10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark one)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended April 1, 2023

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                                                   to                                                          

Commission File Number 1-7724

Snap-on Incorporated

(Exact name of registrant as specified in its charter)

Delaware			39-0622040
(State of incorporation)			(I.R.S. Employer Identification No.)
2801 80th Street,	Kenosha,	Wisconsin	53143
(Address of principal executive offices)			(Zip code)

(262) 656-5200

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $1.00 par value	SNA	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒   No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒   No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐	Non-accelerated filer	☐	Smaller reporting company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date:

Class	Outstanding at April 14, 2023
Common Stock, $1.00 par value	52,931,821 shares

TABLE OF CONTENTS 

		Page
Part I: Financial Information
Item 1.	Financial Statements
	Condensed Consolidated Statements of Earnings (unaudited) – Three Months Ended April 1, 2023, and April 2, 2022	3
	Condensed Consolidated Statements of Comprehensive Income (unaudited) – Three Months Ended April 1, 2023, and April 2, 2022	4
	Condensed Consolidated Balance Sheets (unaudited) – April 1, 2023, and December 31, 2022	5
	Condensed Consolidated Statements of Equity (unaudited) – Three Months Ended April 1, 2023, and April 2, 2022	7
	Condensed Consolidated Statements of Cash Flows (unaudited) – Three Months Ended April 1, 2023, and April 2, 2022	8
	Notes to Condensed Consolidated Financial Statements (unaudited)	9
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	32
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	44
Item 4.	Controls and Procedures	45
Part II: Other Information
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	46
Item 6.	Exhibits	47
	Signatures	48

PART I. FINANCIAL INFORMATION

Item 1: Financial Statements

SNAP-ON INCORPORATED

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

(Amounts in millions, except per share data)

(Unaudited)

	Three Months Ended
	April 1, 2023		April 2, 2022
Net sales	$	1,183.0	$	1,097.8
Cost of goods sold	(593.4)		(563.5)
Gross profit	589.6		534.3
Operating expenses	(329.8)		(311.2)
Operating earnings before financial services	259.8		223.1
Financial services revenue	92.6		87.7
Financial services expenses	(26.3)		(17.3)
Operating earnings from financial services	66.3		70.4
Operating earnings	326.1		293.5
Interest expense	(12.4)		(11.6)
Other income (expense) – net	15.2		8.3
Earnings before income taxes	328.9		290.2
Income tax expense	(74.6)		(67.5)
Net earnings	254.3		222.7
Net earnings attributable to noncontrolling interests	(5.6)		(5.3)
Net earnings attributable to Snap-on Incorporated	$	248.7	$	217.4
Net earnings per share attributable to Snap-on Incorporated:
Basic	$	4.69	$	4.07
Diluted	4.60		4.00
Weighted-average shares outstanding:
Basic	53.0		53.4
Effect of dilutive securities	1.1		0.9
Diluted	54.1		54.3
Dividends declared per common share	$	1.62	$	1.42

See Notes to Condensed Consolidated Financial Statements.

3

SNAP-ON INCORPORATED

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Amounts in millions)

(Unaudited)

 

	Three Months Ended
	April 1, 2023		April 2, 2022
Comprehensive income (loss):
Net earnings	$	254.3	$	222.7
Other comprehensive income (loss):
Foreign currency translation	18.1		(9.7)
Unrealized cash flow hedges, net of tax:
Reclassification of cash flow hedges to net earnings	(0.4)		(0.4)
Defined benefit pension and postretirement plans:
Amortization of net unrecognized losses	—		4.5
Income tax benefit	—		(1.1)
Net of tax	—		3.4
Total comprehensive income	272.0		216.0
Comprehensive income attributable to noncontrolling interests	(5.6)		(5.3)
Comprehensive income attributable to Snap-on Incorporated	$	266.4	$	210.7

See Notes to Condensed Consolidated Financial Statements.

4

SNAP-ON INCORPORATED

CONDENSED CONSOLIDATED BALANCE SHEETS

(Amounts in millions, except share data)

(Unaudited)

	April 1, 2023		December 31, 2022
ASSETS
Current assets:
Cash and cash equivalents	$	833.8	$	757.2
Trade and other accounts receivable – net	782.4		761.7
Finance receivables – net	572.1		562.2
Contract receivables – net	105.8		109.9
Inventories – net	1,049.1		1,033.1
Prepaid expenses and other assets	138.0		144.8
Total current assets	3,481.2		3,368.9
Property and equipment:
Land	32.9		32.6
Buildings and improvements	438.4		434.7
Machinery, equipment and computer software	1,085.4		1,069.3
Property and equipment – gross	1,556.7		1,536.6
Accumulated depreciation and amortization	(1,040.4)		(1,024.0)
Property and equipment – net	516.3		512.6
Operating lease right-of-use assets	61.5		61.5
Deferred income tax assets	73.1		70.0
Long-term finance receivables – net	1,197.1		1,170.8
Long-term contract receivables – net	387.8		383.8
Goodwill	1,050.6		1,045.3
Other intangibles – net	273.3		275.6
Pension assets	71.8		70.6
Other assets	12.9		13.7
Total assets	$	7,125.6	$	6,972.8

See Notes to Condensed Consolidated Financial Statements.

5

SNAP-ON INCORPORATED

CONDENSED CONSOLIDATED BALANCE SHEETS

(Amounts in millions, except share data)

(Unaudited)

	April 1, 2023		December 31, 2022
LIABILITIES AND EQUITY
Current liabilities:
Notes payable	$	18.2	$	17.2
Accounts payable	283.1		287.0
Accrued benefits	65.3		58.6
Accrued compensation	68.6		98.6
Franchisee deposits	72.5		73.8
Other accrued liabilities	491.3		436.4
Total current liabilities	999.0		971.6
Long-term debt	1,184.0		1,183.8
Deferred income tax liabilities	85.3		82.1
Retiree health care benefits	22.9		23.4
Pension liabilities	72.7		78.6
Operating lease liabilities	44.9		44.7
Other long-term liabilities	84.4		85.1
Total liabilities	2,493.2		2,469.3
Commitments and contingencies (Note 14)
Equity
Shareholders’ equity attributable to Snap-on Incorporated:
Preferred stock (authorized 15,000,000 shares of $1 par value; none outstanding)	—		—
Common stock (authorized 250,000,000 shares of $1 par value; issued 67,450,776 and 67,444,966 shares, respectively)	67.5		67.4
Additional paid-in capital	500.2		499.9
Retained earnings	6,458.1		6,296.2
Accumulated other comprehensive loss	(510.6)		(528.3)
Treasury stock at cost (14,520,364 and 14,442,386 shares, respectively)	(1,905.0)		(1,853.9)
Total shareholders’ equity attributable to Snap-on Incorporated	4,610.2		4,481.3
Noncontrolling interests	22.2		22.2
Total equity	4,632.4		4,503.5
Total liabilities and equity	$	7,125.6	$	6,972.8

See Notes to Condensed Consolidated Financial Statements.

6

SNAP-ON INCORPORATED

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

(Amounts in millions, except share data)

(Unaudited)

The following summarizes the changes in total equity for the three month period ended April 1, 2023:

	Shareholders’ Equity Attributable to Snap-on Incorporated
	Common Stock		Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Loss		Treasury Stock		Noncontrolling Interests		Total Equity
Balance at December 31, 2022	$	67.4	$	499.9	$	6,296.2	$	(528.3)	$	(1,853.9)	$	22.2	$	4,503.5
Net earnings for the three months ended April 1, 2023	—		—		248.7		—		—		5.6		254.3
Other comprehensive income	—		—		—		17.7		—		—		17.7
Cash dividends – $1.62 per share	—		—		(86.1)		—		—		—		(86.1)
Stock compensation plans	—		0.3		—		—		36.1		—		36.4
Share repurchases – 356,000 shares	—		—		—		—		(87.2)		—		(87.2)
Other	0.1		—		(0.7)		—		—		(5.6)		(6.2)
Balance at April 1, 2023	$	67.5	$	500.2	$	6,458.1	$	(510.6)	$	(1,905.0)	$	22.2	$	4,632.4

The following summarizes the changes in total equity for the three month period ended April 2, 2022:

	Shareholders’ Equity Attributable to Snap-on Incorporated
	Common Stock		Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Loss		Treasury Stock		Noncontrolling Interests		Total Equity
Balance at January 1, 2022	$	67.4	$	472.7	$	5,699.9	$	(343.9)	$	(1,714.2)	$	21.9	$	4,203.8
Net earnings for the three months ended April 2, 2022	—		—		217.4		—		—		5.3		222.7
Other comprehensive loss	—		—		—		(6.7)		—		—		(6.7)
Cash dividends – $1.42 per share	—		—		(75.7)		—		—		—		(75.7)
Stock compensation plans	—		2.0		—		—		8.8		—		10.8
Share repurchases – 136,000 shares	—		—		—		—		(28.8)		—		(28.8)
Other	—		—		(0.6)		—		—		(4.9)		(5.5)
Balance at April 2, 2022	$	67.4	$	474.7	$	5,841.0	$	(350.6)	$	(1,734.2)	$	22.3	$	4,320.6

See Notes to Condensed Consolidated Financial Statements.

7

SNAP-ON INCORPORATED

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts in millions)

(Unaudited)

	Three Months Ended
	April 1, 2023		April 2, 2022
Operating activities:
Net earnings	$	254.3	$	222.7
Adjustments to reconcile net earnings to net cash provided (used) by operating activities:
Depreciation	18.0		18.5
Amortization of other intangibles	6.9		7.2
Provision for losses on finance receivables	14.2		6.3
Provision for losses on non-finance receivables	5.0		3.8
Stock-based compensation expense	10.2		9.0
Deferred income tax provision (benefit)	(0.2)		2.3
Gain on sales of assets	(0.2)		(2.7)
Changes in operating assets and liabilities:
Trade and other accounts receivable	(22.9)		(53.1)
Contract receivables	0.2		9.7
Inventories	(13.2)		(61.7)
Prepaid expenses and other assets	1.7		1.9
Accounts payable	(0.5)		24.1
Accruals and other liabilities	28.1		5.9
Net cash provided by operating activities	301.6		193.9
Investing activities:
Additions to finance receivables	(257.1)		(205.5)
Collections of finance receivables	207.5		215.6
Capital expenditures	(23.0)		(20.2)
Disposals of property and equipment	0.5		3.8
Other	(0.8)		(0.3)
Net cash used by investing activities	(72.9)		(6.6)
Financing activities:
Net increase in other short-term borrowings	0.8		2.3
Cash dividends paid	(86.1)		(75.7)
Purchases of treasury stock	(87.2)		(28.8)
Proceeds from stock purchase and option plans	32.8		5.8
Other	(12.4)		(9.9)
Net cash used by financing activities	(152.1)		(106.3)
Effect of exchange rate changes on cash and cash equivalents	—		0.1
Increase in cash and cash equivalents	76.6		81.1
Cash and cash equivalents at beginning of year	757.2		780.0
Cash and cash equivalents at end of period	$	833.8	$	861.1
Supplemental cash flow disclosures:
Cash paid for interest	$	(13.6)	$	(13.8)
Net cash paid for income taxes	(13.3)		(18.0)

See Notes to Condensed Consolidated Financial Statements.

8

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 1: Summary of Accounting Policies

Principles of consolidation and presentation

The Condensed Consolidated Financial Statements include the accounts of Snap-on Incorporated and its wholly owned and majority-owned subsidiaries (collectively, “Snap-on” or the “company”). These financial statements should be read in conjunction with, and have been prepared in conformity with, the accounting principles reflected in the consolidated financial statements and related notes included in Snap-on’s 2022 Annual Report on Form 10-K for the fiscal year ended December 31, 2022 (“2022 year end”). The company’s 2023 fiscal first quarter ended on April 1, 2023; the 2022 fiscal first quarter ended on April 2, 2022. The company’s 2023 and 2022 fiscal first quarters each contained 13 weeks of operating results. Snap-on’s Condensed Consolidated Financial Statements are prepared in conformity with generally accepted accounting principles in the United States of America (“GAAP”).

In the opinion of management, all adjustments (consisting of normal recurring adjustments) necessary for the fair presentation of the Condensed Consolidated Financial Statements for the three month periods ended April 1, 2023, and April 2, 2022, have been made. Interim results of operations are not necessarily indicative of the results to be expected for the full fiscal year.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Financial Instruments

The fair value of the company’s derivative financial instruments is generally determined using quoted prices in active markets for similar assets and liabilities. The carrying value of the company’s non-derivative financial instruments either approximates fair value, due to their short-term nature, or the amount disclosed for fair value is based upon a discounted cash flow analysis or quoted market values. See Note 9 for further information on financial instruments.

New Accounting Standards

On January 1, 2023, the beginning of Snap-on’s 2023 fiscal year, the company adopted ASU No. 2022-02, Financial Instruments – Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures, which requires enhanced disclosure of certain loan refinancings and restructurings by creditors when a borrower is experiencing financial difficulty and eliminates certain current recognition and measurement accounting guidance. This ASU also requires the disclosure of current-period gross write-offs by year of origination for financing receivables and net investments in leases. The adoption of this ASU did not have a significant impact on the company’s Condensed Consolidated Financial Statements.

Note 2: Revenue Recognition

Snap-on recognizes revenue from the sale of tools, diagnostics, equipment, and related services based on when control of the product passes to the customer or the service is provided and is recognized at an amount that reflects the consideration expected to be received in exchange for such goods or services.

9

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

Revenue Disaggregation: The following table shows the consolidated revenues by revenue source:

	Three Months Ended
(Amounts in millions)	April 1, 2023		April 2, 2022
Revenue from contracts with customers	$	1,176.5	$	1,091.9
Other revenues	6.5		5.9
Total net sales	1,183.0		1,097.8
Financial services revenue	92.6		87.7
Total revenues	$	1,275.6	$	1,185.5

Snap-on evaluates the performance of its operating segments based on segment revenues, including both external and intersegment net sales, and segment operating earnings. Snap-on accounts for both intersegment sales and transfers based primarily on standard costs with reasonable mark-ups established between the segments. Intersegment amounts are eliminated to arrive at Snap-on’s consolidated financial results.

The following tables represent external net sales disaggregated by geography, based on the customers’ billing addresses:

	For the Three Months Ended April 1, 2023
	Commercial		Snap-on		Repair Systems
	& Industrial		Tools		& Information		Financial				Snap-on
(Amounts in millions)	Group		Group		Group		Services		Eliminations		Incorporated
Net sales:
North America*	$	137.6	$	473.9	$	281.8	$	—	$	—	$	893.3
Europe	75.0		35.7		63.2		—		—		173.9
All other	66.0		27.4		22.4		—		—		115.8
External net sales	278.6		537.0		367.4		—		—		1,183.0
Intersegment net sales	85.2		—		79.2		—		(164.4)		—
Total net sales	363.8		537.0		446.6		—		(164.4)		1,183.0
Financial services revenue	—		—		—		92.6		—		92.6
Total revenue	$	363.8	$	537.0	$	446.6	$	92.6	$	(164.4)	$	1,275.6

	For the Three Months Ended April 2, 2022
	Commercial		Snap-on		Repair Systems
	& Industrial		Tools		& Information		Financial				Snap-on
(Amounts in millions)	Group		Group		Group		Services		Eliminations		Incorporated
Net sales:
North America*	$	113.7	$	447.8	$	242.8	$	—	$	—	$	804.3
Europe	81.8		40.1		61.9		—		—		183.8
All other	65.7		24.2		19.8		—		—		109.7
External net sales	261.2		512.1		324.5		—		—		1,097.8
Intersegment net sales	78.9		—		73.7		—		(152.6)		—
Total net sales	340.1		512.1		398.2		—		(152.6)		1,097.8
Financial services revenue	—		—		—		87.7		—		87.7
Total revenue	$	340.1	$	512.1	$	398.2	$	87.7	$	(152.6)	$	1,185.5
* North America is comprised of the United States, Canada and Mexico.

10

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

The following tables represent external net sales disaggregated by customer type:

	For the Three Months Ended April 1, 2023
	Commercial		Snap-on		Repair Systems
	& Industrial		Tools		& Information		Financial				Snap-on
(Amounts in millions)	Group		Group		Group		Services		Eliminations		Incorporated
Net sales:
Vehicle service professionals	$	21.1	$	537.0	$	367.4	$	—	$	—	$	925.5
All other professionals	257.5		—		—		—		—		257.5
External net sales	278.6		537.0		367.4		—		—		1,183.0
Intersegment net sales	85.2		—		79.2		—		(164.4)		—
Total net sales	363.8		537.0		446.6		—		(164.4)		1,183.0
Financial services revenue	—		—		—		92.6		—		92.6
Total revenue	$	363.8	$	537.0	$	446.6	$	92.6	$	(164.4)	$	1,275.6

	For the Three Months Ended April 2, 2022
	Commercial		Snap-on		Repair Systems
	& Industrial		Tools		& Information		Financial				Snap-on
(Amounts in millions)	Group		Group		Group		Services		Eliminations		Incorporated
Net sales:
Vehicle service professionals	$	23.9	$	512.1	$	324.5	$	—	$	—	$	860.5
All other professionals	237.3		—		—		—		—		237.3
External net sales	261.2		512.1		324.5		—		—		1,097.8
Intersegment net sales	78.9		—		73.7		—		(152.6)		—
Total net sales	340.1		512.1		398.2		—		(152.6)		1,097.8
Financial services revenue	—		—		—		87.7		—		87.7
Total revenue	$	340.1	$	512.1	$	398.2	$	87.7	$	(152.6)	$	1,185.5

Nature of goods and services: Snap-on derives net sales from a broad line of products and complementary services that are grouped into three categories: (i) tools; (ii) diagnostics, information and management systems; and (iii) equipment. The tools product category includes hand tools, power tools, tool storage products and other similar products. The diagnostics, information and management systems product category includes handheld and computer-based diagnostic products, service and repair information products, diagnostic software solutions, electronic parts catalogs, business management systems and services, point-of-sale systems, integrated systems for vehicle service shops, original equipment manufacturer (“OEM”) purchasing facilitation services, and warranty management systems and analytics to help OEM dealership service and repair shops (“OEM dealerships”) manage and track performance. The equipment product category includes solutions for the service of vehicles and industrial equipment. Snap-on supports the sale of its diagnostics and vehicle service shop equipment by offering training programs as well as after-sales support to its customers. Through its financial services businesses, Snap‑on derives revenue from various financing programs designed to facilitate the sales of its products and support its franchise business.

Approximately 90% of Snap-on’s net sales are products sold at a point in time through ship-and-bill performance obligations that also include repair services. The remaining sales revenue is earned over time primarily for software subscriptions, other subscription service agreements and extended warranty programs.

11

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

Snap-on enters into contracts related to the selling of tools, diagnostics, repair information, equipment and related services. At contract inception, an assessment of the goods and services promised in the contracts with customers is performed and a performance obligation is identified for each distinct promise to transfer to the customer a good or service (or bundle of goods or services). To identify the performance obligations, Snap-on considers all of the goods or services promised in the contract regardless of whether they are explicitly stated or are implied by customary business practices. Contracts with customers are comprised of customer purchase orders, invoices and written contracts.

For certain performance obligations related to software subscriptions, extended warranty and other subscription agreements that are settled over time, Snap-on has elected not to disclose the value of unsatisfied performance obligations for: (i) contracts that have an original expected length of one year or less; (ii) contracts where revenue is recognized as invoiced; and (iii) contracts with variable consideration related to unsatisfied performance obligations. The remaining duration of these unsatisfied performance obligations range from one month up to 60 months. Snap-on had approximately $180.0 million of long-term contracts that have fixed consideration that extends beyond one year as of April 1, 2023. Snap-on expects to recognize approximately 70% of these contracts as revenue by the end of fiscal 2024, an additional 25% by the end of fiscal 2026, and the balance thereafter. 

Contract liabilities: Contract liabilities are recorded when cash payments are received in advance of Snap-on’s performance.  The timing of payment is typically on a monthly, quarterly or annual basis. The balance of total contract liabilities was $65.7 million and $63.3 million at April 1, 2023, and December 31, 2022, respectively. The current portion of contract liabilities is included in “Other accrued liabilities” and the non-current portion of such liabilities is included in “Other long-term liabilities” on the accompanying Condensed Consolidated Balance Sheets. During the three months ended April 1, 2023, Snap-on recognized $34.7 million of revenue that was included in the $63.3 million contract liability balance at December 31, 2022, which was primarily from the amortization of software subscriptions, extended warranties and other subscription agreements.

Note 3: Receivables

Trade and other accounts receivable: Snap-on’s trade and other accounts receivable primarily arise from the sale of tools, diagnostics, and equipment products to a broad range of industrial and commercial customers and to Snap-on’s independent franchise van channel with payment terms generally ranging from 30 to 120 days.

The components of Snap-on’s trade and other accounts receivable as of April 1, 2023, and December 31, 2022, are as follows:

(Amounts in millions)	April 1, 2023		December 31, 2022
Trade and other accounts receivable	$	813.6	$	792.8
Allowances for credit losses	(31.2)		(31.1)
Total trade and other accounts receivable – net	$	782.4	$	761.7

The following is a rollforward of the allowances for credit losses related to trade and other accounts receivable for the three months ended April 1, 2023, and April 2, 2022:

	Three Months Ended
(Amounts in millions)	April 1, 2023		April 2, 2022
Allowances for credit losses:
Beginning of period	$	31.1	$	27.3
Provision for credit losses	4.7		3.7
Charge-offs	(4.8)		(3.0)
Recoveries	—		0.1
Currency translation	0.2		0.3
End of period	$	31.2	$	28.4

12

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

Finance and contract receivables: Snap-on Credit LLC (“SOC”), the company’s financial services operation in the United States, originates extended-term finance and contract receivables on sales of Snap-on’s products sold through the U.S. franchisee network and to certain other customers of Snap-on; Snap-on’s foreign finance subsidiaries provide similar financing internationally. Interest income on finance and contract receivables is included in “Financial services revenue” on the accompanying Condensed Consolidated Statements of Earnings.

Finance receivables are comprised of extended-term payment contracts to both technicians and independent shop owners (i.e., franchisees’ customers) to enable them to purchase tools, diagnostics, and equipment products on an extended-term payment plan, with average payment terms of approximately four years.

Contract receivables, with payment terms of up to 10 years, are comprised of extended-term payment contracts to a broad base of customers worldwide, including shop owners, both independents and national chains, for their purchase of tools, diagnostics, and equipment products, as well as extended-term contracts to franchisees to meet a number of financing needs, including working capital loans, loans to enable new franchisees to fund the purchase of the franchise and van leases, or the expansion of an existing franchise. Finance and contract receivables are generally secured by the underlying tools, diagnostics and/or equipment products financed and, for contracts to franchisees, other franchisee assets.

The components of Snap-on’s current finance and contract receivables as of April 1, 2023, and December 31, 2022, are as follows:

(Amounts in millions)	April 1, 2023		December 31, 2022
Finance installment receivables	$	589.2	$	578.6
Finance lease receivables, net of unearned finance charges of $0.5 million and $0.5 million, respectively	2.9		3.2
Total finance receivables	592.1		581.8
Contract installment receivables	46.2		51.3
Contract lease receivables, net of unearned finance charges of $19.3 million and $19.1 million, respectively	61.3		60.3
Total contract receivables	107.5		111.6
Total	699.6		693.4
Allowances for credit losses:
Finance installment receivables	(20.0)		(19.5)
Finance lease receivables	—		(0.1)
Total finance allowance for credit losses	(20.0)		(19.6)
Contract installment receivables	(0.8)		(0.8)
Contract lease receivables	(0.9)		(0.9)
Total contract allowance for credit losses	(1.7)		(1.7)
Total allowance for credit losses	(21.7)		(21.3)
Total current finance and contract receivables – net	$	677.9	$	672.1
Finance receivables – net	$	572.1	$	562.2
Contract receivables – net	105.8		109.9
Total current finance and contract receivables – net	$	677.9	$	672.1

13

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

The components of Snap-on’s finance and contract receivables with payment terms beyond one year as of April 1, 2023, and December 31, 2022, are as follows: 

(Amounts in millions)	April 1, 2023		December 31, 2022
Finance installment receivables	$	1,238.2	$	1,210.4
Finance lease receivables, net of unearned finance charges of $0.2 million and $0.2 million, respectively	1.6		1.7
Total finance receivables	1,239.8		1,212.1
Contract installment receivables	205.6		202.1
Contract lease receivables, net of unearned finance charges of $30.9 million and $30.7 million, respectively	187.0		186.6
Total contract receivables	392.6		388.7
Total	1,632.4		1,600.8
Allowances for credit losses:
Finance installment receivables	(42.7)		(41.3)
Finance lease receivables	—		—
Total finance allowance for credit losses	(42.7)		(41.3)
Contract installment receivables	(3.1)		(3.1)
Contract lease receivables	(1.7)		(1.8)
Total contract allowance for credit losses	(4.8)		(4.9)
Total allowance for credit losses	(47.5)		(46.2)
Total long-term finance and contract receivables – net	$	1,584.9	$	1,554.6
Finance receivables – net	$	1,197.1	$	1,170.8
Contract receivables – net	387.8		383.8
Total long-term finance and contract receivables – net	$	1,584.9	$	1,554.6

Credit quality: The company’s receivable portfolio is comprised of two portfolio segments, finance and contract receivables, which are the same segments used to estimate expected credit losses reported in the allowance for credit losses. The amortized cost basis for finance and contract receivables is the amount originated adjusted for applicable accrued interest and net of deferred fees or costs, collection of cash, and write-offs. The company monitors and assesses credit risk based on the characteristics of each portfolio segment.

When extending credit, Snap-on evaluates the collectability of the receivables based on a combination of various financial and qualitative factors that may affect a customer’s ability to pay. These factors may include the customer’s financial condition, past payment experience, and credit bureau and proprietary Snap-on credit model information, as well as the value of the underlying collateral.

14

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

For finance and contract receivables, Snap-on assesses quantitative and qualitative factors through the use of credit quality indicators consisting primarily of collection experience and related internal metrics. Delinquency is the primary indicator of credit quality for finance and contract receivables. Snap-on conducts monthly reviews of credit and collection performance for both the finance and contract receivable portfolios focusing on data such as delinquency trends, nonaccrual receivables, and write-off and recovery activity. These reviews allow for the formulation of collection strategies and potential collection policy modifications in response to changing risk profiles in the finance and contract receivable portfolios. The other internal metrics include credit exposure by customer and delinquency classification to further monitor changing risk profiles. The company maintains a system that aggregates credit exposure and provides delinquency data by days past due aging categories. A receivable 30 days or more past due is considered delinquent. However, customers are monitored prior to becoming 30 days past due.

The amortized cost basis of finance and contract receivables by origination year as of April 1, 2023, and charge-offs for the three months ended April 1, 2023, are as follows:

(Amounts in millions)	2023		2022		2021		2020		2019		Prior		Total
Finance receivables:
Delinquent	$	0.2	$	18.0	$	11.4	$	6.8	$	3.3	$	2.1	$	41.8
Non-delinquent	505.1		836.7		271.6		124.4		40.4		11.9		1,790.1
Total Finance receivables	$	505.3	$	854.7	$	283.0	$	131.2	$	43.7	$	14.0	$	1,831.9
Finance receivables charge-offs	$	—	$	5.7	$	4.6	$	2.5	$	1.0	$	0.7	$	14.5
Contract receivables:
Delinquent	$	—	$	0.9	$	1.4	$	0.5	$	0.5	$	0.2	$	3.5
Non-delinquent	46.1		160.1		109.9		77.5		51.4		51.6		496.6
Total Contract receivables	$	46.1	$	161.0	$	111.3	$	78.0	$	51.9	$	51.8	$	500.1
Contract receivables charge-offs	$	—	$	0.1	$	0.1	$	0.3	$	—	$	—	$	0.5

Allowances for credit losses: The allowances for credit losses are maintained at levels that are considered adequate to cover expected credit losses over the remaining contractual life of the receivables using historical loss experience, asset specific risk characteristics, current conditions, reasonable and supportable forecasts, and an appropriate reversion period, when applicable. Management performs detailed reviews of its receivables on a monthly and/or quarterly basis to assess the adequacy of the allowances and to determine if any impairment has occurred. A receivable generally has credit losses when it is expected that all amounts related to the receivable will not be collected according to the contractual terms of the agreement. Amounts determined to be uncollectable are charged directly against the allowances, while amounts recovered on previously written off accounts increase the allowances.

For both finance and contract receivables, write-offs include the uncollectable principal amount of the receivable as well as the uncollectable accrued interest and fees, net of repossessions. For finance receivables only, write-offs are partially offset by recourse from franchisees. Recovered interest and fees previously written off are recorded through the allowances for credit losses and increase the allowances. Absent a repossession, finance receivables are typically written off when an account reaches 120 days past due. Repossessed accounts are typically written off within 60 days of asset repossession. Contract receivables related to equipment leases are generally written off when an account becomes 150 days past due, while contract receivables related to franchise finance and van leases are generally written off no later than when the receivable becomes 180 days past the asset return date. For finance and contract receivables, customer bankruptcies are generally written off upon notification that the associated debt is not being reaffirmed or, in any event, no later than when the receivable becomes 180 days past due. Changes to the allowances for credit losses are maintained through adjustments to the provisions for credit losses.

For finance receivables, the company uses a vintage loss rate methodology to determine expected losses. Vintage analysis aims to calculate losses based on the timing of the losses relative to the origination of the receivables. The finance receivable portfolio contains a substantial amount of homogeneous contracts which fits well with the vintage analysis.

15

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

For contract receivables, the company primarily uses a Weighted-Average Remaining Maturity (“WARM”) methodology. The WARM methodology calculates the average annual write-off rate and applies it to the remaining term of the receivables. The WARM methodology is used since the contract receivables have limited loss experience over generally longer terms and, therefore, the predictive loss patterns are more difficult to estimate.

The company performed a correlation analysis to compare historical losses to many economic factors. The primary economic factors considered were real gross domestic product, civilian unemployment, industrial production index, and repair and maintenance employment rate; the company determined that there is limited correlation between the historical losses and economic factors. As a result, consideration was given to qualitative factors to adjust the reserve balance for asset specific risk characteristics, current conditions and future expectations. Similar qualitative factors are considered for both finance and contract receivables. The qualitative factors used in determining the estimate of expected credit losses are influenced by the changes in the composition of the portfolio, underwriting practices, and other relevant conditions that were different from the historical periods.

The allowances for credit losses are adjusted each period for changes in the credit risk and expected lifetime credit losses.

The following is a rollforward of the allowances for credit losses for finance and contract receivables for the three months ended April 1, 2023, and April 2, 2022:

 

	Three Months Ended April 1, 2023				Three Months Ended April 2, 2022
(Amounts in millions)	Finance Receivables		Contract Receivables		Finance Receivables		Contract Receivables
Allowances for credit losses:
Beginning of period	$	60.9	$	6.6	$	67.3	$	8.4
Provision for credit losses	14.2		0.3		6.3		0.1
Charge-offs	(14.5)		(0.5)		(13.4)		(0.8)
Recoveries	2.1		0.1		2.3		—
Currency translation	—		—		—		—
End of period	$	62.7	$	6.5	$	62.5	$	7.7

Past due: Depending on the contract, payments for finance and contract receivables are due on a monthly or weekly basis. Weekly payments are converted into a monthly equivalent for purposes of calculating delinquency. Delinquencies are assessed at the end of each month following the monthly equivalent contractual payment due date. The entire receivable balance of a contract is considered delinquent when contractual payments become 30 days past due. Removal from delinquent status occurs when the cumulative amount of monthly contractual payments then due have been received by the company.

It is the general practice of Snap-on’s financial services business not to engage in contract or loan modifications. In limited instances, Snap-on’s financial services business may modify certain receivables. The amount and number of finance and contract receivable modifications as of April 1, 2023, and December 31, 2022, were immaterial to both the financial services portfolio and the company’s results of operations and financial position.

16

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

The aging of finance and contract receivables as of April 1, 2023, and December 31, 2022, is as follows:

(Amounts in millions)	30-59 Days Past Due		60-90 Days Past Due		Greater Than 90 Days Past Due		Total Past Due		Total Not Past Due		Total		Greater Than 90 Days Past Due and Accruing
April 1, 2023:
Finance receivables	$	12.3	$	9.6	$	19.9	$	41.8	$	1,790.1	$	1,831.9	$	16.8
Contract receivables	1.4		0.4		1.7		3.5		496.6		500.1		0.3
December 31, 2022:
Finance receivables	$	17.2	$	11.2	$	19.5	$	47.9	$	1,746.0	$	1,793.9	$	16.5
Contract receivables	1.2		0.3		2.2		3.7		496.6		500.3		0.3

Nonaccrual: SOC maintains the accrual of interest income during the progression through the various stages of delinquency prior to processing for write-off. At the time of write-off, the entire balance including the accrued but unpaid interest income amount is recorded as a loss.

Finance receivables are generally placed on nonaccrual status (nonaccrual of interest and other fees): (i) when a customer is placed on repossession status; (ii) upon receipt of notification of bankruptcy; (iii) upon notification of the death of a customer; or (iv) in other instances in which management concludes collectability is not reasonably assured.

Contract receivables are generally placed on nonaccrual status: (i) when a receivable is more than 90 days past due or at the point a customer’s account is placed on terminated status regardless of its delinquency status; (ii) upon notification of the death of a customer; or (iii) in other instances in which management concludes collectability is not reasonably assured.

