Chart Industries, Inc. (NYSE: GTLS) today reported results for the
fourth quarter and full year ended December 31, 2022. All results
reported are from continuing operations. Further details can be
found in the supplemental presentation accompanying this release
and published in the investor relations section of our website.
- Record
fourth quarter 2022 and record full year 2022 backlog, sales, gross
profit, and operating income
- Record
full year 2022 orders of $2,779.9 million included our four highest
order quarters in our history and increased 65.9% compared to 2021
(29.0% excluding Big LNG); fourth quarter 2022 orders of $525.9
million increased 14.1% from the fourth quarter 2021
- Record
fourth quarter 2022 sales of $441.4 million contributed to record
full year 2022 sales of $1,612.4 million, an increase of 22.4%
(+21.4% organic, +4.8% inorganic offset by 3.9% foreign exchange
headwind) compared to 2021
- Record
fourth quarter operating income of $60.1 million (adjusted $75.0
million) and record fourth quarter operating income as a percent of
sales of 13.6% (adjusted 17.0%) contributed to full year record
operating income of $151.5 million
- Record
reported EBITDA of $102.1 million in the fourth quarter 2022
(adjusted EBITDA of $97.5 million) and EBITDA as a percent of sales
of 23.1% (adjusted 22.1%) driven by strong execution, continued
pricing actions and small and large project work
- Reported
fourth quarter 2022 non-diluted earnings per share (“EPS”) of
$0.42; when adjusted for one-time items, fourth quarter adjusted
non-diluted EPS was $1.67, a quarterly record, contributing to full
year 2022 record non-diluted EPS of $2.21 and record adjusted
non-diluted EPS of $4.69
- Fourth
quarter 2022 net cash provided by operations of $30.5 million
before $26.0 million of capital expenditures; when adjusted for
one-time items, fourth quarter 2022 adjusted free cash flow of
$71.5 million
-
Reiterating Chart standalone 2023 full-year sales outlook
of $2.10 billion to $2.20 billion and reiterating our associated
2023 full-year adjusted EBITDA outlook in the range of $440 million
to $480 million
- Howden
acquisition anticipated to close in the next 45 days and on-track
to delivering our year-one synergy and financial
commitments.
We set numerous full year 2022 and
fourth quarter 2022 historical records.
|
Orders |
Net Sales |
Backlog |
GrossProfit |
OperatingIncome |
OperatingMargin |
Q4 2022 |
|
✔ |
✔ |
✔ |
✔ |
✔ |
FY 2022 |
✔ |
✔ |
✔ |
✔ |
✔ |
|
Our four highest order quarters in our history
were all in 2022. Full year orders of $2,779.9 million included
three Big LNG orders totaling $620.7 million as well as a total of
12 floating LNG (“FLNG”), small-scale LNG and hydrogen liquefaction
systems and associated equipment. Fourth quarter 2022 orders of
$525.9 million included orders for our IPSMR® process technology
and associated equipment for New Fortress Energy’s Fast4 and Fast5
LNG projects and was a 14.1% increase over the fourth quarter 2021
orders. The 2022 record orders contributed to record backlog of
$2,338.1 million, a strong setup to our 2023 outlook. 2022 was the
first time in our history that we booked multiple Big LNG projects
in the same year, with three consecutive quarters (first through
third quarters 2022) having Big LNG bookings. We anticipate Big
LNG, small-scale LNG and FLNG demand to continue in 2023, and while
no additional Big LNG orders are included in our 2023 outlook, we
currently anticipate more than one project to move to Final
Investment Decision (“FID”), with one expected in the first half
2023. To start 2023, we received an order for $115 million for our
IPSMR® liquefaction systems from Wison Heavy Industry Co., Ltd. as
well as an order for brazed aluminum heat exchangers into a
floating LNG application for $19.5 million.
Fourth quarter 2022 sales of $441.4 million and
full year 2022 sales of $1,612.4 million were our highest sales
quarter and year in our history, and each of our segments had
record sales in the full year 2022. Fourth quarter 2022 sales
sequentially increased more than 8.5% in three of our four segments
compared to the third quarter 2022, with RSL and HTS up 11.1% and
12.3%, respectively. CTS sales were flat to the third quarter 2022,
which is consistent with the typical seasonal nature of industrial
gas activity.
