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Dec 31, 2019
ESCO Technologies Q1 2020 Earnings Report
Announced first quarter fiscal 2020 results, with GAAP EPS of $3.32 and adjusted EPS of $0.43.
Key Takeaways
ESCO Technologies reported a strong first quarter, exceeding adjusted EPS guidance due to solid performance in the Test and A&D segments, while completing the sale of the Technical Packaging segment.
Completed the sale of the Technical Packaging segment for approximately $190 million, recording a significant gain on the sale.
Adjusted EPS of $0.43 exceeded the previously communicated guidance of $0.35 to $0.40 per share.
Adjusted EBITDA increased by 5 percent to $28.0 million, driven by strong performance in the Test and A&D segments.
Booked $220 million of new business, growing backlog by 11 percent to $500 million.
ESCO Technologies
ESCO Technologies
Forward Guidance
Management expects 2020 revenues and Adjusted EPS to be more back half weighted, with Q2 2020 Adjusted EPS expected to be in the range of $0.70 to $0.75 per share.
Positive Outlook
- Meaningful net sales and Adjusted EBITDA growth across each of the Company’s business segments.
- Growth rates in 2020 and beyond will generally exceed the broader industrial market.
- Growth is expected to be enhanced by additional M&A contributions during the year.
- Management expects Q2 2020 Adjusted EPS to be in the range of $0.70 to $0.75 per share.
- Globe continues to deliver results above expectations.
Challenges Ahead
- The timing of quarterly sales and earnings throughout the year, coupled with the discrete charges incurred within the respective quarters will impact quarterly comparability.
- The recent news surrounding the suspended production of the 737MAX creates some headwind for us over the next few months until production resumes.
- Pension plan liability
- Equity market risk
- Interest rate volatility