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Sep 30, 2022
Wabtec Q3 2022 Earnings Report
Wabtec delivered a strong quarterly performance with growth in sales and earnings.
Key Takeaways
Wabtec reported strong third quarter 2022 results with sales growth of 9.1% to $2.08 billion. GAAP earnings per share were $0.88, up 27.5% versus the third quarter of 2021. Adjusted earnings per share were $1.22, up 7.0% versus the same quarter a year ago. Cash from operations was $204 million.
Sales increased 9.1% compared to the year-ago quarter driven by significantly higher Freight segment sales, partially offset by lower Transit segment sales. On a constant currency basis, consolidated sales were up 14.3%.
GAAP operating margin was up 1.1 percentage points behind lower restructuring and transaction costs. Adjusted operating margin was lower due to a less rich mix of sales from significantly higher locomotive sales in the quarter.
GAAP and adjusted EPS increased from the year-ago quarter primarily due to higher sales and disciplined cost management. GAAP EPS further benefited from lower restructuring and transaction costs.
Total Backlog of $22.61 Billion, Up $ 0.77 Billion and Up $1.52 Billion Year-Over- Year on Constant Currency Basis
Revenue by Segment
Forward Guidance
Wabtec updated its 2022 financial guidance with sales expected to be in a range of $8.15 billion to $8.35 billion versus previous guidance of $8.3 billion to $8.6 billion. Adjusted earnings per diluted share is expected to be in a range of $4.75 to $4.95 versus previous guidance of $4.70 to $5.00. For full year 2022, Wabtec expects strong cash flow generation with operating cash flow conversion greater than 90 percent.
Positive Outlook
- Sales expected to be in a range of $8.15 billion to $8.35 billion
- Adjusted earnings per diluted share is expected to be in a range of $4.75 to $4.95
- Strong cash flow generation
- Operating cash flow conversion greater than 90 percent
- Technologically differentiated portfolio of products and solutions
Challenges Ahead
- Reduction reflects the expected impacts from unfavorable foreign currency exchange in the second half of the year.
- Significant headwinds from negative foreign currency exchange
- Supply chain constraints
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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