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Ingersoll Rand (IR) Q4 Earnings Beat, Revenues Up 14% Y/Y
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Ingersoll Rand Inc. (IR - Free Report) reported fourth-quarter 2022 adjusted earnings (excluding 18 cents from non-recurring items) of 72 cents per share, which beat the Zacks Consensus Estimate of 63 cents. The bottom line increased year over year.
Total revenues of $1,623.7 million outperformed the Zacks Consensus Estimate of $1,534.8 million. The top line increased 14.4% year over year on a 19.2% rise in organic revenues. Acquisitions contributed 2% to revenues, while foreign currency movements had an adverse impact of 6.8%.
Orders in the quarter totaled $1,484 million, down 1% from the year-ago quarter. Organically orders increased 2%.
Ingersoll Rand Inc. Price, Consensus and EPS Surprise
Industrial Technologies & Services generated revenues of $1,315 million, accounting for 81% of net revenues in the reported quarter. Sales increased 17% year over year on 22% growth in organic sales. Acquisitions contributed 1.5%, while movement in foreign currencies had a negative impact of 7%. The segment’s orders in the quarter were down 1% (up 4% organically).
Precision & Science Technologies’ revenues totaled $308 million, representing 19% of net revenues in the quarter. On a year-over-year basis, the segment’s revenues increased 6%. Organic sales grew 9%. Acquisitions had a positive impact of 4.3%, while movement in foreign currencies had a negative impact of 6.5%. The segment’s orders were down 4% (2% organically).
Margin Profile
Adjusted EBITDA in the quarter increased 22.8% year over year to $420.2 million. Margin increased to 25.9% from 24.1% in the year-ago period.
On a segmental basis, the adjusted EBITDA margin increased 170 basis points (bps) year over year to 27.4% for Industrial Technologies & Services. The same increased 330 bps to 30.1% for Precision & Science Technologies.
Balance Sheet & Cash Flow
While exiting the fourth quarter of 2022, Ingersoll Rand had cash and cash equivalents of $1,613 million compared with $2,109.6 million recorded at the end of the year-ago period. Long-term debt (less current maturities) was $2,716.1 million compared with #3,401.8 million in the year-ago period.
In 2022, IR generated net cash of $865.4 million from operating activities, up 37.8% year over year. Capital expenditure totaled $94.6 million compared with $64.1 million in the year-ago quarter. Free cash flow increased 36.7% to $770.8 million.
2023 Outlook
For 2023, Ingersoll Rand expects revenues to increase 7-9%. Organic revenues are estimated to increase 3-5%. Industrial Technologies & Services revenues are predicted to increase 3-5% organically, while Precision & Science Technologies revenues are forecasted to climb 4-6% organically. Adverse foreign currency movements are expected to have an impact of 1% on total revenues.
Adjusted EBITDA is expected to be $1,570-$1,630 million, indicating an increase of 9-14% year over year. Adjusted earnings are anticipated to be $2.48-$2.58 per share, indicating an increase of 5-9%.
Performance of Other Industrial Stocks
Within the broader Industrial Products sector, the following companies have recently reported earnings numbers.
Parker-Hannifin Corporation (PH - Free Report) , carrying a Zacks Rank #2, reported second-quarter fiscal 2023 (ended Dec 31, 2022) adjusted earnings (excluding $1.72 from non-recurring items) of $4.76 per share, which surpassed the Zacks Consensus Estimate of $4.45. The bottom line improved 6.7% year over year.
Parker-Hannifin’s total revenues of $4,674.8 million also outperformed the Zacks Consensus Estimate of $4,461.5 million. The top line jumped 22.2% year over year. Organic sales for the quarter increased 10.3% year over year. Orders were up 3% year over year.
Xylem (XYL - Free Report) , carrying a Zacks Rank #3 (Hold), reported fourth-quarter 2022 adjusted earnings (excluding 10 cents from non-recurring items) of 92 cents per share, which surpassed the Zacks Consensus Estimate of 80 cents. The bottom line increased 46% year over year.
Xylem’s revenues of $1,506 million also outperformed the Zacks Consensus Estimate of $1,415 million and rose 13.8% year over year. Organic sales in the quarter rose 20%.
