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John Bean (JBT) Q3 Earnings and Revenues Beat Estimates
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John Bean Technologies Corporation (JBT - Free Report) reported adjusted earnings of 83 cents per share in third-quarter 2020, surpassing the Zacks Consensus Estimate of 71 cents by a margin of 17%. However, the bottom line slumped 35% from the prior-year quarter reflecting the impact of the COVID-19 pandemic as reductions in global passenger air travel and global foodservice production impacted demand for the company’s products and services. Consequently, there has not been any major price change since the quarterly release as the earnings beat failed to impress the market.
On a reported basis, the company’s earnings per share was 54 cents compared with the prior-year quarter’s $1.04.
Revenues of $419 million in the reported quarter beat the Zacks Consensus Estimate of $392 million. Further, the top line declined 14% from the prior-year quarter figure of $489 million due to low demand amid the pandemic.
In the reported quarter, the company’s total orders went down 9% to $421 million from the prior-year quarter. Orders in the JBT FoodTech segment improved 10% year over year to $310.4 million. In the JBT AeroTech segment, orders slumped 39% to $110.8 million from the prior-year quarter. However, on a sequential basis, orders at FoodTech and AeroTech increased 18% and 35%, respectively.
John Bean Technologies Corporation Price, Consensus and EPS Surprise
Backlog in the FoodTech segment remained flat compared with the year-ago quarter at $377 million. The AeroTech segment’s backlog was $276 million in the reported quarter, down 27% from the prior-year quarter. Total backlog of $653 million as of the end of the third quarter was down 13% year over year.
Cost and Margins
Cost of sales decreased 15% year over year to $292 million in the third quarter. Gross profit declined 14% year over year to $127 million. Gross margin came in at 30.3% compared with the year-earlier quarter’s 30.2%.
Selling, general and administrative expenses were down 6% year over year to $92 million. Adjusted operating profit declined 14% year over year to $41.7 million. Adjusted operating margin was 9.9%, flat compared with prior-year quarter. In the reported quarter, adjusted EBITDA was around $60 million, down 21% year over year.
Segment Performance
JBT FoodTech: Net sales fell 10% year over year to $301 million. Adjusted operating profit amounted to $39 million, reflecting a decline of 23% from the prior-year quarter.
JBT AeroTech: Net sales were $118 million, reflecting a decline of 24% from the prior-year quarter. The segment’s adjusted operating profit slumped 40% year over year to $13.3 million.
Financial Performance
John Bean reported cash and cash equivalents of around $51 million at the end of third-quarter 2020, up from $39.5 million at the end of fiscal 2019. The company generated around $161 million of cash from operating activities during the first nine-month period of 2020 compared with the $35 million reported in the prior-year comparable period. At the end of third-quarter 2020, long-term debt was $598 million, down from $698 million as of Dec 31, 2019.
Restructuring Activities
John Bean incurred exit costs of $9 million in third-quarter 2020 associated with its previously announced manufacturing capacity rationalizations. Manufacturing operations at the AeroTech facility in Spain were substantially downsized. The company has initiated the rationalizing of two FoodTech manufacturing operations. John Bean anticipates additional $1 million to $2 million in exit costs in fourth-quarter 2020.
These restructuring actions are expected to generate $0.5 million in cost savings in fourth-quarter 2020 and incremental cost savings of about $5 million during 2021.
Guidance
Despite the ongoing uncertainty related to the coronavirus pandemic, increasing levels of customer engagement and sequential pickup in order levels bodes well for the fourth-quarter performance.
For fourth-quarter 2020, John Bean anticipates a sequential increase of 3-5% in revenues for the FoodTech segment. Operating margins are expected to be 13-14% and adjusted EBITDA margins in the band of 18% to 19%.
The AeroTech segment’s revenue is expected to decline 7-8% sequentially in the fourth quarter owing to typical seasonality. Operating margins are anticipated to come in at around 10 percent and adjusted EBITDA margins in the range of 11% to 12%.
The company projects adjusted earnings per share between 80 cents and 90 cents in fourth-quarter 2020. The mid-point of the guidance range projects a slump of 43% from earnings of $1.50 per share in fourth-quarter 2019.
Price Performance
John Bean's shares have declined 24.8% year to date against the industry’s growth of 6.2%.
Crown Holdings has a projected earnings growth rate of 11.7% for fiscal 2020. Year to date, the company’s shares have appreciated 18%.
iRobot has an estimated earnings growth rate of 18.8% for the ongoing year. The company’s shares have rallied 61% so far this year.
Worthington has an expected earnings growth rate of 19.2% for 2020. The stock has climbed 12% year to date.
