Abhi Khandelwal
Senior Vice President, Chief Financial Officer at IDEX
Thanks, Eric. Turning to the consolidated financial results on Slide 6. Please note, all comparisons are against the prior year period unless stated otherwise. 4th-quarter orders of $817 million were up approximately 8% on a reported basis and up 5% organically. We saw orders growth across the portfolio with SST experiencing 8% organic growth in the quarter, driven by blanket order activity that will ship in 2025. FSDP had mid-single-digit organic growth and FMT had low single-digit growth. For the year, orders were up 4% overall and up 3% organically.
Our HST and FSDP segments experienced high single-digit organic growth. HST growth was driven by year-end blanket order activity in pneumatics and life sciences, combined with strong demand in both semiconductor MRO within our Sealing Solutions business and within global broadband satellite communications. FSDP growth was driven by the combination of strong demand from North-America fire OEMs and Fire integrated system solutions. FMT experienced a low-single-digit organic decline driven by market softness in our agriculture business as well as softness in our semiconductor capital equipment vertical within our intelligent Water portfolio.
4th-quarter sales of $863 million were up 9% reported and up 3% organically compared to prior year. We experienced organic growth of 8% in FSDP and 3% in FMT. FSDP growth was driven by continued strength with North-America Fire OEMs production ramp and share gain of automation programs within integrated fire systems. HST was flat organically versus prior year. Strong execution of targeted growth initiatives tied to fuel cells, projects in pharma and global broadband satellite communications and strong demand for semiconductor MRO were offset by broad-based softness in-life sciences, analytics instrumentation, automotive and semiconductor capital equipment verticals. Overall, we delivered approximately $40 million of projects, primarily centered in HST.
Full-year sales of $3.3 billion were flat overall and down 2% organically. HST contracted by 7% on an organic basis, driven by Life life sciences and semiconductor cyclical market headwinds. FMP growth was flat with strength in chemicals and municipal water markets, offsetting softness in agriculture and semiconductor capital equipment within the intelligent Water platform. FSDP drove low-single digit growth bolstered by North-America Fire OEM and Fire Integrated system solution demand.
Our 4th-quarter gross margin declined 20 basis-points to 42.5% on a reported basis. However, on an adjusted basis, gross margin expanded by-40 basis-points as the benefit from strong price-cost and operational productivity was partially offset by higher employee-related and discretionary cost, unfavorable mix and the net dilutive impact of acquisitions and divestitures. For the year, gross margin was 44.2%, ending relatively flat. Adjusted gross margin was 44.5%, expanding 30 basis-points. Strong price-cost and improved operational productivity, net of lower-volume leverage were partially offset by higher employee-related costs and unfavorable mix.
Our 4th-quarter adjusted EBITDA margin was 26.4%, up 60 basis-points. I will discuss the drivers of 4th-quarter adjusted EBITDA on the next slide in a moment. On a full-year basis, adjusted EBITDA margin contracted 80 basis-points to 26.7%. A bridge of the full-year adjusted EBITDA can be found in the appendix of this presentation.
On a GAAP basis, our Q4 effective tax-rate was 18.5% versus 22.7% in the prior year period. The full-year 2024 GAAP effective tax-rate was 21.1% versus 21.7% in 2023. Both the Q4 and full-year tax-rate decreases were primarily due to discrete benefits at year end, including the reduction of taxes accrued on dividends of foreign earnings and the decrease in-state tax expense mainly due to the jurisdictional mix of taxable income. 4th-quarter net income was $123 million, resulting in GAAP-diluted EPS of $1.62. Adjusted net income was $155 million with an adjusted EPS of $2.04, up $0.21 or 11%. For the full-year, net income was $505 million, resulting in EPS of $6.64. Adjusted net income was $599 million, generating an EPS of $7.89, down $0.33 or 4% from last year.
