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Mar 31, 2021
Wabtec Q1 2021 Earnings Report
Wabtec reported strong operational quarter, delivering for customers, driving cash generation, and reducing costs.
Key Takeaways
Wabtec reported first quarter 2021 earnings per diluted share of $0.59 and adjusted earnings per diluted share of $0.89. Total sales were $1.8 billion and cash from operations was strong at $292 million.
Delivered Strong Cash Flow from Operations of $292 Million
First Quarter Reported GAAP Earnings Per Share of $0.59; Adjusted EPS of $0.89
Converted Key Long-term Orders, Strengthening Book-to-Bill
Expanded Into Global Maintenance of Way Market with Strategic Acquisition of Nordco
Wabtec
Wabtec
Forward Guidance
Wabtec updated its 2021 sales guidance to a range of $7.7 billion to $7.9 billion, GAAP earnings per diluted share guidance to between $2.80 to $3.05 and adjusted earnings per diluted share to between $4.05 to $4.30. The adjusted guidance excludes estimated expenses for restructuring and amortization expenses. With cost actions and synergies stemming from the Wabtec and GE Transportation merger on-track, we expect to achieve a run rate savings of $250 million in 2021 as well as margin expansion through continued cost actions. For full year 2021, Wabtec expects strong cash flow generation with operating cash flow conversion greater than 90%.
Positive Outlook
- Sales guidance between $7.7 billion to $7.9 billion
- GAAP earnings per diluted share guidance between $2.80 to $3.05
- Adjusted earnings per diluted share between $4.05 to $4.30
- Achieve a run rate savings of $250 million in 2021
- Expect strong cash flow generation with operating cash flow conversion greater than 90%
Challenges Ahead
- The adjusted guidance excludes estimated expenses for restructuring and amortization expenses.
- Decrease in sales compared to the year-ago quarter was primarily driven by lower sales in Freight Equipment
- Organic transit segment sales were primarily impacted by the on-going disruption caused by the COVID-19 pandemic.
- Freight segment adjusted income from operations decreased 11 percent from the year-ago quarter primarily driven by mix of sales
- Lower absorption of fixed costs due to decreased locomotive deliveries offset somewhat by synergies and lower operating costs.