-24-000062_sna-20240928.htm:54]**          | **$471.5 million**  **[0000091440-24-000062_sna-20240928.htm:54]**  |
| Details                  | Replaced by 2024 Authorization  **[0000091440-24-000062_sna-20240928.htm:54]**  | Active  **[0000091440-24-000062_sna-20240928.htm:54]**  |

9203e156b0c8adbad58d9ae649424e5dcf0c5340fdfd478d3fc36f4ab27ddf9a

fc09813748d48244f6f98151517db49f0c44d039752108d0a0da3545a21da9de

| Name                | Start Date | End Date | Reason for Change |
|---------------------|------------|----------|-------------------|
| Deloitte & Touche LLP | 2002       | Present  | Current auditor   |  **[0000091440-24-000005_sna-20231230.htm:97]**  |

445bdb1b35482036fe4f03033b16072c55a1ea1d918e3bc3199f17c44dd5b0f3

23794d91c53ae875c8e247d72561e35d9d06ee07c70c9e0dbcc977a6d161504a

- Total Revenue: $1,247.4 million (-1% YoY)  **[0000091440-24-000062_sna-20240928.htm:41]** **[0000091440-23-000033_sna-20230930.htm:7]**   
- Commercial & Industrial Group: $365.7 million (flat YoY)  **[0000091440-24-000062_sna-20240928.htm:41]** **[0000091440-23-000033_sna-20230930.htm:44]**   
- Snap-on Tools Group: $500.5 million (-3% YoY)  **[0000091440-24-000062_sna-20240928.htm:41]** **[0000091440-23-000033_sna-20230930.htm:7]**   
- Repair Systems & Information Group: $422.7 million (-2% YoY)  **[0000091440-24-000062_sna-20240928.htm:41]** **[0000091440-23-000033_sna-20230930.htm:47]**   
- Financial Services: **$100.4 million (+6% YoY)**  **[0000091440-24-000062_sna-20240928.htm:41]** **[0000091440-23-000033_sna-20230930.htm:7]**   
- Operating Income (EBIT): **$324.1 million (-15% YoY)**  **[0000091440-24-000062_sna-20240928.htm:2]** **[0000091440-23-000033_sna-20230930.htm:2]**   

b60c082c91f7d2c89c00afbc9f02e72d9cc795688d0c5f3d86598a07ca6bf40c

62b1529e686d83154cd6605d70e8109698a6b7334841fafa404e1cab89ef8879

Finance receivable originations (USD millions)

Average yield on finance receivables (percent)

Average yield on contract receivables (percent)

Financial services expenses as a percentage of the average financial services portfolio (percent)

d558245f8182c10a66f91223f6cc395e86664209647f6e4c6a01b4a55b1777ef

1. **Decline in Power Tools and Diagnostics**  
   **Q:** Power tools weakest; quantify and discuss other subsegments?  
   **A:** Power tools sales were down **double digits**  **[SNA_3379994_10]** ; diagnostics were also down.  **[SNA_3379994_10]**  However, tool storage was up, and hand tools were less affected.  **[SNA_3379994_10]**  There's a shift towards shorter payback items.  **[SNA_3379994_10]** 

2. **Pivot to Short Payback Items**  
   **Q:** Will you increase promotions or restore growth in Tools segment?  
   **A:** We're focusing on pivoting to offer more short payback items.  **[SNA_3379994_16]**  We're designing new products and adjusting factory capacity to meet technicians' preference for quicker returns.  **[SNA_3379994_16]** **[SNA_3379994_22]** 

3. **Timeline for Improvement**  
   **Q:** How long to align focus and see improvement?  
   **A:** It's hard to say, but we're working with urgency and expect to see improvement as we go forward.  **[SNA_3379994_15]** **[SNA_3379994_22]** 

4. **Manufacturing Capacity Progress**  
   **Q:** Progress with manufacturing capacity; did it offset negatives?  
   **A:** We've made good progress in Algona, especially in tool storage.  **[SNA_3379994_17]**  We're shifting capacity to produce more short payback items.  **[SNA_3379994_16]** 

