● |
Organic orders increased 9% YoY
|
● |
Organic revenue grew 3% with gains across both segments
|
● |
Reported operating margin of 10.1%; Record adjusted operating margin* of 12.9%, up 160 points year over year
|
● |
Margin improvement driven by structural SG&A productivity, positive price/cost, and volume leverage improvement
|
● |
Strategic alternative review ongoing
|
$ millions | Q3 2021 | Q3 2020 | Variance | Organic Variance | ||||
Backlog | $ | 597.8 | $ | 530.4 | 12.7 | % | 2.5 | % |
Orders | 384.1 | 327.6 | 17.2 | % | 9.3 | % | ||
Revenues | 389.6 | 356.9 | 9.2 | % | 3.3 | % | ||
Operating income | 39.2 | 31.6 | 24.1 | % | ||||
Margin % | 10.1 | % | 8.9 | % | 120 bps | |||
Adjusted operating income* | 50.4 | 40.3 | 25.1 | % | ||||
Margin % | 12.9 | % | 11.3 | % | 160 bps | |||
Segment income | 56.0 | 52.8 | 6.1 | % | ||||
Margin % | 14.4 | % | 14.8 | % | -40 bps | |||
Operating cash flow from continuing operations | 8.1 | 39.1 | ||||||
Adjusted free cash flow from continuing operations* | 6.7 | 38.6 | ||||||
Income from continuing operations, net of tax | 23.4 | 16.3 | ||||||
Adjusted EBITDA from continuing operations* | 57.9 | 46.8 |
Three months ended | Nine months ended | |||||||
October 2, 2021 | September 26, 2020 | October 2, 2021 | September 26, 2020 | |||||
Revenues | $ | 389.6 | $ | 356.9 | $ | 1,135.0 | $ | 954.5 |
Cost of products sold | 250.6 | 230.8 | 735.8 | 613.8 | ||||
Gross profit | 139.0 | 126.1 | 399.2 | 340.7 | ||||
Selling, general and administrative | 93.3 | 89.9 | 277.5 | 265.9 | ||||
Intangible amortization | 5.9 | 2.8 | 13.6 | 8.5 | ||||
Asset impairment charges | - | 0.5 | - | 3.2 | ||||
Restructuring and other related charges | 0.6 | 1.3 | 14.1 | 8.7 | ||||
Operating income | 39.2 | 31.6 | 94.0 | 54.4 | ||||
Other income, net | 9.5 | 4.2 | 18.1 | 8.5 | ||||
Interest expense, net | (4.2) | (7.4) | (14.0) | (24.9) | ||||
Loss on early extinguishment of debt | (12.4) | (11.0) | (12.4) | (11.0) | ||||
Income from continuing operations before income taxes | 32.1 | 17.4 | 85.7 | 27.0 | ||||
Income tax provision | (8.6) | (0.7) | (31.6) | (3.7) | ||||
Income from continuing operations | 23.5 | 16.7 | 54.1 | 23.3 | ||||
Income (loss) from discontinued operations, net of tax | 0.1 | (4.2) | (0.8) | (40.9) | ||||
Net income (loss) | 23.6 | 12.5 | 53.3 | (17.6) | ||||
Less: Net income attributable to noncontrolling interests | 0.1 | 0.4 | 0.4 | 0.7 | ||||
Net income (loss) attributable to SPX FLOW, Inc. | $ | 23.5 | $ | 12.1 | $ | 52.9 | $ | (18.3) |
Amounts attributable to SPX FLOW, Inc. common shareholders: | ||||||||
Income from continuing operations, net of tax | $ | 23.4 | $ | 16.3 | $ | 53.7 | $ | 22.5 |
Income (loss) from discontinued operations, net of tax | 0.1 | (4.2) | (0.8) | (40.8) | ||||
Net income (loss) attributable to SPX FLOW, Inc. | $ | 23.5 | $ | 12.1 | $ | 52.9 | $ | (18.3) |
Basic income (loss) per share of common stock: | ||||||||
Income per share from continuing operations | $ | 0.56 | $ | 0.39 | $ | 1.28 | $ | 0.53 |
Income (loss) per share from discontinued operations | - | (0.10) | (0.02) | (0.96) | ||||