The accrual of interest and other fees is resumed when the finance or contract receivable becomes contractually current and collection of all remaining contractual amounts due is reasonably assured. A receivable may have credit losses when it is expected that all amounts related to the receivable will not be collected according to the contractual terms of the applicable agreement. Such finance and contract receivables are covered by the company’s respective allowances for credit losses and are written-off against the allowances when appropriate.

The amount of finance and contract receivables on nonaccrual status as of April 1, 2023, and December 31, 2022, is as follows:

(Amounts in millions)	April 1, 2023		December 31, 2022
Finance receivables	$	9.3	$	8.7
Contract receivables	2.8		3.3

17

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

Note 4: Inventories

Inventories by major classification are as follows:

(Amounts in millions)	April 1, 2023		December 31, 2022
Finished goods	$	895.1	$	882.2
Work in progress	76.2		77.2
Raw materials	186.7		182.3
Total FIFO value	1,158.0		1,141.7
Excess of current cost over LIFO cost	(108.9)		(108.6)
Total inventories – net	$	1,049.1	$	1,033.1

Inventories accounted for using the first-in, first-out (“FIFO”) method approximated 61% of total inventories as of both April 1, 2023, and December 31, 2022. The company accounts for its non-U.S. inventory on the FIFO method. As of April 1, 2023, approximately 38% of the company’s U.S. inventory was accounted for using the FIFO method and 62% was accounted for using the last-in, first-out (“LIFO”) method. There were no LIFO inventory liquidations in the three months ended April 1, 2023, or April 2, 2022.

Note 5: Goodwill and Other Intangible Assets

The changes in the carrying amount of goodwill by segment for the three months ended April 1, 2023, are as follows:

(Amounts in millions)	Commercial & Industrial Group		Snap-on Tools Group		Repair Systems & Information Group		Total
Balance as of December 31, 2022	$	302.9	$	12.4	$	730.0	$	1,045.3
Currency translation	3.7		—		1.6		5.3
Balance as of April 1, 2023	$	306.6	$	12.4	$	731.6	$	1,050.6

Additional disclosures related to other intangible assets are as follows:

	April 1, 2023						December 31, 2022
(Amounts in millions)	Gross  Carrying Value		Accumulated Amortization		Net Carrying Value		Gross  Carrying Value		Accumulated Amortization		Net Carrying Value
Amortized other intangible assets:
Customer relationships	$	212.7	$	(154.1)	$	58.6	$	212.1	$	(150.8)	$	61.3
Developed technology	36.0		(27.1)		8.9		35.8		(26.0)		9.8
Internally developed software	182.4		(140.1)		42.3		179.6		(137.2)		42.4
Patents	49.4		(25.8)		23.6		48.4		(25.6)		22.8
Trademarks	3.9		(2.4)		1.5		3.9		(2.4)		1.5
Other	7.8		(4.1)		3.7		7.7		(4.0)		3.7
Total	492.2		(353.6)		138.6		487.5		(346.0)		141.5
Non-amortized trademarks	134.7		—		134.7		134.1		—		134.1
Total other intangible assets	$	626.9	$	(353.6)	$	273.3	$	621.6	$	(346.0)	$	275.6

Provision for impairment of goodwill and/or other intangible assets could arise in a future period due to significant and unanticipated changes in circumstances, such as declines in profitability and cash flow due to long-term deterioration in macroeconomic, industry and market conditions, the loss of key customers, changes in technology or markets, significant changes in key personnel or litigation, a sustained decrease in share price and/or other events. As of April 1, 2023, the company had no accumulated impairment losses.

18

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

The weighted-average amortization periods related to other intangible assets are as follows:

	In Years
Customer relationships	14
Developed technology	5
Internally developed software	6
Patents	14
Trademarks	9
Other	39

The weighted-average amortization period for all amortizable intangibles on a combined basis is 12 years. Intangible asset renewal costs are expensed as incurred.

The aggregate amortization expense was $6.9 million and $7.2 million for the respective three month periods ended April 1, 2023, and April 2, 2022. Based on current levels of amortizable intangible assets and estimated weighted-average useful lives, estimated annual amortization expense is expected to be $26.9 million in 2023, $21.1 million in 2024, $15.1 million in 2025, $11.4 million in 2026, $10.3 million in 2027, and $8.9 million in 2028.

Note 6: Exit and Disposal Activities

Snap-on did not record any costs for exit and disposal activities for each of the three month periods ended April 1, 2023, and April 2, 2022.

Snap-on’s exit and disposal accrual activity for the first three months of 2023 is as follows:

	Balance at		Three Months				Balance at
(Amounts in millions)	December 31, 2022		Provision		Usage		April 1, 2023
Severance costs:
Commercial & Industrial Group	$	1.6	$	—	$	(0.1)	$	1.5
Snap-on Tools Group	0.1		—		—		0.1
Repair System & Information Group	1.1		—		(0.2)		0.9
Total	$	2.8	$	—	$	(0.3)	$	2.5

As of April 1, 2023, the company expects that approximately $1.4 million of the $2.5 million exit and disposal accrual will be utilized in 2023, and the remainder thereafter, primarily for longer-term severance payments.

Snap-on expects to fund the remaining cash requirements of its exit and disposal activities with available cash on hand, cash flows from operating activities and borrowings under the company’s existing credit facilities. The estimated costs for the exit and disposal activities were based on management’s best business judgement under prevailing circumstances.

Note 7: Income Taxes

Snap-on’s effective income tax rate on earnings attributable to Snap-on was 23.1% and 23.7% in the respective first three month periods of 2023 and 2022. 

Snap-on and its subsidiaries file income tax returns in the United States and in various state, local and foreign jurisdictions. It is reasonably possible that certain unrecognized tax benefits may either be settled with taxing authorities or the statutes of limitations for such items may lapse within the next 12 months, causing Snap-on’s gross unrecognized tax benefits to decrease by a range of zero to $0.6 million. Over the next 12 months, Snap-on anticipates taking certain tax positions on various tax returns for which the related tax benefit does not meet the recognition threshold. Accordingly, Snap-on’s gross unrecognized tax benefits may increase by a range of zero to $0.6 million over the next 12 months for uncertain tax positions expected to be taken in future tax filings.

19

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

Note 8: Short-term and Long-term Debt

Short-term and long-term debt as of April 1, 2023, and December 31, 2022, consisted of the following:

(Amounts in millions)	April 1, 2023		December 31, 2022
3.25% unsecured notes due 2027	$	300.0	$	300.0
4.10% unsecured notes due 2048	400.0		400.0
3.10% unsecured notes due 2050	500.0		500.0
Other*	2.2		1.0
	1,202.2		1,201.0
Less: notes payable	(18.2)		(17.2)
Total long-term debt	$	1,184.0	$	1,183.8

* Includes unamortized debt issuance costs.

Notes payable of $18.2 million as of April 1, 2023, compared to $17.2 million as of 2022 year end.

Snap-on has an $800 million multi-currency revolving credit facility that terminates on September 16, 2024 (the “Credit Facility”); no amounts were borrowed or outstanding under the Credit Facility for the three months ended and as of April 1, 2023. Borrowings under the Credit Facility bear interest at varying rates based on either: (i) Snap-on’s then-current, long-term debt ratings; or (ii) Snap-on’s then-current ratio of consolidated debt net of certain cash adjustments (“Consolidated Net Debt”) to earnings before interest, taxes, depreciation, amortization and certain other adjustments for the preceding four fiscal quarters then ended (the “Consolidated Net Debt to EBITDA Ratio”). The Credit Facility’s financial covenant requires that Snap-on maintain, as of each fiscal quarter end, either (i) a ratio not greater than 0.60 to 1.00 of Consolidated Net Debt to the sum of Consolidated Net Debt plus total equity and less accumulated other comprehensive income or loss (the “Leverage Ratio”); or (ii) a Consolidated Net Debt to EBITDA Ratio not greater than 3.50 to 1.00. Snap-on may, up to two times during any five-year period during the term of the Credit Facility (including any extensions thereof), elect to increase the maximum Leverage Ratio to 0.65 to 1.00 and/or increase the maximum Consolidated Net Debt to EBITDA Ratio to 4.00 to 1.00 for four consecutive fiscal quarters in connection with certain material acquisitions (as defined in the related credit agreement). As of April 1, 2023, the company’s actual ratios of 0.08 and 0.30, respectively, were both within the permitted ranges set forth in this financial covenant. Snap-on generally issues commercial paper to fund its financing needs on a short-term basis and uses the Credit Facility as back-up liquidity to support such commercial paper issuances. As of April 1, 2023, there were no commercial paper issuances outstanding.

Note 9: Financial Instruments

Derivatives: All derivative instruments are reported in the Condensed Consolidated Financial Statements at fair value. Changes in the fair value of derivatives are recorded each period in earnings or on the accompanying Condensed Consolidated Balance Sheets, depending on whether the derivative is designated and effective as part of a hedged transaction. Gains or losses on derivative instruments recorded in earnings are presented in the same Condensed Consolidated Statement of Earnings line that is used to present the earnings effect of the hedged item. Gains or losses on derivative instruments in accumulated other comprehensive income (loss) (“Accumulated OCI”) are reclassified to earnings in the period in which earnings are affected by the underlying hedged item.

The criteria used to determine if hedge accounting treatment is appropriate are: (i) the designation of the hedge to an underlying exposure; (ii) whether or not overall risk is being reduced; and (iii) if there is a correlation between the value of the derivative instrument and the underlying hedged item. Once a derivative contract is entered into, Snap-on designates the derivative as a fair value hedge, a cash flow hedge, a hedge of a net investment in a foreign operation, or a natural hedging instrument whose change in fair value is recognized as an economic hedge against changes in the value of the hedged item. Snap-on does not use derivative instruments for speculative or trading purposes.

20

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

Snap-on is exposed to global market risks, including the effects of changes in foreign currency exchange rates, interest rates, and the company’s stock price. The company uses derivatives to manage financial exposures that occur in the normal course of business. The primary risks managed by using derivative instruments are foreign currency risk, interest rate risk and stock-based deferred compensation risk.

Foreign currency risk management: Snap-on has significant international operations and is subject to certain risks inherent with foreign operations that include currency fluctuations. Foreign currency exchange risk exists to the extent that Snap-on has payment obligations or receipts denominated in currencies other than the functional currency, including intercompany loans denominated in foreign currencies. To manage these exposures, Snap-on identifies naturally offsetting positions and then purchases hedging instruments to protect the residual net exposures. Snap-on manages most of these exposures on a consolidated basis, which allows for netting of certain exposures to take advantage of natural offsets. Foreign currency forward contracts (“foreign currency forwards”) are used to hedge the net exposures. Gains or losses on net foreign currency hedges are intended to offset losses or gains on the underlying net exposures in an effort to reduce the earnings volatility resulting from fluctuating foreign currency exchange rates. Snap-on’s foreign currency forwards are typically not designated as hedges. The fair value changes of these contracts are reported in earnings as foreign exchange gain or loss, which is included in “Other income (expense) – net” on the accompanying Condensed Consolidated Statements of Earnings. See Note 16 for additional information on Other income (expense) – net.

Interest rate risk management: Snap-on may manage the exposure created by the differing maturities and interest rate structures of Snap-on’s borrowings through the use of interest rate swap agreements (“interest rate swaps”) and treasury lock agreements (“treasury locks”).

Interest rate swaps: Snap-on may enter into interest rate swaps to manage risks associated with changing interest rates related to the company’s fixed rate borrowings. Interest rate swaps are accounted for as fair value hedges. The differentials paid or received on interest rate swaps are recognized as adjustments to “Interest expense” on the accompanying Condensed Consolidated Statements of Earnings. The change in the fair value of the derivative is recorded in “Long-term debt” on the accompanying Condensed Consolidated Balance Sheets. There were no outstanding interest rate swaps as of both April 1, 2023, and December 31, 2022.

Treasury locks: Snap-on may use treasury locks to manage the potential change in interest rates in anticipation of the issuance of fixed rate debt. Treasury locks are accounted for as cash flow hedges. The differentials to be paid or received on treasury locks related to the anticipated issuance of fixed rate debt are initially recorded in Accumulated OCI for derivative instruments that are designated and qualify as cash flow hedges. Upon the issuance of debt, the related amount in Accumulated OCI is released over the term of the debt and recognized as an adjustment to interest expense on the Condensed Consolidated Statements of Earnings. There were no treasury locks outstanding as of both April 1, 2023, and December 31, 2022.

Stock-based deferred compensation risk management: Snap-on manages market risk associated with the stock-based portion of its deferred compensation plans through the use of prepaid equity forward agreements (“equity forwards”). Equity forwards are used to aid in offsetting the potential mark-to-market effect on stock-based deferred compensation from changes in Snap‑on’s stock price. Since stock-based deferred compensation liabilities increase as the company’s stock price rises and decrease as the company’s stock price declines, the equity forwards are intended to mitigate the potential impact on deferred compensation expense that may result from such mark-to-market changes. As of April 1, 2023, Snap-on had equity forwards in place intended to manage market risk with respect to 68,200 shares of Snap-on common stock associated with its deferred compensation plans.

Counterparty risk: Snap-on is exposed to credit losses in the event of non-performance by the counterparties to its various financial agreements, including its foreign currency forward contracts, interest rate swap agreements, treasury lock agreements and prepaid equity forward agreements. Snap-on does not obtain collateral or other security to support financial instruments subject to credit risk, but monitors the credit standing of the counterparties and generally enters into agreements with financial institution counterparties with a credit rating of A- or better. Snap-on does not anticipate non-performance by its counterparties, but cannot provide assurances.

21

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

Fair value of financial instruments: The fair values of financial instruments that do not approximate the carrying values in the financial statements are as follows:

	April 1, 2023				December 31, 2022
(Amounts in millions)	Carrying Value		Fair Value		Carrying Value		Fair Value
Finance receivables – net	$	1,769.2	$	2,020.9	$	1,733.0	$	1,983.9
Contract receivables – net	493.6		524.8		493.7		520.4
Long-term debt and notes payable	1,202.2		1,032.0		1,201.0		982.1

The following methods and assumptions were used in estimating the fair value of financial instruments:

•Finance and contract receivables include both short-term and long-term receivables. The fair value estimates of finance and contract receivables are derived utilizing discounted cash flow analyses performed on groupings of receivables that are similar in terms of loan type and characteristics. The cash flow analyses consider recent prepayment trends where applicable. The cash flows are discounted over the average life of the receivables using a current market discount rate of a similar term adjusted for credit quality. Significant inputs to the fair value measurements of the receivables are unobservable and, as such, are classified as Level 3.

•Fair value of long-term debt is estimated, using Level 2 fair value measurements, based on quoted market values of Snap-on’s publicly traded senior debt. The carrying value of long-term debt includes unamortized debt issuance costs. The fair value of notes payable approximates such instruments’ carrying value due to their short-term nature.

•The fair value of all other financial instruments, including trade and other accounts receivable, accounts payable and other financial instruments, approximates such instruments’ carrying value due to their short-term nature.

Note 10: Pension Plans

Snap-on’s net periodic pension benefit included the following components: 

	Three Months Ended
(Amounts in millions)	April 1, 2023		April 2, 2022
Service cost	$	4.9	$	7.1
Interest cost	16.3		11.1
Expected return on plan assets	(26.2)		(24.5)
Amortization of unrecognized loss	0.3		4.5
Net periodic pension benefit	$	(4.7)	$	(1.8)

The components of net periodic pension benefit, other than the service cost component, are included in “Other income (expense) – net” on the accompanying Condensed Consolidated Statements of Earnings. See Note 16 for additional information on other income (expense) – net.

Snap-on intends to make contributions of $6.9 million to its foreign pension plans and $2.4 million to its domestic pension plans in 2023, as required by law. Depending on market and other conditions, Snap-on may make discretionary cash contributions to its pension plans in 2023.

22

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

Note 11: Postretirement Health Care Plans

Snap-on’s net periodic postretirement health care cost included the following components: 

	Three Months Ended
(Amounts in millions)	April 1, 2023		April 2, 2022
Interest cost	$	0.5	$	0.3
Expected return on plan assets	(0.2)		(0.2)
Amortization of unrecognized gain	(0.3)		—
Net periodic postretirement health care cost	$	—	$	0.1

The components of net periodic postretirement health care cost are included in “Other income (expense) – net” on the accompanying Condensed Consolidated Statements of Earnings. See Note 16 for additional information on other income (expense) – net.

Note 12: Stock-based Compensation and Other Stock Plans

The 2011 Incentive Stock and Awards Plan (the “2011 Plan”) provides for the grant of stock options, performance share units (“PSUs”), stock appreciation rights (“SARs”) and restricted stock awards (which may be designated as “restricted stock units” or “RSUs”). As of April 1, 2023, the 2011 Plan had 2,612,539 shares available for future grants. The company uses treasury stock to deliver shares under the 2011 Plan.

Net stock-based compensation expense was $10.2 million and $9.0 million for the respective three month periods ended April 1, 2023, and April 2, 2022. Cash received from stock purchase and option plan exercises during the respective three month periods ended April 1, 2023, and April 2, 2022 totaled $32.8 million and $5.8 million. The tax benefit realized from both the exercise and vesting of share-based payment arrangements was $5.1 million and $2.1 million for the respective three month periods ended April 1, 2023, and April 2, 2022.

Stock options: Stock options are granted with an exercise price equal to the market value of a share of Snap-on’s common stock on the date of grant and have a contractual term of 10 years. Stock option grants vest ratably on the first, second and third anniversaries of the date of grant.

The fair value of each stock option award is estimated on the date of grant using the Black-Scholes valuation model. The company uses historical data regarding stock option exercise and forfeiture behaviors for different participating groups to estimate the period of time that options granted are expected to be outstanding. Expected volatility is based on the historical volatility of the company’s stock for the length of time corresponding to the expected term of the option. The expected dividend yield is based on the expected annual dividend as a percentage of the market value of our common stock as of the date of grant. The risk-free interest rate is based on the U.S. treasury yield curve on the grant date for the expected term of the option.

The following weighted-average assumptions were used in calculating the fair value of stock options granted during three month periods ended April 1, 2023, and April 2, 2022, using the Black-Scholes valuation model:

	Three Months Ended
	April 1, 2023	April 2, 2022
Expected term of option (in years)	4.90	5.14
Expected volatility factor	23.99%	22.61%
Expected dividend yield	2.60%	2.68%
Risk-free interest rate	3.99%	2.00%

23

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

A summary of stock option activity as of and for the three months ended April 1, 2023, is presented below:

	Shares (in thousands)	Exercise Price Per Share*		Remaining Contractual Term* (in years)	Aggregate Intrinsic Value (in millions)
Outstanding at December 31, 2022	2,349	$	163.07
Granted	241	249.26
Exercised	(220)	148.72
Forfeited or expired	(7)	203.98
Outstanding at April 1, 2023	2,363	173.08		5.8	$	175.0
Exercisable at April 1, 2023	1,839	158.34		4.8	162.8

* Weighted-average

The weighted-average grant date fair value of options granted during the three months ended April 1, 2023, and April 2, 2022, was $51.09 and $34.35, respectively. The intrinsic value of options exercised was $22.6 million and $2.8 million during the respective three month periods ended April 1, 2023, and April 2, 2022. The fair value of stock options vested was $9.1 million and $10.5 million during the respective three month periods ended April 1, 2023, and April 2, 2022.

As of April 1, 2023, there was $19.8 million of unrecognized compensation cost related to non-vested stock options that is expected to be recognized as a charge to earnings over a weighted-average period of 2.1 years.

Performance share units: PSUs are earned and expensed using the fair value of the award over a contractual term of three years based on the company’s performance. Vesting of the PSUs is dependent upon performance relative to pre-defined goals for revenue growth and return on net assets for the applicable performance period. For performance achieved above specified levels, the recipient may earn additional shares of stock, not to exceed 100% of the number of performance awards initially granted. The PSUs have a three-year performance period based on the results of the consolidated financial metrics of the company.

The fair value of PSUs is calculated using the market value of a share of Snap-on’s common stock on the date of grant and assumed forfeitures based on recent historical experience; in recent years, forfeitures have not been significant. The weighted-average grant date fair value of PSUs granted during the three months ended April 1, 2023, and April 2, 2022, was $249.26 and $206.20, respectively. PSUs related to 60,402 shares and 46,217 shares were paid out during the three months ended April 1, 2023, and April 2, 2022, respectively. Earned PSUs vest and are generally paid out following the conclusion of the applicable performance period upon approval by the Organization and Executive Compensation Committee of the company’s Board of Directors (the “Board”).

Changes to the company’s non-vested PSUs during the three months ended April 1, 2023, are as follows:

	Shares (in thousands)	Fair Value Price per Share*
Non-vested PSUs at December 31, 2022	199	$	196.51
Granted	58	249.26
Performance assumption change **	12	211.67
Vested	—	—
Cancellations and other	(2)	204.00
Non-vested PSUs at April 1, 2023	267	208.62

*	Weighted-average
**	Reflects the number of PSUs above target levels based on performance metrics.

As of April 1, 2023, there was $28.6 million of unrecognized compensation cost related to non-vested PSUs that are expected to be recognized as a charge to earnings over a weighted-average period of 1.5 years.

24

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

Restricted stock units: RSUs are earned and expensed using the fair value of the award over the contractual term of three years. Vesting of the RSUs is dependent upon continued employment over the three-year cliff vesting period.

The fair value of RSUs is calculated using the market value of a share of Snap-on’s common stock on the date of grant and assumed forfeitures based on recent historical experience; in recent years, forfeitures have not been significant. The weighted-average grant date fair value of RSUs granted during the three months ended April 1, 2023, and April 2, 2022, was $249.26 and $211.67, respectively.

Changes to the company’s non-vested RSUs during the three months ended April 1, 2023, are as follows:

	Shares (in thousands)	Fair Value Price per Share*
Non-vested RSUs at December 31, 2022	58	$	200.16
Granted	26	249.26
Vested	—	—
Cancellations and other	(1)	203.64
Non-vested RSUs at April 1, 2023	83	215.54

* Weighted-average

As of April 1, 2023, there was $11.3 million of unrecognized compensation cost related to non-vested RSUs that are expected to be recognized as a charge to earnings over a weighted-average period of 1.7 years.

Stock appreciation rights: The company also issues stock-settled and cash-settled SARs to certain key non-U.S. employees. SARs have a contractual term of 10 years and vest ratably on the first, second and third anniversaries of the date of grant. SARs are granted with an exercise price equal to the market value of a share of Snap-on’s common stock on the date of grant.

Stock-settled SARs are accounted for as equity instruments and provide for the issuance of Snap-on common stock equal to the amount by which the company’s stock has appreciated over the exercise price. Stock-settled SARs have an effect on dilutive shares and shares outstanding as any appreciation of Snap-on’s common stock value over the exercise price will be settled in shares of common stock. Cash-settled SARs provide for the cash payment of the excess of the fair market value of Snap-on’s common stock price on the date of exercise over the grant price. Cash-settled SARs have no effect on dilutive shares or shares outstanding as any appreciation of Snap-on’s common stock over the grant price is paid in cash and not in common stock.

The fair value of stock-settled SARs is estimated on the date of grant using the Black-Scholes valuation model. The fair value of cash-settled SARs is revalued (mark-to-market) each reporting period using the Black-Scholes valuation model based on Snap-on’s period-end stock price. The company uses historical data regarding SARs exercise and forfeiture behaviors for different participating groups to estimate the expected term of the SARs granted based on the period of time that similar instruments granted are expected to be outstanding. Expected volatility is based on the historical volatility of the company’s stock for the length of time corresponding to the expected term of the SARs. The expected dividend yield is based on the expected annual dividend as a percentage of the market value of our common stock as of the date of grant (for stock-settled SARs) or reporting date (for cash-settled SARs). The risk-free interest rate is based on the U.S. treasury yield curve in effect as of the grant date (for stock-settled SARs) or reporting date (for cash-settled SARs) for the length of time corresponding to the expected term of the SARs.

25

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

The following weighted-average assumptions were used in calculating the fair value of stock-settled SARs granted during the three months ended April 1, 2023, and April 2, 2022, using the Black-Scholes valuation model:

	Three Months Ended
	April 1, 2023	April 2, 2022
Expected term of stock-settled SARs (in years)	4.08	4.02
Expected volatility factor	24.68%	23.09%
Expected dividend yield	2.60%	2.68%
Risk-free interest rate	3.87%	1.96%

A summary of stock-settled SARs as of and for the three months ended April 1, 2023, are as follows:

	Stock-settled SARs (in thousands)	Exercise Price Per Share*		Remaining Contractual Term* (in years)	Aggregate Intrinsic Value (in millions)
Outstanding at December 31, 2022	385	$	170.11
Granted	62	249.26
Exercised	(23)	153.93
Forfeited or expired	(37)	159.87
Outstanding at April 1, 2023	387	184.66		6.8	$	24.3
Exercisable at April 1, 2023	255	163.58		5.6	21.2

* Weighted-average

The weighted-average grant date fair value of stock-settled SARs granted during the three months ended April 1, 2023, and April 2, 2022, was $48.85 and $32.63, respectively. The intrinsic value of stock-settled SARs exercised was $2.2 million and $0.2 million during the respective three month periods ended April 1, 2023, and April 2, 2022. The fair value of stock-settled SARs vested was $1.9 million and $2.0 million during the respective three month periods ended April 1, 2023, and April 2, 2022.

As of April 1, 2023, there was $4.8 million of unrecognized compensation cost related to non-vested stock-settled SARs that is expected to be recognized as a charge to earnings over a weighted-average period of 2.1 years.

The following weighted-average assumptions were used in calculating the fair value of cash-settled SARs granted during the three months ended April 1, 2023, and April 2, 2022, using the Black-Scholes valuation model:

	Three Months Ended
	April 1, 2023	April 2, 2022
Expected term of cash-settled SARs (in years)	3.96	3.88
Expected volatility factor	24.42%	23.09%
Expected dividend yield	2.62%	2.79%
Risk-free interest rate	3.60%	2.58%

The intrinsic value of cash-settled SARs exercised was $0.4 million for both the respective three month periods ended April 1, 2023, and April 2, 2022. The fair value of cash-settled SARs vested was $0.1 million for both the three month periods ended April 1, 2023, and April 2, 2022.

26

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

Changes to the company’s non-vested cash-settled SARs during the three months ended April 1, 2023, are as follows:

	Cash-settled SARs (in thousands)	Fair Value Price per Share*
Non-vested cash-settled SARs at December 31, 2022	2	$	53.24
Granted	1	48.85
Vested	(1)	72.11
Non-vested cash-settled SARs at April 1, 2023	2	54.52

* Weighted-average

As of April 1, 2023, there was $0.1 million of unrecognized compensation cost related to non-vested cash-settled SARs that is expected to be recognized as a charge to earnings over a weighted-average period of 2.2 years.

Restricted stock awards – non-employee directors: The company awarded 5,760 shares and 6,525 shares of restricted stock to non-employee directors for the respective three month periods ended April 1, 2023, and April 2, 2022. The fair value of the restricted stock awards is expensed over a one-year vesting period based on the fair value on the date of grant. All restrictions generally lapse upon the earlier of the first anniversary of the grant date, the recipient’s death or disability or in the event of a change in control, as defined in the 2011 Plan. If termination of the recipient’s service occurs prior to the first anniversary of the grant date for any reason other than death or disability, the shares of restricted stock would be forfeited, unless otherwise determined by the Board.

Employee stock purchase plan: Substantially all Snap-on employees in the United States and Canada are eligible to participate in an employee stock purchase plan. The purchase price of the company’s common stock to participants is the lesser of the mean of the high and low price of the stock on the beginning date (May 15) or ending date (the following May 14) of each plan year. The company records compensation expense when Snap-on’s period-end stock price is greater than the plan purchase price. There were no share issuances under this plan for the three month periods ended April 1, 2023, and April 2, 2022. As of April 1, 2023, 578,823 shares were reserved for issuance under this plan and Snap-on held participant contributions of approximately $4.7 million. Participants are able to withdraw from the plan at any time prior to the ending date and receive back all contributions made during the plan year. Compensation expense for plan participants was $0.5 million and zero for the three month periods ended April 1, 2023, and April 2, 2022, respectively.

Franchisee stock purchase plan: All franchisees in the United States and Canada are eligible to participate in a franchisee stock purchase plan. The purchase price of the company’s common stock to participants is the lesser of the mean of the high and low price of the stock on the beginning date (May 15) or ending date (the following May 14) of each plan year. The company records mark-to-market expense when Snap-on’s period-end stock price is greater than the plan purchase price. There were no share issuances under this plan for the three month periods ended April 1, 2023, and April 2, 2022. As of April 1, 2023, 225,225 shares were reserved for issuance under this plan and Snap-on held participant contributions of approximately $8.9 million. Participants are able to withdraw from the plan at any time prior to the ending date and generally receive back all contributions made during the plan year. The company recognized market-to-market expense of $0.9 million and zero for the three month periods ended April 1, 2023, and April 2, 2022, respectively.

Note 13: Earnings Per Share

The shares used in the computation of the company’s basic and diluted earnings per common share are as follows:

	Three Months Ended
	April 1, 2023	April 2, 2022
Weighted-average common shares outstanding	53,019,170	53,396,714
Effect of dilutive securities	1,044,581	915,300
Weighted-average common shares outstanding, assuming dilution	54,063,751	54,312,014

27

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

The dilutive effect of the potential exercise of outstanding options and stock-settled SARs to purchase common shares is calculated using the treasury stock method. As of April 1, 2023, there were 302,756 awards outstanding that were anti-dilutive; as of April 2, 2022, there were 358,774 awards outstanding that were anti-dilutive. Performance-based equity awards are included in the diluted earnings per share calculation based on the attainment of the applicable performance metrics to date.

Note 14: Commitments and Contingencies

Snap-on provides product warranties for specific product lines and accrues for estimated future warranty cost in the period in which the sale is recorded. Snap-on calculates its accrual requirements based on historic warranty loss experience that is periodically adjusted for recent actual experience, including the timing of claims during the warranty period and actual costs incurred.

Snap-on’s product warranty accrual activity for the three months ended April 1, 2023, and April 2, 2022, is as follows:

	Three Months Ended
(Amounts in millions)	April 1, 2023		April 2, 2022
Warranty reserve:
Beginning of period	$	14.3	$	17.3
Additions	3.8		2.2
Usage	(3.3)		(3.0)
End of period	$	14.8	$	16.5

In the ordinary course of our business, Snap-on is subject to legal disputes that are being litigated and/or settled. Although it is not possible to predict the outcome of legal matters, management believes that the results of all legal matters will not have a material impact on Snap-on’s consolidated financial position, results of operations or cash flows.

Note 15: Leases

Lessee accounting: Supplemental balance sheet information related to leases as of April 1, 2023, and December 31, 2022, is as follows:

(Amounts in millions)	April 1, 2023		December 31, 2022
Finance leases:
Property and equipment - gross	$	19.7	$	19.4
Accumulated depreciation and amortization	(17.0)		(16.4)
Property and equipment - net	$	2.7	$	3.0
Other accrued liabilities	$	1.9	$	2.0
Other long-term liabilities	1.6		1.9
Total finance lease liabilities	$	3.5	$	3.9
Operating leases:
Operating lease right-of-use assets	$	61.5	$	61.5
Other accrued liabilities	$	19.4	$	19.4
Operating lease liabilities	44.9		44.7
Total operating lease liabilities	$	64.3	$	64.1

28

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

Lessor accounting: Snap-on’s Financial Services business offers its customers lease financing for the lease of tools, diagnostics, and equipment products and to franchisees who require financing for vehicle leases. Sales-type leases are included in both “Finance receivables – net” and “Long-term finance receivables – net” and also in both “Contract receivables – net” and “Long-term contract receivables – net” on the accompanying Condensed Consolidated Balance Sheets.

See Note 3 for further information on finance and contract receivables.

Note 16: Other Income (Expense) – Net

“Other income (expense) – net” on the accompanying Condensed Consolidated Statements of Earnings consists of the following:

	Three Months Ended
(Amounts in millions)	April 1, 2023		April 2, 2022
Interest income	$	8.0	$	0.5
Net foreign exchange loss	(2.5)		(1.0)
Net periodic pension and postretirement benefits – non-service	9.6		8.8
Other	0.1		—
Total other income (expense) – net	$	15.2	$	8.3

Note 17: Accumulated Other Comprehensive Income (Loss)

The following is a summary of net changes in Accumulated OCI by component and net of tax for the three months ended April 1, 2023:

(Amounts in millions)	Foreign Currency Translation		Cash Flow Hedges		Defined Benefit Pension and Postretirement Plans		Total
Balance as of December 31, 2022	$	(272.5)	$	7.3	$	(263.1)	$	(528.3)
Other comprehensive income before reclassifications	18.1		—		—		18.1
Amounts reclassified from Accumulated OCI	—		(0.4)		—		(0.4)
Net other comprehensive income (loss)	18.1		(0.4)		—		17.7
Balance as of April 1, 2023	$	(254.4)	$	6.9	$	(263.1)	$	(510.6)

The following is a summary of net changes in Accumulated OCI by component and net of tax for the three months ended April 2, 2022:

(Amounts in millions)	Foreign Currency Translation		Cash Flow Hedges		Defined Benefit Pension and Postretirement Plans		Total
Balance as of January 1, 2022	$	(145.1)	$	8.9	$	(207.7)	$	(343.9)
Other comprehensive loss before reclassifications	(9.7)		—		—		(9.7)
Amounts reclassified from Accumulated OCI	—		(0.4)		3.4		3.0
Net other comprehensive income (loss)	(9.7)		(0.4)		3.4		(6.7)
Balance as of April 2, 2022	$	(154.8)	$	8.5	$	(204.3)	$	(350.6)

29

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

The reclassifications out of Accumulated OCI for the three month periods ended April 1, 2023, and April 2, 2022, are as follows:

	Amount Reclassified from Accumulated OCI
	Three Months Ended
(Amounts in millions)	April 1, 2023		April 2, 2022		Statement of Earnings Presentation
Gains on cash flow hedges:
Treasury locks	$	0.4	$	0.4	Interest expense
Income tax expense	—		—		Income tax expense
Net of tax	0.4		0.4
Amortization of net unrecognized losses	$	—	$	(4.5)	See footnote below*
Income tax benefit	—		1.1		Income tax expense
Net of tax	—		(3.4)
Total reclassifications for the period, net of tax	$	0.4	$	(3.0)

* These Accumulated OCI components are included in the computation of net periodic pension and postretirement health care costs; see Note 10 and Note 11 for further information.