Full year 2022 sales grew 22.4%, despite the
negative impact of foreign exchange of 3.9%, and a 79.2% decline in
HLNG over-the-road vehicle tank sales (excluding HLNG from full
year sales in both 2022 and 2021 would result in a 33.6% growth
rate for the business year-over-year). Repair, Service and Leasing
(“RSL”) and Heat Transfer Systems (“HTS”) segments full year 2022
sales were $209.6 million (+12.1% increase when compared to 2021)
and $462.7 million (+76.1%), respectively. HTS benefitted from a
strong small-scale, floating LNG and Big LNG year, as well as
traditional energy applications’ orders growing in 2022. Cryo Tank
Solutions full year 2022 sales of $504.3 million also grew 12.7%
year-over-year, while Specialty Products sales increased 3.6% to
$448.3 million. Specialty Products sales increased 39.7% when
excluding HLNG over-the-road vehicle tank sales in each year.
Record fourth quarter 2022 reported gross profit
of $124.3 million contributed to our full year record 2022 gross
profit of $407.4 million. We have sequential quarter-over-quarter
improvement in gross margin as a percent of sales, with reported
gross margin in the fourth quarter 2022 of 28.2% (and each month’s
reported gross margin as a percent of sales and operating margin as
a percent of sales within the quarter sequentially increased, with
our exit rate from December 2022 of reported gross profit as a
percent of sales of 31%). When adjusted for one-time items of
restructuring costs, specific customer concession, and the brazed
aluminum heat exchanger installation costs, gross margin as a
percent of sales for the fourth quarter 2022 was 29.9%. We intend
to continue to robustly manage gross margin levels as we remain
active on our pricing actions and expect tempering of the recent
inflationary pressures for our main material input costs.
Reported operating income of $60.1 million for
the fourth quarter 2022 resulted in record reported operating
income as a percent of sales of 13.6%. When excluding the $14.9
million of operational one-time costs in the fourth quarter 2022,
including specific costs related to the Howden acquisition (third
party due diligence and legal costs primarily), adjusted operating
income as a percent of sales was 17.0%, also a historical
record.
Fourth quarter 2022 EBITDA of $102.1 million
included one-time items related to the revaluation of our
investment in Svante following its sale of securities to additional
investors, including Chevron (gain of $23.3 million), share based
compensation ($2.7 million) and the non-recurring costs reflected
in adjusted operating income. When adjusting for these one-time
items, adjusted EBITDA for the fourth quarter 2022 was $97.5
million.
Reported fourth quarter 2022 non-diluted
earnings per share (“EPS”) of $0.42; when adjusted for one-time
items primarily related to Howden deal-related costs, integration
costs on other acquisitions, financing costs as well the gain from
our revaluation of Svante and our mark-market of our inorganic
investments, fourth quarter adjusted non-diluted EPS was $1.67.
Full year 2022 reported non-diluted EPS of $2.21 is a historical
record as is our adjusted non-diluted EPS for the full year of
$4.69.
“Not only was 2022 a record year across nearly
all financial metrics for our business, we continue to see
broad-based demand as we head into 2023 across our full solution
offering,” stated Jill Evanko, Chart’s CEO and President. “We are
pleased with the progress of margin improvement, in particular our
record adjusted operating income as a percent of sales of 17.0% in
the fourth quarter and are excited to be progressing on track to
closing the acquisition of Howden and the expectation of delivering
year-one synergies at or above target. I want to thank our One
Chart global team members for their efforts in executing a record
year, and most importantly, doing so safely as we had our lowest
number of safety incidents and total recordable incident rate to
end 2022.”
Broad-based demand for our products and
solutions continues into 2023 providing strong confidence in our
2023 through 2025 outlook driven by macro tailwinds and our
Chart-specific differentiation including certifications, new
products and a safe operating environment. January 2023 total Chart
orders were over $285 million.
