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Adjusted EPS of $1.82 surpassed the Zacks Consensus Estimate by 11% and increased 33.8% year over year. Revenues of $4.1 billion beat the consensus mark by 2.7% and increased 14.1% year over year on a reported basis and 19% organically.
Strong results in the quarter were driven by robust demand. Bookings were down 2% year over year on a reported basis and were flat organically at $4 billion.
Trane’s shares have gained 18.5% over the past six months against the 28.8% decline of the industry it belongs to.
Revenues and Bookings
The Americas segment’s revenues of $3.1 billion increased 14% year over year on a reported and an organic basis. Bookings were flat on a reported basis, as well as organically, at $3.2 billion.
The Europe, Middle East and Africa segment’s revenues were $558.5 million, up 16% year over year on a reported basis and 23% organically. Bookings were down 5% year over year on a reported basis but up 2% organically at 483.7 million.
Revenues from the Asia Pacific segment were up 11% year over year on a reported basis and 19% on an organic basis to $375.5 million. Bookings of $330.2 million decreased 12% on a reported basis and 6% organically.
Margin Performance
Adjusted EBITDA was $638 million, up 22% year over year. The adjusted EBITDA margin improved 100 basis points (bps) to 15.7%. Adjusted operating income of $558 million increased 25% year over year, with the adjusted operating margin improving 120 bps to 13.7%.
Key Balance Sheet and Cash Flow Figures
Trane ended the quarter with a cash balance of $1.2 billion compared with $1.1 billion in the previous quarter. The debt balance was $4.8 billion, flat with the previous quarter. The company generated $766 million of cash from operating activities and a free cash flow of $675 million in the quarter.
Trane Technologies plc Price, Consensus and EPS Surprise
Recent Performance of Some Other Business Services Companies
Robert Half International Inc. (RHI - Free Report) reported mixed fourth-quarter 2022 results, wherein earnings beat the Zacks Consensus Estimate but revenues missed the same.
RHI’s quarterly earnings of $1.37 per share beat the Zacks Consensus Estimate by 1.5% but declined 9.3% year over year. Revenues of $1.73 billion missed the Zacks Consensus Estimate by 0.6% and decreased 2.4% year over year.
Automatic Data Processing, Inc. (ADP - Free Report) reported better-than-expected second-quarter fiscal 2023 results.
ADP’s adjusted earnings per share of $1.96 beat the Zacks Consensus Estimate by 0.5% and grew 19% from the year-ago quarter. Total revenues of $4.4 billion beat the Zacks Consensus Estimate by 0.3% and improved 9.1% from the year-ago quarter.
Booz Allen Hamilton Holding Corp. (BAH - Free Report) reported impressive third-quarter fiscal 2023 results, wherein both earnings and revenues beat the Zacks Consensus Estimate. Quarterly adjusted earnings per share of $1.07 beat the Zacks Consensus Estimate by 4.9% and increased 4.9% on a year-over-year basis.
BAH’s total revenues of $2.3 billion beat the Zacks Consensus Estimate by 4% and increased 12.1% on a year-over-year basis.
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Trane Technologies (TT) Q4 Earnings Beat Estimates, Rise Y/Y
Trane Technologies plc (TT - Free Report) reported better-than-expected fourth-quarter 2022 results.
Adjusted EPS of $1.82 surpassed the Zacks Consensus Estimate by 11% and increased 33.8% year over year. Revenues of $4.1 billion beat the consensus mark by 2.7% and increased 14.1% year over year on a reported basis and 19% organically.
Strong results in the quarter were driven by robust demand. Bookings were down 2% year over year on a reported basis and were flat organically at $4 billion.
Trane’s shares have gained 18.5% over the past six months against the 28.8% decline of the industry it belongs to.
Revenues and Bookings
The Americas segment’s revenues of $3.1 billion increased 14% year over year on a reported and an organic basis. Bookings were flat on a reported basis, as well as organically, at $3.2 billion.
The Europe, Middle East and Africa segment’s revenues were $558.5 million, up 16% year over year on a reported basis and 23% organically. Bookings were down 5% year over year on a reported basis but up 2% organically at 483.7 million.
Revenues from the Asia Pacific segment were up 11% year over year on a reported basis and 19% on an organic basis to $375.5 million. Bookings of $330.2 million decreased 12% on a reported basis and 6% organically.
Margin Performance
Adjusted EBITDA was $638 million, up 22% year over year. The adjusted EBITDA margin improved 100 basis points (bps) to 15.7%. Adjusted operating income of $558 million increased 25% year over year, with the adjusted operating margin improving 120 bps to 13.7%.
Key Balance Sheet and Cash Flow Figures
Trane ended the quarter with a cash balance of $1.2 billion compared with $1.1 billion in the previous quarter. The debt balance was $4.8 billion, flat with the previous quarter. The company generated $766 million of cash from operating activities and a free cash flow of $675 million in the quarter.
Trane Technologies plc Price, Consensus and EPS Surprise
Trane Technologies plc price-consensus-eps-surprise-chart | Trane Technologies plc Quote
2023 Guidance
Trane expects revenues to increase 7-9% on a reported basis and 6-8% on an organic basis.
Adjusted EPS is expected between $8.2 and $8.5. The guided range is above the Zacks Consensus Estimate of $7.82.
Trane currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Performance of Some Other Business Services Companies
Robert Half International Inc. (RHI - Free Report) reported mixed fourth-quarter 2022 results, wherein earnings beat the Zacks Consensus Estimate but revenues missed the same.
RHI’s quarterly earnings of $1.37 per share beat the Zacks Consensus Estimate by 1.5% but declined 9.3% year over year. Revenues of $1.73 billion missed the Zacks Consensus Estimate by 0.6% and decreased 2.4% year over year.
Automatic Data Processing, Inc. (ADP - Free Report) reported better-than-expected second-quarter fiscal 2023 results.
ADP’s adjusted earnings per share of $1.96 beat the Zacks Consensus Estimate by 0.5% and grew 19% from the year-ago quarter. Total revenues of $4.4 billion beat the Zacks Consensus Estimate by 0.3% and improved 9.1% from the year-ago quarter.
Booz Allen Hamilton Holding Corp. (BAH - Free Report) reported impressive third-quarter fiscal 2023 results, wherein both earnings and revenues beat the Zacks Consensus Estimate. Quarterly adjusted earnings per share of $1.07 beat the Zacks Consensus Estimate by 4.9% and increased 4.9% on a year-over-year basis.
BAH’s total revenues of $2.3 billion beat the Zacks Consensus Estimate by 4% and increased 12.1% on a year-over-year basis.