Note 18: Segments

Snap-on’s business segments are based on the organization structure used by management for making operating and investment decisions and for assessing performance. Snap-on’s reportable business segments are: (i) the Commercial & Industrial Group; (ii) the Snap-on Tools Group; (iii) the Repair Systems & Information Group; and (iv) Financial Services. The Commercial & Industrial Group consists of business operations serving a broad range of industrial and commercial customers worldwide, including customers in the aerospace, natural resources, government and military, power generation, transportation and technical education market segments (collectively, “critical industries”), primarily through direct and distributor channels. The Snap-on Tools Group consists of business operations primarily serving vehicle service and repair technicians through the company’s multi-national mobile tool distribution channel. The Repair Systems & Information Group consists of business operations serving other professional vehicle repair customers worldwide, primarily owners and managers of independent repair shops and OEM dealerships, through direct and distributor channels. Financial Services consists of the business operations of Snap-on’s finance subsidiaries.

Snap-on evaluates the performance of its operating segments based on segment revenues, including both external and intersegment net sales, and segment operating earnings. Snap-on accounts for intersegment sales and transfers based primarily on standard costs with reasonable mark-ups established between the segments. Identifiable assets by segment are those assets used in the respective reportable segment’s operations. Corporate assets consist of cash and cash equivalents (excluding cash held at Financial Services), deferred income taxes and certain other assets. Intersegment amounts are eliminated to arrive at Snap-on’s consolidated financial results.

30

SNAP-ON INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

Financial Data by Segment:

	Three Months Ended
(Amounts in millions)	April 1, 2023		April 2, 2022
Net sales:
Commercial & Industrial Group	$	363.8	$	340.1
Snap-on Tools Group	537.0		512.1
Repair Systems & Information Group	446.6		398.2
Segment net sales	1,347.4		1,250.4
Intersegment eliminations	(164.4)		(152.6)
Total net sales	1,183.0		1,097.8
Financial Services revenue	92.6		87.7
Total revenues	$	1,275.6	$	1,185.5
Operating earnings:
Commercial & Industrial Group	$	55.8	$	45.7
Snap-on Tools Group	131.7		116.0
Repair Systems & Information Group	104.6		91.6
Financial Services	66.3		70.4
Segment operating earnings	358.4		323.7
Corporate	(32.3)		(30.2)
Operating earnings	326.1		293.5
Interest expense	(12.4)		(11.6)
Other income (expense) – net	15.2		8.3
Earnings before income taxes	$	328.9	$	290.2

(Amounts in millions)	April 1, 2023		December 31, 2022
Assets:
Commercial & Industrial Group	$	1,271.1	$	1,245.8
Snap-on Tools Group	934.0		912.9
Repair Systems & Information Group	1,681.7		1,678.1
Financial Services	2,281.2		2,242.7
Total assets from reportable segments	6,168.0		6,079.5
Corporate	1,041.1		972.9
Elimination of intersegment receivables	(83.5)		(79.6)
Total assets	$	7,125.6	$	6,972.8

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Item 2: Management’s Discussion and Analysis of Financial Condition and Results of Operations

Caution Regarding Forward-Looking Statements:

Statements in this document that are not historical facts, including statements that (i) are in the future tense, (ii) include the words “expects,” “plans,” “targets,” “estimates,” “believes,” “anticipates,” or similar words that reference Snap-on Incorporated (“Snap-on” or “the company”) or its management, (iii) are specifically identified as forward-looking, or (iv) describe Snap‑on’s or management’s future outlook, plans, estimates, objectives or goals, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Snap-on cautions the reader that any forward-looking statements included in this document that are based upon assumptions and estimates were developed by management in good faith and are subject to risks, uncertainties or other factors that could cause (and in some cases have caused) actual results to differ materially from those described in any such statement. Accordingly, forward-looking statements should not be relied upon as a prediction of actual results or regarded as a representation by the company or its management that the projected results will be achieved. For those forward-looking statements, Snap-on cautions the reader that numerous important factors, such as those listed below, the factors discussed in its Annual Report on Form 10-K for the fiscal year ended December 31, 2022 (“2022 year end”), and those discussed in this document, could affect the company’s actual results and could cause its actual consolidated results to differ materially from those expressed in any forward-looking statement made by, or on behalf of, Snap-on.

Risks and uncertainties include, without limitation:

•Uncertainties related to estimates, assumptions and projections generally;

•The timing and progress with which Snap-on can attain value through its Snap-on Value Creation Processes, including its ability to (i) realize efficiencies and savings from its rapid continuous improvement and other cost reduction initiatives, (ii) improve workforce productivity, (iii) achieve improvements in the company’s manufacturing footprint and greater efficiencies in its supply chain, and (iv) enhance machine maintenance, plant productivity and manufacturing line set-up and change-over practices, any or all of which could result in production inefficiencies, higher costs and/or lost revenues;

•Snap-on’s capability to successfully implement future strategies with respect to its existing businesses;

•Snap-on’s ability to refine its brand and franchise strategies, retain and attract franchisees, and further enhance service and value to franchisees in order to help improve the sales and profitability of franchisees;

•The company’s ability to introduce successful new products;

•Significant changes in the current competitive environment;

•Risks related to pursuing, completing and integrating acquisitions;

•Inflation, interest rate changes and other monetary and market fluctuations;

•Price and supply fluctuations related to raw materials, components and certain purchased finished goods, such as steel, plastics, and electronics;

•The effects of external economic factors, including adverse developments in world financial markets, disruptions related to tariffs and other trade issues, and global supply chain inefficiencies, including as a result of the current war in Ukraine;

•Snap-on’s ability to successfully manage changes in prices and the availability of energy sources, including gasoline;

•Snap-on’s ability to withstand disruption arising from natural disasters, including climate-related events or other unusual occurrences;

•Risks associated with data security and technological systems and protections, including the effects of cyber incidents and from new legislation, regulations or government-related developments;

•The impact of labor interruptions or challenges, and Snap-on’s ability to effectively manage human capital resources;

•Snap-on’s ability to successfully manage planned facility closures or to withstand disruptions from unexpected closures;

•Weakness in certain geographic areas, including as a result of localized recessions, and the impact of matters related to the United Kingdom’s exit from the European Union;

•Changes in tax rates, laws and regulations as well as uncertainty surrounding potential changes;

•The amount, rate and growth of health care and postretirement costs, including continuing and potentially increasing required contributions to pension and postretirement plans;

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•The effects of new requirements, legislation, regulations or government-related developments or issues, as well as third party actions, including those addressing climate change;

•Potential reputational damages and costs related to litigation;

•The impact of the coronavirus (“COVID-19”) pandemic and other outbreaks of infectious diseases, as well as the effects of governmental actions related thereto on Snap-on’s business, which could have the potential to amplify the impact of the other risks facing the company; and

•Other world or local events outside Snap-on’s control, including terrorist disruptions, armed conflicts and civil unrest.

Snap-on disclaims any responsibility to update any forward-looking statement provided in this document, except as required by law.

In addition, investors should be aware that generally accepted accounting principles in the United States of America (“GAAP”) prescribe when a company should reserve for particular risks, including litigation exposures. Accordingly, results for a given reporting period could be significantly affected if and when a reserve is established for a major contingency. Reported results, therefore, may appear to be volatile in certain accounting periods.

Non-GAAP Measures

References in this report to “organic sales” refer to sales from continuing operations calculated in accordance with GAAP, adjusted to exclude acquisition-related sales and the impact of foreign currency translation. Management evaluates the company’s sales performance based on organic sales growth, which primarily reflects growth from the company’s existing businesses as a result of increased output, expanded customer base, geographic expansion, new product development and pricing changes, and excludes sales contributions from acquired operations the company did not own as of the comparable prior-year reporting period. Organic sales also exclude the effects of foreign currency translation as foreign currency translation is subject to volatility that can obscure underlying business trends. Management believes that the non-GAAP financial measure of organic sales is meaningful to investors as it provides them with useful information to aid in identifying underlying growth trends in the company’s businesses and facilitates comparisons of its sales performance with prior periods.

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RESULTS OF OPERATIONS

Results of operations for the three months ended April 1, 2023, and April 2, 2022, are as follows:

	Three Months Ended
(Amounts in millions)	April 1, 2023				April 2, 2022				Change
Net sales	$	1,183.0	100.0	%	$	1,097.8	100.0	%	$	85.2	7.8	%
Cost of goods sold	(593.4)		(50.2)	%	(563.5)		(51.3)	%	(29.9)		(5.3)	%
Gross profit	589.6		49.8	%	534.3		48.7	%	55.3		10.3	%
Operating expenses	(329.8)		(27.8)	%	(311.2)		(28.4)	%	(18.6)		(6.0)	%
Operating earnings before financial services	259.8		22.0	%	223.1		20.3	%	36.7		16.5	%
Financial services revenue	92.6		100.0	%	87.7		100.0	%	4.9		5.6	%
Financial services expenses	(26.3)		(28.4)	%	(17.3)		(19.7)	%	(9.0)		(52.0)	%
Operating earnings from financial services	66.3		71.6	%	70.4		80.3	%	(4.1)		(5.8)	%
Operating earnings	326.1		25.6	%	293.5		24.8	%	32.6		11.1	%
Interest expense	(12.4)		(1.0)	%	(11.6)		(1.0)	%	(0.8)		(6.9)	%
Other income (expense) – net	15.2		1.2	%	8.3		0.7	%	6.9		83.1	%
Earnings before income taxes	328.9		25.8	%	290.2		24.5	%	38.7		13.3	%
Income tax expense	(74.6)		(5.9)	%	(67.5)		(5.7)	%	(7.1)		(10.5)	%
Net earnings	254.3		19.9	%	222.7		18.8	%	31.6		14.2	%
Net earnings attributable to noncontrolling interests	(5.6)		(0.4)	%	(5.3)		(0.5)	%	(0.3)		(5.7)	%
Net earnings attributable to Snap-on Inc.	$	248.7	19.5	%	$	217.4	18.3	%	$	31.3	14.4	%

Percentage Disclosure: All income statement line item percentages below “Operating earnings from financial services” are calculated as a percentage of the sum of Net sales and Financial services revenue.

Net sales of $1,183.0 million in the first quarter of 2023 increased $85.2 million, or 7.8%, from 2022 levels, reflecting a $109.2 million, or 10.2%, organic gain, partially offset by $24.0 million of unfavorable foreign currency translation.

Gross profit of $589.6 million in the first quarter of 2023 increased $55.3 million, or 10.3%, compared to $534.3 million last year. Gross margin (gross profit as a percentage of net sales) of 49.8% in the quarter improved 110 basis points (100 basis points (“bps”) equals 1.0 percent) from the first quarter of 2022 primarily due to increased sales volumes and pricing actions, and benefits from the company’s “Rapid Continuous Improvement” or “RCI” initiatives, partially offset by the effects of higher material and other costs and 20 bps of unfavorable foreign currency.

Snap-on’s RCI initiatives employ a structured set of tools and processes across multiple businesses and geographies intended to eliminate waste and improve operations. Savings from Snap-on’s RCI initiatives reflect benefits from a wide variety of ongoing efficiency, productivity and process improvements, including savings generated from product design cost reductions, improved manufacturing line set-up and change-over practices, lower-cost sourcing initiatives and facility consolidations. Unless individually significant, it is not practicable to disclose each RCI activity that generated savings and/or segregate RCI savings embedded in sales volume increases.

Operating expenses of $329.8 million in the first quarter of 2023 compared to $311.2 million last year. Operating expenses as a percentage of net sales of 27.8% improved 60 bps from last year primarily due to the higher sales volumes.

Operating earnings before financial services of $259.8 million in the first quarter of 2023 increased $36.7 million, or 16.5%, compared to $223.1 million in the first quarter of 2022. As a percentage of net sales, operating earnings before financial services of 22.0% compared to 20.3% last year.

Financial services revenue of $92.6 million in the first quarter of 2023 compared to $87.7 million last year. Financial services operating earnings of $66.3 million in the period compared to $70.4 million in 2022.

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Operating earnings of $326.1 million in the first quarter of 2023 increased $32.6 million, or 11.1%, compared to $293.5 million last year. As a percentage of revenues (net sales plus financial services revenue), operating earnings of 25.6% in the quarter compared to 24.8% last year.

Interest expense in the first quarter of 2023 increased $0.8 million compared to last year. See Note 8 to the Condensed Consolidated Financial Statements for information on Snap-on’s debt and credit facilities.

Other income (expense) – net primarily includes net gains and losses associated with hedging and currency exchange rate transactions, non-service components of net periodic benefit costs, and interest income. See Note 16 to the Condensed Consolidated Financial Statements for information on Other income (expense) – net.

Snap-on’s effective income tax rate on earnings attributable to Snap-on was 23.1% in the first quarter of 2023 and 23.7% in the first quarter of 2022. See Note 7 to the Condensed Consolidated Financial Statements for information on income taxes.

Net earnings attributable to Snap-on in the first quarter of 2023 of $248.7 million, or $4.60 per diluted share, increased $31.3 million, or $0.60 per diluted share, as compared to $217.4 million, or $4.00 per diluted share, in the first quarter of 2022.

Segment Results

Snap-on’s business segments are based on the organization structure used by management for making operating and investment decisions and for assessing performance. Snap-on’s reportable business segments are: (i) the Commercial & Industrial Group; (ii) the Snap-on Tools Group; (iii) the Repair Systems & Information Group; and (iv) Financial Services. The Commercial & Industrial Group consists of business operations serving a broad range of industrial and commercial customers worldwide, including customers in the aerospace, natural resources, government and military, power generation, transportation and technical education market segments (collectively, “critical industries”), primarily through direct and distributor channels. The Snap-on Tools Group consists of business operations primarily serving vehicle service and repair technicians through the company’s multi-national mobile tool distribution channel. The Repair Systems & Information Group consists of business operations serving other professional vehicle repair customers worldwide, primarily owners and managers of independent repair shops and OEM dealerships, through direct and distributor channels. Financial Services consists of the business operations of Snap-on’s finance subsidiaries.

Snap-on evaluates the performance of its operating segments based on segment revenues, including both external and intersegment net sales, and segment operating earnings. Snap-on accounts for intersegment sales and transfers based primarily on standard costs with reasonable mark-ups established between the segments. Identifiable assets by segment are those assets used in the respective reportable segment’s operations. Corporate assets consist of cash and cash equivalents (excluding cash held at Financial Services), deferred income taxes and certain other assets. Intersegment amounts are eliminated to arrive at Snap-on’s consolidated financial results.

Commercial & Industrial Group

	Three Months Ended
(Amounts in millions)	April 1, 2023				April 2, 2022				Change
External net sales	$	278.6	76.6	%	$	261.2	76.8	%	$	17.4	6.7	%
Intersegment net sales	85.2		23.4	%	78.9		23.2	%	6.3		8.0	%
Segment net sales	363.8		100.0	%	340.1		100.0	%	23.7		7.0	%
Cost of goods sold	(222.5)		(61.2)	%	(216.4)		(63.6)	%	(6.1)		(2.8)	%
Gross profit	141.3		38.8	%	123.7		36.4	%	17.6		14.2	%
Operating expenses	(85.5)		(23.5)	%	(78.0)		(23.0)	%	(7.5)		(9.6)	%
Segment operating earnings	$	55.8	15.3	%	$	45.7	13.4	%	$	10.1	22.1	%

Segment net sales of $363.8 million in the first quarter of 2023 increased $23.7 million, or 7.0%, from 2022 levels, reflecting a $36.2 million, or 11.1%, organic sales increase, partially offset by $12.5 million of unfavorable foreign currency translation. The organic increase primarily reflects double-digit gains in sales to customers in critical industries and in the segment’s specialty tools business, as well as a low single-digit increase in the segment’s European-based hand tools business.

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Segment gross margin in the first quarter of 38.8% improved 240 bps from last year, primarily due to higher sales volumes, including increased activity in higher gross margin critical industries, pricing actions, and benefits from the segment’s RCI initiatives. These improvements were partially offset by the effects of higher material and other costs.

Segment operating expenses as a percentage of sales in the first quarter of 23.5% increased 50 bps as compared to 2022 primarily due to increased sales in higher-expense businesses.

As a result of these factors, segment operating earnings of $55.8 million in the first quarter of 2023, including $2.0 million of unfavorable foreign currency effects, increased $10.1 million, or 22.1%, compared to $45.7 million in 2022. Operating margin (segment operating earnings as a percentage of segment net sales) for the Commercial & Industrial Group of 15.3% in the first quarter of 2023 compared to 13.4% in 2022.

Snap-on Tools Group

	Three Months Ended
(Amounts in millions)	April 1, 2023				April 2, 2022				Change
Segment net sales	$	537.0	100.0	%	$	512.1	100.0	%	$	24.9	4.9	%
Cost of goods sold	(283.1)		(52.7)	%	(278.9)		(54.5)	%	(4.2)		(1.5)	%
Gross profit	253.9		47.3	%	233.2		45.5	%	20.7		8.9	%
Operating expenses	(122.2)		(22.8)	%	(117.2)		(22.8)	%	(5.0)		(4.3)	%
Segment operating earnings	$	131.7	24.5	%	$	116.0	22.7	%	$	15.7	13.5	%

Segment net sales of $537.0 million in the first quarter of 2023 increased $24.9 million, or 4.9%, from 2022 levels, reflecting a $32.0 million, or 6.3%, organic sales gain, partially offset by $7.1 million of unfavorable foreign currency translation. The organic increase is due to a high single-digit gain in the U.S. franchise business and a low single-digit increase in the segment’s international operations.

Segment gross margin in the first quarter of 47.3% improved 180 bps from last year primarily due to increased sales volumes and pricing actions, lower material and other costs, and benefits from the segment’s RCI initiatives. These improvements were partially offset by 80 bps of unfavorable foreign currency effects.

Segment operating expenses as a percentage of net sales in the first quarter of 22.8% was unchanged from last year.

As a result of these factors, segment operating earnings of $131.7 million in the first quarter of 2023, including $6.1 million of unfavorable foreign currency effects, increased $15.7 million, or 13.5%, compared to $116.0 million in 2022. Operating margin for the Snap-on Tools Group of 24.5% in the first quarter of 2023 compared to 22.7% last year.

Repair Systems & Information Group

	Three Months Ended
(Amounts in millions)	April 1, 2023				April 2, 2022				Change
External net sales	$	367.4	82.3	%	$	324.5	81.5	%	$	42.9	13.2	%
Intersegment net sales	79.2		17.7	%	73.7		18.5	%	5.5		7.5	%
Segment net sales	446.6		100.0	%	398.2		100.0	%	48.4		12.2	%
Cost of goods sold	(252.2)		(56.5)	%	(220.8)		(55.4)	%	(31.4)		(14.2)	%
Gross profit	194.4		43.5	%	177.4		44.6	%	17.0		9.6	%
Operating expenses	(89.8)		(20.1)	%	(85.8)		(21.6)	%	(4.0)		(4.7)	%
Segment operating earnings	$	104.6	23.4	%	$	91.6	23.0	%	$	13.0	14.2	%

Segment net sales of $446.6 million in the first quarter of 2023 increased $48.4 million, or 12.2%, from 2022 levels, reflecting a $54.4 million, or 13.9%, organic sales increase, partially offset by $6.0 million of unfavorable foreign currency translation. The organic gain includes double-digit increases in sales of undercar equipment and in activity with OEM dealerships, and a mid single-digit gain in sales of diagnostic and repair information products to independent repair shop owners and managers.

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Segment gross margin in the first quarter of 43.5% declined 110 bps from last year primarily due to increased sales in lower gross margin businesses and the effects of higher material and other costs. These declines were partially offset by benefits from pricing actions and savings from RCI initiatives, as well as 30 bps of favorable foreign currency effects.

Segment operating expenses as a percentage of net sales in the first quarter of 20.1% improved 150 bps from 2022 primarily due to benefits from sales volume leverage, higher activity in lower-expense businesses, and savings from RCI initiatives.

As a result of these factors, segment operating earnings of $104.6 million in the first quarter of 2023, including $0.5 million of favorable foreign currency effects, increased $13.0 million, or 14.2%, from $91.6 million in 2022. Operating margin for the Repair Systems & Information Group of 23.4% in the first quarter of 2023 compared to 23.0% last year.

Financial Services

	Three Months Ended
(Amounts in millions)	April 1, 2023				April 2, 2022				Change
Financial services revenue	$	92.6	100.0	%	$	87.7	100.0	%	$	4.9	5.6	%
Financial services expenses	(26.3)		(28.4)	%	(17.3)		(19.7)	%	(9.0)		(52.0)	%
Segment operating earnings	$	66.3	71.6	%	$	70.4	80.3	%	$	(4.1)	(5.8)	%

Financial services revenue is generally dependent on the size of the average financial services portfolio during the period, as well as on the average yield on receivables. Financial services revenue in the first quarter of 2023 increased $4.9 million, or 5.6%, from $87.7 million last year. In the first quarters of 2023 and 2022, the respective average yields on finance receivables were 17.7% and 17.6%. In the first quarters of 2023 and 2022, the average yields on contract receivables were 8.7% and 8.5%, respectively. Originations of $300.9 million in the first quarter of 2023 increased $55.3 million, or 22.5%, from 2022 levels.

Financial services expenses primarily include personnel-related and other general and administrative costs, as well as provisions for credit losses. These expenses are generally more dependent on changes in the size of the financial services portfolio than they are on the revenue of the segment. Financial services expenses in the first quarter of 2023 increased primarily due to higher provisions for credit losses as compared to those recorded in the first quarter of 2022. As a percentage of the average financial services portfolio, expenses were 1.1% in the first quarter of 2023 and 0.8% in 2022.

Segment operating earnings in the first quarter of 2023, including $0.7 million of unfavorable foreign currency effects, decreased $4.1 million, or 5.8%, from 2022 levels.

Corporate

Snap-on’s first quarter 2023 general corporate expenses of $32.3 million increased $2.1 million from $30.2 million last year primarily due to higher stock-based and performance-based compensation.

Non-GAAP Supplemental Data

The following non-GAAP supplemental data is presented for informational purposes to provide readers with insight into the information used by management for assessing the operating performance of Snap-on’s non-financial services (“Operations”) and “Financial Services” businesses.

The supplemental Operations data reflects the results of operations and financial position of Snap-on’s tools, diagnostics, equipment products, software, and other non-financial services operations with Financial Services presented on the equity method. The supplemental Financial Services data reflects the results of operations and financial position of Snap-on’s U.S. and international financial services operations. The financing needs of Financial Services are met through intersegment borrowings and cash generated from Operations; Financial Services is charged interest expense on intersegment borrowings at market rates. Income taxes are charged to Financial Services on the basis of the specific tax attributes generated by the U.S. and international financial services businesses. Transactions between the Operations and Financial Services businesses were eliminated to arrive at the Condensed Consolidated Financial Statements.

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Non-GAAP Supplemental Consolidating Data – Supplemental Condensed Statements of Earnings information for the three months ended April 1, 2023, and April 2, 2022, are as follows:

	Operations*				Financial Services
(Amounts in millions)	April 1, 2023		April 2, 2022		April 1, 2023		April 2, 2022
Net sales	$	1,183.0	$	1,097.8	$	—	$	—
Cost of goods sold	(593.4)		(563.5)		—		—
Gross profit	589.6		534.3		—		—
Operating expenses	(329.8)		(311.2)		—		—
Operating earnings before financial services	259.8		223.1		—		—
Financial services revenue	—		—		92.6		87.7
Financial services expenses	—		—		(26.3)		(17.3)
Operating earnings from financial services	—		—		66.3		70.4
Operating earnings	259.8		223.1		66.3		70.4
Interest expense	(12.4)		(11.6)		—		—
Intersegment interest income (expense) – net	15.7		14.9		(15.7)		(14.9)
Other income (expense) – net	15.2		8.3		—		—
Earnings before income taxes and equity earnings	278.3		234.7		50.6		55.5
Income tax expense	(61.5)		(53.2)		(13.1)		(14.3)
Earnings before equity earnings	216.8		181.5		37.5		41.2
Financial services – net earnings attributable to Snap-on	37.5		41.2		—		—
Net earnings	254.3		222.7		37.5		41.2
Net earnings attributable to noncontrolling interests	(5.6)		(5.3)		—		—
Net earnings attributable to Snap-on	$	248.7	$	217.4	$	37.5	$	41.2

* Snap-on with Financial Services presented on the equity method.

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Non-GAAP Supplemental Consolidating Data – Supplemental Condensed Balance Sheet information as of April 1, 2023, and December 31, 2022, is as follows:

	Operations*				Financial Services
(Amounts in millions)	April 1, 2023		December 31, 2022		April 1, 2023		December 31, 2022
ASSETS
Current assets:
Cash and cash equivalents	$	833.4	$	757.1	$	0.4	$	0.1
Intersegment receivables	20.1		13.4		—		—
Trade and other accounts receivable – net	781.2		761.1		1.2		0.6
Finance receivables – net	—		—		572.1		562.2
Contract receivables – net	5.8		5.9		100.0		104.0
Inventories – net	1,049.1		1,033.1		—		—
Prepaid expenses and other assets	142.7		149.2		6.0		5.8
Total current assets	2,832.3		2,719.8		679.7		672.7
Property and equipment – net	513.6		510.7		2.7		1.9
Operating lease right-of-use assets	60.2		60.1		1.3		1.4
Investment in Financial Services	367.7		363.9		—		—
Deferred income tax assets	51.1		48.4		22.0		21.6
Intersegment long-term notes receivable	654.3		635.9		—		—
Long-term finance receivables – net	—		—		1,197.1		1,170.8
Long-term contract receivables – net	9.5		9.6		378.3		374.2
Goodwill	1,050.6		1,045.3		—		—
Other intangibles – net	273.3		275.6		—		—
Pension assets	71.8		70.6		—		—
Other assets	27.0		27.1		0.1		0.1
Total assets	$	5,911.4	$	5,767.0	$	2,281.2	$	2,242.7

* Snap-on with Financial Services presented on the equity method.

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Non-GAAP Supplemental Consolidating Data – Supplemental Condensed Balance Sheets Information (continued):

	Operations*				Financial Services
(Amounts in millions)	April 1, 2023		December 31, 2022		April 1, 2023		December 31, 2022
LIABILITIES AND EQUITY
Current liabilities:
Notes payable	$	18.2	$	17.2	$	—	$	—
Accounts payable	281.3		285.8		1.8		1.2
Intersegment payables	—		—		20.1		13.4
Accrued benefits	65.3		58.6		—		—
Accrued compensation	66.8		95.6		1.8		3.0
Franchisee deposits	72.5		73.8		—		—
Other accrued liabilities	466.7		420.8		35.3		25.8
Total current liabilities	970.8		951.8		59.0		43.4
Long-term debt and intersegment long-term debt	—		—		1,838.3		1,819.7
Deferred income tax liabilities	85.3		82.1		—		—
Retiree health care benefits	22.9		23.4		—		—
Pension liabilities	72.7		78.6		—		—
Operating lease liabilities	43.9		43.6		1.0		1.1
Other long-term liabilities	83.4		84.0		15.2		14.6
Total liabilities	1,279.0		1,263.5		1,913.5		1,878.8
Total shareholders’ equity attributable to Snap-on	4,610.2		4,481.3		367.7		363.9
Noncontrolling interests	22.2		22.2		—		—
Total equity	4,632.4		4,503.5		367.7		363.9
Total liabilities and equity	$	5,911.4	$	5,767.0	$	2,281.2	$	2,242.7

* Snap-on with Financial Services presented on the equity method.

40

SNAP-ON INCORPORATED

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS

OF OPERATIONS

(continued)

Liquidity and Capital Resources

Snap-on’s growth has historically been funded by a combination of cash provided by operating activities and debt financing. Snap-on believes that its cash from operations and collections of finance receivables, coupled with its sources of borrowings and available cash on hand, are sufficient to fund its currently anticipated requirements for scheduled debt repayments, payments of interest and dividends, new receivables originated by our financial services businesses, capital expenditures, working capital, the funding of pension plans, and funding for share repurchases and acquisitions, if and as they arise.

Due to Snap-on’s credit rating over the years, external funds have been available at an acceptable cost. As of April 14, 2023, Snap-on’s long-term debt and commercial paper were rated, respectively, A2 and P-1 by Moody’s Investors Service; A- and A-2 by Standard & Poor’s; and A and F1 by Fitch Ratings. Snap-on believes that its current credit arrangements are sound and that the strength of its balance sheet affords the company the financial flexibility, including through access to financial markets for potential new financing, to respond to both internal growth opportunities and those available through acquisitions. However, Snap-on cannot provide any assurance that financing will be available in the future on acceptable terms, or that its debt ratings will not decrease.

The following discussion focuses on information included in the accompanying Condensed Consolidated Balance Sheets.

As of April 1, 2023, working capital (current assets less current liabilities) of $2,482.2 million increased $84.9 million from $2,397.3 million as of December 31, 2022 (fiscal 2022 year end), primarily as a result of the net changes discussed below.

The following represents the company’s working capital position as of April 1, 2023, and December 31, 2022:

(Amounts in millions)	April 1, 2023		December 31, 2022
Cash and cash equivalents	$	833.8	$	757.2
Trade and other accounts receivable – net	782.4		761.7
Finance receivables – net	572.1		562.2
Contract receivables – net	105.8		109.9
Inventories – net	1,049.1		1,033.1
Prepaid expenses and other assets	138.0		144.8
Total current assets	3,481.2		3,368.9
Notes payable	(18.2)		(17.2)
Accounts payable	(283.1)		(287.0)
Other current liabilities	(697.7)		(667.4)
Total current liabilities	(999.0)		(971.6)
Working capital	$	2,482.2	$	2,397.3

Cash and cash equivalents of $833.8 million as of April 1, 2023, increased $76.6 million from 2022 year-end levels primarily due to: (i) $301.6 million of cash generated from operations; (ii) $207.5 million of cash from collections of finance receivables; (iii) $32.8 million of cash proceeds from stock purchase and option plan exercises; and (iv) $0.8 million of net proceeds from other short-term borrowings. These increases in cash and cash equivalents were partially offset by: (i) the funding of $257.1 million of new finance receivables; (ii) the repurchase of 356,000 shares of the company’s common stock for $87.2 million; (iii) dividend payments to shareholders of $86.1 million; and (iv) the funding of $23.0 million of capital expenditures.

Of the $833.8 million of cash and cash equivalents as of April 1, 2023, $267.9 million was held outside of the United States. Snap-on maintains non-U.S. funds in its foreign operations to: (i) provide adequate working capital; (ii) satisfy various regulatory requirements; and/or (iii) take advantage of business expansion opportunities as they arise. Although the Tax Cuts and Jobs Act (“Tax Act”) generally eliminated U.S. federal taxation of dividends from foreign subsidiaries, such dividends may still be subject to state income taxation and foreign withholding taxes. Snap-on periodically evaluates its cash held outside the United States and may pursue opportunities to repatriate certain foreign cash amounts to the extent that it can be accomplished in a tax efficient manner.

41

SNAP-ON INCORPORATED

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS

OF OPERATIONS

(continued)

Trade and other accounts receivable – net of $782.4 million as of April 1, 2023, increased $20.7 million from 2022 year-end levels primarily due to higher sales and $3.7 million of foreign currency translation. Days sales outstanding (trade and other accounts receivable – net as of the respective period end, divided by the respective trailing 12 months sales, times 360 days) was 62 days at April 1, 2023, and 61 days at December 31, 2022.

The current portions of net finance and contract receivables of $677.9 million as of April 1, 2023, compared to $672.1 million at 2022 year end. The long-term portions of net finance and contract receivables of $1,584.9 million as of April 1, 2023, compared to $1,554.6 million at 2022 year end. The combined $36.1 million increase in net current and long-term finance and contract receivables over 2022 year-end levels is primarily due to an increase in net receivable originations and $1.1 million of foreign currency translation.

Inventories – net of $1,049.1 million as of April 1, 2023, increased $16.0 million from 2022 year-end levels primarily due to higher demand, increased costs, efforts to manage the current supply chain situation and $6.2 million of foreign currency translation. Inventory turns (trailing 12 months of cost of goods sold, divided by the average of the beginning and ending inventory balance for the trailing 12 months) were 2.4 turns and 2.5 turns as of April 1, 2023, and December 31, 2022, respectively. Inventories accounted for using the first-in, first-out (“FIFO”) method approximated 61% of total inventories as of both April 1, 2023, and December 31, 2022. All other inventories are accounted for using the last-in, first-out (“LIFO”) method. The company’s LIFO reserve was $108.9 million and $108.6 million as of April 1, 2023, and December 31, 2022, respectively.

Notes payable of $18.2 million as of April 1, 2023, compared to $17.2 million as of 2022 year end.

Accounts payable of $283.1 million as of April 1, 2023, decreased $3.9 million from 2022 year-end levels primarily due to the timing of payments, partially offset by $1.0 million of foreign currency translation.