5. **Franchisee Inventory Putback**  
   **Q:** Was inventory putback from franchisees a negative factor?  
   **A:** There was some inventory putback, but perhaps a bit less than last quarter.  **[SNA_3379994_18]** 

6. **Credit Trends and Originations**  
   **Q:** How are credit trends amid flat originations and lower big-ticket sales?  
   **A:** Penetration rates are steady; lower big-ticket sales mean lower originations, but no significant change in credit participation.  **[SNA_3379994_20]** **[SNA_3379994_19]**  Provisions increased by **$4 million**.  **[SNA_3379994_20]** 

7. **Technicians' Confidence Impact**  
   **Q:** Strength from shops contrasts technicians' confidence?  
   **A:** Shops are performing well, but technicians are cautious due to economic uncertainty, affecting purchases of big-ticket items.  **[SNA_3379994_14]** **[SNA_3379994_21]** 

8. **RS&I Opportunities**  
   **Q:** How is the RS&I segment performing and opportunities ahead?  
   **A:** RS&I external sales were up **5.8%**.  **[SNA_3379994_12]**  Growth comes from new models launched, booming North American equipment business, and strong software performance.  **[SNA_3379994_23]** 

9. **Market Share and Competition**  
   **Q:** Are you maintaining market share amid competition?  
   **A:** We don't believe we're losing market share.  **[SNA_3379994_27]**  Franchisees haven't reported issues, and there's no significant impact from competitors like Matco.  **[SNA_3379994_27]** 

10. **Sell-in vs Sell-out**  
    **Q:** What did sell-in vs sell-out look like for franchise tools?  
    **A:** Franchisees sold more off their vans than they bought, especially towards the end; sell-out was better than sell-in.  **[SNA_3379994_25]** 

11. **Specific Pullbacks in Power Tools**  
    **Q:** Any markets driving power tools decline?  
    **A:** No specific pullbacks noted. Sales follow new product introductions; industrial demand remains strong, but garage purchases are affected by uncertainty.  **[SNA_3379994_24]** 

b4b283cb51e5eca9a6cdbf6fc4baed5714218500bc2b98fd140f5588990f4ab3

- **Declining sales in the Snap-on Tools Group**: The company reported a **7.7% organic sales decline** in the Snap-on Tools Group, primarily due to uncertainty among technicians affecting demand.  **[SNA_3393415_15]**
- **Operating expenses remain high despite lower sales volumes**: Management acknowledged that they **didn't back off** on spending and maintained support levels even with decreased sales, potentially leading to **operating expense deleverage** and pressure on margins.  **[SNA_3393415_15]** **[SNA_3393415_19]**
- **Execution risks with facility expansions**: The company is expanding facilities to increase capacity, but **some are not yet operating at high efficiency**, suggesting potential delays in realizing expected benefits and efficiencies from these investments.  **[SNA_3393415_11]**

36bdd25d78344fd809b55d1a1e198696e4d15472d574e5fed45e96dd87496079

- **Snap-on expects the Tools Group to return to growth by pivoting to shorter payback items, leveraging their strong product lineup in hand tools, tool storage carts, and diagnostics, which they have successfully done in past periods.**  **[SNA_3372460_10]**
- **The automotive repair market remains robust with positive trends such as increased miles driven, higher household spending on repair, rising technician wages, and a growing number of technicians, providing a favorable environment for Snap-on's products.**  **[SNA_3372460_17]**
- **Strong performance in the Critical Industries (C&I) segment, with double-digit sales growth and improving margins, demonstrates Snap-on's ability to diversify and capitalize on opportunities beyond automotive repair.**  **[SNA_3372460_3]** **[SNA_3372460_8]** **[SNA_3372460_7]**

