Chart Q2 2022 Earnings Report
Key Takeaways
Chart Industries reported record second-quarter results, including all-time high orders, backlog, sales, gross margin, and operating income. Sales increased by 25.7% compared to the second quarter of 2021. The company also completed acquisitions of Fronti Fabrications and CSC Cryogenic Service Center AB.
Record orders of $887.8 million and record backlog of $1,953.3 million.
Record sales of $404.8 million, a 25.7% increase compared to Q2 2021.
Operating income was 7.3% of sales (adjusted 9.9%), the highest in the past year.
Adjusted non-diluted EPS of $0.88, the second-highest in company history.
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Forward Guidance
Chart Industries narrowed its full-year 2022 sales guidance and provided adjusted non-diluted EPS guidance. The company has increased confidence in its 2023 to 2025 outlooks.
Positive Outlook
- Full year 2022 sales guidance is in the range of $1.725 billion and $1.80 billion.
- Adjusted FCF is anticipated to be in the range of $175 million to $225 million.
- The majority of the orders booked in the second quarter 2022 will primarily be revenue recognized in 2023 through 2025.
- Over $1.1 billion of backlog for 2023 and beyond.
- Capital expenditures are expected to be in the range of $55 million to $60 million for the full year 2022
Challenges Ahead
- Adjusted non-diluted EPS guidance is in the range of $5.20 to $5.60, compared to prior guidance range of $5.35 to $6.50.
- The prior higher-end guidance range is not likely at this point in the year given timing of revenue recognition on larger project work.
- Less than anticipated HLNG vehicle tank demand recovery early in 2022.
- Current macroeconomic market factors, including the inflationary environment and foreign exchange volatility.
- Do not include any second half 2022 additional Big LNG revenue from new orders in this outlook since the timing for revenue recognition is likely after 2022.