Net income (loss) per share attributable to SPX FLOW, Inc. | 0.56 | 0.29 | 1.26 | (0.43) | ||||
Diluted income (loss) per share of common stock: | ||||||||
Income per share from continuing operations | $ | 0.56 | $ | 0.39 | $ | 1.28 | $ | 0.53 |
Income (loss) per share from discontinued operations | - | (0.10) | (0.02) | (0.96) | ||||
Net income (loss) per share attributable to SPX FLOW, Inc. | 0.56 | 0.29 | 1.26 | (0.43) | ||||
Weighted average number of common shares outstanding - basic | 41.952 | 42.127 | 41.924 | 42.425 | ||||
Weighted average number of common shares outstanding - diluted | 41.960 | 42.450 | 41.956 | 42.640 |
October 2, 2021 | December 31, 2020 | |||
ASSETS | ||||
Current assets: | ||||
Cash and equivalents | $ | 313.6 | $ | 441.5 |
Accounts receivable, net | 241.2 | 232.6 | ||
Contract assets | 27.7 | 24.4 | ||
Inventories, net | 245.7 | 199.3 | ||
Other current assets | 31.7 | 27.4 | ||
Total current assets | 859.9 | 925.2 | ||
Property, plant and equipment: | ||||
Land | 22.1 | 22.8 | ||
Buildings and leasehold improvements | 171.7 | 176.8 | ||
Machinery and equipment | 355.4 | 349.1 | ||
549.2 | 548.7 | |||
Accumulated depreciation | (315.1) | (320.6) | ||
Property, plant and equipment, net | 234.1 | 228.1 | ||
Goodwill | 595.2 | 569.7 | ||
Intangibles, net | 227.9 | 206.0 | ||
Other assets | 175.6 | 169.5 | ||
TOTAL ASSETS | $ | 2,092.7 | $ | 2,098.5 |
LIABILITIES, MEZZANINE EQUITY AND EQUITY | ||||
Current liabilities: | ||||
Accounts payable | $ | 169.3 | $ | 149.1 |
Contract liabilities | 115.3 | 119.5 | ||
Accrued expenses | 180.7 | 178.7 | ||
Income taxes payable | 19.3 | 23.0 | ||
Short-term debt | 15.4 | 12.5 | ||
Current maturities of long-term debt | 20.0 | 0.1 | ||
Total current liabilities | 520.0 | 482.9 | ||
Long-term debt | 379.1 | 397.3 | ||
Deferred and other income taxes | 35.7 | 36.6 | ||
Other long-term liabilities | 114.5 | 117.5 | ||
Total long-term liabilities | 529.3 | 551.4 | ||
Mezzanine equity | 3.3 | 3.4 | ||
Equity: | ||||
SPX FLOW, Inc. shareholders' equity: | ||||
Common stock | 0.4 | 0.4 | ||
Paid-in capital | 1,723.8 | 1,696.9 | ||
Accumulated deficit | (321.8) | (363.3) | ||
Accumulated other comprehensive loss | (268.9) | (226.4) | ||
Common stock in treasury | (92.7) | (46.2) | ||
Total SPX FLOW, Inc. shareholders' equity | 1,040.8 | 1,061.4 | ||
Noncontrolling interests | (0.7) | (0.6) | ||
Total equity | 1,040.1 | 1,060.8 | ||
TOTAL LIABILITIES, MEZZANINE EQUITY AND EQUITY | $ | 2,092.7 | $ | 2,098.5 |
Three months ended | Nine months ended | |||||||
October 2, 2021 | September 26, 2020 | October 2, 2021 | September 26, 2020 | |||||
Cash flows from operating activities: | ||||||||
Net income (loss) | $ | 23.6 | $ | 12.5 | $ | 53.3 | $ | (17.6) |
Less: Income (loss) from discontinued operations, net of tax | 0.1 | (4.2) | (0.8) | (40.9) | ||||
Income from continuing operations | 23.5 | 16.7 | 54.1 | 23.3 | ||||
Adjustments to reconcile income from continuing operations to net cash from operating activities: | ||||||||
Restructuring and other related charges | 0.6 | 1.3 | 14.1 | 8.7 | ||||
Asset impairment charges | - | 0.5 | - | 3.2 | ||||
