Tools and tool storage manufacturer Snap-on reported its 2023 second quarter financial results on July 20, showing a sequential deceleration in year-over-year sales growth while profit margins improved.

The Kenosha, Wisconsin-based company posted 2Q23 total sales of $1.19 billion, up 4.8% year-over-year. Sales narrowly topped 1Q23’s $1.18 billion but considerably trailed its 7.8% YoY growth.

Snap-on said 2Q23 organic sales grew 5.6% year-over-year, down from 10.9% in 1Q23.

The company’s 2Q23 gross margin improved 200 basis points year-over-year to 50.7%, which the company primarily attributed to increased sales volumes and pricing actions, lower material and other costs, and benefits from Snap-on’s Rapid Continuous Improvement initiatives. Sequentially, that gross margin expanded from 1Q23’s 49.8%.

Meanwhile, Snap-on’s 2Q23 operating profit of $344 million on margin of 26.8% topped the $312 million and 25.5% of a year earlier, and topped 1Q23’s $326 million and 25.6%.

Snap-on’s 2Q23 net profit of $264 million topped the $231.5 million of a year earlier and the $249 million in 1Q23.

“Our performance was again encouraging, demonstrating the broad and substantial strength of our enterprise, driving ongoing overall momentum in sales, in profitability, and in earnings, all achieved quarter by quarter in a range of environments,” Snap-on chairman and Chief Executive Officer Nick Pinchuk said in the company’s 2Q23 earnings release. “Today’s results confirm the wide opportunities along our runways for both growth and improvement.

By Snap-on business segment in 2Q23: 

• Commercial & Industrial Group sales of $364 million saw a 3.0% organic sales gain YoY, while operating profit of $58 million topped the $52 million of a year earlier. Operating margin improved 160 bps YoY to 16.0%.
• Snap-on Tools Group sales of $523 million saw organic sales increase 1.1% YoY, while operating profit of $138 million topped the $124 million of a year earlier. Operating margin improved 240 bps YoY to 26.3%.
• Repair Systems & Information Group sales of $452 million saw organic sales improve 8.5% YoY, while operating profit of $110 million topped the $96 million of a year earlier. Operating margin improved 140 bps YoY to 24.4%.