GORMAN RUPP CO Segments Disclosure
Note 11 – Business Segment Information
The Company operates in business segment comprising the design, manufacture and sale of pumps and pump systems. The Company’s products are used in water, wastewater, construction, industrial, petroleum, original equipment, agriculture, fire suppression, heating, ventilation and air conditioning (HVAC), military and other liquid-handling applications.
The pumps and pump systems are marketed in the United States and worldwide through a broad network of distributors, through manufacturers’ representatives (for sales to many original equipment manufacturers), through third-party distributor catalogs, and by direct sales. International sales are made primarily through foreign distributors and representatives.
The Company's chief operating decision maker ("CODM") is its chief executive officer, who reviews financial information presented on a consolidated basis. The CODM uses consolidated operating income and net income to assess financial performance and allocate resources. These financial metrics are used by the CODM to make key operating decisions, such as the allocation of capital between reinvestment in the business, the payment of dividends, paying down debt, and/or acquisitions. The measure of segment assets is reported on the balance sheet as total consolidated assets.
The following table presents selected financial information with respect to the Company’s single operating segment for the years ended December 31, 2024, 2023 and 2022:
|
2024 |
2023 |
2022 |
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|
Net sales |
$ | 659,667 | $ | 659,511 | $ | 521,027 | ||||||
|
Less |
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|
Cost of material |
315,240 | 328,731 | 279,290 | |||||||||
|
Labor |
82,012 | 78,898 | 65,376 | |||||||||
|
Overhead |
58,087 | 55,629 | 45,424 | |||||||||
|
Selling |
48,908 | 45,212 | 35,599 | |||||||||
|
General and administrative |
51,598 | 51,448 | 47,518 | |||||||||
|
Amortization expense |
12,379 | 12,552 | 7,637 | |||||||||
|
Operating income |
91,443 | 87,041 | 40,183 | |||||||||
|
Other income (expense): |
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|
Interest expense |
(33,621 | ) | (41,273 | ) | (19,240 | ) | ||||||
|
Other income (expense) |
(7,329 | ) | (1,807 | ) | (7,071 | ) | ||||||
|
Income before income taxes |
50,493 | 43,961 | 13,872 | |||||||||
|
Provision from income taxes |
10,378 | 9,010 | 2,677 | |||||||||
|
Net income |
$ | 40,115 | $ | 34,951 | $ | 11,195 | ||||||
The Company sells to approximately 140 countries around the world. The Company attributes revenues to individual countries based on the customer location to which finished products are shipped. The following tables disaggregate total net sales by geographic location:
|
Geographic Location |
2024 |
2023 |
2022 |
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|
United States |
$ | 491,516 | $ | 497,387 | $ | 381,306 | ||||||
|
Foreign countries |
168,151 | 162,124 | 139,721 | |||||||||
|
Total net sales |
$ | 659,667 | $ | 659,511 | $ | 521,027 | ||||||
As of the years ending December 31, 2024 and 2023, 90.2% and 89.5%, respectively, of the Company’s long-lived assets were located in the United States. For the years ended December 31, 2024 and 2023, individual foreign country held more than 10% of consolidated long-lived assets nor was responsible for more than 10% of consolidated revenue.
About Segments Disclosures
Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.
Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.