We continue to see widespread demand across our
business, with one indicator of this being seven consecutive
quarters with more than 60 orders each over $1 million. In the
fourth quarter 2022, we booked 66 of these orders, bringing our
full year 2022 to 263 orders each greater than $1 million. This is
a 16.4% increase of orders of this magnitude compared to 2021. We
also booked orders in 2022 with 327 new customers (729 total in the
past two years) and 89 new first-of-a-kind orders (“FOAK”) (168 in
the past two years combined). In the fourth quarter 2022, we
received a FOAK order from TotalEnergies for one of our Spintube™
replacement heat exchanger bundles to be installed in a refinery in
Europe, with the customer expecting significant efficiency gains by
converting to a Spintube bundle.
Another one of our fourth quarter 2022 FOAK
orders was a PFAS water treatment system with Yarmouth,
Massachusetts – this will be the first full scale system for
drinking water in the state of Massachusetts (only pilots have been
run to date). Water treatment is one of the many macro tailwinds
that we see in the Nexus of Clean™ - clean power, clean water,
clean food and clean industrials. For water treatment, PFAS
restrictions are going into effect in the United States this year,
and the United States Inflation Reduction Act (“IRA”) includes $4
billion in drought resilience and $550 million for domestic water
program funding (USA). Outside of the U.S., we have won three water
treatment orders in 2022 in India (each over $3.5 million), and
there is a growing trend for global government partnering to
accelerate water and sanitation projects. We see the
IRA as a significant tailwind to all of our Specialty Products
order activity, and this has continued in 2023.
We signed agreements or Memoranda of
Understanding (“MOU”) with 30 different partners in 2022, with a
balance between hydrogen (38%), LNG and liquefaction (34%) and
carbon capture, utilization and storage (“CCUS”) (25%), including
10 new MOUs executed in the fourth quarter 2022, with partners such
as Wison Heavy Industry Co., Ltd. that in turn has already placed a
meaningful order with us to start 2023. So far in 2023, we have
executed three new agreements with additional partners, including
Nikola for hydrogen offerings, and MOUs with Rotec for high flow
reverse osmosis for water treatment and GenH2 to incorporate Chart
equipment into their small-scale hydrogen liquefaction systems,
inclusive of storage, brazed aluminum heat exchangers, cold
boxes.
In addition to the U.S. IRA, other governments
are committing funds and programs for green energy and supporting
carbon emission reductions which we expect to drive further demand
for our solutions globally, in particular in energy, hydrogen,
water, food, and carbon capture. Examples of this include the
recently announced European Green Deal Industrial Plan, India’s
National Green Hydrogen Mission, and the continuation of the
support for a hybrid of clean energy sources. In February 2023, the
European Investment Bank (“EIB”), the bank of the European Union,
joined the India Hydrogen Alliance (“IH2A”), which Chart and
Reliance Industries were founding members. The EIB is working with
the Indian government on a credit facility to provide public sector
investments supporting the large-scale green hydrogen hubs and
projects with an indicative funding of EUR 1 billion.
The global CO2 shortage is impacting food,
beverage and industrial applications, and therefore increasing
demand and potential demand for our carbon capture and storage
solutions. In the past month, we have received record inbound
requests from customers and potential customers of breweries, food
producers, and energy companies to help them address this
situation. Of note, we have the largest pipeline of opportunities
for CCUS in New Zealand and Australia in our history. Also, our
Cryogenic Carbon Capture ™ technology and solutions are supporting
development of decarbonization solutions for the lime industry. A
first milestone achieved is represented by two recent pre-FEED
orders from two of the largest lime producers, one of them being
Carmeuse. There are many additional macro tailwinds related to ESG
and sustainability and more examples are shown in the supplemental
presentation.
Our own activities related to safety,
productivity, differentiation through global and regional
certifications, ESG-oriented internal activities to achieve our
carbon emission reduction target of 30% by 2030 and carbon
neutrality by 2050 (which we are reiterating as our goals for the
combined Chart and Howden business) continue to be central to our
One Chart operating environment. In the fourth quarter 2022, we hit
our lowest total recordable incident rate in our history, and we
received 11 certifications ranging from geographies including
China, South Korea, Canada and the United States to end uses
including rail, HLNG for buses and hydrogen.