Deferred income taxes | (5.2) | 0.1 | 2.5 | 18.9 | ||||
Depreciation and amortization | 13.3 | 10.2 | 35.3 | 30.2 | ||||
Stock-based compensation | 3.8 | 3.6 | 9.6 | 10.6 | ||||
Pension and other employee benefits | 0.2 | 0.3 | 0.8 | 1.0 | ||||
Gains on asset sales and other, net | (7.5) | (1.3) | (7.8) | (0.9) | ||||
Gains on changes in fair value of investment in equity security | (1.6) | (2.1) | (9.1) | (7.4) | ||||
Losses on early extinguishment of debt | 12.4 | 11.0 | 12.4 | 11.0 | ||||
Changes in operating assets and liabilities, net of effects from business acquisitions and discontinued operations: | ||||||||
Accounts receivable and other assets | 9.9 | (12.1) | (9.6) | 16.2 | ||||
Contract assets and liabilities, net | (11.9) | 1.1 | (10.0) | 4.4 | ||||
Inventories | (10.1) | 17.9 | (37.8) | (11.2) | ||||
Accounts payable, accrued expenses and other | (16.8) | (5.3) | (2.1) | (68.9) | ||||
Cash spending on restructuring actions | (2.5) | (2.8) | (10.4) | (7.5) | ||||
Net cash from continuing operations | 8.1 | 39.1 | 42.0 | 31.6 | ||||
Net cash from (used in) discontinued operations | 0.1 | (1.9) | (0.6) | (8.3) | ||||
Net cash from operating activities | 8.2 | 37.2 | 41.4 | 23.3 | ||||
Cash flows from (used in) investing activities: | ||||||||
Proceeds from asset sales and other, net | 11.5 | 3.1 | 12.1 | 3.3 | ||||
Capital expenditures | (9.1) | (5.5) | (23.5) | (17.3) | ||||
Business acquisitions, net of cash acquired of $4.5 in the nine months ended October 2, 2021 and of $- in the three and nine months ended September 26, 2020
| - | (10.0) | (102.6) | (10.0) | ||||
Net cash from (used in) continuing operations | 2.4 | (12.4) | (114.0) | (24.0) | ||||
Net cash from discontinued operations (includes proceeds from disposition of $406.2, less cash and restricted cash disposed of $7.3, in the nine months ended September 26, 2020)
| - | - | - | 393.4 | ||||
Net cash from (used in) investing activities | 2.4 | (12.4) | (114.0) | 369.4 |
Three months ended | Nine months ended | |||||||
October 2, 2021 | September 26, 2020 | October 2, 2021 | September 26, 2020 | |||||
Cash flows used in financing activities: | ||||||||
Borrowings under amended senior credit facility | 400.0 | - | 400.0 | - | ||||
Repurchases of senior notes (includes premiums paid of $8.8 in the three and nine months ended October 2, 2021 and of $8.4 in the three and nine months ended September 26, 2020)
| (308.8) | (308.4) | (308.8) | (308.4) | ||||
Repayments of former senior credit facility | (100.0) | - | (100.0) | - | ||||
Borrowings under (repayments of) purchase card program, net | 0.1 | (6.8) | 2.9 | (11.6) | ||||
Repayments of other financing arrangements | (0.5) | - | (1.7) | (0.3) | ||||
Financing fees paid | (2.9) | - | (2.9) | - | ||||
Purchases of common stock | (5.7) | (10.7) | (40.2) | (16.9) | ||||
Proceeds from the exercise of employee stock options | - | - | 17.6 | - | ||||
Minimum withholdings paid on behalf of employees for net share settlements, net | (0.3) | (0.1) | (6.6) | (6.9) | ||||
Dividends paid (includes noncontrolling interest distributions of $1.2 in the nine months ended September 26, 2020)
