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Apr 02, 2022
ITT Q1 2022 Earnings Report
ITT reported an increase in revenue driven by Connect & Control Technologies, but EPS and operating income decreased due to cost inflation and other factors.
Key Takeaways
ITT reported a 4% increase in revenue (7% organic) driven primarily by Connect & Control Technologies. However, earnings per share decreased by 11% to $0.88, and adjusted EPS decreased by 8.5% to $0.97. The company deployed over $235 million of capital, including $186 million in share repurchases and announced the acquisition of Habonim in Q2.
Revenue increased by 4% (7% organic), driven by Connect & Control Technologies.
Orders increased by 11% (14% organic) due to strong demand in Industrial Process and Connect & Control Technologies.
Earnings per share decreased by 11% to $0.88, and adjusted EPS decreased by 8.5% to $0.97.
The company deployed over $235 million of capital, including $186 million in share repurchases.
ITT
ITT
ITT Revenue by Segment
Revenue by Segment
Motion Technologies Revenue
CapyFin.comIndustrial Process Revenue
CapyFin.comConnect & Control Technologies Revenue
CapyFin.com Forward Guidance
ITT expects revenue growth of 7% to 9%, or up 9% to 11% on an organic basis; segment operating margin of 17.5% to 18.4%; and adjusted segment operating margin of 17.6% to 18.5%, up 40 to 130 bps. We now expect earnings per share of $4.07 to $4.50, with no change to adjusted earnings per share of $4.30 to $4.70 per share, up 6% to 16%. Free cash flow is now expected to be in a range of $250 million to $300 million, representing free cash flow margin of approximately 8% to 10% for the full year.
Positive Outlook
- Expects revenue growth of 7% to 9%, or up 9% to 11% on an organic basis
- Segment operating margin of 17.5% to 18.4%
- Adjusted segment operating margin of 17.6% to 18.5%, up 40 to 130 bps
- Earnings per share of $4.07 to $4.50
- Adjusted earnings per share of $4.30 to $4.70 per share, up 6% to 16%
Challenges Ahead
- Continued disruptions in the global supply chain stemming from labor shortages, supplier delays, and raw material inflation
- Anticipate disruptions will persist through at least the first half of 2022
- Significant reduction in sales in Russia stemming from the conflict in Ukraine
- Estimate conflict in Ukraine will impact revenue by approximately $60 to $85 million for the full year
- Guidance does not include the potential impact, if any, of a prolonged shutdown in China due to the reemergence of COVID-19
Revenue & Expenses
Visualization of income flow from segment revenue to net income