On this page of StockholderLetter.com we present the latest annual shareholder letter from NOVANTA INC — ticker symbol NOVT. Reading current and past NOVT letters to shareholders can bring important insights into the investment thesis.

Dear Fellow Shareholders, At Novanta, our mission is to be a trusted sole-sourced technology partner to leading global original equipment manufacturers (OEMs), improving end-user productivity in medical and advanced industrial markets. Novanta s proprietary products and technologies are well positioned in applications with long-term secular tailwinds, such as precision manufacturing, robotics and automation, advanced surgery, and precision medicine. Our winning growth strategy is focused on increasing content in these high growth markets through new innovations and design wins with market-leading OEMs, as well as compounding our growth through acquisitions. Our performance has been resilient under multiple geopolitical and macroeconomic scenarios, founded on strong customer relationships, a strong and diversified portfolio, our sticky business model, and our efforts to institutionalize the Novanta Growth System (NGS) deep into our company culture. We believe our playbook will continue to drive robust performance through the economic cycles, and deliver predictable, consistent, long-term growth and shareholder value, no matter the environment. Novanta achieved solid financial results for the full year 2024, effectively navigating a persistently challenging environment. We delivered $949 million in revenue, representing 8% reported growth, which was driven by the impact of our acquisition of Motion Solutions at the beginning of the year. On an organic(1) basis, sales declined (2%) for the year, due to choppy market demand in life science and industrial end markets. We had strong operating performance, achieving Adjusted Gross Margins of 47%, with our core businesses expanding margins by roughly 120 basis points. Adjusted EBITDA(1) for the full year was $210 million, growing 7% yearover-year. We achieved record Operating Cash Flow of $159 million, up 32% year-over-year. In the year, we launched 15 new products, and received initial orders from our customers supporting our new product revenue ramp in 2025 and beyond. Some highlights include: launching multiple new next generation smoke-evacuation insufflators with leading medical device OEMs; launching a new endoscopic pump product, with more next generation pumps ready for launch in the near future; launching multiple new components designed for advanced robotics applications such as warehouse automation and humanoid robotics. Across all our end markets, we continue to stay focused on gaining content and share in multiple high-growth application areas, particularly in medical end markets, based on a robust innovation pipeline over the coming years. Based on the strength of these new product launches, we have sustained confidence in Novanta s long-term organic growth outlook. We continue to invest in our company culture, which we call the Novanta Way. Our focus is on giving our employees a sense of belonging within the company, and on improving employment engagement. One of the most critical aspects of our company culture is using NGS to drive excellence into the many ways we work together. In 2024, we leveraged NGS to enhance performance across our factory teams, commercial organization, R&D, and product management. We doubled the number of Kaizen events and trained over 100 employees as NGS practitioners, driving continuous improvement. These efforts significantly boosted our operations by speeding up product launches, reducing lead times and inventory, improving gross margins, and expanding our commercial funnel with new OEM opportunities. NGS is integral to Novanta s identity, fostering cross functional teamwork and effective problem-solving. At Novanta, acquisitions remain our number one capital allocation priority. In the last 10 years we have executed 20 transactions and deployed over $1.1 billion of capital. In 2024, we closed the Motion Solutions acquisition, which is an attractive business that makes advanced motion control subsystems, mainly for OEM customers in the life science market. The integration of Motion Solutions has gone smoothly, and we feel the long-term outlook for this business is solid. We maintain a large and exciting pipeline of potential targets and our balance sheet is well positioned for sizeable transactions as we head into 2025. We have also made some significant organizational changes to better prepare for scaling Novanta organically and inorganically. As of January 2025, we have appointed two Co-Chief Operating Officers to the Novanta Leadership team, who will be responsible for organic growth strategies, driving the Novanta Growth Systems and other enterprise initiatives and for creating a robust organization capability and capacity to receive new acquisitions. The Automation Enabling Technologies segment will be led by Chuck Ravetto. We are also excited to welcome John Lesica to Novanta, who will be responsible for the Medical Solutions segment. In summary, Novanta delivered solid operating performance in 2024 while navigating a difficult macroeconomic environment. The fundamentals of Novanta are strong, and we remain confident in our strategy, in our portfolio, our exposure to diversified end-markets, and in our ability to generate strong operating cash flows to compound our growth through our targeted acquisition strategy. As we look to 2025, we have three priorities: first, ramp all our planned new products; second, further expand our margins and cashflows using NGS; and third, continue to acquire additional companies that fit our strategy, at attractive returns. In closing, as always, I would like to thank our customers, our employees, and our shareholders, for their ongoing support. I am particularly grateful to our dedicated Novanta teammates, and am inspired by their persistent efforts to live the Novanta values and go above and beyond our expectations. Our achievements couldn t happen without them. Yours truly, /s/ Matthijs Glastra Chair of the Board of Directors and Chief Executive Officer April 25, 2025 (1) A non-GAAP financial measures. Reconciliations of GAAP to non-GAAP financial measures can be found beginning on page 107.
 • shareholder letter icon 4/25/2025 Letter Continued (Full PDF)
 • stockholder letter icon 4/3/2024 NOVT Stockholder Letter
 • stockholder letter icon More "Electronic Equipment & Products" Category Stockholder Letters
 • Benford's Law Stocks icon NOVT Benford's Law Stock Score = 96


NOVT Shareholder/Stockholder Letter Transcript:



