Parker Reports Fiscal 2022 First Quarter Results

-       First quarter records for sales, segment operating margins, net income and EPS

-       Sales increased 17% to $3.76 billion, organic sales increased 16%

-       Segment operating margin was 19.7% as reported, or 22.0% adjusted

-       Net income was $451.2 million; EPS was $3.45 as reported, or $4.26 adjusted

-       EBITDA margin was 20.6% as reported, or 22.1% adjusted

-       Company increases fiscal 2022 EPS guidance

                            

CLEVELAND, November 4, 2021 -- Parker Hannifin Corporation (NYSE: PH), the global leader in motion and control technologies, today reported results for the fiscal 2022 first quarter ended September 30, 2021. Fiscal 2022 first quarter sales were a first quarter record at $3.76 billion, an increase of 17% compared with $3.23 billion in the first quarter of fiscal 2021. Net income was also a first quarter record at $451.2 million, an increase of 41% compared with $319.8 million in the prior year quarter. Fiscal 2022 first quarter earnings per share were also a first quarter record at $3.45, an increase of 41% compared with $2.45 in the first quarter of fiscal 2021. Adjusted earnings per share increased 40% to $4.26 compared with adjusted earnings per share of $3.05 in the prior year quarter.  Fiscal year-to-date cash flow from operations was $424.4 million, or 11.3% of sales, compared with $737.4 million in the prior year period. A reconciliation of non-GAAP measures is included in the financial tables of this press release.

 

“We delivered impressive results in the quarter,” said Chairman and Chief Executive Officer, Tom Williams. "Our performance demonstrated operational discipline and agility in a challenging manufacturing environment that coupled increased demand with labor and supply chain constraints. We achieved first quarter records for sales, segment operating margins, net income and earnings per share. Adjusted total segment operating margin and adjusted EBITDA margin both increased 210 basis points as a result of The Win Strategy™ 3.0, portfolio enhancements and the excellent efforts from our global team.”

                  

Segment Results

Diversified Industrial Segment:  North American first quarter sales increased 17% to $1.79 billion and operating income was $333.7 million compared with $268.8 million in the same period a year ago. International first quarter sales increased 22% to $1.38 billion and operating income was $291.2 million compared with $186.9 million in the same period a year ago.

                         

Aerospace Systems Segment:  First quarter sales increased 3% to $592.7 million and operating income was $118.3 million compared with $86.8 million in the same period a year ago.

 

Parker reported the following orders for the quarter ending September 30, 2021, compared with the same quarter a year ago:

·       Orders increased 26% for total Parker

·       Orders increased 32% in the Diversified Industrial North America businesses

·       Orders increased 25% in the Diversified Industrial International businesses

·       Orders increased 16% in the Aerospace Systems Segment on a rolling 12-month average basis

                                 

Offer to Acquire Meggitt PLC

As previously announced on August 2, 2021, the company has reached an agreement on the terms of a recommended cash acquisition of the entire issued and to be issued ordinary share capital of Meggitt PLC. The acquisition was approved by Meggitt shareholders on September 21, 2021. The transaction remains subject to satisfaction of the conditions set out in the scheme document, including regulatory clearances. Under the UK Companies Act, the Scheme of Arrangement further requires the sanction of the Court, currently expected during the third quarter of calendar year 2022. For copies of all announcements and further information, please visit the dedicated transaction microsite at www.aerospacegrowth.com.

 

Outlook

For the fiscal year ending June 30, 2022, the company has increased guidance for earnings per share to the range of $14.52 to $15.22, or $16.95 to $17.65 on an adjusted basis. Guidance assumes organic sales growth of approximately 7% to 10% compared with the prior year. Fiscal year 2022 guidance is adjusted on a pre-tax basis for acquisition-related expenses of $52 million and expected business realignment expenses of approximately $35 million, LORD costs to achieve of approximately $7 million and acquisition-related intangible asset amortization of approximately $320 million. A reconciliation of forecasted earnings per share to adjusted forecasted earnings per share is included in the financial tables of this press release.

              

Williams added, “Robust demand trends continue across nearly all of our end markets reinforcing our positive outlook for sales and earnings per share for this fiscal year. The transformation of our portfolio and the Win Strategy 3.0 continue to position us to deliver sustainable long-term growth and top quartile performance."

                

NOTICE OF CONFERENCE CALL:  Parker Hannifin's conference call and slide presentation to discuss its fiscal 2022 first quarter results are available to all interested parties via live webcast today at 11:00 a.m. ET, at www.phstock.com. A replay of the webcast will be available on the site approximately one hour after the completion of the call and will remain available for one year. To register for e-mail notification of future events please visit www.phstock.com.

                 

About Parker Hannifin

Parker Hannifin is a Fortune 250 global leader in motion and control technologies. For more than a century the company has been enabling engineering breakthroughs that lead to a better tomorrow. Parker has increased its annual dividend per share paid to shareholders for 65 consecutive fiscal years, among the top five longest-running dividend-increase records in the S&P 500 index. Learn more at www.parker.com or @parkerhannifin.