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John Bean (JBT) Q3 Earnings and Revenues Beat Estimates
John Bean Technologies Corporation (JBT - Free Report) reported adjusted earnings of 83 cents per share in third-quarter 2020, surpassing the Zacks Consensus Estimate of 71 cents by a margin of 17%. However, the bottom line slumped 35% from the prior-year quarter reflecting the impact of the COVID-19 pandemic as reductions in global passenger air travel and global foodservice production impacted demand for the company’s products and services. Consequently, there has not been any major price change since the quarterly release as the earnings beat failed to impress the market.
On a reported basis, the company’s earnings per share was 54 cents compared with the prior-year quarter’s $1.04.
Revenues of $419 million in the reported quarter beat the Zacks Consensus Estimate of $392 million. Further, the top line declined 14% from the prior-year quarter figure of $489 million due to low demand amid the pandemic.
In the reported quarter, the company’s total orders went down 9% to $421 million from the prior-year quarter. Orders in the JBT FoodTech segment improved 10% year over year to $310.4 million. In the JBT AeroTech segment, orders slumped 39% to $110.8 million from the prior-year quarter. However, on a sequential basis, orders at FoodTech and AeroTech increased 18% and 35%, respectively.
John Bean Technologies Corporation Price, Consensus and EPS Surprise
John Bean Technologies Corporation price-consensus-eps-surprise-chart | John Bean Technologies Corporation Quote
Backlog in the FoodTech segment remained flat compared with the year-ago quarter at $377 million. The AeroTech segment’s backlog was $276 million in the reported quarter, down 27% from the prior-year quarter. Total backlog of $653 million as of the end of the third quarter was down 13% year over year.
Cost and Margins
Cost of sales decreased 15% year over year to $292 million in the third quarter. Gross profit declined 14% year over year to $127 million. Gross margin came in at 30.3% compared with the year-earlier quarter’s 30.2%.
Selling, general and administrative expenses were down 6% year over year to $92 million. Adjusted operating profit declined 14% year over year to $41.7 million. Adjusted operating margin was 9.9%, flat compared with prior-year quarter. In the reported quarter, adjusted EBITDA was around $60 million, down 21% year over year.
Segment Performance
JBT FoodTech: Net sales fell 10% year over year to $301 million. Adjusted operating profit amounted to $39 million, reflecting a decline of 23% from the prior-year quarter.
JBT AeroTech: Net sales were $118 million, reflecting a decline of 24% from the prior-year quarter. The segment’s adjusted operating profit slumped 40% year over year to $13.3 million.
Financial Performance
John Bean reported cash and cash equivalents of around $51 million at the end of third-quarter 2020, up from $39.5 million at the end of fiscal 2019. The company generated around $161 million of cash from operating activities during the first nine-month period of 2020 compared with the $35 million reported in the prior-year comparable period. At the end of third-quarter 2020, long-term debt was $598 million, down from $698 million as of Dec 31, 2019.
Restructuring Activities
John Bean incurred exit costs of $9 million in third-quarter 2020 associated with its previously announced manufacturing capacity rationalizations. Manufacturing operations at the AeroTech facility in Spain were substantially downsized. The company has initiated the rationalizing of two FoodTech manufacturing operations. John Bean anticipates additional $1 million to $2 million in exit costs in fourth-quarter 2020.
These restructuring actions are expected to generate $0.5 million in cost savings in fourth-quarter 2020 and incremental cost savings of about $5 million during 2021.
Guidance
Despite the ongoing uncertainty related to the coronavirus pandemic, increasing levels of customer engagement and sequential pickup in order levels bodes well for the fourth-quarter performance.
For fourth-quarter 2020, John Bean anticipates a sequential increase of 3-5% in revenues for the FoodTech segment. Operating margins are expected to be 13-14% and adjusted EBITDA margins in the band of 18% to 19%.
The AeroTech segment’s revenue is expected to decline 7-8% sequentially in the fourth quarter owing to typical seasonality. Operating margins are anticipated to come in at around 10 percent and adjusted EBITDA margins in the range of 11% to 12%.
The company projects adjusted earnings per share between 80 cents and 90 cents in fourth-quarter 2020. The mid-point of the guidance range projects a slump of 43% from earnings of $1.50 per share in fourth-quarter 2019.
Price Performance
John Bean's shares have declined 24.8% year to date against the industry’s growth of 6.2%.
Zacks Rank & Stocks to Consider
John Bean carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the Industrial Products sector are Crown Holdings, Inc. (CCK - Free Report) , iRobot Corporation (IRBT - Free Report) and Worthington Industries, Inc. (WOR - Free Report) . All of these stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Crown Holdings has a projected earnings growth rate of 11.7% for fiscal 2020. Year to date, the company’s shares have appreciated 18%.
iRobot has an estimated earnings growth rate of 18.8% for the ongoing year. The company’s shares have rallied 61% so far this year.
Worthington has an expected earnings growth rate of 19.2% for 2020. The stock has climbed 12% year to date.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by referendums and legislation, this industry is expected to blast from an already robust $17.7 billion in 2019 to a staggering $73.6 billion by 2027. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot stocks we're targeting >>