14e926fbbaa6c41e47f95d528f19fc99b73b73577c77595d3fe51383d107e04f

- **Softness in hardware sales within RS&I**, particularly undercar equipment like aligners and lifts, due to customers delaying big-ticket purchases amid macroeconomic uncertainty and higher financing costs.  **[SNA_3402964_26]**
- **Negative impact from CDK's disruption**, which diverted dealership attention away from purchasing equipment, as they focused on staying operational without a computer system. This was **not a favorable event** for Snap-on in the quarter.  **[SNA_3402964_26]**
- **Technician customers are hesitant to purchase big-ticket items** due to uncertainties such as elections, interest rates, and global events like wars, affecting demand for Snap-on's products.  **[SNA_3402964_26]**

fb7c266ff184ba236312a0ef055fb252db6c2d9ed7743760d15efc4e72afbb23

1. **Tools Group Growth Prospects**  
   **Q:** Can you grow the Tools business this earnings?  
   **A:** Nicholas Pinchuk affirmed that they can grow the Tools Group despite challenges. Drawing on past experiences during the pandemic and financial recession, they plan to pivot towards shorter payback items like **hand tools**, **diagnostics**, **tool storage carts**, and lower-priced tool storage boxes like the **classic series**. They are focusing on product innovation and deploying field teams to support franchisees. * **[SNA_3372460_10]** *

2. **Shift in Product Mix and Margins**  
   **Q:** Could you split out the different subsegments within Tools?  
   **A:** The biggest decline was in **diagnostics**, especially higher-priced items like **ZEUS** and **Triton**. **Tool storage** was up slightly due to carts, while **hand tools** were down somewhat. The shift towards higher-margin products like tool storage and hand tools improved margins, as these products provide both distribution and manufacturer margins. * **[SNA_3372460_14]** *

3. **Credit Usage and Trends**  
   **Q:** How did mechanic sentiment shifts affect credit appetite?  
   **A:** There's likely less credit use in the current environment, with **originations down 1%** in the U.S. This trend mirrors previous periods, like post-COVID. Customers may pivot away from credit due to economic concerns, even though they have jobs and cash flow. * **[SNA_3372460_11]** *

4. **Competitive Dynamics and Market Share**  
   **Q:** Was there any share loss to competitors this quarter?  
   **A:** Nicholas Pinchuk doesn't believe there was share loss, noting they cover the market with about **3,400** franchisees. Franchisees haven't reported increased competition impacting sales significantly. * **[SNA_3372460_18]** *

5. **Pricing Actions**  
   **Q:** Are pricing actions on the table?  
   **A:** No major pricing adjustments are planned. Snap-on typically achieves **30 to 40 basis points** of pricing. They rely more on continuous improvement and new product introductions for margin gains, focusing on shifting towards shorter payback items rather than altering pricing strategies. * **[SNA_3372460_13]** *

6. **Economic Sentiment Impact**  
   **Q:** Any warning signs for the underlying business demand?  
   **A:** Nicholas Pinchuk doesn't see warning signs. Metrics like household spending on repair (up **4%**), number of technicians (up **4.5%**), and technician wages (up **7%**) are positive. He believes the market remains strong and expects the Tools Group to grow. * **[SNA_3372460_16]** *

7. **Corporate Expense Changes**  
   **Q:** Anything notable in the corporate expense line in Q4?  
   **A:** There was lower spending due to a favorable legal settlement. Total corporate expenses were about **$113 million**, up **$5 to $6 million** year-over-year, but the run rate remains typical. * **[SNA_3372460_13]** *

8. **Credit Standards and Demand**  
   **Q:** Opportunity to relax credit standards to boost demand?  
   **A:** No, Snap-on doesn't plan to relax credit standards or discount interest rates to stimulate sales. Discounting isn't their approach; they prefer maintaining credit quality and may consider creative promotions or bundling instead. * **[SNA_3372460_17]** *

9. **Regional Kickoffs and Outlook**  
   **Q:** What's the outlook from recent regional kickoffs?  
   **A:** They adjusted the kickoff approach, focusing on shorter payback items and extending programs into February and March. Franchisees appear positive and undaunted by current conditions. * **[SNA_3372460_17]** *