Other accrued liabilities of $491.3 million as of April 1, 2023, increased $54.9 million from 2022 year-end levels primarily due to higher tax accruals and $1.6 million of foreign currency translation.

Long-term debt of $1,184.0 million as of April 1, 2023, consisted of: (i) $300 million of unsecured 3.25% notes that mature on March 1, 2027 (the “2027 Notes”); (ii) $400 million of unsecured 4.10% notes that mature on March 1, 2048 (the “2048 Notes”); and (iii) $500 million of 3.10% notes that mature on May 1, 2050 (“the 2050 Notes”), partially offset by $16.0 million of unamortized debt issuance costs.

Snap-on has an $800 million multi-currency revolving credit facility that terminates on September 16, 2024 (the “Credit Facility”); no amounts were borrowed or outstanding under the Credit Facility for the three months ended and as of April 1, 2023. Borrowings under the Credit Facility bear interest at varying rates based on either: (i) Snap-on’s then-current, long-term debt ratings; or (ii) Snap-on’s then-current ratio of consolidated debt net of certain cash adjustments (“Consolidated Net Debt”) to earnings before interest, taxes, depreciation, amortization and certain other adjustments for the preceding four fiscal quarters then ended (the “Consolidated Net Debt to EBITDA Ratio”). The Credit Facility’s financial covenant requires that Snap-on maintain, as of each fiscal quarter end, either (i) a ratio not greater than 0.60 to 1.00 of Consolidated Net Debt to the sum of Consolidated Net Debt plus total equity and less accumulated other comprehensive income or loss (the “Leverage Ratio”); or (ii) a Consolidated Net Debt to EBITDA Ratio not greater than 3.50 to 1.00. Snap-on may, up to two times during any five-year period during the term of the Credit Facility (including any extensions thereof), elect to increase the maximum Leverage Ratio to 0.65 to 1.00 and/or increase the maximum Consolidated Net Debt to EBITDA Ratio to 4.00 to 1.00 for four consecutive fiscal quarters in connection with certain material acquisitions (as defined in the related credit agreement). As of April 1, 2023, the company’s actual ratios of 0.08 and 0.30 respectively, were both within the permitted ranges set forth in this financial covenant. Snap-on generally issues commercial paper to fund its financing needs on a short-term basis and uses the Credit Facility as back-up liquidity to support such commercial paper issuances. As of April 1, 2023, there were no commercial paper issuances outstanding.

42

SNAP-ON INCORPORATED

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS

OF OPERATIONS

(continued)

Snap-on believes it has sufficient available cash and access to both committed and uncommitted credit facilities to cover its expected funding needs on both a short-term and long-term basis. Snap-on manages its aggregate short-term borrowings so as not to exceed its availability under the Credit Facility. Snap-on believes that it can access short-term debt markets, predominantly through commercial paper issuances and existing lines of credit, to fund its short-term requirements and to ensure near-term liquidity. Snap-on regularly monitors the credit and financial markets and, if it believes conditions are favorable, it may take advantage of such conditions to issue long-term debt to further improve its liquidity and capital resources. Near-term liquidity requirements for Snap-on include payments of interest and dividends, funding to support new receivables originated by our financial services businesses, capital expenditures, working capital, the funding of pension plans, and funding for share repurchases and acquisitions, if and as they arise. Snap-on intends to make contributions of $6.9 million to its foreign pension plans and $2.4 million to its domestic pension plans in 2023, as required by law. Depending on market and other conditions, Snap-on may make discretionary cash contributions to its pension plans in 2023.

Snap-on’s long-term financing strategy is to maintain continuous access to the debt markets to accommodate its liquidity needs, including the potential use of commercial paper, additional fixed-term debt and/or securitizations.

The following discussion focuses on information included in the accompanying Condensed Consolidated Statements of Cash Flows.

Operating Activities

Net cash provided by operating activities was $301.6 million and $193.9 million in the first three months of 2023 and 2022, respectively. The $107.7 million year-over-year increase in net cash provided by operating activities primarily reflects a $66.6 million change in net operating assets and liabilities and a $31.6 million increase in net earnings.

Investing Activities

Net cash used by investing activities of $72.9 million in the first three months of 2023 included additions to finance receivables of $257.1 million, offset by collections of $207.5 million. Net cash used by investing activities of $6.6 million in the first three months of 2022 included additions to finance receivables of $205.5 million, offset by collections of $215.6 million. Finance receivables are comprised of extended-term installment payment contracts to both technicians and independent shop owners (i.e., franchisees’ customers) to enable them to purchase tools, diagnostics, and equipment products on an extended-term payment plan, with average payment terms of approximately four years.

Capital expenditures were $23.0 million and $20.2 million in the first three months of 2023 and 2022, respectively. Capital expenditures in both years included continued investments related to the company’s execution of its strategic Value Creation Processes around safety, quality, customer connection, innovation and RCI.

Financing Activities

Net cash used by financing activities of $152.1 million in the first three months of 2023 included net proceeds from other short-term borrowings of $0.8 million; net cash used by financing activities of $106.3 million in the first three months of 2022 included net proceeds from other short-term borrowings of $2.3 million.

Proceeds from stock purchase and option plan exercises totaled $32.8 million and $5.8 million in the first three months of 2023 and 2022, respectively. In the first three months of 2023, Snap-on repurchased 356,000 shares of its common stock for $87.2 million under its previously announced share repurchase programs. In the first three months of 2022, Snap-on repurchased 136,000 shares of its common stock for $28.8 million under its previously announced share repurchase programs. As of April 1, 2023, Snap-on had remaining availability to repurchase up to an additional $345.4 million in common stock pursuant to its Board’s authorizations. The repurchase of Snap-on common stock to offset dilution related to equity plan issuances or for other corporate purposes is at the company’s discretion, subject to prevailing financial and market conditions. Snap‑on believes that its cash generated from operations, available cash on hand, and funds available from its credit facilities, will be sufficient to fund the company’s additional share repurchases, if any.

Snap-on has paid consecutive quarterly cash dividends, without interruption or reduction, since 1939. Cash dividends totaled $86.1 million and $75.7 million in the first three months of 2023 and 2022, respectively. On November 4, 2022, the Board increased the quarterly cash dividend by 14.1% to $1.62 per share ($6.48 per share annualized). Snap-on believes that its cash generated from operations, available cash on hand, and funds available from its credit facilities, will be sufficient to pay dividends.

43

SNAP-ON INCORPORATED

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS

OF OPERATIONS

(continued)

Critical Accounting Policies and Estimates

Snap-on’s discussion of its critical accounting policies and estimates, contained in its Annual Report on Form 10-K for the fiscal year ended December 31, 2022, have not materially changed since the report was filed.

Outlook

We believe that our markets and our operations possess and have demonstrated continuing and considerable resilience against the uncertainties of the current environment. In 2023, Snap-on expects to make ongoing progress along its defined runways for coherent growth, leveraging capabilities already demonstrated in the automotive repair arena and developing and expanding its professional customer base, not only in automotive repair, but in adjacent markets, additional geographies and other areas, including extending in critical industries, where the cost and penalties for failure can be high. In pursuit of these initiatives, it is projected that capital expenditures in 2023 will approximate $100 million, of which $23.0 million was incurred in the first three months of the year.

Snap-on currently anticipates that its full year 2023 effective income tax rate will be in the range of 23% to 24%.

44

Item 3: Quantitative and Qualitative Disclosures About Market Risk

There has been no significant change in the company’s exposure to market risk during the first quarter of 2023. Refer to Part II, Item 7A. Quantitative and Qualitative Disclosures About Market Risk in the company’s Annual Report on Form 10-K for the year ended December 31, 2022 for further discussion.

Interest Rate Risk Management

Snap-on may manage the exposure created by the differing maturities and interest rate structures of Snap-on’s borrowings through the use of interest rate swap agreements. Treasury lock agreements may be used to manage the potential change in interest rates in anticipation of the issuance of fixed rate debt. See Note 9 to the Condensed Consolidated Financial Statements for information on interest rate risk management.

Snap-on utilizes a Value-at-Risk (“VAR”) model to determine the potential one-day loss in the fair value of its interest rate and foreign exchange-sensitive financial instruments from adverse changes in market factors. The VAR model estimates were made assuming normal market conditions and a 95% confidence level. Snap-on’s computations are based on the inter-relationships among movements in various currencies and interest rates (variance/co-variance technique). These inter-relationships were determined by observing interest rate and foreign currency market changes over the preceding quarter.

The estimated maximum potential net one-day loss in fair value, calculated using the VAR model, as of April 1, 2023, was $20.4 million, consisting of a $20.6 million loss on interest rate-sensitive financial instruments and a $0.2 million gain on foreign currency-sensitive financial instruments. The VAR model is a risk management tool and does not purport to represent actual losses in fair value that will be incurred by Snap-on, nor does it consider the potential effect of favorable changes in market factors.

Item 4: Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Snap-on maintains a system of disclosure controls and procedures that is designed to provide reasonable assurance that material information relating to the company and its consolidated subsidiaries is timely communicated to the officers who certify Snap-on’s financial reports and to other members of senior management and the Board, as appropriate.

In accordance with Rule 13a-15(b) of the Securities Exchange Act of 1934 (the “Exchange Act”), the company’s management evaluated, with the participation of the Chief Executive Officer and Chief Financial Officer, the effectiveness of the design and operation of the company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of April 1, 2023. Based upon their evaluation of these disclosure controls and procedures, the Chief Executive Officer and Chief Financial Officer concluded that the disclosure controls and procedures were effective as of April 1, 2023, to ensure that information required to be disclosed by the company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time period specified in the Securities and Exchange Commission rules and forms, and to ensure that information required to be disclosed by the company in the reports it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure.

Changes in Internal Control

There has not been any change in the company’s internal control over financial reporting during the quarter ended April 1, 2023, that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting (as such term is defined in Exchange Act Rules 13a-15(f) and 15d-15(f)).

45

PART II. OTHER INFORMATION

Item 2: Unregistered Sales of Equity Securities and Use of Proceeds

Issuer Purchases of Equity Securities

The following chart discloses information regarding the shares of Snap-on’s common stock repurchased by the company during the first quarter of fiscal 2023, all of which were purchased pursuant to the Board’s authorizations that the company has publicly announced. Snap-on has undertaken stock repurchases from time to time to offset dilution related to equity plan issuances or for other corporate purposes, as well as when the company believes market conditions are favorable. The repurchase of Snap-on common stock is at the company’s discretion, subject to prevailing financial and market conditions, and pursuant to the Board’s authorizations that the company has publicly announced.

Period	Shares purchased	Average price per share	Shares purchased as part of publicly announced plans or programs	Approximate value of shares that may yet be purchased under publicly announced plans or programs*
01/01/2023 to 01/28/2023	—	—	—	$369.3 million
01/29/2023 to 02/25/2023	127,000	$250.68	127,000	$391.2 million
02/26/2023 to 04/01/2023	229,000	$241.58	229,000	$345.4 million
Total/Average	356,000	$244.82	356,000	N/A
N/A: Not applicable

* Subject to further adjustment pursuant to the 1996 Authorization described below, as of April 1, 2023, the approximate value of shares that may yet be

purchased pursuant to the outstanding Board authorizations discussed below is $345.4 million.

•In 1996, the Board authorized the company to repurchase shares of the company’s common stock periodically in the open market or in privately negotiated transactions (the “1996 Authorization”). The 1996 Authorization allows the repurchase of up to the number of shares issued or delivered from treasury under the various plans the company has in place that call for the issuance of the company’s common stock. Because the number of shares that are purchased pursuant to the 1996 Authorization will change as (i) the company issues shares under its various plans; and (ii) shares are repurchased pursuant to this authorization, the number of shares authorized to be repurchased will vary from time to time. The 1996 Authorization will expire when terminated by the Board.

•On November 4, 2021, the Board authorized the repurchase of up to $500 million of the company’s common stock (the “2021 Authorization”). The 2021 Authorization will expire when the aggregate repurchase price limit is met, unless terminated earlier by the Board.

Other Purchases or Sales of Equity Securities

The following chart discloses information regarding transactions in shares of Snap-on’s common stock by Citibank, N.A. (“Citibank”) during the first quarter of 2023 pursuant to a prepaid equity forward agreement (the “Agreement”) with Citibank that is intended to reduce the impact of market risk associated with the stock-based portion of the company’s deferred compensation plans. The company’s stock-based deferred compensation liabilities, which are impacted by changes in the company’s stock price, increase as the company’s stock price rises and decrease as the company’s stock price declines. Pursuant to the Agreement, Citibank may purchase or sell shares of the company’s common stock (for Citibank’s account) in the market or in privately negotiated transactions. The Agreement has no stated expiration date and does not provide for Snap-on to purchase or repurchase its shares.

Citibank Purchases of Snap-on Stock
Period	Shares purchased	Average price per share
01/01/2023 to 01/28/2023	—	—
01/29/2023 to 02/25/2023	2,100	$252.89
02/26/2023 to 04/01/2023	1,200	$248.02
Total/Average	3,300	$251.12

46

Item 6: Exhibits
Exhibit 31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Exhibit 31.2	Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Exhibit 32.1	Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
Exhibit 32.2	Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
Exhibit 101.INS	Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
Exhibit 101.SCH	Inline XBRL Taxonomy Extension Schema Document
Exhibit 101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document
Exhibit 101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document
Exhibit 101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document
Exhibit 101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document
Exhibit 104	Cover page Inline XBRL data (contained in Exhibit 101)

47

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, Snap-on Incorporated has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

	SNAP-ON INCORPORATED
Date: April 20, 2023	/s/ Aldo J. Pagliari
	Aldo J. Pagliari, Principal Financial Officer,
	Senior Vice President – Finance and
	Chief Financial Officer

48

EX-31.1

EXHIBIT 31.1

Certification of the Chief Executive Officer Pursuant to

Section 302 of the Sarbanes-Oxley Act of 2002

I, Nicholas T. Pinchuk, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Snap-on Incorporated;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: April 20, 2023

/s/ Nicholas T. Pinchuk

Nicholas T. Pinchuk

Chief Executive Officer

EX-31.2

EXHIBIT 31.2

Certification of the Principal Financial Officer Pursuant to

Section 302 of the Sarbanes-Oxley Act of 2002

I, Aldo J. Pagliari, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Snap-on Incorporated;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: April 20, 2023

/s/ Aldo J. Pagliari

Aldo J. Pagliari

Principal Financial Officer

EX-32.1

EXHIBIT 32.1

Certification of Chief Executive Officer

Pursuant to 18 U.S.C. Section 1350,

As Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of Snap-on Incorporated (the “Company”) on Form 10-Q for the period ended April 1, 2023, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Nicholas T. Pinchuk as Chief Executive Officer of the Company, hereby certifies, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, to the best of his knowledge, that:

(1)The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Nicholas T. Pinchuk

Nicholas T. Pinchuk

Chief Executive Officer

April 20, 2023

EX-32.2

EXHIBIT 32.2

Certification of Principal Financial Officer

Pursuant to 18 U.S.C. Section 1350,

As Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of Snap-on Incorporated (the “Company”) on Form 10-Q for the period ended April 1, 2023, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Aldo J. Pagliari as Principal Financial Officer of the Company, hereby certifies, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, to the best of his knowledge, that:

(1)The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Aldo J. Pagliari

Aldo J. Pagliari

Principal Financial Officer

April 20, 2023

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Cover - shares	3 Months Ended
	Apr. 01, 2023	Apr. 14, 2023
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Apr. 01, 2023
Document Transition Report	false
Entity File Number	1-7724
Entity Registrant Name	Snap-on Inc
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	39-0622040
Entity Address, Address Line One	2801 80th Street,
Entity Address, City or Town	Kenosha,
Entity Address, State or Province	WI
Entity Address, Postal Zip Code	53143
City Area Code	262
Local Phone Number	656-5200
Title of 12(b) Security	Common Stock, $1.00 par value
Trading Symbol	SNA
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding (in shares)		52,931,821
Amendment Flag	false
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q1
Entity Central Index Key	0000091440
Current Fiscal Year End Date	--12-30

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CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS - USD ($) shares in Millions, $ in Millions	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Net sales	$ 1,275.6	$ 1,185.5
Operating earnings	326.1	293.5
Interest expense	(12.4)	(11.6)
Other income (expense) – net	15.2	8.3
Earnings before income taxes	328.9	290.2
Income tax expense	(74.6)	(67.5)
Net earnings	254.3	222.7
Net earnings attributable to noncontrolling interests	(5.6)	(5.3)
Net earnings attributable to Snap-on Incorporated	$ 248.7	$ 217.4
Net earnings per share attributable to Snap-on Incorporated:
Basic (in dollars per share)	$ 4.69	$ 4.07
Diluted (in dollars per share)	$ 4.60	$ 4.00
Weighted-average shares outstanding:
Basic (in shares)	53.0	53.4
Effect of dilutive securities (in shares)	1.1	0.9
Diluted (in shares)	54.1	54.3
Dividends declared per common share (in dollars per share)	$ 1.62	$ 1.42
Total net sales
Net sales	$ 1,183.0	$ 1,097.8
Cost of goods sold	(593.4)	(563.5)
Gross profit	589.6	534.3
Operating expenses	(329.8)	(311.2)
Operating earnings	259.8	223.1
Financial services revenue
Net sales	92.6	87.7
Cost of goods sold	(26.3)	(17.3)
Operating earnings	$ 66.3	$ 70.4

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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Comprehensive income (loss):
Net earnings	$ 254.3	$ 222.7
Other comprehensive income (loss):
Foreign currency translation	18.1	(9.7)
Unrealized cash flow hedges, net of tax:
Reclassification of cash flow hedges to net earnings	(0.4)	(0.4)
Defined benefit pension and postretirement plans:
Amortization of net unrecognized losses	0.0	4.5
Income tax benefit	0.0	(1.1)
Net of tax	0.0	3.4
Total comprehensive income	272.0	216.0
Comprehensive income attributable to noncontrolling interests	(5.6)	(5.3)
Comprehensive income attributable to Snap-on Incorporated	$ 266.4	$ 210.7

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CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions	Apr. 01, 2023	Dec. 31, 2022
Current assets:
Cash and cash equivalents	$ 833.8	$ 757.2
Trade and other accounts receivable – net	782.4	761.7
Finance receivables and contract receivables - net	677.9	672.1
Inventories – net	1,049.1	1,033.1
Prepaid expenses and other assets	138.0	144.8
Total current assets	3,481.2	3,368.9
Property and equipment:
Property and equipment – gross	1,556.7	1,536.6
Accumulated depreciation and amortization	(1,040.4)	(1,024.0)
Property and equipment – net	516.3	512.6
Operating lease right-of-use assets	61.5	61.5
Deferred income tax assets	73.1	70.0
Long-term finance receivables and contract receivables - net	1,584.9	1,554.6
Goodwill	1,050.6	1,045.3
Other intangibles – net	273.3	275.6
Pension assets	71.8	70.6
Other assets	12.9	13.7
Total assets	7,125.6	6,972.8
Current liabilities:
Notes payable	18.2	17.2
Accounts payable	283.1	287.0
Accrued benefits	65.3	58.6
Accrued compensation	68.6	98.6
Franchisee deposits	72.5	73.8
Other accrued liabilities	491.3	436.4
Total current liabilities	999.0	971.6
Long-term debt	1,184.0	1,183.8
Deferred income tax liabilities	85.3	82.1
Retiree health care benefits	22.9	23.4
Pension liabilities	72.7	78.6
Operating lease liabilities	44.9	44.7
Other long-term liabilities	84.4	85.1
Total liabilities	2,493.2	2,469.3
Commitments and contingencies (Note 14)
Shareholders’ equity attributable to Snap-on Incorporated:
Preferred stock (authorized 15,000,000 shares of $1 par value; none outstanding)	0.0	0.0
Common stock (authorized 250,000,000 shares of $1 par value; issued 67,450,776 and 67,444,966 shares, respectively)	67.5	67.4
Additional paid-in capital	500.2	499.9
Retained earnings	6,458.1	6,296.2
Accumulated other comprehensive loss	(510.6)	(528.3)
Treasury stock at cost (14,520,364 and 14,442,386 shares, respectively)	(1,905.0)	(1,853.9)
Total shareholders’ equity attributable to Snap-on Incorporated	4,610.2	4,481.3
Noncontrolling interests	22.2	22.2
Total equity	4,632.4	4,503.5
Total liabilities and equity	7,125.6	6,972.8
Land
Property and equipment:
Property and equipment – gross	32.9	32.6
Buildings and improvements
Property and equipment:
Property and equipment – gross	438.4	434.7
Machinery, equipment and computer software
Property and equipment:
Property and equipment – gross	1,085.4	1,069.3
Finance Receivables
Current assets:
Finance receivables and contract receivables - net	572.1	562.2
Property and equipment:
Long-term finance receivables and contract receivables - net	1,197.1	1,170.8
Contract Receivables
Current assets:
Finance receivables and contract receivables - net	105.8	109.9
Property and equipment:
Long-term finance receivables and contract receivables - net	$ 387.8	$ 383.8

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CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Apr. 01, 2023	Dec. 31, 2022
Statement of Financial Position [Abstract]
Preferred stock, shares authorized (in shares)	15,000,000	15,000,000
Preferred stock, par value (in dollars per share)	$ 1	$ 1
Preferred stock, shares outstanding (in shares)	0	0
Common stock, shares authorized (in shares)	250,000,000	250,000,000
Common stock, par value (in dollars per share)	$ 1	$ 1
Common stock, shares issued (in shares)	67,450,776	67,444,966
Treasury stock shares at cost (in shares)	14,520,364	14,442,386

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CONDENSED CONSOLIDATED STATEMENTS OF EQUITY - USD ($) $ in Millions	Total	Common Stock	Additional Paid-in Capital	Retained Earnings	Accumulated Other Comprehensive Loss	Treasury Stock	Noncontrolling Interests
Beginning balance at Jan. 01, 2022	$ 4,203.8	$ 67.4	$ 472.7	$ 5,699.9	$ (343.9)	$ (1,714.2)	$ 21.9
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net earnings	222.7			217.4			5.3
Other comprehensive income (loss)	(6.7)				(6.7)
Cash dividends	(75.7)			(75.7)
Stock compensation plans	10.8		2.0			8.8
Share repurchases	(28.8)					(28.8)
Other	(5.5)			(0.6)			(4.9)
Ending balance at Apr. 02, 2022	4,320.6	67.4	474.7	5,841.0	(350.6)	(1,734.2)	22.3
Beginning balance at Dec. 31, 2022	4,503.5	67.4	499.9	6,296.2	(528.3)	(1,853.9)	22.2
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net earnings	254.3			248.7			5.6
Other comprehensive income (loss)	17.7				17.7
Cash dividends	(86.1)			(86.1)
Stock compensation plans	36.4		0.3			36.1
Share repurchases	(87.2)					(87.2)
Other	(6.2)	0.1		(0.7)			(5.6)
Ending balance at Apr. 01, 2023	$ 4,632.4	$ 67.5	$ 500.2	$ 6,458.1	$ (510.6)	$ (1,905.0)	$ 22.2

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CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (Parenthetical) - USD ($) $ in Millions	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Statement of Stockholders' Equity [Abstract]
Cash dividends per share (in dollars per share)	$ 1.62	$ 1.42
Share repurchases (in shares)	356,000	136,000
Stockholders' Equity, Other	$ (6.2)	$ (5.5)

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Operating activities:
Net earnings	$ 254.3	$ 222.7
Adjustments to reconcile net earnings to net cash provided (used) by operating activities:
Depreciation	18.0	18.5
Amortization of other intangibles	6.9	7.2
Provision for losses on finance receivables	14.2	6.3
Provision for losses on non-finance receivables	5.0	3.8
Stock-based compensation expense	10.2	9.0
Deferred income tax provision (benefit)	(0.2)	2.3
Gain on sales of assets	(0.2)	(2.7)
Changes in operating assets and liabilities:
Trade and other accounts receivable	(22.9)	(53.1)
Contract receivables	0.2	9.7
Inventories	(13.2)	(61.7)
Prepaid expenses and other assets	1.7	1.9
Accounts payable	(0.5)	24.1
Accruals and other liabilities	28.1	5.9
Net cash provided by operating activities	301.6	193.9
Investing activities:
Additions to finance receivables	(257.1)	(205.5)
Collections of finance receivables	207.5	215.6
Capital expenditures	(23.0)	(20.2)
Disposals of property and equipment	0.5	3.8
Other	(0.8)	(0.3)
Net cash used by investing activities	(72.9)	(6.6)
Financing activities:
Net increase in other short-term borrowings	0.8	2.3
Cash dividends paid	(86.1)	(75.7)
Purchases of treasury stock	(87.2)	(28.8)
Proceeds from stock purchase and option plans	32.8	5.8
Other	(12.4)	(9.9)
Net cash used by financing activities	(152.1)	(106.3)
Effect of exchange rate changes on cash and cash equivalents	0.0	0.1
Increase in cash and cash equivalents	76.6	81.1
Cash and cash equivalents at beginning of year	757.2	780.0
Cash and cash equivalents at end of period	833.8	861.1
Supplemental cash flow disclosures:
Cash paid for interest	(13.6)	(13.8)
Net cash paid for income taxes	$ (13.3)	$ (18.0)

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Summary of Accounting Policies

3 Months Ended

Apr. 01, 2023

Accounting Policies [Abstract]

Summary of Accounting Policies

Summary of Accounting Policies

Principles of consolidation and presentation

The Condensed Consolidated Financial Statements include the accounts of Snap-on Incorporated and its wholly owned and majority-owned subsidiaries (collectively, “Snap-on” or the “company”). These financial statements should be read in conjunction with, and have been prepared in conformity with, the accounting principles reflected in the consolidated financial statements and related notes included in Snap-on’s 2022 Annual Report on Form 10-K for the fiscal year ended December 31, 2022 (“2022 year end”). The company’s 2023 fiscal first quarter ended on April 1, 2023; the 2022 fiscal first quarter ended on April 2, 2022. The company’s 2023 and 2022 fiscal first quarters each contained 13 weeks of operating results. Snap-on’s Condensed Consolidated Financial Statements are prepared in conformity with generally accepted accounting principles in the United States of America (“GAAP”).

In the opinion of management, all adjustments (consisting of normal recurring adjustments) necessary for the fair presentation of the Condensed Consolidated Financial Statements for the three month periods ended April 1, 2023, and April 2, 2022, have been made. Interim results of operations are not necessarily indicative of the results to be expected for the full fiscal year.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Financial Instruments

The fair value of the company’s derivative financial instruments is generally determined using quoted prices in active markets for similar assets and liabilities. The carrying value of the company’s non-derivative financial instruments either approximates fair value, due to their short-term nature, or the amount disclosed for fair value is based upon a discounted cash flow analysis or quoted market values. See Note 9 for further information on financial instruments.

New Accounting Standards

On January 1, 2023, the beginning of Snap-on’s 2023 fiscal year, the company adopted ASU No. 2022-02, Financial Instruments – Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures, which requires enhanced disclosure of certain loan refinancings and restructurings by creditors when a borrower is experiencing financial difficulty and eliminates certain current recognition and measurement accounting guidance. This ASU also requires the disclosure of current-period gross write-offs by year of origination for financing receivables and net investments in leases. The adoption of this ASU did not have a significant impact on the company’s Condensed Consolidated Financial Statements.

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Revenue Recognition

3 Months Ended

Apr. 01, 2023

Revenue from Contract with Customer [Abstract]

Revenue Recognition

Revenue RecognitionSnap-on recognizes revenue from the sale of tools, diagnostics, equipment, and related services based on when control of the product passes to the customer or the service is provided and is recognized at an amount that reflects the consideration expected to be received in exchange for such goods or services.

Revenue Disaggregation: The following table shows the consolidated revenues by revenue source:

	Three Months Ended
(Amounts in millions)	April 1, 2023		April 2, 2022
Revenue from contracts with customers	$	1,176.5	$	1,091.9
Other revenues	6.5		5.9
Total net sales	1,183.0		1,097.8
Financial services revenue	92.6		87.7
Total revenues	$	1,275.6	$	1,185.5

Snap-on evaluates the performance of its operating segments based on segment revenues, including both external and intersegment net sales, and segment operating earnings. Snap-on accounts for both intersegment sales and transfers based primarily on standard costs with reasonable mark-ups established between the segments. Intersegment amounts are eliminated to arrive at Snap-on’s consolidated financial results.

The following tables represent external net sales disaggregated by geography, based on the customers’ billing addresses:

	For the Three Months Ended April 1, 2023
	Commercial		Snap-on		Repair Systems
	& Industrial		Tools		& Information		Financial				Snap-on
(Amounts in millions)	Group		Group		Group		Services		Eliminations		Incorporated
Net sales:
North America*	$	137.6	$	473.9	$	281.8	$	—	$	—	$	893.3
Europe	75.0		35.7		63.2		—		—		173.9
All other	66.0		27.4		22.4		—		—		115.8
External net sales	278.6		537.0		367.4		—		—		1,183.0
Intersegment net sales	85.2		—		79.2		—		(164.4)		—
Total net sales	363.8		537.0		446.6		—		(164.4)		1,183.0
Financial services revenue	—		—		—		92.6		—		92.6
Total revenue	$	363.8	$	537.0	$	446.6	$	92.6	$	(164.4)	$	1,275.6

	For the Three Months Ended April 2, 2022
	Commercial		Snap-on		Repair Systems
	& Industrial		Tools		& Information		Financial				Snap-on
(Amounts in millions)	Group		Group		Group		Services		Eliminations		Incorporated
Net sales:
North America*	$	113.7	$	447.8	$	242.8	$	—	$	—	$	804.3
Europe	81.8		40.1		61.9		—		—		183.8
All other	65.7		24.2		19.8		—		—		109.7
External net sales	261.2		512.1		324.5		—		—		1,097.8
Intersegment net sales	78.9		—		73.7		—		(152.6)		—
Total net sales	340.1		512.1		398.2		—		(152.6)		1,097.8
Financial services revenue	—		—		—		87.7		—		87.7
Total revenue	$	340.1	$	512.1	$	398.2	$	87.7	$	(152.6)	$	1,185.5
* North America is comprised of the United States, Canada and Mexico.

The following tables represent external net sales disaggregated by customer type:

	For the Three Months Ended April 1, 2023
	Commercial		Snap-on		Repair Systems
	& Industrial		Tools		& Information		Financial				Snap-on
(Amounts in millions)	Group		Group		Group		Services		Eliminations		Incorporated
Net sales:
Vehicle service professionals	$	21.1	$	537.0	$	367.4	$	—	$	—	$	925.5
All other professionals	257.5		—		—		—		—		257.5
External net sales	278.6		537.0		367.4		—		—		1,183.0
Intersegment net sales	85.2		—		79.2		—		(164.4)		—
Total net sales	363.8		537.0		446.6		—		(164.4)		1,183.0
Financial services revenue	—		—		—		92.6		—		92.6
Total revenue	$	363.8	$	537.0	$	446.6	$	92.6	$	(164.4)	$	1,275.6

	For the Three Months Ended April 2, 2022
	Commercial		Snap-on		Repair Systems
	& Industrial		Tools		& Information		Financial				Snap-on
(Amounts in millions)	Group		Group		Group		Services		Eliminations		Incorporated
Net sales:
Vehicle service professionals	$	23.9	$	512.1	$	324.5	$	—	$	—	$	860.5
All other professionals	237.3		—		—		—		—		237.3
External net sales	261.2		512.1		324.5		—		—		1,097.8
Intersegment net sales	78.9		—		73.7		—		(152.6)		—
Total net sales	340.1		512.1		398.2		—		(152.6)		1,097.8
Financial services revenue	—		—		—		87.7		—		87.7
Total revenue	$	340.1	$	512.1	$	398.2	$	87.7	$	(152.6)	$	1,185.5

Nature of goods and services: Snap-on derives net sales from a broad line of products and complementary services that are grouped into three categories: (i) tools; (ii) diagnostics, information and management systems; and (iii) equipment. The tools product category includes hand tools, power tools, tool storage products and other similar products. The diagnostics, information and management systems product category includes handheld and computer-based diagnostic products, service and repair information products, diagnostic software solutions, electronic parts catalogs, business management systems and services, point-of-sale systems, integrated systems for vehicle service shops, original equipment manufacturer (“OEM”) purchasing facilitation services, and warranty management systems and analytics to help OEM dealership service and repair shops (“OEM dealerships”) manage and track performance. The equipment product category includes solutions for the service of vehicles and industrial equipment. Snap-on supports the sale of its diagnostics and vehicle service shop equipment by offering training programs as well as after-sales support to its customers. Through its financial services businesses, Snap‑on derives revenue from various financing programs designed to facilitate the sales of its products and support its franchise business.

Approximately 90% of Snap-on’s net sales are products sold at a point in time through ship-and-bill performance obligations that also include repair services. The remaining sales revenue is earned over time primarily for software subscriptions, other subscription service agreements and extended warranty programs.

Snap-on enters into contracts related to the selling of tools, diagnostics, repair information, equipment and related services. At contract inception, an assessment of the goods and services promised in the contracts with customers is performed and a performance obligation is identified for each distinct promise to transfer to the customer a good or service (or bundle of goods or services). To identify the performance obligations, Snap-on considers all of the goods or services promised in the contract regardless of whether they are explicitly stated or are implied by customary business practices. Contracts with customers are comprised of customer purchase orders, invoices and written contracts.

