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Barnes Group (B) Q4 Earnings & Revenues Surpass Estimates
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Barnes Group Inc. (B - Free Report) reported better-than-expected fourth-quarter 2020 results, with earnings and revenues surpassing estimates.
The company’s adjusted earnings in the reported quarter were 36 cents per share. The figure surpassed the Zacks Consensus Estimate of 33 cents by 9.1%. However, the bottom line declined 58.1% on a year-over-year basis.
In 2020, the company’s adjusted earnings came in at $1.64 per share, down 49% year over year.
Top-Line Results
In the reported quarter, Barnes’ revenues declined 22% year over year to $289.1 million. Revenues were adversely impacted by organic sales decline of 21% and adverse impact of 3% from divestitures, partially offset by positive impact of 3% from foreign exchange.
The top line beat the Zacks Consensus Estimate of $287 million by 0.9%.
In 2020, the company’s revenues were $1,124 million, down 25% year over year.
Barnes reports net sales under two heads — Industrial and Aerospace. A brief snapshot of the segmental sales is provided below:
Quarterly net sales generated from Industrial amounted to $209.1 million, declining 9% year over year. The segment suffered from weakness in automotive and industrial end markets due to the coronavirus outbreak-related issues. Organic sales were down 8% year over year, while favorable foreign exchange had a positive impact of 4%. Divestiture of the Seeger business had a negative impact of 5%.
Aerospace’s sales were $80 million in the fourth quarter, down 43% year over year on account of softness in global aerospace end markets. Original equipment manufacturing net sales declined 39%, while aftermarket net sales fell 49%.
Margin Profile
In the reported quarter, Barnes’ cost of sales fell 16.7% year over year to $189 million. Notably, cost of sales contributed 65.4% of net sales compared with 61.3% in the year-ago quarter. Selling and administrative expenses declined 17.9% to $67.4 million and contributed 23.3% to net sales. Total operating income in the quarter declined 46.6% to $32.7 million, while margin contracted 520 basis points to 11.3%. Interest expenses totaled $4 million in the reported quarter, down 15.8% year over year.
Balance Sheet & Cash Flow
Exiting the fourth quarter, Barnes’ cash and cash equivalents were $79.1 million, up 2.1% from $77.5 million recorded in the last reported quarter. Long-term debt was $699.9 million, down 0.2% from $701.4 million in the last reported quarter.
In 2020, it generated net cash of $215.5 million from operating activities, down 13.2% from the previous year. Capital expenditures totaled $40.7 million, down 23.6%. Free cash flow was $174.8 million compared with $195 million reported a year ago.
During the quarter, Barnes paid out dividends amounting to $8.1 million compared with $8.13 million in the year-ago quarter’s disbursement. Notably, the company refrained from repurchasing any shares in the quarter.
Outlook
For 2021, the company anticipates adjusted earnings of $1.65-$1.90 per share, suggesting growth of 8.2% at the mid-point from the year-ago reported figure.
Organic sales for the year are expected to rise 6-8% on a year-over-year basis. Adjusted operating margin is predicted to be 12-14%.
The company anticipates capital expenditures of about $55 million. It expects the effective tax rate for 2021 to be about 30%.
Barnes Group, Inc. Price, Consensus and EPS Surprise
iRobot has a trailing four-quarter earnings surprise of 228.19%, on average.
Franklin Electric has a trailing four-quarter earnings surprise of 19.15%, on average.
Emerson has a trailing four-quarter earnings surprise of 21.53%, on average.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
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Barnes Group (B) Q4 Earnings & Revenues Surpass Estimates
Barnes Group Inc. (B - Free Report) reported better-than-expected fourth-quarter 2020 results, with earnings and revenues surpassing estimates.
The company’s adjusted earnings in the reported quarter were 36 cents per share. The figure surpassed the Zacks Consensus Estimate of 33 cents by 9.1%. However, the bottom line declined 58.1% on a year-over-year basis.
In 2020, the company’s adjusted earnings came in at $1.64 per share, down 49% year over year.
Top-Line Results
In the reported quarter, Barnes’ revenues declined 22% year over year to $289.1 million. Revenues were adversely impacted by organic sales decline of 21% and adverse impact of 3% from divestitures, partially offset by positive impact of 3% from foreign exchange.
The top line beat the Zacks Consensus Estimate of $287 million by 0.9%.
In 2020, the company’s revenues were $1,124 million, down 25% year over year.
Barnes reports net sales under two heads — Industrial and Aerospace. A brief snapshot of the segmental sales is provided below:
Quarterly net sales generated from Industrial amounted to $209.1 million, declining 9% year over year. The segment suffered from weakness in automotive and industrial end markets due to the coronavirus outbreak-related issues. Organic sales were down 8% year over year, while favorable foreign exchange had a positive impact of 4%. Divestiture of the Seeger business had a negative impact of 5%.
Aerospace’s sales were $80 million in the fourth quarter, down 43% year over year on account of softness in global aerospace end markets. Original equipment manufacturing net sales declined 39%, while aftermarket net sales fell 49%.
Margin Profile
In the reported quarter, Barnes’ cost of sales fell 16.7% year over year to $189 million. Notably, cost of sales contributed 65.4% of net sales compared with 61.3% in the year-ago quarter. Selling and administrative expenses declined 17.9% to $67.4 million and contributed 23.3% to net sales. Total operating income in the quarter declined 46.6% to $32.7 million, while margin contracted 520 basis points to 11.3%. Interest expenses totaled $4 million in the reported quarter, down 15.8% year over year.
Balance Sheet & Cash Flow
Exiting the fourth quarter, Barnes’ cash and cash equivalents were $79.1 million, up 2.1% from $77.5 million recorded in the last reported quarter. Long-term debt was $699.9 million, down 0.2% from $701.4 million in the last reported quarter.
In 2020, it generated net cash of $215.5 million from operating activities, down 13.2% from the previous year. Capital expenditures totaled $40.7 million, down 23.6%. Free cash flow was $174.8 million compared with $195 million reported a year ago.
During the quarter, Barnes paid out dividends amounting to $8.1 million compared with $8.13 million in the year-ago quarter’s disbursement. Notably, the company refrained from repurchasing any shares in the quarter.
Outlook
For 2021, the company anticipates adjusted earnings of $1.65-$1.90 per share, suggesting growth of 8.2% at the mid-point from the year-ago reported figure.
Organic sales for the year are expected to rise 6-8% on a year-over-year basis. Adjusted operating margin is predicted to be 12-14%.
The company anticipates capital expenditures of about $55 million. It expects the effective tax rate for 2021 to be about 30%.
Barnes Group, Inc. Price, Consensus and EPS Surprise
Barnes Group, Inc. price-consensus-eps-surprise-chart | Barnes Group, Inc. Quote
Zacks Rank & Stocks to Consider
The company currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks are iRobot Corporation (IRBT - Free Report) , Franklin Electric Co., Inc. (FELE - Free Report) and Emerson Electric Co. (EMR - Free Report) . While iRobot sports a Zacks Rank #1 (Strong Buy), Franklin Electric and Emerson carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
iRobot has a trailing four-quarter earnings surprise of 228.19%, on average.
Franklin Electric has a trailing four-quarter earnings surprise of 19.15%, on average.
Emerson has a trailing four-quarter earnings surprise of 21.53%, on average.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
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