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Sep 30, 2023
Lennox Q3 2023 Earnings Report
Lennox reported record revenue and raised 2023 guidance.
Key Takeaways
Lennox reported record third-quarter revenue of $1.37 billion, a 10% increase year-over-year. The company's GAAP diluted EPS was $3.65, while adjusted diluted EPS rose 30% to $5.37. Lennox raised its 2023 outlook, expecting core revenue to be up approximately 5% and an adjusted EPS range of $17.25 to $17.75.
Revenue increased by 10% to $1.37 billion, with core revenue (excluding European Operations) up 10% to $1.30 billion.
GAAP diluted EPS decreased by 9% to $3.65, impacted by impairment related to European divestiture, while adjusted diluted EPS increased by 30% to $5.37.
Operating cash flow increased by 83% to $313 million.
2023 outlook was raised with core revenue up approximately 5% and an adjusted EPS range of $17.25 to $17.75.
Forward Guidance
Lennox raised its full-year 2023 guidance, expecting core revenue to be up approximately 5% and adjusted earnings per share of $17.25 to $17.75.
Positive Outlook
- Core revenue expected to be up approximately 5%.
- Adjusted earnings per share expected to be in the range of $17.25 to $17.75.
- Operating cash flow of $600 million to $650 million.
- Capital expenditures of approximately $250 million.
- Confident in ability to achieve 2023 targets.
Challenges Ahead
- Risks that the North American unitary HVAC and refrigeration markets perform worse than current assumptions.
- Impact of higher raw material prices.
- Availability and timely delivery of raw materials and other components.
- Competition in the HVACR business.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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