For certain performance obligations related to software subscriptions, extended warranty and other subscription agreements that are settled over time, Snap-on has elected not to disclose the value of unsatisfied performance obligations for: (i) contracts that have an original expected length of one year or less; (ii) contracts where revenue is recognized as invoiced; and (iii) contracts with variable consideration related to unsatisfied performance obligations. The remaining duration of these unsatisfied performance obligations range from one month up to 60 months. Snap-on had approximately $180.0 million of long-term contracts that have fixed consideration that extends beyond one year as of April 1, 2023. Snap-on expects to recognize approximately 70% of these contracts as revenue by the end of fiscal 2024, an additional 25% by the end of fiscal 2026, and the balance thereafter. 

Contract liabilities: Contract liabilities are recorded when cash payments are received in advance of Snap-on’s performance.  The timing of payment is typically on a monthly, quarterly or annual basis. The balance of total contract liabilities was $65.7 million and $63.3 million at April 1, 2023, and December 31, 2022, respectively. The current portion of contract liabilities is included in “Other accrued liabilities” and the non-current portion of such liabilities is included in “Other long-term liabilities” on the accompanying Condensed Consolidated Balance Sheets. During the three months ended April 1, 2023, Snap-on recognized $34.7 million of revenue that was included in the $63.3 million contract liability balance at December 31, 2022, which was primarily from the amortization of software subscriptions, extended warranties and other subscription agreements.

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Receivables

3 Months Ended

Apr. 01, 2023

Receivables [Abstract]

Receivables

Receivables

Trade and other accounts receivable: Snap-on’s trade and other accounts receivable primarily arise from the sale of tools, diagnostics, and equipment products to a broad range of industrial and commercial customers and to Snap-on’s independent franchise van channel with payment terms generally ranging from 30 to 120 days.

The components of Snap-on’s trade and other accounts receivable as of April 1, 2023, and December 31, 2022, are as follows:

(Amounts in millions)	April 1, 2023		December 31, 2022
Trade and other accounts receivable	$	813.6	$	792.8
Allowances for credit losses	(31.2)		(31.1)
Total trade and other accounts receivable – net	$	782.4	$	761.7

The following is a rollforward of the allowances for credit losses related to trade and other accounts receivable for the three months ended April 1, 2023, and April 2, 2022:

	Three Months Ended
(Amounts in millions)	April 1, 2023		April 2, 2022
Allowances for credit losses:
Beginning of period	$	31.1	$	27.3
Provision for credit losses	4.7		3.7
Charge-offs	(4.8)		(3.0)
Recoveries	—		0.1
Currency translation	0.2		0.3
End of period	$	31.2	$	28.4

Finance and contract receivables: Snap-on Credit LLC (“SOC”), the company’s financial services operation in the United States, originates extended-term finance and contract receivables on sales of Snap-on’s products sold through the U.S. franchisee network and to certain other customers of Snap-on; Snap-on’s foreign finance subsidiaries provide similar financing internationally. Interest income on finance and contract receivables is included in “Financial services revenue” on the accompanying Condensed Consolidated Statements of Earnings.

Finance receivables are comprised of extended-term payment contracts to both technicians and independent shop owners (i.e., franchisees’ customers) to enable them to purchase tools, diagnostics, and equipment products on an extended-term payment plan, with average payment terms of approximately four years.

Contract receivables, with payment terms of up to 10 years, are comprised of extended-term payment contracts to a broad base of customers worldwide, including shop owners, both independents and national chains, for their purchase of tools, diagnostics, and equipment products, as well as extended-term contracts to franchisees to meet a number of financing needs, including working capital loans, loans to enable new franchisees to fund the purchase of the franchise and van leases, or the expansion of an existing franchise. Finance and contract receivables are generally secured by the underlying tools, diagnostics and/or equipment products financed and, for contracts to franchisees, other franchisee assets.

The components of Snap-on’s current finance and contract receivables as of April 1, 2023, and December 31, 2022, are as follows:

(Amounts in millions)	April 1, 2023		December 31, 2022
Finance installment receivables	$	589.2	$	578.6
Finance lease receivables, net of unearned finance charges of $0.5 million and $0.5 million, respectively	2.9		3.2
Total finance receivables	592.1		581.8
Contract installment receivables	46.2		51.3
Contract lease receivables, net of unearned finance charges of $19.3 million and $19.1 million, respectively	61.3		60.3
Total contract receivables	107.5		111.6
Total	699.6		693.4
Allowances for credit losses:
Finance installment receivables	(20.0)		(19.5)
Finance lease receivables	—		(0.1)
Total finance allowance for credit losses	(20.0)		(19.6)
Contract installment receivables	(0.8)		(0.8)
Contract lease receivables	(0.9)		(0.9)
Total contract allowance for credit losses	(1.7)		(1.7)
Total allowance for credit losses	(21.7)		(21.3)
Total current finance and contract receivables – net	$	677.9	$	672.1
Finance receivables – net	$	572.1	$	562.2
Contract receivables – net	105.8		109.9
Total current finance and contract receivables – net	$	677.9	$	672.1

The components of Snap-on’s finance and contract receivables with payment terms beyond one year as of April 1, 2023, and December 31, 2022, are as follows: 

(Amounts in millions)	April 1, 2023		December 31, 2022
Finance installment receivables	$	1,238.2	$	1,210.4
Finance lease receivables, net of unearned finance charges of $0.2 million and $0.2 million, respectively	1.6		1.7
Total finance receivables	1,239.8		1,212.1
Contract installment receivables	205.6		202.1
Contract lease receivables, net of unearned finance charges of $30.9 million and $30.7 million, respectively	187.0		186.6
Total contract receivables	392.6		388.7
Total	1,632.4		1,600.8
Allowances for credit losses:
Finance installment receivables	(42.7)		(41.3)
Finance lease receivables	—		—
Total finance allowance for credit losses	(42.7)		(41.3)
Contract installment receivables	(3.1)		(3.1)
Contract lease receivables	(1.7)		(1.8)
Total contract allowance for credit losses	(4.8)		(4.9)
Total allowance for credit losses	(47.5)		(46.2)
Total long-term finance and contract receivables – net	$	1,584.9	$	1,554.6
Finance receivables – net	$	1,197.1	$	1,170.8
Contract receivables – net	387.8		383.8
Total long-term finance and contract receivables – net	$	1,584.9	$	1,554.6

Credit quality: The company’s receivable portfolio is comprised of two portfolio segments, finance and contract receivables, which are the same segments used to estimate expected credit losses reported in the allowance for credit losses. The amortized cost basis for finance and contract receivables is the amount originated adjusted for applicable accrued interest and net of deferred fees or costs, collection of cash, and write-offs. The company monitors and assesses credit risk based on the characteristics of each portfolio segment.

When extending credit, Snap-on evaluates the collectability of the receivables based on a combination of various financial and qualitative factors that may affect a customer’s ability to pay. These factors may include the customer’s financial condition, past payment experience, and credit bureau and proprietary Snap-on credit model information, as well as the value of the underlying collateral.

For finance and contract receivables, Snap-on assesses quantitative and qualitative factors through the use of credit quality indicators consisting primarily of collection experience and related internal metrics. Delinquency is the primary indicator of credit quality for finance and contract receivables. Snap-on conducts monthly reviews of credit and collection performance for both the finance and contract receivable portfolios focusing on data such as delinquency trends, nonaccrual receivables, and write-off and recovery activity. These reviews allow for the formulation of collection strategies and potential collection policy modifications in response to changing risk profiles in the finance and contract receivable portfolios. The other internal metrics include credit exposure by customer and delinquency classification to further monitor changing risk profiles. The company maintains a system that aggregates credit exposure and provides delinquency data by days past due aging categories. A receivable 30 days or more past due is considered delinquent. However, customers are monitored prior to becoming 30 days past due.

The amortized cost basis of finance and contract receivables by origination year as of April 1, 2023, and charge-offs for the three months ended April 1, 2023, are as follows:

(Amounts in millions)	2023		2022		2021		2020		2019		Prior		Total
Finance receivables:
Delinquent	$	0.2	$	18.0	$	11.4	$	6.8	$	3.3	$	2.1	$	41.8
Non-delinquent	505.1		836.7		271.6		124.4		40.4		11.9		1,790.1
Total Finance receivables	$	505.3	$	854.7	$	283.0	$	131.2	$	43.7	$	14.0	$	1,831.9
Finance receivables charge-offs	$	—	$	5.7	$	4.6	$	2.5	$	1.0	$	0.7	$	14.5
Contract receivables:
Delinquent	$	—	$	0.9	$	1.4	$	0.5	$	0.5	$	0.2	$	3.5
Non-delinquent	46.1		160.1		109.9		77.5		51.4		51.6		496.6
Total Contract receivables	$	46.1	$	161.0	$	111.3	$	78.0	$	51.9	$	51.8	$	500.1
Contract receivables charge-offs	$	—	$	0.1	$	0.1	$	0.3	$	—	$	—	$	0.5

Allowances for credit losses: The allowances for credit losses are maintained at levels that are considered adequate to cover expected credit losses over the remaining contractual life of the receivables using historical loss experience, asset specific risk characteristics, current conditions, reasonable and supportable forecasts, and an appropriate reversion period, when applicable. Management performs detailed reviews of its receivables on a monthly and/or quarterly basis to assess the adequacy of the allowances and to determine if any impairment has occurred. A receivable generally has credit losses when it is expected that all amounts related to the receivable will not be collected according to the contractual terms of the agreement. Amounts determined to be uncollectable are charged directly against the allowances, while amounts recovered on previously written off accounts increase the allowances.

For both finance and contract receivables, write-offs include the uncollectable principal amount of the receivable as well as the uncollectable accrued interest and fees, net of repossessions. For finance receivables only, write-offs are partially offset by recourse from franchisees. Recovered interest and fees previously written off are recorded through the allowances for credit losses and increase the allowances. Absent a repossession, finance receivables are typically written off when an account reaches 120 days past due. Repossessed accounts are typically written off within 60 days of asset repossession. Contract receivables related to equipment leases are generally written off when an account becomes 150 days past due, while contract receivables related to franchise finance and van leases are generally written off no later than when the receivable becomes 180 days past the asset return date. For finance and contract receivables, customer bankruptcies are generally written off upon notification that the associated debt is not being reaffirmed or, in any event, no later than when the receivable becomes 180 days past due. Changes to the allowances for credit losses are maintained through adjustments to the provisions for credit losses.

For finance receivables, the company uses a vintage loss rate methodology to determine expected losses. Vintage analysis aims to calculate losses based on the timing of the losses relative to the origination of the receivables. The finance receivable portfolio contains a substantial amount of homogeneous contracts which fits well with the vintage analysis.

For contract receivables, the company primarily uses a Weighted-Average Remaining Maturity (“WARM”) methodology. The WARM methodology calculates the average annual write-off rate and applies it to the remaining term of the receivables. The WARM methodology is used since the contract receivables have limited loss experience over generally longer terms and, therefore, the predictive loss patterns are more difficult to estimate.

The company performed a correlation analysis to compare historical losses to many economic factors. The primary economic factors considered were real gross domestic product, civilian unemployment, industrial production index, and repair and maintenance employment rate; the company determined that there is limited correlation between the historical losses and economic factors. As a result, consideration was given to qualitative factors to adjust the reserve balance for asset specific risk characteristics, current conditions and future expectations. Similar qualitative factors are considered for both finance and contract receivables. The qualitative factors used in determining the estimate of expected credit losses are influenced by the changes in the composition of the portfolio, underwriting practices, and other relevant conditions that were different from the historical periods.

The allowances for credit losses are adjusted each period for changes in the credit risk and expected lifetime credit losses.

The following is a rollforward of the allowances for credit losses for finance and contract receivables for the three months ended April 1, 2023, and April 2, 2022:

 

	Three Months Ended April 1, 2023				Three Months Ended April 2, 2022
(Amounts in millions)	Finance Receivables		Contract Receivables		Finance Receivables		Contract Receivables
Allowances for credit losses:
Beginning of period	$	60.9	$	6.6	$	67.3	$	8.4
Provision for credit losses	14.2		0.3		6.3		0.1
Charge-offs	(14.5)		(0.5)		(13.4)		(0.8)
Recoveries	2.1		0.1		2.3		—
Currency translation	—		—		—		—
End of period	$	62.7	$	6.5	$	62.5	$	7.7

Past due: Depending on the contract, payments for finance and contract receivables are due on a monthly or weekly basis. Weekly payments are converted into a monthly equivalent for purposes of calculating delinquency. Delinquencies are assessed at the end of each month following the monthly equivalent contractual payment due date. The entire receivable balance of a contract is considered delinquent when contractual payments become 30 days past due. Removal from delinquent status occurs when the cumulative amount of monthly contractual payments then due have been received by the company.

It is the general practice of Snap-on’s financial services business not to engage in contract or loan modifications. In limited instances, Snap-on’s financial services business may modify certain receivables. The amount and number of finance and contract receivable modifications as of April 1, 2023, and December 31, 2022, were immaterial to both the financial services portfolio and the company’s results of operations and financial position.

The aging of finance and contract receivables as of April 1, 2023, and December 31, 2022, is as follows:

(Amounts in millions)	30-59 Days Past Due		60-90 Days Past Due		Greater Than 90 Days Past Due		Total Past Due		Total Not Past Due		Total		Greater Than 90 Days Past Due and Accruing
April 1, 2023:
Finance receivables	$	12.3	$	9.6	$	19.9	$	41.8	$	1,790.1	$	1,831.9	$	16.8
Contract receivables	1.4		0.4		1.7		3.5		496.6		500.1		0.3
December 31, 2022:
Finance receivables	$	17.2	$	11.2	$	19.5	$	47.9	$	1,746.0	$	1,793.9	$	16.5
Contract receivables	1.2		0.3		2.2		3.7		496.6		500.3		0.3

Nonaccrual: SOC maintains the accrual of interest income during the progression through the various stages of delinquency prior to processing for write-off. At the time of write-off, the entire balance including the accrued but unpaid interest income amount is recorded as a loss.

Finance receivables are generally placed on nonaccrual status (nonaccrual of interest and other fees): (i) when a customer is placed on repossession status; (ii) upon receipt of notification of bankruptcy; (iii) upon notification of the death of a customer; or (iv) in other instances in which management concludes collectability is not reasonably assured.

Contract receivables are generally placed on nonaccrual status: (i) when a receivable is more than 90 days past due or at the point a customer’s account is placed on terminated status regardless of its delinquency status; (ii) upon notification of the death of a customer; or (iii) in other instances in which management concludes collectability is not reasonably assured.

The accrual of interest and other fees is resumed when the finance or contract receivable becomes contractually current and collection of all remaining contractual amounts due is reasonably assured. A receivable may have credit losses when it is expected that all amounts related to the receivable will not be collected according to the contractual terms of the applicable agreement. Such finance and contract receivables are covered by the company’s respective allowances for credit losses and are written-off against the allowances when appropriate.

The amount of finance and contract receivables on nonaccrual status as of April 1, 2023, and December 31, 2022, is as follows:

(Amounts in millions)	April 1, 2023		December 31, 2022
Finance receivables	$	9.3	$	8.7
Contract receivables	2.8		3.3

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Inventories

3 Months Ended

Apr. 01, 2023

Inventory Disclosure [Abstract]

Inventories

Inventories

Inventories by major classification are as follows:

(Amounts in millions)	April 1, 2023		December 31, 2022
Finished goods	$	895.1	$	882.2
Work in progress	76.2		77.2
Raw materials	186.7		182.3
Total FIFO value	1,158.0		1,141.7
Excess of current cost over LIFO cost	(108.9)		(108.6)
Total inventories – net	$	1,049.1	$	1,033.1

Inventories accounted for using the first-in, first-out (“FIFO”) method approximated 61% of total inventories as of both April 1, 2023, and December 31, 2022. The company accounts for its non-U.S. inventory on the FIFO method. As of April 1, 2023, approximately 38% of the company’s U.S. inventory was accounted for using the FIFO method and 62% was accounted for using the last-in, first-out (“LIFO”) method. There were no LIFO inventory liquidations in the three months ended April 1, 2023, or April 2, 2022.

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Goodwill and Other Intangible Assets

3 Months Ended

Apr. 01, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets

Goodwill and Other Intangible Assets

The changes in the carrying amount of goodwill by segment for the three months ended April 1, 2023, are as follows:

(Amounts in millions)	Commercial & Industrial Group		Snap-on Tools Group		Repair Systems & Information Group		Total
Balance as of December 31, 2022	$	302.9	$	12.4	$	730.0	$	1,045.3
Currency translation	3.7		—		1.6		5.3
Balance as of April 1, 2023	$	306.6	$	12.4	$	731.6	$	1,050.6

Additional disclosures related to other intangible assets are as follows:

	April 1, 2023						December 31, 2022
(Amounts in millions)	Gross  Carrying Value		Accumulated Amortization		Net Carrying Value		Gross  Carrying Value		Accumulated Amortization		Net Carrying Value
Amortized other intangible assets:
Customer relationships	$	212.7	$	(154.1)	$	58.6	$	212.1	$	(150.8)	$	61.3
Developed technology	36.0		(27.1)		8.9		35.8		(26.0)		9.8
Internally developed software	182.4		(140.1)		42.3		179.6		(137.2)		42.4
Patents	49.4		(25.8)		23.6		48.4		(25.6)		22.8
Trademarks	3.9		(2.4)		1.5		3.9		(2.4)		1.5
Other	7.8		(4.1)		3.7		7.7		(4.0)		3.7
Total	492.2		(353.6)		138.6		487.5		(346.0)		141.5
Non-amortized trademarks	134.7		—		134.7		134.1		—		134.1
Total other intangible assets	$	626.9	$	(353.6)	$	273.3	$	621.6	$	(346.0)	$	275.6

Provision for impairment of goodwill and/or other intangible assets could arise in a future period due to significant and unanticipated changes in circumstances, such as declines in profitability and cash flow due to long-term deterioration in macroeconomic, industry and market conditions, the loss of key customers, changes in technology or markets, significant changes in key personnel or litigation, a sustained decrease in share price and/or other events. As of April 1, 2023, the company had no accumulated impairment losses.

The weighted-average amortization periods related to other intangible assets are as follows:

	In Years
Customer relationships	14
Developed technology	5
Internally developed software	6
Patents	14
Trademarks	9
Other	39

The weighted-average amortization period for all amortizable intangibles on a combined basis is 12 years. Intangible asset renewal costs are expensed as incurred.

The aggregate amortization expense was $6.9 million and $7.2 million for the respective three month periods ended April 1, 2023, and April 2, 2022. Based on current levels of amortizable intangible assets and estimated weighted-average useful lives, estimated annual amortization expense is expected to be $26.9 million in 2023, $21.1 million in 2024, $15.1 million in 2025, $11.4 million in 2026, $10.3 million in 2027, and $8.9 million in 2028.

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Exit and Disposal Activities

3 Months Ended

Apr. 01, 2023

Restructuring and Related Activities [Abstract]

Exit and Disposal Activities

Exit and Disposal Activities

Snap-on did not record any costs for exit and disposal activities for each of the three month periods ended April 1, 2023, and April 2, 2022.

Snap-on’s exit and disposal accrual activity for the first three months of 2023 is as follows:

	Balance at		Three Months				Balance at
(Amounts in millions)	December 31, 2022		Provision		Usage		April 1, 2023
Severance costs:
Commercial & Industrial Group	$	1.6	$	—	$	(0.1)	$	1.5
Snap-on Tools Group	0.1		—		—		0.1
Repair System & Information Group	1.1		—		(0.2)		0.9
Total	$	2.8	$	—	$	(0.3)	$	2.5

As of April 1, 2023, the company expects that approximately $1.4 million of the $2.5 million exit and disposal accrual will be utilized in 2023, and the remainder thereafter, primarily for longer-term severance payments.

Snap-on expects to fund the remaining cash requirements of its exit and disposal activities with available cash on hand, cash flows from operating activities and borrowings under the company’s existing credit facilities. The estimated costs for the exit and disposal activities were based on management’s best business judgement under prevailing circumstances.

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Income Taxes

3 Months Ended

Apr. 01, 2023

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

Snap-on’s effective income tax rate on earnings attributable to Snap-on was 23.1% and 23.7% in the respective first three month periods of 2023 and 2022. 

Snap-on and its subsidiaries file income tax returns in the United States and in various state, local and foreign jurisdictions. It is reasonably possible that certain unrecognized tax benefits may either be settled with taxing authorities or the statutes of limitations for such items may lapse within the next 12 months, causing Snap-on’s gross unrecognized tax benefits to decrease by a range of zero to $0.6 million. Over the next 12 months, Snap-on anticipates taking certain tax positions on various tax returns for which the related tax benefit does not meet the recognition threshold. Accordingly, Snap-on’s gross unrecognized tax benefits may increase by a range of zero to $0.6 million over the next 12 months for uncertain tax positions expected to be taken in future tax filings.

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Short-term and Long-term Debt

3 Months Ended

Apr. 01, 2023

Debt Disclosure [Abstract]

Short-term and Long-term Debt

Short-term and Long-term Debt

Short-term and long-term debt as of April 1, 2023, and December 31, 2022, consisted of the following:

(Amounts in millions)	April 1, 2023		December 31, 2022
3.25% unsecured notes due 2027	$	300.0	$	300.0
4.10% unsecured notes due 2048	400.0		400.0
3.10% unsecured notes due 2050	500.0		500.0
Other*	2.2		1.0
	1,202.2		1,201.0
Less: notes payable	(18.2)		(17.2)
Total long-term debt	$	1,184.0	$	1,183.8

* Includes unamortized debt issuance costs.

Notes payable of $18.2 million as of April 1, 2023, compared to $17.2 million as of 2022 year end.

Snap-on has an $800 million multi-currency revolving credit facility that terminates on September 16, 2024 (the “Credit Facility”); no amounts were borrowed or outstanding under the Credit Facility for the three months ended and as of April 1, 2023. Borrowings under the Credit Facility bear interest at varying rates based on either: (i) Snap-on’s then-current, long-term debt ratings; or (ii) Snap-on’s then-current ratio of consolidated debt net of certain cash adjustments (“Consolidated Net Debt”) to earnings before interest, taxes, depreciation, amortization and certain other adjustments for the preceding four fiscal quarters then ended (the “Consolidated Net Debt to EBITDA Ratio”). The Credit Facility’s financial covenant requires that Snap-on maintain, as of each fiscal quarter end, either (i) a ratio not greater than 0.60 to 1.00 of Consolidated Net Debt to the sum of Consolidated Net Debt plus total equity and less accumulated other comprehensive income or loss (the “Leverage Ratio”); or (ii) a Consolidated Net Debt to EBITDA Ratio not greater than 3.50 to 1.00. Snap-on may, up to two times during any five-year period during the term of the Credit Facility (including any extensions thereof), elect to increase the maximum Leverage Ratio to 0.65 to 1.00 and/or increase the maximum Consolidated Net Debt to EBITDA Ratio to 4.00 to 1.00 for four consecutive fiscal quarters in connection with certain material acquisitions (as defined in the related credit agreement). As of April 1, 2023, the company’s actual ratios of 0.08 and 0.30, respectively, were both within the permitted ranges set forth in this financial covenant. Snap-on generally issues commercial paper to fund its financing needs on a short-term basis and uses the Credit Facility as back-up liquidity to support such commercial paper issuances. As of April 1, 2023, there were no commercial paper issuances outstanding.

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Financial Instruments

3 Months Ended

Apr. 01, 2023

Investments, All Other Investments [Abstract]

Financial Instruments

Financial Instruments

Derivatives: All derivative instruments are reported in the Condensed Consolidated Financial Statements at fair value. Changes in the fair value of derivatives are recorded each period in earnings or on the accompanying Condensed Consolidated Balance Sheets, depending on whether the derivative is designated and effective as part of a hedged transaction. Gains or losses on derivative instruments recorded in earnings are presented in the same Condensed Consolidated Statement of Earnings line that is used to present the earnings effect of the hedged item. Gains or losses on derivative instruments in accumulated other comprehensive income (loss) (“Accumulated OCI”) are reclassified to earnings in the period in which earnings are affected by the underlying hedged item.

The criteria used to determine if hedge accounting treatment is appropriate are: (i) the designation of the hedge to an underlying exposure; (ii) whether or not overall risk is being reduced; and (iii) if there is a correlation between the value of the derivative instrument and the underlying hedged item. Once a derivative contract is entered into, Snap-on designates the derivative as a fair value hedge, a cash flow hedge, a hedge of a net investment in a foreign operation, or a natural hedging instrument whose change in fair value is recognized as an economic hedge against changes in the value of the hedged item. Snap-on does not use derivative instruments for speculative or trading purposes.

Snap-on is exposed to global market risks, including the effects of changes in foreign currency exchange rates, interest rates, and the company’s stock price. The company uses derivatives to manage financial exposures that occur in the normal course of business. The primary risks managed by using derivative instruments are foreign currency risk, interest rate risk and stock-based deferred compensation risk.

Foreign currency risk management: Snap-on has significant international operations and is subject to certain risks inherent with foreign operations that include currency fluctuations. Foreign currency exchange risk exists to the extent that Snap-on has payment obligations or receipts denominated in currencies other than the functional currency, including intercompany loans denominated in foreign currencies. To manage these exposures, Snap-on identifies naturally offsetting positions and then purchases hedging instruments to protect the residual net exposures. Snap-on manages most of these exposures on a consolidated basis, which allows for netting of certain exposures to take advantage of natural offsets. Foreign currency forward contracts (“foreign currency forwards”) are used to hedge the net exposures. Gains or losses on net foreign currency hedges are intended to offset losses or gains on the underlying net exposures in an effort to reduce the earnings volatility resulting from fluctuating foreign currency exchange rates. Snap-on’s foreign currency forwards are typically not designated as hedges. The fair value changes of these contracts are reported in earnings as foreign exchange gain or loss, which is included in “Other income (expense) – net” on the accompanying Condensed Consolidated Statements of Earnings. See Note 16 for additional information on Other income (expense) – net.

Interest rate risk management: Snap-on may manage the exposure created by the differing maturities and interest rate structures of Snap-on’s borrowings through the use of interest rate swap agreements (“interest rate swaps”) and treasury lock agreements (“treasury locks”).

Interest rate swaps: Snap-on may enter into interest rate swaps to manage risks associated with changing interest rates related to the company’s fixed rate borrowings. Interest rate swaps are accounted for as fair value hedges. The differentials paid or received on interest rate swaps are recognized as adjustments to “Interest expense” on the accompanying Condensed Consolidated Statements of Earnings. The change in the fair value of the derivative is recorded in “Long-term debt” on the accompanying Condensed Consolidated Balance Sheets. There were no outstanding interest rate swaps as of both April 1, 2023, and December 31, 2022.

Treasury locks: Snap-on may use treasury locks to manage the potential change in interest rates in anticipation of the issuance of fixed rate debt. Treasury locks are accounted for as cash flow hedges. The differentials to be paid or received on treasury locks related to the anticipated issuance of fixed rate debt are initially recorded in Accumulated OCI for derivative instruments that are designated and qualify as cash flow hedges. Upon the issuance of debt, the related amount in Accumulated OCI is released over the term of the debt and recognized as an adjustment to interest expense on the Condensed Consolidated Statements of Earnings. There were no treasury locks outstanding as of both April 1, 2023, and December 31, 2022.

Stock-based deferred compensation risk management: Snap-on manages market risk associated with the stock-based portion of its deferred compensation plans through the use of prepaid equity forward agreements (“equity forwards”). Equity forwards are used to aid in offsetting the potential mark-to-market effect on stock-based deferred compensation from changes in Snap‑on’s stock price. Since stock-based deferred compensation liabilities increase as the company’s stock price rises and decrease as the company’s stock price declines, the equity forwards are intended to mitigate the potential impact on deferred compensation expense that may result from such mark-to-market changes. As of April 1, 2023, Snap-on had equity forwards in place intended to manage market risk with respect to 68,200 shares of Snap-on common stock associated with its deferred compensation plans.

Counterparty risk: Snap-on is exposed to credit losses in the event of non-performance by the counterparties to its various financial agreements, including its foreign currency forward contracts, interest rate swap agreements, treasury lock agreements and prepaid equity forward agreements. Snap-on does not obtain collateral or other security to support financial instruments subject to credit risk, but monitors the credit standing of the counterparties and generally enters into agreements with financial institution counterparties with a credit rating of A- or better. Snap-on does not anticipate non-performance by its counterparties, but cannot provide assurances.

Fair value of financial instruments: The fair values of financial instruments that do not approximate the carrying values in the financial statements are as follows:

	April 1, 2023				December 31, 2022
(Amounts in millions)	Carrying Value		Fair Value		Carrying Value		Fair Value
Finance receivables – net	$	1,769.2	$	2,020.9	$	1,733.0	$	1,983.9
Contract receivables – net	493.6		524.8		493.7		520.4
Long-term debt and notes payable	1,202.2		1,032.0		1,201.0		982.1

The following methods and assumptions were used in estimating the fair value of financial instruments:

•Finance and contract receivables include both short-term and long-term receivables. The fair value estimates of finance and contract receivables are derived utilizing discounted cash flow analyses performed on groupings of receivables that are similar in terms of loan type and characteristics. The cash flow analyses consider recent prepayment trends where applicable. The cash flows are discounted over the average life of the receivables using a current market discount rate of a similar term adjusted for credit quality. Significant inputs to the fair value measurements of the receivables are unobservable and, as such, are classified as Level 3.

•Fair value of long-term debt is estimated, using Level 2 fair value measurements, based on quoted market values of Snap-on’s publicly traded senior debt. The carrying value of long-term debt includes unamortized debt issuance costs. The fair value of notes payable approximates such instruments’ carrying value due to their short-term nature.

•The fair value of all other financial instruments, including trade and other accounts receivable, accounts payable and other financial instruments, approximates such instruments’ carrying value due to their short-term nature.

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Pension Plans

3 Months Ended

Apr. 01, 2023

Retirement Benefits [Abstract]

Pension Plans

Pension Plans

Snap-on’s net periodic pension benefit included the following components: 

	Three Months Ended
(Amounts in millions)	April 1, 2023		April 2, 2022
Service cost	$	4.9	$	7.1
Interest cost	16.3		11.1
Expected return on plan assets	(26.2)		(24.5)
Amortization of unrecognized loss	0.3		4.5
Net periodic pension benefit	$	(4.7)	$	(1.8)

The components of net periodic pension benefit, other than the service cost component, are included in “Other income (expense) – net” on the accompanying Condensed Consolidated Statements of Earnings. See Note 16 for additional information on other income (expense) – net.

Snap-on intends to make contributions of $6.9 million to its foreign pension plans and $2.4 million to its domestic pension plans in 2023, as required by law. Depending on market and other conditions, Snap-on may make discretionary cash contributions to its pension plans in 2023.

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Postretirement Health Care Plans

3 Months Ended

Apr. 01, 2023

Postemployment Benefits [Abstract]

Postretirement Health Care Plans

Postretirement Health Care Plans

Snap-on’s net periodic postretirement health care cost included the following components: 

	Three Months Ended
(Amounts in millions)	April 1, 2023		April 2, 2022
Interest cost	$	0.5	$	0.3
Expected return on plan assets	(0.2)		(0.2)
Amortization of unrecognized gain	(0.3)		—
Net periodic postretirement health care cost	$	—	$	0.1

The components of net periodic postretirement health care cost are included in “Other income (expense) – net” on the accompanying Condensed Consolidated Statements of Earnings. See Note 16 for additional information on other income (expense) – net.

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Stock-based Compensation and Other Stock Plans

3 Months Ended

Apr. 01, 2023

Share-Based Payment Arrangement [Abstract]

Stock-based Compensation and Other Stock Plans

Stock-based Compensation and Other Stock Plans

The 2011 Incentive Stock and Awards Plan (the “2011 Plan”) provides for the grant of stock options, performance share units (“PSUs”), stock appreciation rights (“SARs”) and restricted stock awards (which may be designated as “restricted stock units” or “RSUs”). As of April 1, 2023, the 2011 Plan had 2,612,539 shares available for future grants. The company uses treasury stock to deliver shares under the 2011 Plan.

Net stock-based compensation expense was $10.2 million and $9.0 million for the respective three month periods ended April 1, 2023, and April 2, 2022. Cash received from stock purchase and option plan exercises during the respective three month periods ended April 1, 2023, and April 2, 2022 totaled $32.8 million and $5.8 million. The tax benefit realized from both the exercise and vesting of share-based payment arrangements was $5.1 million and $2.1 million for the respective three month periods ended April 1, 2023, and April 2, 2022.

Stock options: Stock options are granted with an exercise price equal to the market value of a share of Snap-on’s common stock on the date of grant and have a contractual term of 10 years. Stock option grants vest ratably on the first, second and third anniversaries of the date of grant.

The fair value of each stock option award is estimated on the date of grant using the Black-Scholes valuation model. The company uses historical data regarding stock option exercise and forfeiture behaviors for different participating groups to estimate the period of time that options granted are expected to be outstanding. Expected volatility is based on the historical volatility of the company’s stock for the length of time corresponding to the expected term of the option. The expected dividend yield is based on the expected annual dividend as a percentage of the market value of our common stock as of the date of grant. The risk-free interest rate is based on the U.S. treasury yield curve on the grant date for the expected term of the option.

