Parker-Hannifin Q4 2020 Earnings Report
Key Takeaways
Parker Hannifin's Q4 2020 results showed resilience amidst the COVID-19 pandemic, with adjusted total segment operating margin at 17.4% and adjusted EBITDA margin at 20.4%. Full-year cash flow from operations reached a record $2.07 billion. The company issued FY21 EPS guidance in the range of $7.41 to $8.41, or $9.80 to $10.80 on an adjusted basis.
Fourth quarter EPS were $2.27 as reported, or $2.55 adjusted.
Fourth quarter total segment operating margin was 15.8% as reported, or 17.4% adjusted.
Fourth quarter EBITDA margin was 18.7% as reported, or 20.4% adjusted.
Full year cash flow from operations was an all-time record at $2.1 billion, or 15.1% of sales.
Parker-Hannifin
Parker-Hannifin
Parker-Hannifin Revenue by Segment
Forward Guidance
Parker Hannifin expects the global COVID-19 pandemic to continue negatively affecting economic activity in fiscal 2021. The company will manage costs, preserve cash, and position itself for economic recovery, aiming to achieve long-term targets for sales growth, margins, earnings growth, and cash flow.
Positive Outlook
- Portfolio improvement through transformative acquisitions
- Continued execution of The Win Strategyâ„¢
- Near-term actions to reduce costs and preserve cash
- Maintaining manufacturing capacity across the enterprise
- Committed to achieving long-term targets
Challenges Ahead
- Global COVID-19 pandemic will continue to have a negative effect on economic activity in fiscal 2021.
- Expected business realignment expenses of approximately $65 million
- Costs to achieve of approximately $19 million
- Acquisition-related intangible asset amortization of approximately $321 million
- Guidance assumes an organic sales decline in the range of 13% to 9%