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Sep 30, 2021
Lennox Q3 2021 Earnings Report
Reported third quarter results with revenue up slightly but impacted by supply chain and Covid-19 disruptions.
Key Takeaways
Lennox International reported a slight increase in revenue to $1.06 billion in the third quarter, a record for the company. However, the financial performance was negatively impacted by global supply chain and Covid-19 disruptions, which reduced revenue by approximately $75 million and operating profit by approximately $25 million.
Revenue reached a record $1.06 billion, slightly up from the prior-year quarter.
GAAP EPS from continuing operations was relatively flat at $3.41.
Adjusted EPS from continuing operations decreased by 4% to $3.40, including a $0.55 negative impact from supply chain and Covid-19 disruptions.
The company repurchased $200 million of stock during the quarter.
Lennox
Lennox
Lennox Revenue by Segment
Revenue by Segment
Home Comfort Solutions Revenue
CapyFin.comBuilding Climate Solutions Revenue
CapyFin.com Forward Guidance
Lennox International is narrowing its 2021 guidance and now expects revenue growth of 13-15% and adjusted EPS from continuing operations of $12.10-$12.30 for the full year.
Positive Outlook
- Demand remains strong across all end markets.
- Revenue growth is expected to be between 13-15% for the full year.
- Adjusted EPS from continuing operations is expected to be between $12.10-$12.30 for the full year.
- Foreign exchange is still expected to be 1% favorable to revenue growth for the full year.
- Corporate expense guidance updated from approximately $100 million to $95 million.
Challenges Ahead
- Global supply chain bottlenecks and shortages are not expected to be resolved soon.
- Covid-19 adds more complexity to labor and production disruptions.
- Global supply chain and Covid-19 disruptions to production and labor force negatively impacted third-quarter revenue by approximately $75 million and operating profit by approximately $25 million
- Residential Heating & Cooling revenue was down 2%.
- Commercial Heating & Cooling segment margin was down 800 basis points to 10.7%.
Revenue & Expenses
Visualization of income flow from segment revenue to net income