10. **Power Tools and Inventory Adjustment**  
    **Q:** Was there a one-time adjustment in power tools orders?  
    **A:** The Tools Group reduced purchases of power tools and diagnostics, leading to lower intersegment sales from C&I and RS&I. Demand shifted from higher-priced **18-volt** tools to more affordable **14.4-volt** tools, and supply chain constraints limited the ability to meet this demand fully. * **[SNA_3372460_12]** *

94119654a72bd73a2d8c279a5cd62078af1364d873c9eafc804521b3e1e8d6d5

- **Strong momentum in critical industries like aviation and defense**, with robust demand for custom kits and control solutions, boosting growth in the Commercial & Industrial (C&I) group.  **[SNA_3379994_2]**
- **Introduction of innovative new products**, including new power tools like the PH3045B AirHammer, expected to drive sales growth in upcoming quarters.  **[SNA_3379994_2]** **[SNA_3379994_11]**
- **Management confidence in maintaining market share**, with adjustments in strategy to focus on quick payback products that meet current customer preferences, which are starting to show positive momentum.  **[SNA_3379994_26]** **[SNA_3379994_2]** **[SNA_3379994_15]**

c75874ee7e15eb85b68df0da9baf54c1ce292bfbacf04a116bd60333a7670e6b

1. **Tools Group Momentum**  
   **Q:** How did the pivot in the Tools Group impact Q3 growth?  
   **A:** The shift towards hand tools significantly drove growth, with hand tools being the strongest category this quarter.  **[SNA_3402964_13]**  Hand tools represented a major mix of sales for franchisees, helping margins and reflecting what customers are ready to buy.  **[SNA_3402964_13]** 

2. **Diagnostics and Software Growth**  
   **Q:** Is the Apollo Plus driving growth in Diagnostics, and does the Tools Group benefit?  
   **A:** The launch of **Apollo Plus** boosted Diagnostics sales, with sales and activations up substantially year-over-year.  **[SNA_3402964_22]**  It's the most cost-effective way to get intelligent diagnostics, appealing to the market.  **[SNA_3402964_22]**  Tools Group benefits, and software subscriptions are up substantially, contributing to profitability.  **[SNA_3402964_22]** 

3. **Gross Profit Improvement**  
   **Q:** What contributed to the 100 basis point gross profit increase in Snap-on Tools?  
   **A:** The increase resulted from a combination of factors: category mix favoring hand tools, efficiencies from new factory arrangements, and lower steel costs.  **[SNA_3402964_18]**  Hand tools provided some favorability, but improvements were across the board.  **[SNA_3402964_18]** 

4. **Q4 Growth Outlook**  
   **Q:** How are you thinking about Q4 growth for Snap-on Tools?  
   **A:** While not providing guidance, we believe the Tools Group has momentum.  **[SNA_3402964_19]**  With uncertainty, customers want lower payback items, and we're catering to that with compelling new products and expanded factory capacity.  **[SNA_3402964_19]** 

5. **RS&I Hardware Sales**  
   **Q:** What's happening with hardware sales in RS&I?  
   **A:** Hardware sales, particularly equipment like aligners and lifts, are seeing a slowdown.  **[SNA_3402964_26]**  Customers are hesitant to make big-ticket purchases due to macroeconomic factors and may delay installations.  **[SNA_3402964_26]** 

6. **Torque Products Growth**  
   **Q:** What's driving growth in torque products in C&I?  
   **A:** Increasing complexity in critical industries requires more precise tools, and torque wrenches provide that precision.  **[SNA_3402964_14]**  Additionally, the need for documentation is driving demand, as our tools connect with factory systems to record correct application.  **[SNA_3402964_14]**  This business grew in profits and sales in the quarter.  **[SNA_3402964_14]** 

7. **Franchisee Attrition Trends**  
   **Q:** Can you update us on franchisee attrition trends?  
   **A:** Attrition trends have remained about the same, fluctuating by tenths of a point quarter-to-quarter.  **[SNA_3402964_20]**  We saw an increase in the number of assistants as a percent of franchisees, which is favorable.  **[SNA_3402964_20]** 