Reported fourth quarter 2022 net cash
provided by operating activities of $30.5 million with capital
expenditures of $26.0 million; when adjusting for Howden-related
costs, primarily financing and one-time items, adjusted free cash
flow was $71.5 million.
For the fourth quarter 2022, net cash provided
by operating activities was $30.5 million with capital expenditures
of $26.0 million. Capital expenditures in the fourth quarter 2022
of $26.0 million included our decision to accelerate activity on
the installation of our brazed aluminum heat exchanger (“BAHX”)
furnace and production line in our Tulsa, Oklahoma flexible
manufacturing facility, our New Iberia, Louisiana cold box rooftop
expansion, and putting more leasing fleet assets into service. We
accelerated capacity projects as demand for our BAHX cores and cold
boxes continues at record levels, both for LNG applications of all
sizes, traditional oil and gas applications as well as our
Specialty Products full solution offerings for hydrogen, water
treatment and carbon capture and storage. We also continue to see
strong commercial activity for our standard leasing fleet, which is
primarily mobile transports and ISO containers. When adjusted for
Howden related costs, financing costs and other net income
adjustments, adjusted free cash flow for fourth quarter 2022 was
$71.5 million. We did not adjust fourth quarter 2022 adjusted free
cash flow for a negative foreign exchange headwind of $1.4 million,
$8.9 million of accelerated capacity capital expenditures, or
accounts receivable payments from four customers of $8.3 million
that came in early January 2023 versus our original expectation of
receipt in the fourth quarter 2022.
Chart standalone (excluding Howden) 2023
outlook reiterated and supported by record backlog of $2,338.1
million and a strong start to our order book in 2023; Chart and
Howden combined outlook reiterated.
We are reiterating our 2023 sales outlook range
of $2.10 billion to $2.20 billion, which includes only Big LNG
projects that are in backlog as of December 31, 2022. We are
confident in achieving this sales range, underpinned by five key
items:
- It is not unusual for project
revenue to shift between quarters. We anticipate realizing pushed
Q422 revenue in 2023 based on customer, project and material
receipt timing.
- Our outlook does not include any
additional mid-size or large project orders between now and the end
of the first half 2023, which could provide additional revenue in
the second half of 2023.
- Even though we are seeing early end
market improvement in HLNG vehicle tank sales, our forecast for
HLNG vehicle tank sales is flat with 2022.
- As of December 31, 2022, we had
record backlog of $2,338.1 million, with approximately 60% of the
full year 2023 sales outlook already in backlog, which is
meaningfully higher than in prior years
- We have existing capacity to
deliver on our backlog and any potential new orders that could
materialize throughout the year.
We are reiterating our prior 2023 standalone
full year adjusted EBITDA outlook which is anticipated to be in the
range of $440 million to $480 million. Adjusted 2023 full
year free cash flow, which also excludes any impact from the
pending Howden acquisition, is reiterated in the range of $250
million to $300 million. We will be using EBITDA as a
financial metric going forward and in light of the adjustments,
costs and variable metrics and timing associated with the Howden
acquisition, we will not provide standalone Chart adjusted earnings
per share for 2023. Following the close of the Howden
acquisition, we will provide updated combined company guidance for
the calendar year 2023 for sales, adjusted diluted earnings per
share, EBITDA and adjusted free cash flow. All of the current
share count and interest information as of the first quarter 2023
is included in the supplemental presentation.
Seasonally, as in past years, our first quarter
is typically our lowest quarter of the year, and we expect our
normal first quarter seasonality. Given this and the timing
of our backlog, we expect quarterly revenues, gross margin and
operating margins will increase over the course of the year.
Our guidance does not include the impact of the
pending acquisition with Howden, which is expected to close in the
next 45 days. We are also adjusting for acquisition and divestiture
costs, restructuring, and interest on Chart’s long-term debt to
fund the Howden transaction placed in December 2022. Chart
anticipates the absolute level of adjustments to decrease in 2024,
and effective in the fourth quarter 2022, we are no longer
adjusting strategic inventory items for free cash flow.