Free-cash flow for the quarter was $157 million, a decrease of 12%. We achieved a conversion rate of 101% of adjusted net income. For the year, we delivered free-cash flow of $603 million, down 4% versus last year and also coming in at 101% of adjusted net income. We achieved $3.8 million in inventory turns and invested $65 million in capital expenditures. Our strong balance sheet and cash-flow enabled us to pay $205 million in cash dividends to shareholders this year. We also funded the acquisition of through the combination of approximately $212 million of cash and $774 million of debt. We continue to maintain our strong investment-grade rating and closed the year with a gross leverage ratio of 2.2 times.
Moving on to Slide 7, I will walk-through the details of the adjusted EBITDA drivers. For the 4th-quarter, adjusted EBITDA increased by approximately $23 million. Our organic sales volume increase of approximately 1% favorably impacted adjusted EBITDA by $2 million, flowing through at prior year adjusted gross margin rate of 42.7%. Strong price-cost set of 130 basis-points and operational productivity drove $18 million of benefits year-over-year. In the quarter, we saw unfavorable mix, primarily in our energy and banded business. We strategically invested in resources, supporting target growth initiatives in groups such as fire; Safety and Intelligent Water. All these factors combined into a favorable organic flow-through of 53%. The impact of acquisitions, net of divestitures and FX increased adjusted EBITDA by $12 million on a quarter-over-quarter basis.
Now, I would like to move on to our overall outlook for 2025, starting on Page 8. Before diving into our full-year guidance, I want to reiterate Eric's opening comments. IDEXX continues to have leading positions in attractive end-markets attached to strong secular growth trends. Beyond positive economic fundamentals, we will continue to drive above-market growth through pricing power, targeted growth initiatives, competitive lead times and customer intimacy-driven share gains. These dynamics are demonstrated within each of our segments and will result in better than market performance over the long-term.
For the full-year 2025, we expect organic growth of 1% to 3% with the majority of our end-markets stable to grow. Within this range, we expect HST to be our highest-growth segment near the high-end of the range. We are expecting a modest lift within our key end-markets in Life Sciences, fluidics and optical filters and a second-half recovery in the semiconductor capital equipment. We will continue to see tailwinds with pharma, semiconductor MRO, space and energy transition markets as we experienced in Q4. Those tailwinds are supported by demand for new disease therapies and nutrition, global communications satellite network expansion and energy consumption tied to data centers.
Additionally, applications and capabilities will enable growth acceleration with energy transition as demand for clean-energy expands internationally and traditional energy solutions grows domestically. For FMT, we expect overall segment growth closer to the lower-end of the guidance range. We see the most exposure to-market cyclicality in this segment. In our core industrial markets, we expect continued stability as we saw in the 4th-quarter, but flat to low single-digit market growth and strong price support. This stability will be tempered by energy and agriculture, where we see more challenges driven by the timing of capital investments and lower levels of farm income respectively. We remain bullish with the growth in our intelligentWater platform, driven by continued municipal water markets investment in wastewater management and aging infrastructure improvements in conjunction with key project wins in our semiconductor ultrapure water heater business. Finally, turning to our FSDP segment, we expect organic growth to be towards the midpoint of our guided range with continued strength in our fire; Safety business.
Our fire business has successfully deployed its integrated systems platform over the past few years and it is now more than 10% of that business. This program has increased our content per truck, which when combined with the recovering North-America OEM channels has accelerated our growth. We expect the growth trajectory to continue in 2025. We expect dispensing and bandit to be up low-single digits. This segment performance outlook embedded within our organic growth range of 1% to 3% equals adjusted earnings per share growth of $0.15 to $0.40 depending on-top line results, including price-cost in-line with IDEX's historical performance and slight portfolio mix.