| (3.8) | - | (7.6) | (1.2) | ||||
Purchases of noncontrolling interests | - | (8.2) | (0.6) | (8.2) | ||||
Net cash used in continuing operations | (21.9) | (334.2) | (47.9) | (353.5) | ||||
Net cash used in discontinued operations | - | - | - | (0.3) | ||||
Net cash used in financing activities | (21.9) | (334.2) | (47.9) | (353.8) | ||||
Change in cash, cash equivalents and restricted cash due to changes in foreign currency exchange rates | 0.8 | 4.8 | (7.4) | 10.2 | ||||
Net change in cash, cash equivalents and restricted cash | (10.5) | (304.6) | (127.9) | 49.1 | ||||
Consolidated cash, cash equivalents and restricted cash, beginning of period | 324.2 | 657.1 | 441.6 | 303.4 | ||||
Consolidated cash, cash equivalents and restricted cash, end of period | $ | 313.7 | $ | 352.5 | $ | 313.7 | $ | 352.5 |
Three months ended | Nine months ended | |||||||
October 2, 2021 | September 26, 2020 | October 2, 2021 | September 26, 2020 | |||||
Net cash flow from operating activities - continuing and discontinued operations | $ | 8.2 | $ | 37.2 | $ | 41.4 | $ | 23.3 |
Less: Net cash flow from (used in) operating activities - discontinued operations | 0.1 | (1.9) | (0.6) | (8.3) | ||||
Net cash flow from operating activities - continuing operations | 8.1 | 39.1 | 42.0 | 31.6 | ||||
Capital expenditures - continuing operations | (9.1) | (5.5) | (23.5) | (17.3) | ||||
Free cash flow from (used in) operations - continuing operations | (1.0) | 33.6 | 18.5 | 14.3 | ||||
Cash spending on restructuring actions | 2.5 | 2.8 | 10.4 | 7.5 | ||||
Cash spending on certain M&A activities | 0.7 | - | 4.6 | - | ||||
Cash spending on strategic actions | - | 2.2 | - | 6.4 | ||||
Discrete cash tax payments | 4.5 | - | 4.5 | 17.1 | ||||
Adjusted free cash flow from operations | $ | 6.7 | $ | 38.6 | $ | 38.0 | $ | 45.3 |
As of and for the three months ended |
As of and for the nine months ended | |||||||||||||||
October 2, 2021 | September 26, 2020 | Δ | %/bps | October 2, 2021 | September 26, 2020 | Δ | %/bps | |||||||||
Nutrition and Health | ||||||||||||||||
Backlog | $ | 262.0 | $ | 269.2 | $ | (7.2) | (2.7) | % | $ | 262.0 | $ | 269.2 | $ | (7.2) | (2.7) | % |
Orders | $ | 160.2 | $ | 159.0 | $ | 1.2 | 0.8 | % | $ | 504.0 | $ | 435.1 | $ | 68.9 | 15.8 | % |
Revenues | $ | 170.1 | $ | 160.6 | $ | 9.5 | 5.9 | % | $ | 510.0 | $ | 443.1 | $ | 66.9 | 15.1 | % |
Segment income | $ | 24.6 | $ | 24.2 | $ | 0.4 | 1.7 | % | $ | 79.6 | $ | 62.7 | $ | 16.9 | 27.0 | % |
Intangible amortization expense | 1.6 | 1.5 | 0.1 | 4.8 | 4.6 | 0.2 | ||||||||||
Adjusted segment income | $ | 26.2 | $ | 25.7 | $ | 0.5 | 1.9 | % | $ | 84.4 | $ | 67.3 | $ | 17.1 | 25.4 | % |
as a percent of revenues | 15.4 | % | 16.0 | % | (60)bps | 16.5 | % | 15.2 | % | 130bps | ||||||
Precision Solutions | ||||||||||||||||
Backlog | $ | 335.8 | $ | 261.2 | $ | 74.6 | 28.6% | $ | 335.8 | $ | 261.2 | $ | 74.6 | 28.6% | ||
Orders | $ | 223.9 | $ | 168.6 | $ | 55.3 | 32.8% | $ | 656.6 | $ | 529.9 | $ | 126.7 | 23.9% | ||
Revenues | $ | 219.5 | $ | 196.3 | $ | 23.2 | 11.8% | $ | 625.0 | $ | 511.4 | $ | 113.6 | 22.2% | ||
Segment income | $ | 31.4 | $ | 28.6 | $ | 2.8 | 9.8% | $ | 76.4 | $ | 57.9 | $ | 18.5 | 32.0% | ||