The following weighted-average assumptions were used in calculating the fair value of stock options granted during three month periods ended April 1, 2023, and April 2, 2022, using the Black-Scholes valuation model:

	Three Months Ended
	April 1, 2023	April 2, 2022
Expected term of option (in years)	4.90	5.14
Expected volatility factor	23.99%	22.61%
Expected dividend yield	2.60%	2.68%
Risk-free interest rate	3.99%	2.00%

A summary of stock option activity as of and for the three months ended April 1, 2023, is presented below:

	Shares (in thousands)	Exercise Price Per Share*		Remaining Contractual Term* (in years)	Aggregate Intrinsic Value (in millions)
Outstanding at December 31, 2022	2,349	$	163.07
Granted	241	249.26
Exercised	(220)	148.72
Forfeited or expired	(7)	203.98
Outstanding at April 1, 2023	2,363	173.08		5.8	$	175.0
Exercisable at April 1, 2023	1,839	158.34		4.8	162.8

* Weighted-average

The weighted-average grant date fair value of options granted during the three months ended April 1, 2023, and April 2, 2022, was $51.09 and $34.35, respectively. The intrinsic value of options exercised was $22.6 million and $2.8 million during the respective three month periods ended April 1, 2023, and April 2, 2022. The fair value of stock options vested was $9.1 million and $10.5 million during the respective three month periods ended April 1, 2023, and April 2, 2022.

As of April 1, 2023, there was $19.8 million of unrecognized compensation cost related to non-vested stock options that is expected to be recognized as a charge to earnings over a weighted-average period of 2.1 years.

Performance share units: PSUs are earned and expensed using the fair value of the award over a contractual term of three years based on the company’s performance. Vesting of the PSUs is dependent upon performance relative to pre-defined goals for revenue growth and return on net assets for the applicable performance period. For performance achieved above specified levels, the recipient may earn additional shares of stock, not to exceed 100% of the number of performance awards initially granted. The PSUs have a three-year performance period based on the results of the consolidated financial metrics of the company.

The fair value of PSUs is calculated using the market value of a share of Snap-on’s common stock on the date of grant and assumed forfeitures based on recent historical experience; in recent years, forfeitures have not been significant. The weighted-average grant date fair value of PSUs granted during the three months ended April 1, 2023, and April 2, 2022, was $249.26 and $206.20, respectively. PSUs related to 60,402 shares and 46,217 shares were paid out during the three months ended April 1, 2023, and April 2, 2022, respectively. Earned PSUs vest and are generally paid out following the conclusion of the applicable performance period upon approval by the Organization and Executive Compensation Committee of the company’s Board of Directors (the “Board”).

Changes to the company’s non-vested PSUs during the three months ended April 1, 2023, are as follows:

	Shares (in thousands)	Fair Value Price per Share*
Non-vested PSUs at December 31, 2022	199	$	196.51
Granted	58	249.26
Performance assumption change **	12	211.67
Vested	—	—
Cancellations and other	(2)	204.00
Non-vested PSUs at April 1, 2023	267	208.62

*	Weighted-average
**	Reflects the number of PSUs above target levels based on performance metrics.

As of April 1, 2023, there was $28.6 million of unrecognized compensation cost related to non-vested PSUs that are expected to be recognized as a charge to earnings over a weighted-average period of 1.5 years.

Restricted stock units: RSUs are earned and expensed using the fair value of the award over the contractual term of three years. Vesting of the RSUs is dependent upon continued employment over the three-year cliff vesting period.

The fair value of RSUs is calculated using the market value of a share of Snap-on’s common stock on the date of grant and assumed forfeitures based on recent historical experience; in recent years, forfeitures have not been significant. The weighted-average grant date fair value of RSUs granted during the three months ended April 1, 2023, and April 2, 2022, was $249.26 and $211.67, respectively.

Changes to the company’s non-vested RSUs during the three months ended April 1, 2023, are as follows:

	Shares (in thousands)	Fair Value Price per Share*
Non-vested RSUs at December 31, 2022	58	$	200.16
Granted	26	249.26
Vested	—	—
Cancellations and other	(1)	203.64
Non-vested RSUs at April 1, 2023	83	215.54

* Weighted-average

As of April 1, 2023, there was $11.3 million of unrecognized compensation cost related to non-vested RSUs that are expected to be recognized as a charge to earnings over a weighted-average period of 1.7 years.

Stock appreciation rights: The company also issues stock-settled and cash-settled SARs to certain key non-U.S. employees. SARs have a contractual term of 10 years and vest ratably on the first, second and third anniversaries of the date of grant. SARs are granted with an exercise price equal to the market value of a share of Snap-on’s common stock on the date of grant.

Stock-settled SARs are accounted for as equity instruments and provide for the issuance of Snap-on common stock equal to the amount by which the company’s stock has appreciated over the exercise price. Stock-settled SARs have an effect on dilutive shares and shares outstanding as any appreciation of Snap-on’s common stock value over the exercise price will be settled in shares of common stock. Cash-settled SARs provide for the cash payment of the excess of the fair market value of Snap-on’s common stock price on the date of exercise over the grant price. Cash-settled SARs have no effect on dilutive shares or shares outstanding as any appreciation of Snap-on’s common stock over the grant price is paid in cash and not in common stock.

The fair value of stock-settled SARs is estimated on the date of grant using the Black-Scholes valuation model. The fair value of cash-settled SARs is revalued (mark-to-market) each reporting period using the Black-Scholes valuation model based on Snap-on’s period-end stock price. The company uses historical data regarding SARs exercise and forfeiture behaviors for different participating groups to estimate the expected term of the SARs granted based on the period of time that similar instruments granted are expected to be outstanding. Expected volatility is based on the historical volatility of the company’s stock for the length of time corresponding to the expected term of the SARs. The expected dividend yield is based on the expected annual dividend as a percentage of the market value of our common stock as of the date of grant (for stock-settled SARs) or reporting date (for cash-settled SARs). The risk-free interest rate is based on the U.S. treasury yield curve in effect as of the grant date (for stock-settled SARs) or reporting date (for cash-settled SARs) for the length of time corresponding to the expected term of the SARs.

The following weighted-average assumptions were used in calculating the fair value of stock-settled SARs granted during the three months ended April 1, 2023, and April 2, 2022, using the Black-Scholes valuation model:

	Three Months Ended
	April 1, 2023	April 2, 2022
Expected term of stock-settled SARs (in years)	4.08	4.02
Expected volatility factor	24.68%	23.09%
Expected dividend yield	2.60%	2.68%
Risk-free interest rate	3.87%	1.96%

A summary of stock-settled SARs as of and for the three months ended April 1, 2023, are as follows:

	Stock-settled SARs (in thousands)	Exercise Price Per Share*		Remaining Contractual Term* (in years)	Aggregate Intrinsic Value (in millions)
Outstanding at December 31, 2022	385	$	170.11
Granted	62	249.26
Exercised	(23)	153.93
Forfeited or expired	(37)	159.87
Outstanding at April 1, 2023	387	184.66		6.8	$	24.3
Exercisable at April 1, 2023	255	163.58		5.6	21.2

* Weighted-average

The weighted-average grant date fair value of stock-settled SARs granted during the three months ended April 1, 2023, and April 2, 2022, was $48.85 and $32.63, respectively. The intrinsic value of stock-settled SARs exercised was $2.2 million and $0.2 million during the respective three month periods ended April 1, 2023, and April 2, 2022. The fair value of stock-settled SARs vested was $1.9 million and $2.0 million during the respective three month periods ended April 1, 2023, and April 2, 2022.

As of April 1, 2023, there was $4.8 million of unrecognized compensation cost related to non-vested stock-settled SARs that is expected to be recognized as a charge to earnings over a weighted-average period of 2.1 years.

The following weighted-average assumptions were used in calculating the fair value of cash-settled SARs granted during the three months ended April 1, 2023, and April 2, 2022, using the Black-Scholes valuation model:

	Three Months Ended
	April 1, 2023	April 2, 2022
Expected term of cash-settled SARs (in years)	3.96	3.88
Expected volatility factor	24.42%	23.09%
Expected dividend yield	2.62%	2.79%
Risk-free interest rate	3.60%	2.58%

The intrinsic value of cash-settled SARs exercised was $0.4 million for both the respective three month periods ended April 1, 2023, and April 2, 2022. The fair value of cash-settled SARs vested was $0.1 million for both the three month periods ended April 1, 2023, and April 2, 2022.

Changes to the company’s non-vested cash-settled SARs during the three months ended April 1, 2023, are as follows:

	Cash-settled SARs (in thousands)	Fair Value Price per Share*
Non-vested cash-settled SARs at December 31, 2022	2	$	53.24
Granted	1	48.85
Vested	(1)	72.11
Non-vested cash-settled SARs at April 1, 2023	2	54.52

* Weighted-average

As of April 1, 2023, there was $0.1 million of unrecognized compensation cost related to non-vested cash-settled SARs that is expected to be recognized as a charge to earnings over a weighted-average period of 2.2 years.

Restricted stock awards – non-employee directors: The company awarded 5,760 shares and 6,525 shares of restricted stock to non-employee directors for the respective three month periods ended April 1, 2023, and April 2, 2022. The fair value of the restricted stock awards is expensed over a one-year vesting period based on the fair value on the date of grant. All restrictions generally lapse upon the earlier of the first anniversary of the grant date, the recipient’s death or disability or in the event of a change in control, as defined in the 2011 Plan. If termination of the recipient’s service occurs prior to the first anniversary of the grant date for any reason other than death or disability, the shares of restricted stock would be forfeited, unless otherwise determined by the Board.

Employee stock purchase plan: Substantially all Snap-on employees in the United States and Canada are eligible to participate in an employee stock purchase plan. The purchase price of the company’s common stock to participants is the lesser of the mean of the high and low price of the stock on the beginning date (May 15) or ending date (the following May 14) of each plan year. The company records compensation expense when Snap-on’s period-end stock price is greater than the plan purchase price. There were no share issuances under this plan for the three month periods ended April 1, 2023, and April 2, 2022. As of April 1, 2023, 578,823 shares were reserved for issuance under this plan and Snap-on held participant contributions of approximately $4.7 million. Participants are able to withdraw from the plan at any time prior to the ending date and receive back all contributions made during the plan year. Compensation expense for plan participants was $0.5 million and zero for the three month periods ended April 1, 2023, and April 2, 2022, respectively.

Franchisee stock purchase plan: All franchisees in the United States and Canada are eligible to participate in a franchisee stock purchase plan. The purchase price of the company’s common stock to participants is the lesser of the mean of the high and low price of the stock on the beginning date (May 15) or ending date (the following May 14) of each plan year. The company records mark-to-market expense when Snap-on’s period-end stock price is greater than the plan purchase price. There were no share issuances under this plan for the three month periods ended April 1, 2023, and April 2, 2022. As of April 1, 2023, 225,225 shares were reserved for issuance under this plan and Snap-on held participant contributions of approximately $8.9 million. Participants are able to withdraw from the plan at any time prior to the ending date and generally receive back all contributions made during the plan year. The company recognized market-to-market expense of $0.9 million and zero for the three month periods ended April 1, 2023, and April 2, 2022, respectively.

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Earnings Per Share

3 Months Ended

Apr. 01, 2023

Earnings Per Share [Abstract]

Earnings Per Share

Earnings Per ShareThe shares used in the computation of the company’s basic and diluted earnings per common share are as follows:

	Three Months Ended
	April 1, 2023	April 2, 2022
Weighted-average common shares outstanding	53,019,170	53,396,714
Effect of dilutive securities	1,044,581	915,300
Weighted-average common shares outstanding, assuming dilution	54,063,751	54,312,014

The dilutive effect of the potential exercise of outstanding options and stock-settled SARs to purchase common shares is calculated using the treasury stock method. As of April 1, 2023, there were 302,756 awards outstanding that were anti-dilutive; as of April 2, 2022, there were 358,774 awards outstanding that were anti-dilutive. Performance-based equity awards are included in the diluted earnings per share calculation based on the attainment of the applicable performance metrics to date.

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Commitments and Contingencies

3 Months Ended

Apr. 01, 2023

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Snap-on provides product warranties for specific product lines and accrues for estimated future warranty cost in the period in which the sale is recorded. Snap-on calculates its accrual requirements based on historic warranty loss experience that is periodically adjusted for recent actual experience, including the timing of claims during the warranty period and actual costs incurred.

Snap-on’s product warranty accrual activity for the three months ended April 1, 2023, and April 2, 2022, is as follows:

	Three Months Ended
(Amounts in millions)	April 1, 2023		April 2, 2022
Warranty reserve:
Beginning of period	$	14.3	$	17.3
Additions	3.8		2.2
Usage	(3.3)		(3.0)
End of period	$	14.8	$	16.5

In the ordinary course of our business, Snap-on is subject to legal disputes that are being litigated and/or settled. Although it is not possible to predict the outcome of legal matters, management believes that the results of all legal matters will not have a material impact on Snap-on’s consolidated financial position, results of operations or cash flows.

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Leases

3 Months Ended

Apr. 01, 2023

Leases [Abstract]

Leases

Leases

Lessee accounting: Supplemental balance sheet information related to leases as of April 1, 2023, and December 31, 2022, is as follows:

(Amounts in millions)	April 1, 2023		December 31, 2022
Finance leases:
Property and equipment - gross	$	19.7	$	19.4
Accumulated depreciation and amortization	(17.0)		(16.4)
Property and equipment - net	$	2.7	$	3.0
Other accrued liabilities	$	1.9	$	2.0
Other long-term liabilities	1.6		1.9
Total finance lease liabilities	$	3.5	$	3.9
Operating leases:
Operating lease right-of-use assets	$	61.5	$	61.5
Other accrued liabilities	$	19.4	$	19.4
Operating lease liabilities	44.9		44.7
Total operating lease liabilities	$	64.3	$	64.1

Lessor accounting: Snap-on’s Financial Services business offers its customers lease financing for the lease of tools, diagnostics, and equipment products and to franchisees who require financing for vehicle leases. Sales-type leases are included in both “Finance receivables – net” and “Long-term finance receivables – net” and also in both “Contract receivables – net” and “Long-term contract receivables – net” on the accompanying Condensed Consolidated Balance Sheets.

See Note 3 for further information on finance and contract receivables.

Leases

Leases

Lessee accounting: Supplemental balance sheet information related to leases as of April 1, 2023, and December 31, 2022, is as follows:

(Amounts in millions)	April 1, 2023		December 31, 2022
Finance leases:
Property and equipment - gross	$	19.7	$	19.4
Accumulated depreciation and amortization	(17.0)		(16.4)
Property and equipment - net	$	2.7	$	3.0
Other accrued liabilities	$	1.9	$	2.0
Other long-term liabilities	1.6		1.9
Total finance lease liabilities	$	3.5	$	3.9
Operating leases:
Operating lease right-of-use assets	$	61.5	$	61.5
Other accrued liabilities	$	19.4	$	19.4
Operating lease liabilities	44.9		44.7
Total operating lease liabilities	$	64.3	$	64.1

Lessor accounting: Snap-on’s Financial Services business offers its customers lease financing for the lease of tools, diagnostics, and equipment products and to franchisees who require financing for vehicle leases. Sales-type leases are included in both “Finance receivables – net” and “Long-term finance receivables – net” and also in both “Contract receivables – net” and “Long-term contract receivables – net” on the accompanying Condensed Consolidated Balance Sheets.

See Note 3 for further information on finance and contract receivables.

Leases

Leases

Lessee accounting: Supplemental balance sheet information related to leases as of April 1, 2023, and December 31, 2022, is as follows:

(Amounts in millions)	April 1, 2023		December 31, 2022
Finance leases:
Property and equipment - gross	$	19.7	$	19.4
Accumulated depreciation and amortization	(17.0)		(16.4)
Property and equipment - net	$	2.7	$	3.0
Other accrued liabilities	$	1.9	$	2.0
Other long-term liabilities	1.6		1.9
Total finance lease liabilities	$	3.5	$	3.9
Operating leases:
Operating lease right-of-use assets	$	61.5	$	61.5
Other accrued liabilities	$	19.4	$	19.4
Operating lease liabilities	44.9		44.7
Total operating lease liabilities	$	64.3	$	64.1

Lessor accounting: Snap-on’s Financial Services business offers its customers lease financing for the lease of tools, diagnostics, and equipment products and to franchisees who require financing for vehicle leases. Sales-type leases are included in both “Finance receivables – net” and “Long-term finance receivables – net” and also in both “Contract receivables – net” and “Long-term contract receivables – net” on the accompanying Condensed Consolidated Balance Sheets.

See Note 3 for further information on finance and contract receivables.

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Other Income (Expense) - Net

3 Months Ended

Apr. 01, 2023

Other Income and Expenses [Abstract]

Other Income (Expense) - Net

Other Income (Expense) – Net

“Other income (expense) – net” on the accompanying Condensed Consolidated Statements of Earnings consists of the following:

	Three Months Ended
(Amounts in millions)	April 1, 2023		April 2, 2022
Interest income	$	8.0	$	0.5
Net foreign exchange loss	(2.5)		(1.0)
Net periodic pension and postretirement benefits – non-service	9.6		8.8
Other	0.1		—
Total other income (expense) – net	$	15.2	$	8.3

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Accumulated Other Comprehensive Income (Loss)

3 Months Ended

Apr. 01, 2023

Equity [Abstract]

Accumulated Other Comprehensive Income (Loss)

Accumulated Other Comprehensive Income (Loss)

The following is a summary of net changes in Accumulated OCI by component and net of tax for the three months ended April 1, 2023:

(Amounts in millions)	Foreign Currency Translation		Cash Flow Hedges		Defined Benefit Pension and Postretirement Plans		Total
Balance as of December 31, 2022	$	(272.5)	$	7.3	$	(263.1)	$	(528.3)
Other comprehensive income before reclassifications	18.1		—		—		18.1
Amounts reclassified from Accumulated OCI	—		(0.4)		—		(0.4)
Net other comprehensive income (loss)	18.1		(0.4)		—		17.7
Balance as of April 1, 2023	$	(254.4)	$	6.9	$	(263.1)	$	(510.6)

The following is a summary of net changes in Accumulated OCI by component and net of tax for the three months ended April 2, 2022:

(Amounts in millions)	Foreign Currency Translation		Cash Flow Hedges		Defined Benefit Pension and Postretirement Plans		Total
Balance as of January 1, 2022	$	(145.1)	$	8.9	$	(207.7)	$	(343.9)
Other comprehensive loss before reclassifications	(9.7)		—		—		(9.7)
Amounts reclassified from Accumulated OCI	—		(0.4)		3.4		3.0
Net other comprehensive income (loss)	(9.7)		(0.4)		3.4		(6.7)
Balance as of April 2, 2022	$	(154.8)	$	8.5	$	(204.3)	$	(350.6)

The reclassifications out of Accumulated OCI for the three month periods ended April 1, 2023, and April 2, 2022, are as follows:

	Amount Reclassified from Accumulated OCI
	Three Months Ended
(Amounts in millions)	April 1, 2023		April 2, 2022		Statement of Earnings Presentation
Gains on cash flow hedges:
Treasury locks	$	0.4	$	0.4	Interest expense
Income tax expense	—		—		Income tax expense
Net of tax	0.4		0.4
Amortization of net unrecognized losses	$	—	$	(4.5)	See footnote below*
Income tax benefit	—		1.1		Income tax expense
Net of tax	—		(3.4)
Total reclassifications for the period, net of tax	$	0.4	$	(3.0)

* These Accumulated OCI components are included in the computation of net periodic pension and postretirement health care costs; see Note 10 and Note 11 for further information.

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Segments

3 Months Ended

Apr. 01, 2023

Segment Reporting [Abstract]

Segments

Segments

Snap-on’s business segments are based on the organization structure used by management for making operating and investment decisions and for assessing performance. Snap-on’s reportable business segments are: (i) the Commercial & Industrial Group; (ii) the Snap-on Tools Group; (iii) the Repair Systems & Information Group; and (iv) Financial Services. The Commercial & Industrial Group consists of business operations serving a broad range of industrial and commercial customers worldwide, including customers in the aerospace, natural resources, government and military, power generation, transportation and technical education market segments (collectively, “critical industries”), primarily through direct and distributor channels. The Snap-on Tools Group consists of business operations primarily serving vehicle service and repair technicians through the company’s multi-national mobile tool distribution channel. The Repair Systems & Information Group consists of business operations serving other professional vehicle repair customers worldwide, primarily owners and managers of independent repair shops and OEM dealerships, through direct and distributor channels. Financial Services consists of the business operations of Snap-on’s finance subsidiaries.

Snap-on evaluates the performance of its operating segments based on segment revenues, including both external and intersegment net sales, and segment operating earnings. Snap-on accounts for intersegment sales and transfers based primarily on standard costs with reasonable mark-ups established between the segments. Identifiable assets by segment are those assets used in the respective reportable segment’s operations. Corporate assets consist of cash and cash equivalents (excluding cash held at Financial Services), deferred income taxes and certain other assets. Intersegment amounts are eliminated to arrive at Snap-on’s consolidated financial results.

Financial Data by Segment:

	Three Months Ended
(Amounts in millions)	April 1, 2023		April 2, 2022
Net sales:
Commercial & Industrial Group	$	363.8	$	340.1
Snap-on Tools Group	537.0		512.1
Repair Systems & Information Group	446.6		398.2
Segment net sales	1,347.4		1,250.4
Intersegment eliminations	(164.4)		(152.6)
Total net sales	1,183.0		1,097.8
Financial Services revenue	92.6		87.7
Total revenues	$	1,275.6	$	1,185.5
Operating earnings:
Commercial & Industrial Group	$	55.8	$	45.7
Snap-on Tools Group	131.7		116.0
Repair Systems & Information Group	104.6		91.6
Financial Services	66.3		70.4
Segment operating earnings	358.4		323.7
Corporate	(32.3)		(30.2)
Operating earnings	326.1		293.5
Interest expense	(12.4)		(11.6)
Other income (expense) – net	15.2		8.3
Earnings before income taxes	$	328.9	$	290.2

(Amounts in millions)	April 1, 2023		December 31, 2022
Assets:
Commercial & Industrial Group	$	1,271.1	$	1,245.8
Snap-on Tools Group	934.0		912.9
Repair Systems & Information Group	1,681.7		1,678.1
Financial Services	2,281.2		2,242.7
Total assets from reportable segments	6,168.0		6,079.5
Corporate	1,041.1		972.9
Elimination of intersegment receivables	(83.5)		(79.6)
Total assets	$	7,125.6	$	6,972.8

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Summary of Accounting Policies - (Policies)

3 Months Ended

Apr. 01, 2023

Accounting Policies [Abstract]

Principles of consolidation and presentation

Principles of consolidation and presentation

The Condensed Consolidated Financial Statements include the accounts of Snap-on Incorporated and its wholly owned and majority-owned subsidiaries (collectively, “Snap-on” or the “company”). These financial statements should be read in conjunction with, and have been prepared in conformity with, the accounting principles reflected in the consolidated financial statements and related notes included in Snap-on’s 2022 Annual Report on Form 10-K for the fiscal year ended December 31, 2022 (“2022 year end”). The company’s 2023 fiscal first quarter ended on April 1, 2023; the 2022 fiscal first quarter ended on April 2, 2022. The company’s 2023 and 2022 fiscal first quarters each contained 13 weeks of operating results. Snap-on’s Condensed Consolidated Financial Statements are prepared in conformity with generally accepted accounting principles in the United States of America (“GAAP”).

In the opinion of management, all adjustments (consisting of normal recurring adjustments) necessary for the fair presentation of the Condensed Consolidated Financial Statements for the three month periods ended April 1, 2023, and April 2, 2022, have been made. Interim results of operations are not necessarily indicative of the results to be expected for the full fiscal year.

Use of Estimates

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Financial Instruments

Financial Instruments

The fair value of the company’s derivative financial instruments is generally determined using quoted prices in active markets for similar assets and liabilities. The carrying value of the company’s non-derivative financial instruments either approximates fair value, due to their short-term nature, or the amount disclosed for fair value is based upon a discounted cash flow analysis or quoted market values. See Note 9 for further information on financial instruments.

New Accounting Standards

New Accounting Standards

On January 1, 2023, the beginning of Snap-on’s 2023 fiscal year, the company adopted ASU No. 2022-02, Financial Instruments – Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures, which requires enhanced disclosure of certain loan refinancings and restructurings by creditors when a borrower is experiencing financial difficulty and eliminates certain current recognition and measurement accounting guidance. This ASU also requires the disclosure of current-period gross write-offs by year of origination for financing receivables and net investments in leases. The adoption of this ASU did not have a significant impact on the company’s Condensed Consolidated Financial Statements.

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Revenue Recognition - (Tables)

3 Months Ended

Apr. 01, 2023

Revenue from Contract with Customer [Abstract]

Schedule of Disaggregation of Revenue

The following table shows the consolidated revenues by revenue source:

	Three Months Ended
(Amounts in millions)	April 1, 2023		April 2, 2022
Revenue from contracts with customers	$	1,176.5	$	1,091.9
Other revenues	6.5		5.9
Total net sales	1,183.0		1,097.8
Financial services revenue	92.6		87.7
Total revenues	$	1,275.6	$	1,185.5

The following tables represent external net sales disaggregated by geography, based on the customers’ billing addresses:

	For the Three Months Ended April 1, 2023
	Commercial		Snap-on		Repair Systems
	& Industrial		Tools		& Information		Financial				Snap-on
(Amounts in millions)	Group		Group		Group		Services		Eliminations		Incorporated
Net sales:
North America*	$	137.6	$	473.9	$	281.8	$	—	$	—	$	893.3
Europe	75.0		35.7		63.2		—		—		173.9
All other	66.0		27.4		22.4		—		—		115.8
External net sales	278.6		537.0		367.4		—		—		1,183.0
Intersegment net sales	85.2		—		79.2		—		(164.4)		—
Total net sales	363.8		537.0		446.6		—		(164.4)		1,183.0
Financial services revenue	—		—		—		92.6		—		92.6
Total revenue	$	363.8	$	537.0	$	446.6	$	92.6	$	(164.4)	$	1,275.6

	For the Three Months Ended April 2, 2022
	Commercial		Snap-on		Repair Systems
	& Industrial		Tools		& Information		Financial				Snap-on
(Amounts in millions)	Group		Group		Group		Services		Eliminations		Incorporated
Net sales:
North America*	$	113.7	$	447.8	$	242.8	$	—	$	—	$	804.3
Europe	81.8		40.1		61.9		—		—		183.8
All other	65.7		24.2		19.8		—		—		109.7
External net sales	261.2		512.1		324.5		—		—		1,097.8
Intersegment net sales	78.9		—		73.7		—		(152.6)		—
Total net sales	340.1		512.1		398.2		—		(152.6)		1,097.8
Financial services revenue	—		—		—		87.7		—		87.7
Total revenue	$	340.1	$	512.1	$	398.2	$	87.7	$	(152.6)	$	1,185.5
* North America is comprised of the United States, Canada and Mexico.

The following tables represent external net sales disaggregated by customer type:

	For the Three Months Ended April 1, 2023
	Commercial		Snap-on		Repair Systems
	& Industrial		Tools		& Information		Financial				Snap-on
(Amounts in millions)	Group		Group		Group		Services		Eliminations		Incorporated
Net sales:
Vehicle service professionals	$	21.1	$	537.0	$	367.4	$	—	$	—	$	925.5
All other professionals	257.5		—		—		—		—		257.5
External net sales	278.6		537.0		367.4		—		—		1,183.0
Intersegment net sales	85.2		—		79.2		—		(164.4)		—
Total net sales	363.8		537.0		446.6		—		(164.4)		1,183.0
Financial services revenue	—		—		—		92.6		—		92.6
Total revenue	$	363.8	$	537.0	$	446.6	$	92.6	$	(164.4)	$	1,275.6

	For the Three Months Ended April 2, 2022
	Commercial		Snap-on		Repair Systems
	& Industrial		Tools		& Information		Financial				Snap-on
(Amounts in millions)	Group		Group		Group		Services		Eliminations		Incorporated
Net sales:
Vehicle service professionals	$	23.9	$	512.1	$	324.5	$	—	$	—	$	860.5
All other professionals	237.3		—		—		—		—		237.3
External net sales	261.2		512.1		324.5		—		—		1,097.8
Intersegment net sales	78.9		—		73.7		—		(152.6)		—
Total net sales	340.1		512.1		398.2		—		(152.6)		1,097.8
Financial services revenue	—		—		—		87.7		—		87.7
Total revenue	$	340.1	$	512.1	$	398.2	$	87.7	$	(152.6)	$	1,185.5

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Receivables - (Tables)

3 Months Ended

Apr. 01, 2023

Receivables [Abstract]

Schedule of Components of Trade and Other Accounts Receivable

The components of Snap-on’s trade and other accounts receivable as of April 1, 2023, and December 31, 2022, are as follows:

(Amounts in millions)	April 1, 2023		December 31, 2022
Trade and other accounts receivable	$	813.6	$	792.8
Allowances for credit losses	(31.2)		(31.1)
Total trade and other accounts receivable – net	$	782.4	$	761.7

Schedule of Allowance For Credit Losses On Receivables

The following is a rollforward of the allowances for credit losses related to trade and other accounts receivable for the three months ended April 1, 2023, and April 2, 2022:

	Three Months Ended
(Amounts in millions)	April 1, 2023		April 2, 2022
Allowances for credit losses:
Beginning of period	$	31.1	$	27.3
Provision for credit losses	4.7		3.7
Charge-offs	(4.8)		(3.0)
Recoveries	—		0.1
Currency translation	0.2		0.3
End of period	$	31.2	$	28.4

Schedule of Components of Finance and Contract Receivables, Current and Beyond One Year

The components of Snap-on’s current finance and contract receivables as of April 1, 2023, and December 31, 2022, are as follows:

(Amounts in millions)	April 1, 2023		December 31, 2022
Finance installment receivables	$	589.2	$	578.6
Finance lease receivables, net of unearned finance charges of $0.5 million and $0.5 million, respectively	2.9		3.2
Total finance receivables	592.1		581.8
Contract installment receivables	46.2		51.3
Contract lease receivables, net of unearned finance charges of $19.3 million and $19.1 million, respectively	61.3		60.3
Total contract receivables	107.5		111.6
Total	699.6		693.4
Allowances for credit losses:
Finance installment receivables	(20.0)		(19.5)
Finance lease receivables	—		(0.1)
Total finance allowance for credit losses	(20.0)		(19.6)
Contract installment receivables	(0.8)		(0.8)
Contract lease receivables	(0.9)		(0.9)
Total contract allowance for credit losses	(1.7)		(1.7)
Total allowance for credit losses	(21.7)		(21.3)
Total current finance and contract receivables – net	$	677.9	$	672.1
Finance receivables – net	$	572.1	$	562.2
Contract receivables – net	105.8		109.9
Total current finance and contract receivables – net	$	677.9	$	672.1

The components of Snap-on’s finance and contract receivables with payment terms beyond one year as of April 1, 2023, and December 31, 2022, are as follows: 

(Amounts in millions)	April 1, 2023		December 31, 2022
Finance installment receivables	$	1,238.2	$	1,210.4
Finance lease receivables, net of unearned finance charges of $0.2 million and $0.2 million, respectively	1.6		1.7
Total finance receivables	1,239.8		1,212.1
Contract installment receivables	205.6		202.1
Contract lease receivables, net of unearned finance charges of $30.9 million and $30.7 million, respectively	187.0		186.6
Total contract receivables	392.6		388.7
Total	1,632.4		1,600.8
Allowances for credit losses:
Finance installment receivables	(42.7)		(41.3)
Finance lease receivables	—		—
Total finance allowance for credit losses	(42.7)		(41.3)
Contract installment receivables	(3.1)		(3.1)
Contract lease receivables	(1.7)		(1.8)
Total contract allowance for credit losses	(4.8)		(4.9)
Total allowance for credit losses	(47.5)		(46.2)
Total long-term finance and contract receivables – net	$	1,584.9	$	1,554.6
Finance receivables – net	$	1,197.1	$	1,170.8
Contract receivables – net	387.8		383.8
Total long-term finance and contract receivables – net	$	1,584.9	$	1,554.6

Schedule of Financing Receivable Credit Quality Indicators

The amortized cost basis of finance and contract receivables by origination year as of April 1, 2023, and charge-offs for the three months ended April 1, 2023, are as follows:

(Amounts in millions)	2023		2022		2021		2020		2019		Prior		Total
Finance receivables:
Delinquent	$	0.2	$	18.0	$	11.4	$	6.8	$	3.3	$	2.1	$	41.8
Non-delinquent	505.1		836.7		271.6		124.4		40.4		11.9		1,790.1
Total Finance receivables	$	505.3	$	854.7	$	283.0	$	131.2	$	43.7	$	14.0	$	1,831.9
Finance receivables charge-offs	$	—	$	5.7	$	4.6	$	2.5	$	1.0	$	0.7	$	14.5
Contract receivables:
Delinquent	$	—	$	0.9	$	1.4	$	0.5	$	0.5	$	0.2	$	3.5
Non-delinquent	46.1		160.1		109.9		77.5		51.4		51.6		496.6
Total Contract receivables	$	46.1	$	161.0	$	111.3	$	78.0	$	51.9	$	51.8	$	500.1
Contract receivables charge-offs	$	—	$	0.1	$	0.1	$	0.3	$	—	$	—	$	0.5

Schedule of Financing Receivable, Allowance for Credit Loss

The following is a rollforward of the allowances for credit losses for finance and contract receivables for the three months ended April 1, 2023, and April 2, 2022:

 

	Three Months Ended April 1, 2023				Three Months Ended April 2, 2022
(Amounts in millions)	Finance Receivables		Contract Receivables		Finance Receivables		Contract Receivables
Allowances for credit losses:
Beginning of period	$	60.9	$	6.6	$	67.3	$	8.4
Provision for credit losses	14.2		0.3		6.3		0.1
Charge-offs	(14.5)		(0.5)		(13.4)		(0.8)
Recoveries	2.1		0.1		2.3		—
Currency translation	—		—		—		—
End of period	$	62.7	$	6.5	$	62.5	$	7.7

