Loading...
•
Jun 30, 2021
Vertiv Q2 2021 Earnings Report
Reported strong financial results with net sales growth and increased profitability.
Key Takeaways
Vertiv reported a strong second quarter with a 25% increase in net sales and a record backlog of $2.3 billion. The company raised its full year guidance for sales, adjusted operating profit, and adjusted diluted earnings per share.
Diluted earnings per share increased $0.20 and adjusted diluted earnings per share increased $0.15 from last year’s second quarter.
Net sales growth of 25% and organic net sales growth of 20% from last year’s second quarter, with double-digit sales growth in all regions.
Record backlog of $2.3 billion at the end of June. Order growth of 24% compared to prior year’s second quarter.
Operating profit increased $32 million, or 45%, and adjusted operating profit increased $31 million, or 30%, from last year’s second quarter. Adjusted operating margin of 10.6%, up 40 basis points.
Vertiv
Vertiv
Vertiv Revenue by Segment
Vertiv Revenue by Geographic Location
Revenue by Segment
Products Revenue
CapyFin.comRevenue by Geographic Location
Americas Revenue
CapyFin.comAsia Pacific Revenue
CapyFin.comEMEA Revenue
CapyFin.com Forward Guidance
End-market demand remains robust, and Vertiv is increasing its full year net sales guidance to 14% growth at the midpoint (12% organic growth). The company is raising the midpoint of its full year adjusted operating profit guidance to $600 million.
Positive Outlook
- Increasing full year net sales guidance to 14% growth at the midpoint (12% organic growth).
- Raising the midpoint of full year adjusted operating profit guidance to $600 million.
- Implemented additional pricing actions to help offset inflation and supply-chain challenges.
- Fixed cost reductions to help offset inflation and supply-chain challenges.
- Expect pricing to ramp-up as we progress through 2021 and to completely offset gross material and freight inflation within the fourth quarter.
Challenges Ahead
- Material inflation continues to be a challenge.
- Supply-chain challenges continue to be a challenge.
- The full year guidance includes the expected negative net impact in the remainder of the year of current commodity and freight costs.
- Price recovery typically lags inflation.
- Net cash provided by operating activities of $59 million in the second quarter was $14 million lower than last year’s second quarter, and free cash flow of $41 million was down $21 million in part due to incremental inventory investment in the second quarter in response to the challenging supply chain environment, the timing of cash tax payments and higher year-over-year investment in growth-related capital expenditures.