Intangible amortization expense | 4.3 | 1.3 | 3.0 | 8.8 | 3.9 | 4.9 | ||||||||||
Purchase accounting - amortization of inventory fair value adjustment | 0.4 | - | 0.4 | 1.9 | - | 1.9 | ||||||||||
Adjusted segment income | $ | 36.1 | $ | 29.9 | $ | 6.2 | 20.7% | $ | 87.1 | $ | 61.8 | $ | 25.3 | 40.9% | ||
as a percent of revenues | 16.4 | % | 15.2 | % | 120bps | 13.9 | % | 12.1 | % | 180bps | ||||||
Consolidated Backlog | $ | 597.8 | $ | 530.4 | $ | 67.4 | 12.7% | $ | 597.8 | $ | 530.4 | $ | 67.4 | 12.7% | ||
Consolidated Orders | $ | 384.1 | $ | 327.6 | $ | 56.5 | 17.2% | $ | 1,160.6 | $ | 965.0 | $ | 195.6 | 20.3% | ||
Consolidated Revenues | $ | 389.6 | $ | 356.9 | $ | 32.7 | 9.2% | $ | 1,135.0 | $ | 954.5 | $ | 180.5 | 18.9% | ||
Consolidated Segment Income | $ | 56.0 | $ | 52.8 | $ | 3.2 | 6.1% | $ | 156.0 | $ | 120.6 | $ | 35.4 | 29.4% | ||
Consolidated Adjusted Segment Income | $ | 62.3 | $ | 55.6 | $ | 6.7 | 12.1% | $ | 171.5 | $ | 129.1 | $ | 42.4 | 32.8% | ||
as a percent of revenues | 16.0 | % | 15.6 | % | 40bps | 15.1 | % | 13.5 | % | 160bps | ||||||
Consolidated Adjusted Segment Income | $ | 62.3 | $ | 55.6 | $ | 6.7 | $ | 171.5 | $ | 129.1 | $ | 42.4 | ||||
Less: Intangible amortization expense | (5.9) | (2.8) | (3.1) | (13.6) | (8.5) | (5.1) | ||||||||||
Less: Purchase accounting - amortization of inventory fair value adjustment | (0.4) | - | (0.4) | (1.9) | - | (1.9) | ||||||||||
Consolidated Segment Income | 56.0 | 52.8 | 3.2 | 156.0 | 120.6 | 35.4 | ||||||||||
Corporate expense | 16.0 | 19.2 | (3.2) | 47.3 | 53.7 | (6.4) | ||||||||||
Pension and postretirement service costs | 0.2 | 0.2 | - | 0.6 | 0.6 | - | ||||||||||
Asset impairment charges | - | 0.5 | (0.5) | - | 3.2 | (3.2) | ||||||||||
Restructuring and other related charges | 0.6 | 1.3 | (0.7) | 14.1 | 8.7 | 5.4 | ||||||||||
Consolidated Operating Income | $ | 39.2 | $ | 31.6 | $ | 7.6 | 24.1% | $ | 94.0 | $ | 54.4 | $ | 39.6 | 72.8% | ||
as a percent of revenues | 10.1 | % | 8.9 | % | 120bps | 8.3 | % | 5.7 | % | 260bps | ||||||
Three months ended | Nine months ended | |||||||
October 2, 2021 | September 26, 2020 | October 2, 2021 | September 26, 2020 | |||||
Operating income | $ | 39.2 | $ | 31.6 | $ | 94.0 | $ | 54.4 |
Charges and fees associated with strategic actions | 3.3 | 2.8 | 3.3 | 6.0 | ||||
Charges associated with certain M&A activities | 0.8 | - | 5.6 | - | ||||
Restructuring and other related charges | 0.6 | 1.3 | 14.1 | 8.7 | ||||
Asset impairment charges | - | 0.5 | - | 3.2 | ||||
Reduction of SG&A costs associated with transition services income | 0.2 | 1.3 | 1.7 | 2.8 | ||||
Purchase accounting - amortization of inventory fair value adjustment | 0.4 | - | 1.9 | - | ||||
Intangible amortization | 5.9 | 2.8 | 13.6 | 8.5 | ||||
Adjusted operating income | $ | 50.4 | $ | 40.3 | $ | 134.2 | $ | 83.6 |
Three months ended October 2, 2021 | ||||||||
Net Revenue Growth |
Foreign Currency | Business Combinations |
Organic Revenue Growth | |||||
Nutrition and Health | 5.9 | % | 1.4 | % | - | % | 4.5 | % |
Precision Solutions | 11.8 | % | 1.6 | % | 7.9 | % | 2.3 | % |