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Ingersoll Rand (IR) Q4 Earnings Beat, Revenues Up 14% Y/Y
Ingersoll Rand Inc. (IR - Free Report) reported fourth-quarter 2022 adjusted earnings (excluding 18 cents from non-recurring items) of 72 cents per share, which beat the Zacks Consensus Estimate of 63 cents. The bottom line increased year over year.
Total revenues of $1,623.7 million outperformed the Zacks Consensus Estimate of $1,534.8 million. The top line increased 14.4% year over year on a 19.2% rise in organic revenues. Acquisitions contributed 2% to revenues, while foreign currency movements had an adverse impact of 6.8%.
Orders in the quarter totaled $1,484 million, down 1% from the year-ago quarter. Organically orders increased 2%.
Ingersoll Rand Inc. Price, Consensus and EPS Surprise
Ingersoll Rand Inc. price-consensus-eps-surprise-chart | Ingersoll Rand Inc. Quote
Segmental Discussion
Industrial Technologies & Services generated revenues of $1,315 million, accounting for 81% of net revenues in the reported quarter. Sales increased 17% year over year on 22% growth in organic sales. Acquisitions contributed 1.5%, while movement in foreign currencies had a negative impact of 7%. The segment’s orders in the quarter were down 1% (up 4% organically).
Precision & Science Technologies’ revenues totaled $308 million, representing 19% of net revenues in the quarter. On a year-over-year basis, the segment’s revenues increased 6%. Organic sales grew 9%. Acquisitions had a positive impact of 4.3%, while movement in foreign currencies had a negative impact of 6.5%. The segment’s orders were down 4% (2% organically).
Margin Profile
Adjusted EBITDA in the quarter increased 22.8% year over year to $420.2 million. Margin increased to 25.9% from 24.1% in the year-ago period.
On a segmental basis, the adjusted EBITDA margin increased 170 basis points (bps) year over year to 27.4% for Industrial Technologies & Services. The same increased 330 bps to 30.1% for Precision & Science Technologies.
Balance Sheet & Cash Flow
While exiting the fourth quarter of 2022, Ingersoll Rand had cash and cash equivalents of $1,613 million compared with $2,109.6 million recorded at the end of the year-ago period. Long-term debt (less current maturities) was $2,716.1 million compared with #3,401.8 million in the year-ago period.
In 2022, this Zacks Rank #2 (Buy) company returned $294 million to shareholders through dividends and share buybacks. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
In 2022, IR generated net cash of $865.4 million from operating activities, up 37.8% year over year. Capital expenditure totaled $94.6 million compared with $64.1 million in the year-ago quarter. Free cash flow increased 36.7% to $770.8 million.
2023 Outlook
For 2023, Ingersoll Rand expects revenues to increase 7-9%. Organic revenues are estimated to increase 3-5%. Industrial Technologies & Services revenues are predicted to increase 3-5% organically, while Precision & Science Technologies revenues are forecasted to climb 4-6% organically. Adverse foreign currency movements are expected to have an impact of 1% on total revenues.
Adjusted EBITDA is expected to be $1,570-$1,630 million, indicating an increase of 9-14% year over year. Adjusted earnings are anticipated to be $2.48-$2.58 per share, indicating an increase of 5-9%.
Performance of Other Industrial Stocks
Within the broader Industrial Products sector, the following companies have recently reported earnings numbers.
Parker-Hannifin Corporation (PH - Free Report) , carrying a Zacks Rank #2, reported second-quarter fiscal 2023 (ended Dec 31, 2022) adjusted earnings (excluding $1.72 from non-recurring items) of $4.76 per share, which surpassed the Zacks Consensus Estimate of $4.45. The bottom line improved 6.7% year over year.
Parker-Hannifin’s total revenues of $4,674.8 million also outperformed the Zacks Consensus Estimate of $4,461.5 million. The top line jumped 22.2% year over year. Organic sales for the quarter increased 10.3% year over year. Orders were up 3% year over year.
Xylem (XYL - Free Report) , carrying a Zacks Rank #3 (Hold), reported fourth-quarter 2022 adjusted earnings (excluding 10 cents from non-recurring items) of 92 cents per share, which surpassed the Zacks Consensus Estimate of 80 cents. The bottom line increased 46% year over year.
Xylem’s revenues of $1,506 million also outperformed the Zacks Consensus Estimate of $1,415 million and rose 13.8% year over year. Organic sales in the quarter rose 20%.