Schedule of Aging of Finance and Contract Receivables

The aging of finance and contract receivables as of April 1, 2023, and December 31, 2022, is as follows:

(Amounts in millions)	30-59 Days Past Due		60-90 Days Past Due		Greater Than 90 Days Past Due		Total Past Due		Total Not Past Due		Total		Greater Than 90 Days Past Due and Accruing
April 1, 2023:
Finance receivables	$	12.3	$	9.6	$	19.9	$	41.8	$	1,790.1	$	1,831.9	$	16.8
Contract receivables	1.4		0.4		1.7		3.5		496.6		500.1		0.3
December 31, 2022:
Finance receivables	$	17.2	$	11.2	$	19.5	$	47.9	$	1,746.0	$	1,793.9	$	16.5
Contract receivables	1.2		0.3		2.2		3.7		496.6		500.3		0.3

Schedule of Finance and Contract Receivables on Nonaccrual Status

The amount of finance and contract receivables on nonaccrual status as of April 1, 2023, and December 31, 2022, is as follows:

(Amounts in millions)	April 1, 2023		December 31, 2022
Finance receivables	$	9.3	$	8.7
Contract receivables	2.8		3.3

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Inventories - (Tables)

3 Months Ended

Apr. 01, 2023

Inventory Disclosure [Abstract]

Schedule of Inventories by Major Classification

Inventories by major classification are as follows:

(Amounts in millions)	April 1, 2023		December 31, 2022
Finished goods	$	895.1	$	882.2
Work in progress	76.2		77.2
Raw materials	186.7		182.3
Total FIFO value	1,158.0		1,141.7
Excess of current cost over LIFO cost	(108.9)		(108.6)
Total inventories – net	$	1,049.1	$	1,033.1

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Goodwill and Other Intangible Assets - (Tables)

3 Months Ended

Apr. 01, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Changes in Carrying Amount of Goodwill by Segment

The changes in the carrying amount of goodwill by segment for the three months ended April 1, 2023, are as follows:

(Amounts in millions)	Commercial & Industrial Group		Snap-on Tools Group		Repair Systems & Information Group		Total
Balance as of December 31, 2022	$	302.9	$	12.4	$	730.0	$	1,045.3
Currency translation	3.7		—		1.6		5.3
Balance as of April 1, 2023	$	306.6	$	12.4	$	731.6	$	1,050.6

Schedule of Other Intangible Assets by Major Class

dditional disclosures related to other intangible assets are as follows:

	April 1, 2023						December 31, 2022
(Amounts in millions)	Gross  Carrying Value		Accumulated Amortization		Net Carrying Value		Gross  Carrying Value		Accumulated Amortization		Net Carrying Value
Amortized other intangible assets:
Customer relationships	$	212.7	$	(154.1)	$	58.6	$	212.1	$	(150.8)	$	61.3
Developed technology	36.0		(27.1)		8.9		35.8		(26.0)		9.8
Internally developed software	182.4		(140.1)		42.3		179.6		(137.2)		42.4
Patents	49.4		(25.8)		23.6		48.4		(25.6)		22.8
Trademarks	3.9		(2.4)		1.5		3.9		(2.4)		1.5
Other	7.8		(4.1)		3.7		7.7		(4.0)		3.7
Total	492.2		(353.6)		138.6		487.5		(346.0)		141.5
Non-amortized trademarks	134.7		—		134.7		134.1		—		134.1
Total other intangible assets	$	626.9	$	(353.6)	$	273.3	$	621.6	$	(346.0)	$	275.6

Schedule of Weighted-Average Amortization Period by Major Class

The weighted-average amortization periods related to other intangible assets are as follows:

	In Years
Customer relationships	14
Developed technology	5
Internally developed software	6
Patents	14
Trademarks	9
Other	39

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Exit and Disposal Activities (Tables)

3 Months Ended

Apr. 01, 2023

Restructuring and Related Activities [Abstract]

Schedule of Exit and Disposal Accrual Activity

Snap-on’s exit and disposal accrual activity for the first three months of 2023 is as follows:

	Balance at		Three Months				Balance at
(Amounts in millions)	December 31, 2022		Provision		Usage		April 1, 2023
Severance costs:
Commercial & Industrial Group	$	1.6	$	—	$	(0.1)	$	1.5
Snap-on Tools Group	0.1		—		—		0.1
Repair System & Information Group	1.1		—		(0.2)		0.9
Total	$	2.8	$	—	$	(0.3)	$	2.5

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Short-term and Long-term Debt - (Tables)

3 Months Ended

Apr. 01, 2023

Debt Disclosure [Abstract]

Schedule of Short-term and Long-term Debt

Short-term and long-term debt as of April 1, 2023, and December 31, 2022, consisted of the following:

(Amounts in millions)	April 1, 2023		December 31, 2022
3.25% unsecured notes due 2027	$	300.0	$	300.0
4.10% unsecured notes due 2048	400.0		400.0
3.10% unsecured notes due 2050	500.0		500.0
Other*	2.2		1.0
	1,202.2		1,201.0
Less: notes payable	(18.2)		(17.2)
Total long-term debt	$	1,184.0	$	1,183.8

* Includes unamortized debt issuance costs.

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Financial Instruments - (Tables)

3 Months Ended

Apr. 01, 2023

Investments, All Other Investments [Abstract]

Schedule of Fair Values of Financial Instruments Not Approximating Carrying Values in Financial Statements

The fair values of financial instruments that do not approximate the carrying values in the financial statements are as follows:

	April 1, 2023				December 31, 2022
(Amounts in millions)	Carrying Value		Fair Value		Carrying Value		Fair Value
Finance receivables – net	$	1,769.2	$	2,020.9	$	1,733.0	$	1,983.9
Contract receivables – net	493.6		524.8		493.7		520.4
Long-term debt and notes payable	1,202.2		1,032.0		1,201.0		982.1

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Pension Plans - (Tables)

3 Months Ended

Apr. 01, 2023

Retirement Benefits [Abstract]

Schedule of Net Periodic Pension Benefit

Snap-on’s net periodic pension benefit included the following components: 

	Three Months Ended
(Amounts in millions)	April 1, 2023		April 2, 2022
Service cost	$	4.9	$	7.1
Interest cost	16.3		11.1
Expected return on plan assets	(26.2)		(24.5)
Amortization of unrecognized loss	0.3		4.5
Net periodic pension benefit	$	(4.7)	$	(1.8)

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Postretirement Health Care Plans - (Tables)

3 Months Ended

Apr. 01, 2023

Postemployment Benefits [Abstract]

Schedule of Net Periodic Postretirement Health Care Cost

Snap-on’s net periodic postretirement health care cost included the following components: 

	Three Months Ended
(Amounts in millions)	April 1, 2023		April 2, 2022
Interest cost	$	0.5	$	0.3
Expected return on plan assets	(0.2)		(0.2)
Amortization of unrecognized gain	(0.3)		—
Net periodic postretirement health care cost	$	—	$	0.1

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Stock-based Compensation and Other Stock Plans - (Tables)

3 Months Ended

Apr. 01, 2023

Share-Based Payment Arrangement [Abstract]

Schedule of Weighted-Average Assumptions of Fair Value Granted Using Black-Scholes Valuation Model

The following weighted-average assumptions were used in calculating the fair value of stock options granted during three month periods ended April 1, 2023, and April 2, 2022, using the Black-Scholes valuation model:

	Three Months Ended
	April 1, 2023	April 2, 2022
Expected term of option (in years)	4.90	5.14
Expected volatility factor	23.99%	22.61%
Expected dividend yield	2.60%	2.68%
Risk-free interest rate	3.99%	2.00%

Schedule of Stock Option Activity

A summary of stock option activity as of and for the three months ended April 1, 2023, is presented below:

	Shares (in thousands)	Exercise Price Per Share*		Remaining Contractual Term* (in years)	Aggregate Intrinsic Value (in millions)
Outstanding at December 31, 2022	2,349	$	163.07
Granted	241	249.26
Exercised	(220)	148.72
Forfeited or expired	(7)	203.98
Outstanding at April 1, 2023	2,363	173.08		5.8	$	175.0
Exercisable at April 1, 2023	1,839	158.34		4.8	162.8

* Weighted-average

Schedule of Changes in Non-Vested Performance Awards

Changes to the company’s non-vested PSUs during the three months ended April 1, 2023, are as follows:

	Shares (in thousands)	Fair Value Price per Share*
Non-vested PSUs at December 31, 2022	199	$	196.51
Granted	58	249.26
Performance assumption change **	12	211.67
Vested	—	—
Cancellations and other	(2)	204.00
Non-vested PSUs at April 1, 2023	267	208.62

*	Weighted-average
**	Reflects the number of PSUs above target levels based on performance metrics.

Schedule of Non-vested Restricted Stock Units Activity

Changes to the company’s non-vested RSUs during the three months ended April 1, 2023, are as follows:

	Shares (in thousands)	Fair Value Price per Share*
Non-vested RSUs at December 31, 2022	58	$	200.16
Granted	26	249.26
Vested	—	—
Cancellations and other	(1)	203.64
Non-vested RSUs at April 1, 2023	83	215.54

* Weighted-average

Schedule of Weighted-Average Assumptions of Fair Value Granted Using Black-Scholes Valuation Model

The following weighted-average assumptions were used in calculating the fair value of stock-settled SARs granted during the three months ended April 1, 2023, and April 2, 2022, using the Black-Scholes valuation model:

	Three Months Ended
	April 1, 2023	April 2, 2022
Expected term of stock-settled SARs (in years)	4.08	4.02
Expected volatility factor	24.68%	23.09%
Expected dividend yield	2.60%	2.68%
Risk-free interest rate	3.87%	1.96%

The following weighted-average assumptions were used in calculating the fair value of cash-settled SARs granted during the three months ended April 1, 2023, and April 2, 2022, using the Black-Scholes valuation model:

	Three Months Ended
	April 1, 2023	April 2, 2022
Expected term of cash-settled SARs (in years)	3.96	3.88
Expected volatility factor	24.42%	23.09%
Expected dividend yield	2.62%	2.79%
Risk-free interest rate	3.60%	2.58%

Schedule of Changes in SARs

A summary of stock-settled SARs as of and for the three months ended April 1, 2023, are as follows:

	Stock-settled SARs (in thousands)	Exercise Price Per Share*		Remaining Contractual Term* (in years)	Aggregate Intrinsic Value (in millions)
Outstanding at December 31, 2022	385	$	170.11
Granted	62	249.26
Exercised	(23)	153.93
Forfeited or expired	(37)	159.87
Outstanding at April 1, 2023	387	184.66		6.8	$	24.3
Exercisable at April 1, 2023	255	163.58		5.6	21.2

* Weighted-average

Changes to the company’s non-vested cash-settled SARs during the three months ended April 1, 2023, are as follows:

	Cash-settled SARs (in thousands)	Fair Value Price per Share*
Non-vested cash-settled SARs at December 31, 2022	2	$	53.24
Granted	1	48.85
Vested	(1)	72.11
Non-vested cash-settled SARs at April 1, 2023	2	54.52

* Weighted-average

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Earnings Per Share - (Tables)

3 Months Ended

Apr. 01, 2023

Earnings Per Share [Abstract]

Schedule of Computation of Basic and Diluted Earnings Per Common Share

The shares used in the computation of the company’s basic and diluted earnings per common share are as follows:

	Three Months Ended
	April 1, 2023	April 2, 2022
Weighted-average common shares outstanding	53,019,170	53,396,714
Effect of dilutive securities	1,044,581	915,300
Weighted-average common shares outstanding, assuming dilution	54,063,751	54,312,014

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Commitments and Contingencies - (Tables)

3 Months Ended

Apr. 01, 2023

Commitments and Contingencies Disclosure [Abstract]

Schedule of Product Warranty Accrual Activity

Snap-on’s product warranty accrual activity for the three months ended April 1, 2023, and April 2, 2022, is as follows:

	Three Months Ended
(Amounts in millions)	April 1, 2023		April 2, 2022
Warranty reserve:
Beginning of period	$	14.3	$	17.3
Additions	3.8		2.2
Usage	(3.3)		(3.0)
End of period	$	14.8	$	16.5

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Leases - (Tables)

3 Months Ended

Apr. 01, 2023

Leases [Abstract]

Schedule of Lease Supplemental Balance Sheet Information and Weighted-Average Lease Terms and Discount Rates

Supplemental balance sheet information related to leases as of April 1, 2023, and December 31, 2022, is as follows:

(Amounts in millions)	April 1, 2023		December 31, 2022
Finance leases:
Property and equipment - gross	$	19.7	$	19.4
Accumulated depreciation and amortization	(17.0)		(16.4)
Property and equipment - net	$	2.7	$	3.0
Other accrued liabilities	$	1.9	$	2.0
Other long-term liabilities	1.6		1.9
Total finance lease liabilities	$	3.5	$	3.9
Operating leases:
Operating lease right-of-use assets	$	61.5	$	61.5
Other accrued liabilities	$	19.4	$	19.4
Operating lease liabilities	44.9		44.7
Total operating lease liabilities	$	64.3	$	64.1

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Other Income (Expense) - Net - (Tables)

3 Months Ended

Apr. 01, 2023

Other Income and Expenses [Abstract]

Schedule of Other Income (Expense) - Net

“Other income (expense) – net” on the accompanying Condensed Consolidated Statements of Earnings consists of the following:

	Three Months Ended
(Amounts in millions)	April 1, 2023		April 2, 2022
Interest income	$	8.0	$	0.5
Net foreign exchange loss	(2.5)		(1.0)
Net periodic pension and postretirement benefits – non-service	9.6		8.8
Other	0.1		—
Total other income (expense) – net	$	15.2	$	8.3

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Accumulated Other Comprehensive Income (Loss) - (Tables)

3 Months Ended

Apr. 01, 2023

Equity [Abstract]

Schedule of Net Changes in Accumulated OCI by Component, Net of Tax

The following is a summary of net changes in Accumulated OCI by component and net of tax for the three months ended April 1, 2023:

(Amounts in millions)	Foreign Currency Translation		Cash Flow Hedges		Defined Benefit Pension and Postretirement Plans		Total
Balance as of December 31, 2022	$	(272.5)	$	7.3	$	(263.1)	$	(528.3)
Other comprehensive income before reclassifications	18.1		—		—		18.1
Amounts reclassified from Accumulated OCI	—		(0.4)		—		(0.4)
Net other comprehensive income (loss)	18.1		(0.4)		—		17.7
Balance as of April 1, 2023	$	(254.4)	$	6.9	$	(263.1)	$	(510.6)

The following is a summary of net changes in Accumulated OCI by component and net of tax for the three months ended April 2, 2022:

(Amounts in millions)	Foreign Currency Translation		Cash Flow Hedges		Defined Benefit Pension and Postretirement Plans		Total
Balance as of January 1, 2022	$	(145.1)	$	8.9	$	(207.7)	$	(343.9)
Other comprehensive loss before reclassifications	(9.7)		—		—		(9.7)
Amounts reclassified from Accumulated OCI	—		(0.4)		3.4		3.0
Net other comprehensive income (loss)	(9.7)		(0.4)		3.4		(6.7)
Balance as of April 2, 2022	$	(154.8)	$	8.5	$	(204.3)	$	(350.6)

Schedule of Reclassifications Out of Accumulated OCI

The reclassifications out of Accumulated OCI for the three month periods ended April 1, 2023, and April 2, 2022, are as follows:

	Amount Reclassified from Accumulated OCI
	Three Months Ended
(Amounts in millions)	April 1, 2023		April 2, 2022		Statement of Earnings Presentation
Gains on cash flow hedges:
Treasury locks	$	0.4	$	0.4	Interest expense
Income tax expense	—		—		Income tax expense
Net of tax	0.4		0.4
Amortization of net unrecognized losses	$	—	$	(4.5)	See footnote below*
Income tax benefit	—		1.1		Income tax expense
Net of tax	—		(3.4)
Total reclassifications for the period, net of tax	$	0.4	$	(3.0)

* These Accumulated OCI components are included in the computation of net periodic pension and postretirement health care costs; see Note 10 and Note 11 for further information.

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Segments - (Tables)

3 Months Ended

Apr. 01, 2023

Segment Reporting [Abstract]

Schedule of Net Sales by Segment

Financial Data by Segment:

	Three Months Ended
(Amounts in millions)	April 1, 2023		April 2, 2022
Net sales:
Commercial & Industrial Group	$	363.8	$	340.1
Snap-on Tools Group	537.0		512.1
Repair Systems & Information Group	446.6		398.2
Segment net sales	1,347.4		1,250.4
Intersegment eliminations	(164.4)		(152.6)
Total net sales	1,183.0		1,097.8
Financial Services revenue	92.6		87.7
Total revenues	$	1,275.6	$	1,185.5
Operating earnings:
Commercial & Industrial Group	$	55.8	$	45.7
Snap-on Tools Group	131.7		116.0
Repair Systems & Information Group	104.6		91.6
Financial Services	66.3		70.4
Segment operating earnings	358.4		323.7
Corporate	(32.3)		(30.2)
Operating earnings	326.1		293.5
Interest expense	(12.4)		(11.6)
Other income (expense) – net	15.2		8.3
Earnings before income taxes	$	328.9	$	290.2

Schedule of Assets by Segment

(Amounts in millions)	April 1, 2023		December 31, 2022
Assets:
Commercial & Industrial Group	$	1,271.1	$	1,245.8
Snap-on Tools Group	934.0		912.9
Repair Systems & Information Group	1,681.7		1,678.1
Financial Services	2,281.2		2,242.7
Total assets from reportable segments	6,168.0		6,079.5
Corporate	1,041.1		972.9
Elimination of intersegment receivables	(83.5)		(79.6)
Total assets	$	7,125.6	$	6,972.8

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Revenue Recognition - Revenue Disaggregation (Details) - USD ($) $ in Millions	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers	$ 1,176.5	$ 1,091.9
Net sales	1,275.6	1,185.5
Intersegment eliminations
Disaggregation of Revenue [Line Items]
Net sales	(164.4)	(152.6)
Commercial & Industrial Group
Disaggregation of Revenue [Line Items]
Net sales	363.8	340.1
Snap-on Tools Group
Disaggregation of Revenue [Line Items]
Net sales	537.0	512.1
Repair Systems & Information Group
Disaggregation of Revenue [Line Items]
Net sales	446.6	398.2
Financial Services
Disaggregation of Revenue [Line Items]
Net sales	92.6	87.7
Other revenues
Disaggregation of Revenue [Line Items]
Net sales	6.5	5.9
Total net sales
Disaggregation of Revenue [Line Items]
Net sales	1,183.0	1,097.8
Total net sales | Vehicle service professionals
Disaggregation of Revenue [Line Items]
Net sales	925.5	860.5
Total net sales | All other professionals
Disaggregation of Revenue [Line Items]
Net sales	257.5	237.3
Total net sales | Intersegment eliminations
Disaggregation of Revenue [Line Items]
Net sales	(164.4)	(152.6)
Total net sales | Total assets from reportable segments
Disaggregation of Revenue [Line Items]
Net sales	1,347.4	1,250.4
Total net sales | Commercial & Industrial Group
Disaggregation of Revenue [Line Items]
Net sales	278.6	261.2
Total net sales | Commercial & Industrial Group | Vehicle service professionals
Disaggregation of Revenue [Line Items]
Net sales	21.1	23.9
Total net sales | Commercial & Industrial Group | All other professionals
Disaggregation of Revenue [Line Items]
Net sales	257.5	237.3
Total net sales | Commercial & Industrial Group | Intersegment eliminations
Disaggregation of Revenue [Line Items]
Net sales	85.2	78.9
Total net sales | Commercial & Industrial Group | Total assets from reportable segments
Disaggregation of Revenue [Line Items]
Net sales	363.8	340.1
Total net sales | Snap-on Tools Group
Disaggregation of Revenue [Line Items]
Net sales	537.0	512.1
Total net sales | Snap-on Tools Group | Vehicle service professionals
Disaggregation of Revenue [Line Items]
Net sales	537.0	512.1
Total net sales | Snap-on Tools Group | All other professionals
Disaggregation of Revenue [Line Items]
Net sales	0.0	0.0
Total net sales | Snap-on Tools Group | Intersegment eliminations
Disaggregation of Revenue [Line Items]
Net sales	0.0	0.0
Total net sales | Snap-on Tools Group | Total assets from reportable segments
Disaggregation of Revenue [Line Items]
Net sales	537.0	512.1
Total net sales | Repair Systems & Information Group
Disaggregation of Revenue [Line Items]
Net sales	367.4	324.5
Total net sales | Repair Systems & Information Group | Vehicle service professionals
Disaggregation of Revenue [Line Items]
Net sales	367.4	324.5
Total net sales | Repair Systems & Information Group | All other professionals
Disaggregation of Revenue [Line Items]
Net sales	0.0	0.0
Total net sales | Repair Systems & Information Group | Intersegment eliminations
Disaggregation of Revenue [Line Items]
Net sales	79.2	73.7
Total net sales | Repair Systems & Information Group | Total assets from reportable segments
Disaggregation of Revenue [Line Items]
Net sales	446.6	398.2
Total net sales | Financial Services
Disaggregation of Revenue [Line Items]
Net sales	0.0	0.0
Total net sales | Financial Services | Vehicle service professionals
Disaggregation of Revenue [Line Items]
Net sales	0.0	0.0
Total net sales | Financial Services | All other professionals
Disaggregation of Revenue [Line Items]
Net sales	0.0	0.0
Total net sales | Financial Services | Intersegment eliminations
Disaggregation of Revenue [Line Items]
Net sales	0.0	0.0
Total net sales | Financial Services | Total assets from reportable segments
Disaggregation of Revenue [Line Items]
Net sales	0.0	0.0
Total net sales | North America
Disaggregation of Revenue [Line Items]
Net sales	893.3	804.3
Total net sales | North America | Commercial & Industrial Group
Disaggregation of Revenue [Line Items]
Net sales	137.6	113.7
Total net sales | North America | Snap-on Tools Group
Disaggregation of Revenue [Line Items]
Net sales	473.9	447.8
Total net sales | North America | Repair Systems & Information Group
Disaggregation of Revenue [Line Items]
Net sales	281.8	242.8
Total net sales | North America | Financial Services
Disaggregation of Revenue [Line Items]
Net sales	0.0	0.0
Total net sales | Europe
Disaggregation of Revenue [Line Items]
Net sales	173.9	183.8
Total net sales | Europe | Commercial & Industrial Group
Disaggregation of Revenue [Line Items]
Net sales	75.0	81.8
Total net sales | Europe | Snap-on Tools Group
Disaggregation of Revenue [Line Items]
Net sales	35.7	40.1
Total net sales | Europe | Repair Systems & Information Group
Disaggregation of Revenue [Line Items]
Net sales	63.2	61.9
Total net sales | Europe | Financial Services
Disaggregation of Revenue [Line Items]
Net sales	0.0	0.0
Total net sales | All other
Disaggregation of Revenue [Line Items]
Net sales	115.8	109.7
Total net sales | All other | Commercial & Industrial Group
Disaggregation of Revenue [Line Items]
Net sales	66.0	65.7
Total net sales | All other | Snap-on Tools Group
Disaggregation of Revenue [Line Items]
Net sales	27.4	24.2
Total net sales | All other | Repair Systems & Information Group
Disaggregation of Revenue [Line Items]
Net sales	22.4	19.8
Total net sales | All other | Financial Services
Disaggregation of Revenue [Line Items]
Net sales	0.0	0.0
Financial services revenue
Disaggregation of Revenue [Line Items]
Net sales	92.6	87.7
Financial services revenue | Intersegment eliminations
Disaggregation of Revenue [Line Items]
Net sales	0.0	0.0
Financial services revenue | Commercial & Industrial Group
Disaggregation of Revenue [Line Items]
Net sales	0.0	0.0
Financial services revenue | Snap-on Tools Group
Disaggregation of Revenue [Line Items]
Net sales	0.0	0.0
Financial services revenue | Repair Systems & Information Group
Disaggregation of Revenue [Line Items]
Net sales	0.0	0.0
Financial services revenue | Financial Services
Disaggregation of Revenue [Line Items]
Net sales	$ 92.6	$ 87.7

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Revenue Recognition - Narrative (Details) - USD ($) $ in Millions	3 Months Ended
	Apr. 01, 2023	Dec. 31, 2022
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Contractual obligation	$ 180.0
Contract with customer, liability	65.7	$ 63.3
Contract with customer, liability, revenue recognized	$ 34.7
Transferred at Point in Time | Sales Revenue, Net | Ship and Bill Performance Obligations
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Concentration risk, percentage	90.00%

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Revenue Recognition - Performance Obligations (Details)	3 Months Ended
	Apr. 01, 2023
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Revenue, performance obligation, description of timing	The remaining duration of these unsatisfied performance obligations range from one month up to 60 months.
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-04-02
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Revenue, remaining performance obligation, percentage of revenue recognized	70.00%
Revenue, remaining performance obligation, expected timing of satisfaction, period	21 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-12-29
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Revenue, remaining performance obligation, percentage of revenue recognized	25.00%
Revenue, remaining performance obligation, expected timing of satisfaction, period	2 years
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2027-01-03
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Revenue, remaining performance obligation, expected timing of satisfaction, period

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Receivables - Narrative (Details)	3 Months Ended
	Apr. 01, 2023 portfolio_segment
Financing Receivable, Past Due [Line Items]
Minimum payment term for trade and other accounts receivable (in days)	30 days
Maximum payment term for trade and other accounts receivable (in days)	120 days
Average payment term for finance receivables (in years)	4 years
Maximum payment term for contract receivables (in years)	10 years
Number of portfolio segments	2
Minimum period past due to consider receivable balances as delinquent (in days)	30 days
Minimum period past due to declare receivable as non-accrual status (in days)	90 days
Finance Receivables
Financing Receivable, Past Due [Line Items]
Financing receivable, threshold period past due, writeoff (in days)	120 days
Financing receivable, threshold period after asset repossession, writeoff (in days)	60 days
Contract Receivables | Non-Franchisee
Financing Receivable, Past Due [Line Items]
Financing receivable, threshold period past due, writeoff (in days)	150 days
Contract Receivables | Franchisee
Financing Receivable, Past Due [Line Items]
Financing receivable, threshold period past due, writeoff (in days)	180 days
Financing Receivables And Contract Receivables, Customer Bankruptcy
Financing Receivable, Past Due [Line Items]
Financing receivable, threshold period past due, writeoff (in days)	180 days

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Receivables - Components of Trade and Other Accounts Receivable (Details) - USD ($) $ in Millions	Apr. 01, 2023	Dec. 31, 2022	Apr. 02, 2022	Jan. 01, 2022
Receivables [Abstract]
Trade and other accounts receivable	$ 813.6	$ 792.8
Allowances for credit losses	(31.2)	(31.1)	$ (28.4)	$ (27.3)
Total trade and other accounts receivable – net	$ 782.4	$ 761.7

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Receivables - Schedule of Allowance For Credit Losses On Receivables (Details) - USD ($) $ in Millions	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Allowances for credit losses:
Beginning of period	$ 31.1	$ 27.3
Provision for credit losses	4.7	3.7
Charge-offs	(4.8)	(3.0)
Recoveries	0.0	0.1
Currency translation	0.2	0.3
End of period	$ 31.2	$ 28.4

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Receivables - Components of Current Finance and Contract Receivables (Details) - USD ($) $ in Millions	Apr. 01, 2023	Dec. 31, 2022
Financing Receivable, Allowance for Credit Loss [Line Items]
Finance and contract receivables, current	$ 699.6	$ 693.4
Allowance for credit losses, current	(21.7)	(21.3)
Total current finance and contract receivables – net	677.9	672.1
Finance Receivables
Financing Receivable, Allowance for Credit Loss [Line Items]
Finance and contract receivables, current	592.1	581.8
Allowance for credit losses, current	(20.0)	(19.6)
Total current finance and contract receivables – net	572.1	562.2
Finance Receivables | Finance installment receivables
Financing Receivable, Allowance for Credit Loss [Line Items]
Finance and contract receivables, current	589.2	578.6
Allowance for credit losses, current	(20.0)	(19.5)
Finance Receivables | Finance lease receivables
Financing Receivable, Allowance for Credit Loss [Line Items]
Unearned finance charges, current	0.5	0.5
Finance and contract receivables, current	2.9	3.2
Allowance for credit losses, current	0.0	(0.1)
Contract Receivables
Financing Receivable, Allowance for Credit Loss [Line Items]
Finance and contract receivables, current	107.5	111.6
Allowance for credit losses, current	(1.7)	(1.7)
Total current finance and contract receivables – net	105.8	109.9
Contract Receivables | Finance installment receivables
Financing Receivable, Allowance for Credit Loss [Line Items]
Finance and contract receivables, current	46.2	51.3
Allowance for credit losses, current	(0.8)	(0.8)
Contract Receivables | Finance lease receivables
Financing Receivable, Allowance for Credit Loss [Line Items]
Unearned finance charges, current	19.3	19.1
Finance and contract receivables, current	61.3	60.3
Allowance for credit losses, current	$ (0.9)	$ (0.9)

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Receivables - Components of Finance and Contract Receivables Beyond One Year (Details) - USD ($) $ in Millions	Apr. 01, 2023	Dec. 31, 2022
Financing Receivable, Allowance for Credit Loss [Line Items]
Long-term finance and contract receivables	$ 1,632.4	$ 1,600.8
Allowance for credit loss, noncurrent	(47.5)	(46.2)
Total long-term finance and contract receivables – net	1,584.9	1,554.6
Finance Receivables
Financing Receivable, Allowance for Credit Loss [Line Items]
Long-term finance and contract receivables	1,239.8	1,212.1
Allowance for credit loss, noncurrent	(42.7)	(41.3)
Total long-term finance and contract receivables – net	1,197.1	1,170.8
Finance Receivables | Finance installment receivables
Financing Receivable, Allowance for Credit Loss [Line Items]
Long-term finance and contract receivables	1,238.2	1,210.4
Allowance for credit loss, noncurrent	(42.7)	(41.3)
Finance Receivables | Finance lease receivables
Financing Receivable, Allowance for Credit Loss [Line Items]
Unearned finance charges, noncurrent	0.2	0.2
Long-term finance and contract receivables	1.6	1.7
Allowance for credit loss, noncurrent	0.0	0.0
Contract Receivables
Financing Receivable, Allowance for Credit Loss [Line Items]
Long-term finance and contract receivables	392.6	388.7
Allowance for credit loss, noncurrent	(4.8)	(4.9)
Total long-term finance and contract receivables – net	387.8	383.8
Contract Receivables | Finance installment receivables
Financing Receivable, Allowance for Credit Loss [Line Items]
Long-term finance and contract receivables	205.6	202.1
Allowance for credit loss, noncurrent	(3.1)	(3.1)
Contract Receivables | Finance lease receivables
Financing Receivable, Allowance for Credit Loss [Line Items]
Unearned finance charges, noncurrent	30.9	30.7
Long-term finance and contract receivables	187.0	186.6
Allowance for credit loss, noncurrent	$ (1.7)	$ (1.8)

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Receivables - Schedule of Performing and Nonperforming Finance and Contract Receivables (Details) - USD ($) $ in Millions	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022	Dec. 31, 2022
Finance Receivables
Financing Receivable, Credit Quality Indicator [Line Items]
2023	$ 505.3
2022	854.7
2021	283.0
2020	131.2
2019	43.7
Prior	14.0
Total	1,831.9		$ 1,793.9
Finance and contract receivables charge-offs year one	0.0
Finance and contract receivables charge-offs year two	5.7
Finance and contract receivables charge-offs year three	4.6
Finance and contract receivables charge-offs year four	2.5
Finance and contract receivables charge-offs year five	1.0
Finance and contract receivables charge-offs more than five years	0.7
Finance and contract receivables charge-offs	14.5	$ 13.4
Contract Receivables
Financing Receivable, Credit Quality Indicator [Line Items]
2023	46.1
2022	161.0
2021	111.3
2020	78.0
2019	51.9
Prior	51.8
Total	500.1		$ 500.3
Finance and contract receivables charge-offs year one	0.0
Finance and contract receivables charge-offs year two	0.1
Finance and contract receivables charge-offs year three	0.1
Finance and contract receivables charge-offs year four	0.3
Finance and contract receivables charge-offs year five	0.0
Finance and contract receivables charge-offs more than five years	0.0
Finance and contract receivables charge-offs	0.5	$ 0.8
Delinquent | Finance Receivables
Financing Receivable, Credit Quality Indicator [Line Items]
2023	0.2
2022	18.0
2021	11.4
2020	6.8
2019	3.3
Prior	2.1
Total	41.8
Delinquent | Contract Receivables
Financing Receivable, Credit Quality Indicator [Line Items]
2023	0.0
2022	0.9
2021	1.4
2020	0.5
2019	0.5
Prior	0.2
Total	3.5
Non-delinquent | Finance Receivables
Financing Receivable, Credit Quality Indicator [Line Items]
2023	505.1
2022	836.7
2021	271.6
2020	124.4
2019	40.4
Prior	11.9
Total	1,790.1
Non-delinquent | Contract Receivables
Financing Receivable, Credit Quality Indicator [Line Items]
2023	46.1
2022	160.1
2021	109.9
2020	77.5
2019	51.4
Prior	51.6
Total	$ 496.6