Consolidated | 9.2 | % | 1.6 | % | 4.3 | % | 3.3 | % |
Nine months ended October 2, 2021 | ||||||||
Net Revenue Growth |
Foreign Currency | Business Combinations |
Organic Revenue Growth | |||||
Nutrition and Health | 15.1 | % | 4.1 | % | - | % | 11.0 | % |
Precision Solutions | 22.2 | % | 3.7 | % | 6.8 | % | 11.7 | % |
Consolidated | 18.9 | % | 3.9 | % | 3.6 | % | 11.4 | % |
Three months ended | Nine months ended | |||||||
October 2, 2021 | September 26, 2020 | October 2, 2021 | September 26, 2020 | |||||
Net income attributable to SPX FLOW, Inc. from continuing operations | $ | 23.4 | $ | 16.3 | $ | 53.7 | $ | 22.5 |
Income tax provision | 8.6 | 0.7 | 31.6 | 3.7 | ||||
Interest expense, net | 4.2 | 7.4 | 14.0 | 24.9 | ||||
Depreciation and amortization | 13.3 | 10.2 | 35.3 | 30.2 | ||||
EBITDA from continuing operations | 49.5 | 34.6 | 134.6 | 81.3 | ||||
Charges and fees associated with strategic actions | 3.3 | 2.8 | 3.3 | 6.0 | ||||
Charges associated with certain M&A activities | 0.8 | - | 5.6 | - | ||||
Restructuring and other related charges | 0.6 | 1.3 | 14.1 | 8.7 | ||||
Asset impairment charges | - | 0.5 | - | 3.2 | ||||
Fair value adjustment related to an equity security | (1.6) | (2.1) | (9.1) | (7.4) | ||||
Gains on certain asset sales and other, net | (7.5) | (1.3) | (7.8) | (1.3) | ||||
Loss on early extinguishment of debt | 12.4 | 11.0 | 12.4 | 11.0 | ||||
Purchase accounting - amortization of inventory fair value adjustment | 0.4 | - | 1.9 | - | ||||
Adjusted EBITDA from continuing operations | $ | 57.9 | $ | 46.8 | $ | 155.0 | $ | 101.5 |
SPX FLOW, INC. AND SUBSIDIARIES | ||||||||
ADJUSTED DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS RECONCILIATION | ||||||||
(Unaudited) | ||||||||
Three months ended | Nine months ended | |||||||
October 2, 2021 | September 26, 2020 | October 2, 2021 | September 26, 2020 | |||||
Diluted earnings per share from continuing operations | $ | 0.56 | $ | 0.39 | $ | 1.28 | $ | 0.53 |
Charges and fees associated with strategic actions, net of tax | 0.06 | 0.05 | 0.06 | 0.10 | ||||
Charges associated with certain M&A activities, net of tax | 0.01 | - | 0.10 | - | ||||
Restructuring and other related charges, net of tax | 0.01 | 0.02 | 0.27 | 0.16 | ||||
Asset impairment charges, net of tax | - | 0.01 | - | 0.05 | ||||
Fair value adjustment related to an equity security, net of tax | (0.03) | (0.04) | (0.17) | (0.13) | ||||
Gains on certain asset sales and other, net of tax | (0.13) | (0.02) | (0.13) | (0.02) | ||||
Loss on early extinguishment of debt, net of tax | 0.22 | 0.20 | 0.22 | 0.20 | ||||
Purchase accounting - amortization of inventory fair value adjustment, net of tax | 0.01 | - | 0.04 | - | ||||
Intangible amortization, net of tax | 0.11 | 0.05 | 0.25 | 0.15 | ||||
Discrete tax charges (credits) | (0.03) | (0.13) | 0.11 | (0.13) | ||||
Adjusted diluted earnings per share from continuing operations | $ | 0.79 | $ | 0.53 | $ | 2.03 | $ | 0.91 |
Attachments
- Original document
- Permalink
Disclaimer
SPX FLOW Inc. published this content on 10 November 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 10 November 2021 11:36:03 UTC.