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Altra Industrial's (AIMC) Q4 Earnings Miss, Revenues Dip Y/Y
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Altra Industrial Motion Corp.’s fourth-quarter 2022 adjusted earnings of 73 cents per share missed the Zacks Consensus Estimate of 75 cents. The bottom line increased 9% year over year.
Total revenues of $469 million surpassed the Zacks Consensus Estimate of $455 million. The top line dipped 0.1% year over year due to the divestiture of the JVS business and changes in foreign exchange rates. Organic sales in the reported quarter expanded 2.3%. The Nook acquisition had a positive impact of 2.2% on sales. Foreign currency translation had a negative impact of 4.6%.
Segmental Discussion
Revenues generated from Power Transmission Technologies increased 2.7% year over year to $240.1 million, driven by strength across end markets, including metals and mining, turf and garden as well as agriculture end markets. Segment operating income increased 6.5% year over year to $32.7 million.
Altra Industrial Motion Corp. Price, Consensus and EPS Surprise
Automation & Specialty’s sales were $230.4 million in the fourth quarter, down 2.8% from the year-ago quarter. The downside was due to JVS’s business divestiture and foreign-currency woes. Segment operating income came in at $34.8 million against the loss of $117.7 million.
Margin Profile
In the reported quarter, Altra Industrial’s cost of sales decreased 4.2% year over year to $298.7 million. Adjusted gross profit was $171.4 million, up 8.5% year over year. The gross margin (adjusted) increased to 36.5% from 33.6% in the year-ago period.
Selling, general and administrative expenses increased 9.4% year over year to $102.3 million. Research and development expenses were $15.5 million compared with $16.4 million in the year-ago quarter.
Adjusted EBITDA was $96.2 million, up 10.3% year over year. Adjusted EBITDA margin increased to 20.5% in the reported quarter from 18.6% in the year-ago period. AIMC reported an operating income of $50.6 million in the fourth quarter against an operating loss of 95 million. Operating margin was 10.8%, against a negative 20.2% in the fourth quarter of 2021.
Balance Sheet and Cash Flow
While exiting the fourth quarter, Altra Industrial had cash and cash equivalents of $208.9 million compared with $246.1 million. Long-term debt (less current portion and net of unaccreted discount) was $1,024.1 million compared with $1,401 million in the year-ago period.
In 2022, AIMC generated net cash of $125 million from operating activities compared with $217 million generated in the year-ago period. Capital invested in purchasing property, plant and equipment totaled $55.9 million, up 37.7% year over year. The adjusted free cash flow (excluding JVS transaction costs and tax paid for JVS divestiture) was $99.1 million compared with $176.4 million in 2021.
In 2022, Altra Industrial, carrying a Zacks Rank #3 (Hold), paid dividends of $22.3 million, up 21.8% year over year.
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 (Buy), 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. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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, 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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Altra Industrial's (AIMC) Q4 Earnings Miss, Revenues Dip Y/Y
Altra Industrial Motion Corp.’s fourth-quarter 2022 adjusted earnings of 73 cents per share missed the Zacks Consensus Estimate of 75 cents. The bottom line increased 9% year over year.
Total revenues of $469 million surpassed the Zacks Consensus Estimate of $455 million. The top line dipped 0.1% year over year due to the divestiture of the JVS business and changes in foreign exchange rates. Organic sales in the reported quarter expanded 2.3%. The Nook acquisition had a positive impact of 2.2% on sales. Foreign currency translation had a negative impact of 4.6%.
Segmental Discussion
Revenues generated from Power Transmission Technologies increased 2.7% year over year to $240.1 million, driven by strength across end markets, including metals and mining, turf and garden as well as agriculture end markets. Segment operating income increased 6.5% year over year to $32.7 million.
Altra Industrial Motion Corp. Price, Consensus and EPS Surprise
Altra Industrial Motion Corp. price-consensus-eps-surprise-chart | Altra Industrial Motion Corp. Quote
Automation & Specialty’s sales were $230.4 million in the fourth quarter, down 2.8% from the year-ago quarter. The downside was due to JVS’s business divestiture and foreign-currency woes. Segment operating income came in at $34.8 million against the loss of $117.7 million.
Margin Profile
In the reported quarter, Altra Industrial’s cost of sales decreased 4.2% year over year to $298.7 million. Adjusted gross profit was $171.4 million, up 8.5% year over year. The gross margin (adjusted) increased to 36.5% from 33.6% in the year-ago period.
Selling, general and administrative expenses increased 9.4% year over year to $102.3 million. Research and development expenses were $15.5 million compared with $16.4 million in the year-ago quarter.
Adjusted EBITDA was $96.2 million, up 10.3% year over year. Adjusted EBITDA margin increased to 20.5% in the reported quarter from 18.6% in the year-ago period. AIMC reported an operating income of $50.6 million in the fourth quarter against an operating loss of 95 million. Operating margin was 10.8%, against a negative 20.2% in the fourth quarter of 2021.
Balance Sheet and Cash Flow
While exiting the fourth quarter, Altra Industrial had cash and cash equivalents of $208.9 million compared with $246.1 million. Long-term debt (less current portion and net of unaccreted discount) was $1,024.1 million compared with $1,401 million in the year-ago period.
In 2022, AIMC generated net cash of $125 million from operating activities compared with $217 million generated in the year-ago period. Capital invested in purchasing property, plant and equipment totaled $55.9 million, up 37.7% year over year. The adjusted free cash flow (excluding JVS transaction costs and tax paid for JVS divestiture) was $99.1 million compared with $176.4 million in 2021.
In 2022, Altra Industrial, carrying a Zacks Rank #3 (Hold), paid dividends of $22.3 million, up 21.8% year over year.
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 (Buy), 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. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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, 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%.