EnerSys Q3 2023 Earnings Report
Key Takeaways
EnerSys reported a strong third quarter with record revenue of $920 million, a 9% increase year-over-year. GAAP operating earnings improved 53% to $79 million, and adjusted operating earnings also reached a record of $85 million, a 41% increase year-over-year. The company saw significant gross margin improvement, up 150 basis points sequentially to 23.2%.
Record net sales of $920 million, +9% y/y, and +13% y/y in Constant Currency.
Gross Margin of 23.2%, +150 bps sequentially, +140 bps y/y as price/mix improvements eclipsed sequential cost increases.
Operating earnings were $79 million, +53% y/y; Record adjusted operating earnings $85 million, +41% y/y.
Backlog of $1.3 billion, +11% y/y, remains healthy supported by robust demand and order trends across all segments.
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EnerSys Revenue by Segment
Forward Guidance
For the fourth quarter of fiscal 2023, EnerSys expects adjusted diluted earnings per share in the range of $1.33 to $1.43 and gross margin to be in the range of 22% - 24%. For the full year of fiscal 2023, capital expenditures are expected to be approximately $90 million.
Positive Outlook
- Sequential volume and price/mix improvement.
- Strong demand trends.
- Healthy backlog.
- Large portions of business are cycle-independent.
- Significant cash flow generation during past recessionary periods.
Challenges Ahead
- Dynamic macro environment.
- FX and interest rate headwinds.
- Easing but still unpredictable supply chain.
- European utility inflation.
- Potential economic slowdown.
Revenue & Expenses
Visualization of income flow from segment revenue to net income