Additionally, we will drive operational excellence from operational productivity more than offsetting wage inflation pressure, contributing $0.15 to $0.25 of adjusted EPS growth. We will also drive $0.43 of growth from the platform optimization and de-layering savings that Eric already mentioned. In order to achieve these savings, we expect to take $21 million to $25 million in restructuring charges during 2025, of which approximately $8 million to $10 million is expected in the first-quarter. These charges are primarily related to severance. The reset of variable compensation to normal levels after a challenging 2024, combined with higher share-based compensation results in a $0.29 headwind, while the impact of recent acquisition and divestitures contributes $0.24 of adjusted operating EPS growth before financing.
Finally, considering a few non-operational items, the higher debt level due to the acquisition of Matt will unfavorably impact adjusted EPS growth by $0.22. In totality, the overall impact of to 2025 adjusted EPS is accretive, net of higher interest expense ahead of schedule. We expect FX to be a headwind of $0.11 in 2025. An increase in the effective tax-rate on a year-over-year basis is creating $0.14 headwind to adjusted EPS. The 2024 effective tax-rate includes certain discrete events, which produced an $0.11 benefit to adjusted EPS in 2024 that will not repeat in 2025. And in addition, the projected 2025 rate of approximately 22% to 23% includes a heavier mix of improved performance in regions with higher tax rates.
Turning to Slide 9 nine, I'll provide additional details for the full-year guidance as well as the first-quarter of 2025. In summary, for the full-year, we expect organic revenue growth of 1% to 3% to yield GAAP EPS of $6.56 to $6.96 and an adjusted EPS of $8.10 to $8.45 or up 3% to 7% over 2024. Adjusted EBITDA margins are expected to be in the range of 27.5% to 28%. Capital expenditures are anticipated to be about $90 million. Corporate costs are expected to be approximately $110 million, up from 2024 by approximately $16 million, driven by variable compensation reset and essential compliance investments.
Moving on to the first-quarter, we are projecting GAAP EPS to range from $1.18 to $1.24 and adjusted EPS to range from $1.60 to $1.65. Organic revenue is expected to decline 3% to 4% compared to the prior year and adjusted EBITDA margins are expected to be in the range of 24.1% to 24.5%. Our organic revenue range reflects a challenging Q1 2024 comparable with our semiconductor, agriculture, chemical and energy end-markets, which decelerated as we exited 2024. We are offsetting a portion of this pressure through positive price-cost spread, productivity and our platform optimization savings to drive an organic flow-through on lower-volume in the low-to mid 40%. Additionally, our adjusted EPS guidance includes $0.06 of pressure versus the prior year from share-based compensation.
To add additional color to our first-quarter guide, from a sequential perspective versus 4Q 2024, we expect to see reduced revenues resulting from $40 million of projects executed in the 4th-quarter, flowing through at our gross margin rate as well as some additional volume decline in HST due to semiconductor recovery timing and within FMT due to seasonality within ag and water. We expect pressure of $0.20 to adjusted EPS from accelerated recognition of stock-compensation and variable compensation reset as we enter 2025.
To close-out on our guidance, I would like to provide some pacing considerations and consider as you contemplate our full-year guidance on the next slide. I'm on Slide 10. Our guidance implies that revenue and adjusted EPS will be weighted to the second-half of the year. In terms of revenue pacing, we expect a higher portion of our full-year sales guide to be delivered in the second-half, driven by sequential recovery of our capital equipment-related semiconductor markets, timing of water project deliveries and March shipment timing, which has historically been weighted to the latter part of the calendar year.
Additionally, we expect a modest recovery within our Life Sciences, and optical filter business, implying low single-digit organic growth for the year with revenue pacing approximately flat across the year. And industrials to show modest market growth with strong price support following historic seasonal patterns. Our targeted growth programs will have a more pronounced impact in the second-half. From an adjusted EPS perspective, we expect increased adjusted EPS on higher second-half volume at historical flow-through rates. Platform optimization and de-layering benefits as well as price-cost realization reached full run-rate in the 3rd-quarter of 2025 and stock-compensation expense, we will have an in-year first-quarter adjusted EPS impact of approximately $0.20 and a full-year impact of approximately $0.35.
With that, I will turn it over to Eric for closing remarks.
