ROCKWELL AUTOMATION, INC. Rockwell Automation Reports Fourth Quarter and Full Year 2020 Results; Introduces Fiscal 2021 Guidance.
Fourth quarter reported sales down 9.3 percent year-over-year; organic sales down 12.1 percent year-over-year.
Fourth quarter reported sales up 12.6 percent sequentially; organic sales up 9.9 percent sequentially
Fourth quarter diluted EPS of
Full year fiscal 2020 diluted EPS of
Full year fiscal 2020 Cash Flow from Operations of
Redefining Adjusted Income and Adjusted EPS in fiscal 2021; fiscal 2020 Adjusted EPS in the new definition was
Introduces fiscal 2021 EPS guidance: Diluted EPS
'Rockwell's performance in the quarter and fiscal year demonstrates the increasing resiliency of our business model and the dedication of our employees under extraordinarily trying circumstances. Double-digit sequential orders growth reflects gradually improving business conditions and the expanding value we are providing to customers across diverse industries,' said
Fiscal 2020 Q4 Financial Results
Fiscal 2020 fourth quarter sales were
Fiscal 2020 fourth quarter net income attributable to
Pre-tax margin was 19.1 percent in the fourth quarter of fiscal 2020, compared to 3.3 percent in the same period last year. The increase in pre-tax margin was primarily due to the PTC adjustments.
Total segment operating margin was 20.2 percent in the fourth quarter, flat compared to a year ago. Total segment operating earnings were
Cash flow provided by operating activities in the fourth quarter of fiscal 2020 was
Fiscal 2020 Full Year Financial Results
Sales were
Fiscal 2020 net income attributable to
Pre-tax margin was 17.9 percent in fiscal 2020, compared to 13.5 percent last year. The increase in pre-tax margin was primarily due to the PTC Adjustments, partially offset by lower sales.
Total segment operating margin was 19.9 percent compared to 22.0 percent a year ago due to lower sales and the impact of acquisitions, partially offset by a combination of temporary and structural cost actions. Total segment operating earnings were
Cash flow provided by operating activities in fiscal year 2020 was
New Definition of Adjusted Income and Adjusted EPS
Beginning in fiscal 2021, Rockwell is changing its definition of Adjusted Income and Adjusted EPS to also exclude the impact of purchase accounting depreciation and amortization expense, including the related tax effects. Adjusted EPS guidance in the table below is presented using the new definition. Reconciliations of our non-GAAP measure for net income attributable to
Outlook
The COVID-19 pandemic and global efforts to respond to it continue to evolve. Our projections assume that a gradual recovery continues, with no increase in pandemic-related facility closures or disruptions to the supply chain. Based on the information available to us at the time of this release, the following table provides guidance as it relates to sales growth and earnings per share for fiscal 2021:
Sales Growth Guidance
EPS Guidance
Reported sales growth
6% - 9%
Diluted EPS
Organic sales growth
3.5% - 6.5%
Adjusted EPS (new definition)2
Inorganic sales growth1
1.0% - 1.5%
Currency translation
~ 1%
1Estimate for incremental sales resulting from businesses acquired in fiscal year 2020 and 2021.
2Compares to fiscal 2020 Adjusted EPS of
'As markets recover and industrial companies invest in their resilience and agility, Rockwell is well-positioned to grow in fiscal 2021,' Moret continued. 'New software, hardware, and services offerings across our portfolio are adding significant value as we focus on creating more ways to win.'
Following is a discussion of fourth quarter and full year results for both segments.