8. **Corporate Expense Modeling**  
   **Q:** How should we model corporate expenses for 2025?  
   **A:** Lower expenses this year are due to reduced performance-based compensation.  **[SNA_3402964_24]**  For 2025, model around **$27 million per quarter**.  **[SNA_3402964_24]**  This year's slower growth affected performance-based compensation.  **[SNA_3402964_24]** 

9. **Election Impact**  
   **Q:** How might the election outcome impact your business?  
   **A:** It's difficult to predict the impact due to uncertainty around policy specifics.  **[SNA_3402964_25]**  Tariffs could require adjustments but might benefit those producing locally.  **[SNA_3402964_25]** 

10. **SFC Orders and Fulfillment**  
    **Q:** How did SFC orders perform and what's the fulfillment pattern?  
    **A:** SFC orders were flat year-over-year, adjusted for a shorter selling period.  **[SNA_3402964_15]** **[SNA_3402964_17]**  We've planned reinforcing promotions and expect fulfillment over a shorter period.  **[SNA_3402964_16]** **[SNA_3402964_17]** 

11. **Mechanic Sentiment and Sales Mix**  
    **Q:** Is improved momentum due to product mix or mechanic sentiment?  
    **A:** Mechanic sentiment isn't improving.  **[SNA_3402964_23]**  Momentum comes from pivoting to offer attractive, quick payback items that customers can buy without long financing.  **[SNA_3402964_23]**  Third quarter sales were up over second quarter, indicating momentum.  **[SNA_3402964_23]** 

dc4e26b1abaef813d3f3e259ce80161595ce8597333928826a0971f488b44ee1

- **Hand tools were the strongest category in the quarter**, significantly contributing to sales and margins, reflecting a successful pivot to meet customer preferences.  **[SNA_3402964_13]**
- **Gross profits in the Snap-on Tools segment increased by 100 basis points**, driven by lower cost of steel, efficiency improvements from new factory arrangements, and better efficiencies, leading to improved operational performance.  **[SNA_3402964_18]**
- **Introduction of new products and promotions** boosted sales, with **500 out of 4,500 products displayed at the tool show being new**, enhancing customer offerings and driving growth.  **[SNA_3402964_13]**

b24f51c0187a3ae913ab7bc7ebad91992ed0a52202f5bafe7f208078c055adb6

- **The Tools Group experienced a 5.7% organic sales decline in the quarter**, driven by significant decreases in sales of high-margin diagnostic products like ZEUS and Triton, with hand tools also down.  **[SNA_3372460_15]**
- **The company acknowledged that if the Tools Group doesn't return to growth, they will be below expectations**, indicating potential challenges ahead.  **[SNA_3372460_18]**
- **Truck sales were still down in the fourth quarter, albeit less than the Tools Group**, suggesting ongoing issues in sell-through and demand.  **[SNA_3372460_20]**

ca7e2fce5722d750dc9428d6c3177b080e870fda9ed4eaf55394a739a0a9ce39

1. **Tools Group Sales Decline and Outlook**  
   **Q:** Will the Tools Group see negative growth in the second half?  
   **A:** Nicholas Pinchuk acknowledged a **7.7% organic sales decline** in the Tools Group for Q2  **[SNA_3393415_15]** , but he refrained from predicting negative growth for the second half.  **[SNA_3393415_18]**  He highlighted positive factors like new product initiatives and capacity expansions that could mitigate declines.  **[SNA_3393415_18]** **[SNA_3393415_23]**  However, he noted that global uncertainty makes forecasting challenging.  **[SNA_3393415_18]** 

2. **Manufacturing Capacity Expansion Impact**  
   **Q:** How is capacity expansion affecting sales and efficiency?  
   **A:** The company is expanding facilities in Algona, Milwaukee, and Elizabeth, increasing capacities by **25–35%**.  **[SNA_3393415_11]**  These expansions are breaking bottlenecks and enabling production of new, quicker payback items like a 36-inch small Epic toolbox.  **[SNA_3393415_11]**  Nicholas Pinchuk expects capacity improvements to positively impact sales in upcoming quarters, with Q3 better than Q2, and Q4 improving further.  **[SNA_3393415_23]** 