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Receivables - Finance and Contract Receivables Allowance for Credit Losses Rollforward (Details) - USD ($) $ in Millions	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Allowances for credit losses:
Provision for credit losses	$ 14.2	$ 6.3
Finance Receivables
Allowances for credit losses:
Beginning of period	60.9	67.3
Provision for credit losses	14.2	6.3
Charge-offs	(14.5)	(13.4)
Recoveries	2.1	2.3
Currency translation	0.0	0.0
End of period	62.7	62.5
Contract Receivables
Allowances for credit losses:
Beginning of period	6.6	8.4
Provision for credit losses	0.3	0.1
Charge-offs	(0.5)	(0.8)
Recoveries	0.1	0.0
Currency translation	0.0	0.0
End of period	$ 6.5	$ 7.7

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Receivables - Aging of Finance and Contract Receivables (Details) - USD ($) $ in Millions	Apr. 01, 2023	Dec. 31, 2022
Finance Receivables
Financing Receivable, Past Due [Line Items]
Total	$ 1,831.9	$ 1,793.9
Greater Than 90 Days Past Due and Accruing	16.8	16.5
Finance Receivables | Total Past Due
Financing Receivable, Past Due [Line Items]
Total	41.8	47.9
Finance Receivables | 30-59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	12.3	17.2
Finance Receivables | 60-90 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	9.6	11.2
Finance Receivables | Greater Than 90 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	19.9	19.5
Finance Receivables | Total Not Past Due
Financing Receivable, Past Due [Line Items]
Total	1,790.1	1,746.0
Contract Receivables
Financing Receivable, Past Due [Line Items]
Total	500.1	500.3
Greater Than 90 Days Past Due and Accruing	0.3	0.3
Contract Receivables | Total Past Due
Financing Receivable, Past Due [Line Items]
Total	3.5	3.7
Contract Receivables | 30-59 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	1.4	1.2
Contract Receivables | 60-90 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	0.4	0.3
Contract Receivables | Greater Than 90 Days Past Due
Financing Receivable, Past Due [Line Items]
Total	1.7	2.2
Contract Receivables | Total Not Past Due
Financing Receivable, Past Due [Line Items]
Total	$ 496.6	$ 496.6

XML

Receivables - Schedule of Finance and Contract Receivables on Nonaccrual Status (Details) - USD ($) $ in Millions	Apr. 01, 2023	Dec. 31, 2022
Finance Receivables
Financing Receivable, Past Due [Line Items]
Nonaccrual	$ 9.3	$ 8.7
Contract Receivables
Financing Receivable, Past Due [Line Items]
Nonaccrual	$ 2.8	$ 3.3

XML

Inventories - Schedule of Inventories by Major Classification (Details) - USD ($) $ in Millions	Apr. 01, 2023	Dec. 31, 2022
Inventory Disclosure [Abstract]
Finished goods	$ 895.1	$ 882.2
Work in progress	76.2	77.2
Raw materials	186.7	182.3
Total FIFO value	1,158.0	1,141.7
Excess of current cost over LIFO cost	(108.9)	(108.6)
Total inventories – net	$ 1,049.1	$ 1,033.1

XML

Inventories - Narrative (Details) - USD ($)	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022	Dec. 31, 2022
Geographic Valuation Methodologies Of Inventory [Line Items]
Percentage of FIFO inventory	61.00%		61.00%
Effect of LIFO inventory liquidation on income	$ 0	$ 0
United States
Geographic Valuation Methodologies Of Inventory [Line Items]
Percentage of FIFO inventory	38.00%
Percentage of LIFO inventory	62.00%

XML

Goodwill and Other Intangible Assets - Changes in Carrying Amount of Goodwill by Segment (Details) $ in Millions	3 Months Ended
	Apr. 01, 2023 USD ($)
Goodwill [Roll Forward]
Balance as of January 1, 2022	$ 1,045.3
Currency translation	5.3
Balance as of July 2, 2022	1,050.6
Commercial & Industrial Group
Goodwill [Roll Forward]
Balance as of January 1, 2022	302.9
Currency translation	3.7
Balance as of July 2, 2022	306.6
Snap-on Tools Group
Goodwill [Roll Forward]
Balance as of January 1, 2022	12.4
Currency translation	0.0
Balance as of July 2, 2022	12.4
Repair Systems & Information Group
Goodwill [Roll Forward]
Balance as of January 1, 2022	730.0
Currency translation	1.6
Balance as of July 2, 2022	$ 731.6

XML

Goodwill and Other Intangible Assets - Other Intangible Assets by Major Class (Details) - USD ($) $ in Millions	Apr. 01, 2023	Dec. 31, 2022
Finite-Lived Intangible Assets [Line Items]
Gross  Carrying Value	$ 492.2	$ 487.5
Non-amortized trademarks	134.7	134.1
Total other intangible assets	626.9	621.6
Accumulated Amortization	(353.6)	(346.0)
Net Carrying Value	138.6	141.5
Non-amortized trademarks	134.7	134.1
Total other intangible assets	273.3	275.6
Customer relationships
Finite-Lived Intangible Assets [Line Items]
Gross  Carrying Value	212.7	212.1
Accumulated Amortization	(154.1)	(150.8)
Net Carrying Value	58.6	61.3
Developed technology
Finite-Lived Intangible Assets [Line Items]
Gross  Carrying Value	36.0	35.8
Accumulated Amortization	(27.1)	(26.0)
Net Carrying Value	8.9	9.8
Internally developed software
Finite-Lived Intangible Assets [Line Items]
Gross  Carrying Value	182.4	179.6
Accumulated Amortization	(140.1)	(137.2)
Net Carrying Value	42.3	42.4
Patents
Finite-Lived Intangible Assets [Line Items]
Gross  Carrying Value	49.4	48.4
Accumulated Amortization	(25.8)	(25.6)
Net Carrying Value	23.6	22.8
Trademarks
Finite-Lived Intangible Assets [Line Items]
Gross  Carrying Value	3.9	3.9
Accumulated Amortization	(2.4)	(2.4)
Net Carrying Value	1.5	1.5
Other
Finite-Lived Intangible Assets [Line Items]
Gross  Carrying Value	7.8	7.7
Accumulated Amortization	(4.1)	(4.0)
Net Carrying Value	$ 3.7	$ 3.7

XML

Goodwill and Other Intangible Assets - Narrative (Details) - USD ($)	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill And Intangible Assets, Accumulated Impairment Loss	$ 0
Weighted-average amortization period (in years)	12 years
Aggregate amortization expense	$ 6,900,000	$ 7,200,000
Estimated annual amortization expense for fiscal period 2023	26,900,000
Estimated annual amortization expense for fiscal period 2024	21,100,000
Estimated annual amortization expense for fiscal period 2025	15,100,000
Estimated annual amortization expense for fiscal period 2026	11,400,000
Estimated annual amortization expense for fiscal period 2027	10,300,000
Estimated annual amortization expense for fiscal period 2028	$ 8,900,000

XML

Goodwill and Other Intangible Assets - Weighted-Average Amortization Period by Major Class (Details)	3 Months Ended
	Apr. 01, 2023
Finite-Lived Intangible Assets [Line Items]
Weighted-average amortization period (in years)	12 years
Customer relationships
Finite-Lived Intangible Assets [Line Items]
Weighted-average amortization period (in years)	14 years
Developed technology
Finite-Lived Intangible Assets [Line Items]
Weighted-average amortization period (in years)	5 years
Internally developed software
Finite-Lived Intangible Assets [Line Items]
Weighted-average amortization period (in years)	6 years
Patents
Finite-Lived Intangible Assets [Line Items]
Weighted-average amortization period (in years)	14 years
Trademarks
Finite-Lived Intangible Assets [Line Items]
Weighted-average amortization period (in years)	9 years
Other
Finite-Lived Intangible Assets [Line Items]
Weighted-average amortization period (in years)	39 years

XML

Exit and Disposal Activities - Narrative (Details) - USD ($)	3 Months Ended		12 Months Ended
	Apr. 01, 2023	Apr. 02, 2022	Dec. 31, 2023	Dec. 31, 2022
Restructuring Cost and Reserve [Line Items]
Exit and disposal costs	$ 0	$ 0
Restructuring reserve	$ 2,500,000			$ 2,800,000
Forecast
Restructuring Cost and Reserve [Line Items]
Exit and disposal costs			$ 1,400,000

XML

Exit and Disposal Activities - Accrual Activity (Details) $ in Millions	3 Months Ended
	Apr. 01, 2023 USD ($)
Restructuring Reserve [Roll Forward]
Restructuring reserve, beginning balance	$ 2.8
Provision	0.0
Usage	(0.3)
Restructuring reserve, ending balance	2.5
Commercial & Industrial Group
Restructuring Reserve [Roll Forward]
Restructuring reserve, beginning balance	1.6
Provision	0.0
Usage	(0.1)
Restructuring reserve, ending balance	1.5
Snap-on Tools Group
Restructuring Reserve [Roll Forward]
Restructuring reserve, beginning balance	0.1
Provision	0.0
Usage	0.0
Restructuring reserve, ending balance	0.1
Repair Systems & Information Group
Restructuring Reserve [Roll Forward]
Restructuring reserve, beginning balance	1.1
Provision	0.0
Usage	(0.2)
Restructuring reserve, ending balance	$ 0.9

XML

Income Taxes - Narrative (Details) - USD ($)	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Income Tax [Line Items]
Effective income tax rate	23.10%	23.70%
Minimum
Income Tax [Line Items]
Decrease in unrecognized tax benefits	$ 0
Increase in unrecognized tax benefits	0
Maximum
Income Tax [Line Items]
Decrease in unrecognized tax benefits	600,000
Increase in unrecognized tax benefits	$ 600,000

XML

Short-term and Long-term Debt - Schedule of Short-term and Long-term Debt (Details) - USD ($)	Apr. 01, 2023	Dec. 31, 2022
Schedule Of Debt Instruments [Line Items]
Long term debt	$ 1,202,200,000	$ 1,201,000,000
Total long-term debt	1,184,000,000	1,183,800,000
Less: notes payable
Schedule Of Debt Instruments [Line Items]
Less: notes payable	(18,200,000)	(17,200,000)
Commercial paper borrowings
Schedule Of Debt Instruments [Line Items]
Less: notes payable	0
Other Debt
Schedule Of Debt Instruments [Line Items]
Long term debt	$ 2,200,000	1,000,000.0
3.25% unsecured notes due 2027 | Unsecured Debt
Schedule Of Debt Instruments [Line Items]
Unsecured notes, interest rate	3.25%
Long term debt	$ 300,000,000.0	300,000,000.0
4.10% unsecured notes due 2048 | Unsecured Debt
Schedule Of Debt Instruments [Line Items]
Unsecured notes, interest rate	4.10%
Long term debt	$ 400,000,000.0	400,000,000.0
3.10% unsecured notes due 2050 | Unsecured Debt
Schedule Of Debt Instruments [Line Items]
Unsecured notes, interest rate	3.10%
Long term debt	$ 500,000,000.0	$ 500,000,000.0

XML

Short-term and Long-term Debt - Narrative (Details)	3 Months Ended
	Apr. 01, 2023 USD ($) revision	Dec. 31, 2022 USD ($)
Schedule Of Debt Instruments [Line Items]
Notes payable	$ 18,200,000	$ 17,200,000
Commercial paper borrowings
Schedule Of Debt Instruments [Line Items]
Short-term debt	0
Five-year Multi-Currency Revolving Credit Facility
Schedule Of Debt Instruments [Line Items]
Revolving credit facility, amount available	800,000,000
Revolving credit facility, outstanding amount	$ 0
Number of allowed revisions to debt ratios | revision	2
Debt maturity, term	5 years
Actual debt-to-capital ratio	0.08
Actual debt-to-income ratio	0.30
Five-year Multi-Currency Revolving Credit Facility | Maximum
Schedule Of Debt Instruments [Line Items]
Maximum limit of required debt-to-capital ratio	0.60
Maximum limit of required debt-to-income ratio	3.50
Five-year Multi-Currency Revolving Credit Facility | Maximum | Material Acquisition
Schedule Of Debt Instruments [Line Items]
Maximum limit of required debt-to-capital ratio	0.65
Maximum limit of required debt-to-income ratio	4.00

XML

Financial Instruments - Narrative (Details) - USD ($)	Apr. 01, 2023	Dec. 31, 2022
Equity Forwards
Investment Holdings [Line Items]
Equity forwards in place of common stock associated with its deferred compensation plans (in shares)	68,200
Treasury locks
Investment Holdings [Line Items]
Treasury locks outstanding	$ 0	$ 0
Fair Value Hedging
Investment Holdings [Line Items]
Notional amount of interest rate swaps outstanding and designated as fair value hedges	$ 0	$ 0

XML

Financial Instruments - Fair Values of Financial Instruments Not Approximating Carrying Values in Financial Statements (Details) - USD ($) $ in Millions	Apr. 01, 2023	Dec. 31, 2022
Carrying Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term debt and notes payable	$ 1,202.2	$ 1,201.0
Carrying Value | Finance Receivables
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Finance receivables – net	1,769.2	1,733.0
Carrying Value | Contract Receivables
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Finance receivables – net	493.6	493.7
Fair Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term debt and notes payable	1,032.0	982.1
Fair Value | Finance Receivables
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Finance receivables – net	2,020.9	1,983.9
Fair Value | Contract Receivables
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Finance receivables – net	$ 524.8	$ 520.4

XML

Pension Plans - Net Periodic Pension (Benefit) Cost (Details) - Pension Plans, Defined Benefit - USD ($) $ in Millions	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Defined Benefit Plan Disclosure [Line Items]
Service cost	$ 4.9	$ 7.1
Interest cost	16.3	11.1
Expected return on plan assets	(26.2)	(24.5)
Amortization of unrecognized loss	0.3	4.5
Net periodic (pension benefit) postretirement healthcare cost	$ (4.7)	$ (1.8)

XML

Pension Plans - Narrative (Details) - Pension Plans, Defined Benefit $ in Millions	Apr. 01, 2023 USD ($)
Foreign Pension Plans
Defined Benefit Plan Disclosure [Line Items]
Expected future employer contributions	$ 6.9
United States Pension Plans
Defined Benefit Plan Disclosure [Line Items]
Expected future employer contributions	$ 2.4

XML

Postretirement Health Care Plans - Net Periodic Postretirement Health Care Cost (Details) - Postretirement Health Coverage - USD ($) $ in Millions	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Postretirement Health Care Plans [Line Items]
Interest cost	$ 0.5	$ 0.3
Expected return on plan assets	(0.2)	(0.2)
Amortization of unrecognized gain	(0.3)	0.0
Net periodic (pension benefit) postretirement healthcare cost	$ 0.0	$ 0.1

XML

Stock-based Compensation and Other Stock Plans - Narrative (Details) - USD ($) $ in Millions	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Net stock-based compensation expense	$ 10.2	$ 9.0
Cash received from stock purchase and option plan exercises	32.8	5.8
Tax benefit realized from exercise and vesting of share-based payment arrangements	$ 5.1	$ 2.1
2011 Incentive Stock and Awards Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares available for grant (in shares)	2,612,539

XML

Stock-based Compensation and Other Stock Plans - Stock Options Narrative (Details) - Stock Option - USD ($) $ / shares in Units, $ in Millions	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted average contractual term (in years)	10 years
Weighted-average grant date fair value granted (in dollars per share)	$ 51.09	$ 34.35
Intrinsic value of stock exercised	$ 22.6	$ 2.8
Fair value of stock vested	9.1	$ 10.5
Unrecognized compensation cost related to non-vested award	$ 19.8
Cost expected to be recognized over weighted-average period (in years)	2 years 1 month 6 days

XML

Stock-based Compensation and Other Stock Plans - Stock Options, Summary of Weighted Average Assumptions of Fair Value Granted Using Black-Scholes Valuation Model (Details) - Stock Option	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term of option (in years)	4 years 10 months 24 days	5 years 1 month 20 days
Expected volatility factor	23.99%	22.61%
Expected dividend yield	2.60%	2.68%
Risk-free interest rate	3.99%	2.00%

XML

Stock-based Compensation and Other Stock Plans - Schedule of Changes in Stock Options (Details) - Stock Option $ / shares in Units, shares in Thousands, $ in Millions	3 Months Ended
	Apr. 01, 2023 USD ($) $ / shares shares
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
Beginning balance (in shares) | shares	2,349
Granted (in shares) | shares	241
Exercised (in shares) | shares	(220)
Forfeited or expired (in shares) | shares	(7)
Ending balance (in shares) | shares	2,363
Exercisable at end of period (in shares) | shares	1,839
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price
Beginning balance (in dollars per share) | $ / shares	$ 163.07
Granted (in dollars per share) | $ / shares	249.26
Exercised (in dollars per share) | $ / shares	148.72
Forfeited or expired (in dollars per share) | $ / shares	203.98
Ending balance (in dollars per share) | $ / shares	173.08
Exercisable at end of period (in dollars per share) | $ / shares	$ 158.34
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures
Outstanding, remaining contractual term (in years)	5 years 9 months 18 days
Exercisable, remaining contractual term (in years)	4 years 9 months 18 days
Outstanding, aggregate intrinsic value | $	$ 175.0
Exercisable, aggregate intrinsic value | $	$ 162.8

XML

Stock-based Compensation and Other Stock Plans - Performance Share Unit and Restricted Stock Unit Narrative (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Performance Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted average contractual term (in years)	3 years
Maximum stock percentage to be awarded	100.00%
Performance period	3 years
Weighted-average grant date fair value granted (in dollars per share)	$ 249.26	$ 206.20
Performance awards shares paid out (in shares)	60,402	46,217
Unrecognized compensation cost related to non-vested award	$ 28.6
Cost expected to be recognized over weighted-average period (in years)	1 year 6 months
Restricted Stock Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted average contractual term (in years)	3 years
Cliff vesting schedule	3 years
Weighted-average grant date fair value granted (in dollars per share)	$ 249.26	$ 211.67
Unrecognized compensation cost related to non-vested award	$ 11.3
Cost expected to be recognized over weighted-average period (in years)	1 year 8 months 12 days

XML

Stock-based Compensation and Other Stock Plans - Schedule of Performance Share Unit and Restricted Stock Unit (Details) - $ / shares shares in Thousands	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Performance Awards
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Beginning balance (in shares)	199
Granted (in shares)	58
Performance assumption change (in shares)	12
Vested (in shares)	0
Cancellations and other (in shares)	(2)
Ending balance (in shares)	267
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value
Beginning balance (in dollars per share)	$ 196.51
Granted (in dollars per share)	249.26	$ 206.20
Performance assumption change (in dollars per share)	211.67
Vested (in dollars per share)	0
Cancellations and other (in dollars per share)	204.00
Ending balance (in dollars per share)	$ 208.62
Restricted Stock Units
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Beginning balance (in shares)	58
Granted (in shares)	26
Vested (in shares)	0
Cancellations and other (in shares)	(1)
Ending balance (in shares)	83
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value
Beginning balance (in dollars per share)	$ 200.16
Granted (in dollars per share)	249.26	$ 211.67
Vested (in dollars per share)	0
Cancellations and other (in dollars per share)	203.64
Ending balance (in dollars per share)	$ 215.54

XML

Stock-based Compensation and Other Stock Plans - Stock Appreciation Rights Narrative (Details) - USD ($)	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Stock Appreciation Rights (SARs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted average contractual term (in years)	10 years
Weighted-average grant date fair value granted (in dollars per share)	$ 48.85
Intrinsic value of stock exercised	$ 400,000	$ 400,000
Fair value of stock vested	100,000	$ 100,000
Unrecognized compensation cost related to non-vested award	$ 100,000
Cost expected to be recognized over weighted-average period (in years)	2 years 2 months 12 days
Stock-Settled SARs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted-average grant date fair value granted (in dollars per share)	$ 48.85	$ 32.63
Intrinsic value of stock exercised	$ 2,200,000	$ 200,000
Fair value of stock vested	1,900,000	$ 2,000,000
Unrecognized compensation cost related to non-vested award	$ 4,800,000
Cost expected to be recognized over weighted-average period (in years)	2 years 1 month 6 days

XML

Stock-based Compensation and Other Stock Plans - Stock-Settled SARs, Summary of Weighted-Average Assumptions of Fair Value Granted Using Black-Scholes Valuation Model (Details) - Stock-Settled SARs	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term of stock-settled SARs (in years)	4 years 29 days	4 years 7 days
Expected volatility factor	24.68%	23.09%
Expected dividend yield	2.60%	2.68%
Risk-free interest rate	3.87%	1.96%

XML

Stock-based Compensation and Other Stock Plans - Schedule of Changes in Stock-Settled SARs (Details) - Stock-Settled SARs $ / shares in Units, shares in Thousands, $ in Millions	3 Months Ended
	Apr. 01, 2023 USD ($) $ / shares shares
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Beginning balance (in shares) | shares	385
Granted (in shares) | shares	62
Exercised (in shares) | shares	(23)
Forfeited or expired (in shares) | shares	(37)
Ending balance (in shares) | shares	387
Exercisable at end of period (in shares) | shares	255
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value
Beginning balance (in dollars per share) | $ / shares	$ 170.11
Granted (in dollars per share) | $ / shares	249.26
Exercised (in dollars per share) | $ / shares	153.93
Forfeited or expired (in dollars per share) | $ / shares	159.87
Ending balance (in dollars per share) | $ / shares	184.66
Exercisable at end of period (in dollars per share) | $ / shares	$ 163.58
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Additional Disclosures
Outstanding, remaining contractual term	6 years 9 months 18 days
Exercisable, remaining contractual term	5 years 7 months 6 days
Outstanding, aggregate intrinsic value | $	$ 24.3
Exercisable, aggregate intrinsic value | $	$ 21.2

XML

Stock-based Compensation and Other Stock Plans - Cash-Settled SARs, Summary of Weighted-Average Assumptions of Fair Value Granted Using Black-Scholes Valuation Model (Details) - Stock Appreciation Rights (SARs)	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (in years)	3 years 11 months 15 days	3 years 10 months 17 days
Expected volatility factor	24.42%	23.09%
Expected dividend yield	2.62%	2.79%
Risk-free interest rate	3.60%	2.58%

XML

Stock-based Compensation and Other Stock Plans - Schedule of Changes in Non-Vested Cash-Settled SARs (Details) - Stock Appreciation Rights (SARs) shares in Thousands	3 Months Ended
	Apr. 01, 2023 $ / shares shares
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Beginning balance (in shares) | shares	2
Granted (in shares) | shares	1
Vested (in shares) | shares	(1)
Ending balance (in shares) | shares	2
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value
Beginning balance (in dollars per share) | $ / shares	$ 53.24
Granted (in dollars per share) | $ / shares	48.85
Vested (in dollars per share) | $ / shares	72.11
Ending balance (in dollars per share) | $ / shares	$ 54.52

XML

Stock-based Compensation and Other Stock Plans - Restricted Stock Awards, Non-employee Directors Narrative (Details) - USD ($)	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Restricted Stock | Non Employee Directors
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (in shares)	5,760	6,525
Vesting period	1 year
Stock Appreciation Rights (SARs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Intrinsic value of stock exercised	$ 400,000	$ 400,000
Fair value of stock vested	$ 100,000	$ 100,000
Granted (in shares)	1,000
Unrecognized compensation cost related to non-vested award	$ 100,000
Cost expected to be recognized over weighted-average period (in years)	2 years 2 months 12 days

XML

Stock-based Compensation and Other Stock Plans - Employee Stock Purchase Plan Narrative (Details) - Employee Stock - USD ($)	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares issued in period (in shares)	0	0
Shares reserved for future issuance (in shares)	578,823
Participant contributions held	$ 4,700,000
Compensation expense	$ 500,000	$ 0

XML

Stock-based Compensation and Other Stock Plans - Franchise Stock Purchase Plan Narrative (Details) - Franchise Stock - USD ($)	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares issued in period (in shares)	0	0
Shares reserved for future issuance (in shares)	225,225
Participant contributions held	$ 8,900,000
Compensation expense	$ 900,000	$ 0

XML

Earnings Per Share - Computation of Basic and Diluted Earnings Per Common Share (Details) - shares shares in Millions	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Earnings Per Share [Abstract]
Weighted-average common shares outstanding (in shares)	53.0	53.4
Effect of dilutive securities (in shares)	1.1	0.9
Diluted (in shares)	54.1	54.3

XML

Earnings Per Share - Narrative (Details) - shares	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Stock-Settled SARs
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Outstanding options or stock settled SARs (in shares)	302,756	358,774

XML

Commitments and Contingencies - Schedule of Product Warranty Accrual Activity (Details) - USD ($) $ in Millions	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Warranty reserve:
Beginning of period	$ 14.3	$ 17.3
Additions	3.8	2.2
Usage	(3.3)	(3.0)
End of period	$ 14.8	$ 16.5

XML

Leases - Supplemental Balance Sheet Information (Details) - USD ($) $ in Millions	Apr. 01, 2023	Dec. 31, 2022
Finance leases:
Property and equipment - gross	$ 19.7	$ 19.4
Accumulated depreciation and amortization	$ (17.0)	$ (16.4)
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List]	Property, Plant, and Equipment and Finance Lease Right-of-Use Asset, after Accumulated Depreciation and Amortization	Property, Plant, and Equipment and Finance Lease Right-of-Use Asset, after Accumulated Depreciation and Amortization
Property and equipment - net	$ 2.7	$ 3.0
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List]	Other accrued liabilities	Other accrued liabilities
Other accrued liabilities	$ 1.9	$ 2.0
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List]	Other long-term liabilities	Other long-term liabilities
Other long-term liabilities	$ 1.6	$ 1.9
Total finance lease liabilities	3.5	3.9
Operating leases:
Operating lease right-of-use assets	$ 61.5	$ 61.5
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List]	Other accrued liabilities	Other accrued liabilities
Other accrued liabilities	$ 19.4	$ 19.4
Operating lease liabilities	44.9	44.7
Total operating lease liabilities	$ 64.3	$ 64.1

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Other Income (Expense) - Net - Computation of Other Income (Expense) - Net (Details) - USD ($) $ in Millions	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Other Income and Expenses [Abstract]
Interest income	$ 8.0	$ 0.5
Net foreign exchange loss	(2.5)	(1.0)
Net periodic pension and postretirement benefits – non-service	9.6	8.8
Other	0.1	0.0
Total other income (expense) – net	$ 15.2	$ 8.3

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Accumulated Other Comprehensive Income (Loss) - Net Changes in Accumulated OCI by Component, Net of Tax (Details) - USD ($) $ in Millions	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	$ 4,503.5	$ 4,203.8
Other comprehensive income (loss) before reclassifications	18.1	(9.7)
Amounts reclassified from Accumulated OCI	(0.4)	3.0
Net other comprehensive income (loss)	17.7	(6.7)
Ending balance	4,632.4	4,320.6
Accumulated Other Comprehensive Loss
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	(528.3)	(343.9)
Net other comprehensive income (loss)	17.7	(6.7)
Ending balance	(510.6)	(350.6)
Foreign Currency Translation
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	(272.5)	(145.1)
Other comprehensive income (loss) before reclassifications	18.1	(9.7)
Amounts reclassified from Accumulated OCI	0.0	0.0
Net other comprehensive income (loss)	18.1	(9.7)
Ending balance	(254.4)	(154.8)
Cash Flow Hedges
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	7.3	8.9
Other comprehensive income (loss) before reclassifications	0.0	0.0
Amounts reclassified from Accumulated OCI	(0.4)	(0.4)
Net other comprehensive income (loss)	(0.4)	(0.4)
Ending balance	6.9	8.5
Defined Benefit Pension and Postretirement Plans
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	(263.1)	(207.7)
Other comprehensive income (loss) before reclassifications	0.0	0.0
Amounts reclassified from Accumulated OCI	0.0	3.4
Net other comprehensive income (loss)	0.0	3.4
Ending balance	$ (263.1)	$ (204.3)

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Accumulated Other Comprehensive Income (Loss) - Reclassifications Out of Accumulated OCI (Details) - USD ($) $ in Millions	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Gains on cash flow hedges:
Interest expense	$ (12.4)	$ (11.6)
Other income (expense) - net	15.2	8.3
Income tax expense	(74.6)	(67.5)
Net earnings	254.3	222.7
Reclassification out of AOCI
Gains on cash flow hedges:
Net earnings	0.4	(3.0)
Cash Flow Hedges | Reclassification out of AOCI
Gains on cash flow hedges:
Interest expense	0.4	0.4
Income tax expense	0.0	0.0
Net earnings	0.4	0.4
Defined Benefit Pension and Postretirement Plans | Reclassification out of AOCI
Gains on cash flow hedges:
Other income (expense) - net	0.0	(4.5)
Income tax expense	0.0	1.1
Net earnings	$ 0.0	$ (3.4)

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Segments - Schedule of Net Sales by Segment (Details) - USD ($) $ in Millions	3 Months Ended
	Apr. 01, 2023	Apr. 02, 2022
Segment Reporting Information [Line Items]
Total revenues	$ 1,275.6	$ 1,185.5
Operating earnings	326.1	293.5
Interest expense	(12.4)	(11.6)
Other income (expense) – net	15.2	8.3
Earnings before income taxes	328.9	290.2
Commercial & Industrial Group
Segment Reporting Information [Line Items]
Total revenues	363.8	340.1
Snap-on Tools Group
Segment Reporting Information [Line Items]
Total revenues	537.0	512.1
Repair Systems & Information Group
Segment Reporting Information [Line Items]
Total revenues	446.6	398.2
Financial Services
Segment Reporting Information [Line Items]
Total revenues	92.6	87.7
Total assets from reportable segments
Segment Reporting Information [Line Items]
Operating earnings	358.4	323.7
Intersegment eliminations
Segment Reporting Information [Line Items]
Total revenues	(164.4)	(152.6)
Corporate
Segment Reporting Information [Line Items]
Operating earnings	32.3	30.2
Total net sales
Segment Reporting Information [Line Items]
Total revenues	1,183.0	1,097.8
Operating earnings	259.8	223.1
Total net sales | Commercial & Industrial Group
Segment Reporting Information [Line Items]
Total revenues	278.6	261.2
Total net sales | Snap-on Tools Group
Segment Reporting Information [Line Items]
Total revenues	537.0	512.1
Total net sales | Repair Systems & Information Group
Segment Reporting Information [Line Items]
Total revenues	367.4	324.5
Total net sales | Financial Services
Segment Reporting Information [Line Items]
Total revenues	0.0	0.0
Total net sales | Total assets from reportable segments
Segment Reporting Information [Line Items]
Total revenues	1,347.4	1,250.4
Total net sales | Total assets from reportable segments | Commercial & Industrial Group
Segment Reporting Information [Line Items]
Total revenues	363.8	340.1
Operating earnings	55.8	45.7
Total net sales | Total assets from reportable segments | Snap-on Tools Group
Segment Reporting Information [Line Items]
Total revenues	537.0	512.1
Operating earnings	131.7	116.0
Total net sales | Total assets from reportable segments | Repair Systems & Information Group
Segment Reporting Information [Line Items]
Total revenues	446.6	398.2
Operating earnings	104.6	91.6
Total net sales | Total assets from reportable segments | Financial Services
Segment Reporting Information [Line Items]
Total revenues	0.0	0.0
Total net sales | Intersegment eliminations
Segment Reporting Information [Line Items]
Total revenues	(164.4)	(152.6)
Total net sales | Intersegment eliminations | Commercial & Industrial Group
Segment Reporting Information [Line Items]
Total revenues	85.2	78.9
Total net sales | Intersegment eliminations | Snap-on Tools Group
Segment Reporting Information [Line Items]
Total revenues	0.0	0.0
Total net sales | Intersegment eliminations | Repair Systems & Information Group
Segment Reporting Information [Line Items]
Total revenues	79.2	73.7
Total net sales | Intersegment eliminations | Financial Services
Segment Reporting Information [Line Items]
Total revenues	0.0	0.0
Financial services revenue
Segment Reporting Information [Line Items]
Total revenues	92.6	87.7
Operating earnings	66.3	70.4
Financial services revenue | Commercial & Industrial Group
Segment Reporting Information [Line Items]
Total revenues	0.0	0.0
Financial services revenue | Snap-on Tools Group
Segment Reporting Information [Line Items]
Total revenues	0.0	0.0
Financial services revenue | Repair Systems & Information Group
Segment Reporting Information [Line Items]
Total revenues	0.0	0.0
Financial services revenue | Financial Services
Segment Reporting Information [Line Items]
Total revenues	92.6	87.7
Financial services revenue | Total assets from reportable segments | Financial Services
Segment Reporting Information [Line Items]
Operating earnings	66.3	70.4
Financial services revenue | Intersegment eliminations
Segment Reporting Information [Line Items]
Total revenues	$ 0.0	$ 0.0

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Segments - Schedule of Assets by Segment (Details) - USD ($) $ in Millions	Apr. 01, 2023	Dec. 31, 2022
Segment Reporting Information [Line Items]
Assets	$ 7,125.6	$ 6,972.8
Total assets from reportable segments
Segment Reporting Information [Line Items]
Assets	6,168.0	6,079.5
Total assets from reportable segments | Commercial & Industrial Group
Segment Reporting Information [Line Items]
Assets	1,271.1	1,245.8
Total assets from reportable segments | Snap-on Tools Group
Segment Reporting Information [Line Items]
Assets	934.0	912.9
Total assets from reportable segments | Repair Systems & Information Group
Segment Reporting Information [Line Items]
Assets	1,681.7	1,678.1
Total assets from reportable segments | Financial Services
Segment Reporting Information [Line Items]
Assets	2,281.2	2,242.7
Corporate
Segment Reporting Information [Line Items]
Assets	1,041.1	972.9
Elimination of intersegment receivables
Segment Reporting Information [Line Items]
Assets	$ (83.5)	$ (79.6)