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Dec 31, 2023
EnerSys Q3 2024 Earnings Report
EnerSys reported Q3 2024 results, with a gross margin of 28.9%, up 570 basis points year-over-year, and EPS of $1.86, up 72% year-over-year.
Key Takeaways
EnerSys reported net sales of $862 million, a decrease of 6% year-over-year, primarily driven by temporary spending pauses in telecom and broadband. The company achieved a gross margin of 28.9%, including a $59 million benefit from Inflation Reduction Act / IRC 45X tax credits, and an adjusted EPS of $2.56, up 102% year-over-year. Net leverage was reduced to 1.1x EBITDA on operating cash flow of $135 million.
Net sales were $862M, down 6%, due to temporary spending pauses in telecom and broadband.
Gross margin reached 28.9%, up 570 bps, including a $59M benefit from IRC 45X tax credits.
Operating earnings were $93M, up 18%, and adjusted operating earnings were $130M, up 53%.
Diluted EPS was $1.86, up 72%, and adjusted diluted EPS was $2.56, up 102%.
EnerSys
EnerSys
EnerSys Revenue by Segment
Revenue by Segment
Energy Systems Revenue
CapyFin.comMotive Power Revenue
CapyFin.comSpecialty Revenue
CapyFin.com Forward Guidance
For the fourth quarter of fiscal 2024, EnerSys expects adjusted diluted earnings per share in the range of $1.98 to $2.08, including $0.80 to $0.90 from IRC 45X tax benefits under the IRA, and gross margin in the range of 26.0% to 28.0%, including 350bps to 410bps from IRA credits. Full year capital expenditures are expected to be in the range of $80 million to $100 million.
Positive Outlook
- Ability to maintain pricing.
- Healthy demand trends in the majority of end markets
- Well-positioned to capitalize on market opportunities
- Delivering innovative products aligned with secular trends.
Challenges Ahead
- Temporary spending pauses by telecom and broadband customers.
- IRS has not yet finalized guidance related to section 45X, which could materially increase or decrease the quantity of U.S. produced batteries that qualify for this credit.
- Uncertainty of the occurrence or timing of future excluded items
- difficult to predict
- dependent on future events that are less capable of being controlled or reliably predicted by management
Revenue & Expenses
Visualization of income flow from segment revenue to net income