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Dec 31, 2022
A O Smith Q4 2022 Earnings Report
A. O. Smith reported a net loss but achieved record sales for the year, driven by pricing actions and boiler demand, offset by U.S. water heater destocking.
Key Takeaways
A. O. Smith reported a net loss for Q4 2022, with a significant decrease in net earnings compared to Q4 2021. However, the company achieved record sales for the full year 2022. The Q4 results were impacted by a non-cash pension settlement expense. The company introduces 2023 guidance with sales flat to 2022 and EPS between $3.15 and $3.45.
Net sales decreased by 6% year-over-year to $936.1 million.
Net loss was $(120.1) million, a decrease of 186% year-over-year.
Adjusted earnings decreased by 4% year-over-year to $131.6 million.
Adjusted EPS increased by 1% year-over-year to $0.86.
Revenue by Segment
Revenue by Geographic Location
Forward Guidance
The company projects sales to be flat year-over-year, +/- 3%. Anticipates improved profitability as input costs moderate and expects full year EPS to be between $3.15 and $3.45, a 5% year-over-year increase at the mid-point.
Positive Outlook
- Inventory adjustments in the wholesale residential market largely behind us.
- Mindful of headwinds in new home construction, which remains in a deficit position.
- Lifting of certain COVID-19-related restrictions is a positive step to an improved economic environment in China.
- Strong balance sheet and free cash flow.
- Focus on capital allocation priorities of organic growth, dividends, acquisitions, and share repurchases.
Challenges Ahead
- Headwinds in new home construction.
- Impacts from COVID-19-related restrictions on consumer demand in China.
- Potential impacts from future acquisitions are excluded.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
Analyze how earnings announcements historically affect stock price performance
Avg. Return Before/After Earnings
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