Dear Fellow Shareholders,
At Novanta, our mission is to be a trusted sole-sourced technology partner to leading global original equipment manufacturers
(OEMs), improving end-user productivity in medical and advanced industrial markets. Novanta   s proprietary products and
technologies are well positioned in applications with long-term secular tailwinds, such as precision manufacturing, robotics and
automation, advanced surgery, and precision medicine. Our winning growth strategy is focused on increasing content in these high
growth markets through new innovations and design wins with market-leading OEMs, as well as compounding our growth through
acquisitions. Our performance has been resilient under multiple geopolitical and macroeconomic scenarios, founded on strong
customer relationships, a strong and diversified portfolio, our sticky business model, and our efforts to institutionalize the Novanta
Growth System (NGS) deep into our company culture. We believe our playbook will continue to drive robust performance through the
economic cycles, and deliver predictable, consistent, long-term growth and shareholder value, no matter the environment.
Novanta achieved solid financial results for the full year 2024, effectively navigating a persistently challenging environment. We
delivered $949 million in revenue, representing 8% reported growth, which was driven by the impact of our acquisition of Motion
Solutions at the beginning of the year. On an organic(1) basis, sales declined (2%) for the year, due to choppy market demand in life
science and industrial end markets. We had strong operating performance, achieving Adjusted Gross Margins of 47%, with our core
businesses expanding margins by roughly 120 basis points. Adjusted EBITDA(1) for the full year was $210 million, growing 7% yearover-year. We achieved record Operating Cash Flow of $159 million, up 32% year-over-year.
In the year, we launched 15 new products, and received initial orders from our customers supporting our new product revenue ramp in
2025 and beyond. Some highlights include: launching multiple new next generation smoke-evacuation insufflators with leading
medical device OEMs; launching a new endoscopic pump product, with more next generation pumps ready for launch in the near
future; launching multiple new components designed for advanced robotics applications such as warehouse automation and humanoid
robotics. Across all our end markets, we continue to stay focused on gaining content and share in multiple high-growth application
areas, particularly in medical end markets, based on a robust innovation pipeline over the coming years. Based on the strength of these
new product launches, we have sustained confidence in Novanta   s long-term organic growth outlook.
We continue to invest in our company culture, which we call the Novanta Way. Our focus is on giving our employees a sense of
belonging within the company, and on improving employment engagement. One of the most critical aspects of our company culture is
using NGS to drive excellence into the many ways we work together. In 2024, we leveraged NGS to enhance performance across our
factory teams, commercial organization, R&D, and product management. We doubled the number of Kaizen events and trained over
100 employees as NGS practitioners, driving continuous improvement. These efforts significantly boosted our operations by speeding
up product launches, reducing lead times and inventory, improving gross margins, and expanding our commercial funnel with new
OEM opportunities. NGS is integral to Novanta   s identity, fostering cross functional teamwork and effective problem-solving.
At Novanta, acquisitions remain our number one capital allocation priority. In the last 10 years we have executed 20 transactions and
deployed over $1.1 billion of capital. In 2024, we closed the Motion Solutions acquisition, which is an attractive business that makes
advanced motion control subsystems, mainly for OEM customers in the life science market. The integration of Motion Solutions has
gone smoothly, and we feel the long-term outlook for this business is solid. We maintain a large and exciting pipeline of potential
targets and our balance sheet is well positioned for sizeable transactions as we head into 2025.
We have also made some significant organizational changes to better prepare for scaling Novanta organically and inorganically. As of
January 2025, we have appointed two Co-Chief Operating Officers to the Novanta Leadership team, who will be responsible for
organic growth strategies, driving the Novanta Growth Systems and other enterprise initiatives and for creating a robust organization
capability and capacity to receive new acquisitions. The Automation Enabling Technologies segment will be led by Chuck Ravetto.
We are also excited to welcome John Lesica to Novanta, who will be responsible for the Medical Solutions segment.
In summary, Novanta delivered solid operating performance in 2024 while navigating a difficult macroeconomic environment. The
fundamentals of Novanta are strong, and we remain confident in our strategy, in our portfolio, our exposure to diversified end-markets,
and in our ability to generate strong operating cash flows to compound our growth through our targeted acquisition strategy. As we
look to 2025, we have three priorities: first, ramp all our planned new products; second, further expand our margins and cashflows
using NGS; and third, continue to acquire additional companies that fit our strategy, at attractive returns.
In closing, as always, I would like to thank our customers, our employees, and our shareholders, for their ongoing support. I am
particularly grateful to our dedicated Novanta teammates, and am inspired by their persistent efforts to live the Novanta values and go
above and beyond our expectations. Our achievements couldn   t happen without them.
Yours truly,
/s/ Matthijs Glastra
Chair of the Board of Directors and Chief Executive Officer
April 25, 2025
(1)
A non-GAAP financial measures. Reconciliations of GAAP to non-GAAP financial measures can be found beginning on page 107.




shareholder letter icon 4/25/2025 Letter Continued (Full PDF)
 

NOVT Stockholder/Shareholder Letter (NOVANTA INC) | www.StockholderLetter.com
Copyright © 2023 - 2026, All Rights Reserved

Nothing in StockholderLetter.com is intended to be investment advice, nor does it represent the opinion of, counsel from, or recommendations by BNK Invest Inc. or any of its affiliates, subsidiaries or partners. None of the information contained herein constitutes a recommendation that any particular security, portfolio, transaction, or investment strategy is suitable for any specific person. All viewers agree that under no circumstances will BNK Invest, Inc,. its subsidiaries, partners, officers, employees, affiliates, or agents be held liable for any loss or damage caused by your reliance on information obtained. By visiting, using or viewing this site, you agree to the following Full Disclaimer & Terms of Use and Privacy Policy.