Architecture & Software
Architecture & Software fiscal 2020 fourth quarter sales were
Architecture & Software fiscal 2020 sales were
Control Products & Solutions
Control Products & Solutions fiscal 2020 fourth quarter sales were
Control Products & Solutions fiscal 2020 sales were
Supplemental Information
General Corporate-Net - Fiscal 2020 fourth quarter general corporate net expense was
Purchase Accounting Depreciation and Amortization - Fiscal 2020 fourth quarter purchase accounting depreciation and amortization expense was
Tax - On a GAAP basis, the effective tax rate in the fourth quarter of fiscal 2020 was 12.0 percent compared to 85.6 percent in the fourth quarter of 2019. The decrease is primarily due to the PTC adjustments. The effective tax rate for the full fiscal year 2020 was 9.9 percent compared to 22.8 percent in fiscal 2019. The decrease is primarily due to the PTC adjustments, a tax benefit related to Sensia, and other discrete items.
The Adjusted Effective Tax Rate for the fourth quarter of fiscal 2020 was 15.0 percent compared to 17.0 percent in the fourth quarter of 2019. The Adjusted Effective Tax Rate for the full fiscal year 2020 was 12.0 percent compared to 17.9 percent in fiscal 2019.
Share Repurchases - The Company did not repurchase shares of its common stock during the fourth quarter of fiscal 2020. For the full fiscal year 2020, the Company repurchased 1.4 million shares of its common stock at a cost of
ROIC - Return on invested capital was 35.7 percent.
Non-GAAP Measures - Organic sales, total segment operating earnings, total segment operating margin, Adjusted Income, Adjusted EPS, Adjusted Effective Tax Rate, free cash flow, free cash flow conversion, and return on invested capital are non-GAAP measures that are reconciled to GAAP measures in the attachments to this release.
Conference Call
A conference call to discuss our financial results will take place at
Interested parties can access the conference call by dialing the following numbers: (833) 714-0916 in the
Both the presentation materials and a replay of the call will be available on the Investor Relations section of the
This news release contains statements (including certain projections and business trends) that are 'forward-looking statements' as defined in the Private Securities Litigation Reform Act of 1995. Words such as 'believe', 'estimate', 'project', 'plan', 'expect', 'anticipate', 'will', 'intend' and other similar expressions may identify forward-looking statements. Actual results may differ materially from those projected as a result of certain risks and uncertainties, many of which are beyond our control, including but not limited to:
the severity and duration of disruptions to our business due to pandemics, including the COVID-19 pandemic, natural disasters, acts of war, strikes, terrorism, social unrest or other causes, including the impacts of the COVID-19 pandemic and efforts to manage it on the global economy, liquidity and financial markets, demand for our hardware and software products, solutions and services, our supply chain, our work force, our liquidity and the value of the assets we own;
macroeconomic factors, including global and regional business conditions (including adverse impacts in certain markets, such as Oil & Gas), the availability and cost of capital, commodity prices, the cyclical nature of our customers' capital spending, sovereign debt concerns and currency exchange rates;
laws, regulations and governmental policies affecting our activities in the countries where we do business, including those related to tariffs, taxation, and trade controls;
the availability and price of components and materials;
the availability, effectiveness and security of our information technology systems;
our ability to manage and mitigate the risk related to security vulnerabilities and breaches of our hardware and software products, solutions and services;
the successful development of advanced technologies and demand for and market acceptance of new and existing hardware and software products;
our ability to manage and mitigate the risks associated with our solutions and services businesses;
the successful execution of our cost productivity initiatives;
competitive hardware and software products, solutions and services and pricing pressures, and our ability to provide high quality products, solutions and services;
our ability to attract, develop, and retain qualified personnel;
disruptions to our distribution channels or the failure of distributors to develop and maintain capabilities to sell our products;
the successful integration and management of strategic transactions and achievement of the expected benefits of these transactions;
intellectual property infringement claims by others and the ability to protect our intellectual property;
the uncertainty of claims by taxing authorities in the various jurisdictions where we do business;
the uncertainties of litigation, including liabilities related to the safety and security of the hardware and software products, solutions and services we sell;
risks associated with our investment in common stock of
our ability to manage costs related to employee retirement and health care benefits; and
other risks and uncertainties, including but not limited to those detailed from time to time in our
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