3. **Shift from Big Ticket to Lower Payback Items**  
   **Q:** How are lower payback items influencing sales mix?  
   **A:** Technicians are showing aversion to big ticket items amid uncertainty, leading to decreased sales in diagnostics and tool storage.  **[SNA_3393415_12]** **[SNA_3393415_17]**  The company is pivoting to offer smaller, quicker payback items like wrenches and ratchets, which, despite a lower price per unit, are sold at good margins.  **[SNA_3393415_15]**  This shift requires selling more units to offset the decline in higher-priced items.  **[SNA_3393415_15]** 

4. **Gross Margins and Profitability**  
   **Q:** How are gross margins holding up amid sales declines?  
   **A:** Despite the sales decline, gross margin in the Tools Group decreased only by **20 basis points**, evidencing strong profitability.  **[SNA_3393415_15]**  New products are selling at good margins, and software content is increasing.  **[SNA_3393415_15]** **[SNA_3393415_17]**  Overall corporate gross margin decreased by just **10 basis points**, with C&I up **220 basis points** and RS&I up **50 basis points**.  **[SNA_3393415_15]** 

5. **RS&I Division Performance**  
   **Q:** How is the RS&I division performing, especially between OEMs and independents?  
   **A:** Sales to OEM dealerships are strong, growing high single digits, driven by OEM programs adjusting to new vehicle technologies.  **[SNA_3393415_14]**  Independent shops are showing progress, particularly through direct sales, but distributor reluctance and inventory reductions are affecting sales.  **[SNA_3393415_14]**  Overall, external sales in RS&I were up over **4% organically**.  **[SNA_3393415_14]** 

6. **Credit Health and Originations**  
   **Q:** Are there increases in RA transfers affecting originations?  
   **A:** The mix of credit activities remains similar to last quarter, with no pivot to RA transfers as a funding method.  **[SNA_3393415_21]**  Originations, a surrogate for big ticket sales, were down more than the overall Tools Group.  **[SNA_3393415_12]** 

7. **Operating Expenses and Deleveraging**  
   **Q:** Will operating expenses in the Tools Group continue deleveraging?  
   **A:** Operating expenses deleveraged due to lower volumes, but the company maintained spending to support franchisees.  **[SNA_3393415_19]**  Nicholas Pinchuk stated they plan to hold support levels, adjusting spending to match the current environment without significant increases.  **[SNA_3393415_19]** 

8. **Capital Allocation Plans**  
   **Q:** How is the company approaching capital allocation given its cash position?  
   **A:** The company prioritizes funding its business, maintaining dividends, considering acquisitions, and assessing stock buybacks.  **[SNA_3393415_25]**  Nicholas Pinchuk indicated they will carefully evaluate dividend increases and acquisitions while noting that their stock buyback authorization is lower than before.  **[SNA_3393415_25]** 

9. **Competition Impact**  
   **Q:** Is competition affecting market share at the shop level?  
   **A:** Nicholas Pinchuk stated that competitors are not significantly impacting their business.  **[SNA_3393415_24]**  Technicians and franchisees do not mention competitors, and there is no evidence of increased competitor presence.  **[SNA_3393415_24]**  The main challenges are from uncertainty and internal factors, not competition.  **[SNA_3393415_24]** 

10. **Critical Industries Performance**  
    **Q:** What is the outlook for critical industries?  
    **A:** Critical industries are performing well, with **double-digit growth**.  **[SNA_3393415_26]**  The military sector is consistently strong due to global tensions, and aviation was robust in the quarter.  **[SNA_3393415_26]**  Education sales are up, indicating young technicians' interest in Snap-on products.  **[SNA_3393415_26]**  Customized products and custom kitting are in demand across industries.  **[SNA_3393415_26]** 

6b68632a296e3eef6676a60b5241556de9745797e06f2c07600a4305a7af0a8d

Snap-On Inc (SNA)

Financials