Howden acquisition anticipated to close
in the next 45 days and on-track to deliver our year-one synergy
and financial commitments.
We announced our definitive agreement to acquire
Howden, a leading global provider of mission critical air and gas
handling products and services, on November 9, 2022, with an
anticipated closing date within the next 45 days. We completed our
financing activities related to the transaction in December 2022,
within our anticipated weighted average cost of debt range
(previously stated range as 7% to 8.5% blended). The U.S.
Hart-Scott-Rodino (HSR) antitrust waiting period expired with no
further inquiries and the parties have also received clearances
from all except two of our total required international regulatory
approvals. Pending receipt of these two remaining
international regulatory approvals, we now expect the transaction
to close in the next 45 days.
Howden, like Chart, continued to experience
strong demand from numerous macro tailwinds in their end markets in
the fourth quarter 2022 and into the first quarter of 2023 as well
as very strong backlog heading into the year, and therefore the
previously shared 2023 outlook remains unchanged. We are
reiterating our view for 12 months pro forma combined sales of
$4.25 billion and associated adjusted 2023 EBITDA of approximately
$1 billion for the Chart and Howden combined business, inclusive of
year-one cost synergies of $175 million, and we continue to
anticipate reaching our estimated pro forma net leverage ratio in
the high 2x range by the end of 2024. Included in the supplemental
presentation is a 2023 proforma outlook for the combined Chart and
Howden business as well as a reiteration of our 2024 EBITDA outlook
for the combined business.
As previously discussed, we are currently
pursuing divestitures of two product lines related to the combined
business. While these proposed divestitures are at preliminary
stages and there can be no assurances of the completion of these
activities, we continue to target a completion of these within the
next three to six months and continue to anticipate combined
proceeds of approximately $500 million from these divestitures.
Discontinued Operations: Settlement of
the global plaintiff’s Pacific Fertility Clinic lawsuits booked in
discontinued operations related to our primary pre-closing
liability from the divestiture of the Cryobio business to Cryoport
in 2020.
In connection with the October 1, 2020
divestiture of our cryobiological products business, Chart retained
certain potential liabilities in connection with the alleged
failure of a stainless steel cryobiological storage tank at the
Pacific Fertility Center in San Francisco, California.
As previously disclosed, the Company has been engaged
in ongoing discussions in an effort to establish a settlement
framework for the various lawsuits associated with the Pacific
Fertility Center. After substantial discussions with the
various constituent parties, the Company reached a preliminary
settlement in late January 2023 to resolve these 217 cases.
The preliminary settlement remains subject to the
satisfaction of certain conditions, which the Company currently
anticipates occurring as early as March 2023. The Company has
taken a net charge of approximately $73.0 million, which is
included in discontinued operations, representing the expected
out-of-pocket payments in connection with the settlement and
settlement costs. This preliminary settlement resolves the prior
2021 verdict awarded by a federal district court in the Northern
District of California for the initially tried cases, which was on
appeal, as well as the previously disclosed insurance
dispute. We continue to evaluate the merits of the sole
remaining lawsuit that is not included in the preliminary
settlement in light of the information available. Based on the
status of that lawsuit, a current estimate of reasonably possible
losses in that case cannot be made; however, the Company does not
anticipate the potential exposure to be material. This
preliminary settlement and the expected out-of-pocket payments does
not reflect third party recoveries which the Company is
aggressively pursuing with respect to the underlying facts in these
cases, and which the Company currently anticipates will result in
recoveries approximating one-quarter or more of the Company’s
out-of-pocket net payments.
FORWARD-LOOKING STATEMENTS
Certain statements made in this press release
are forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. Forward-looking
statements include statements concerning the Company’s business
plans, including statements regarding completed and pending
acquisitions, divestitures, and investments, cost synergies and
efficiency savings, objectives, future orders, revenues, margins,
segment sales mix, earnings or performance, liquidity and cash
flow, inventory levels, capital expenditures, supply chain
challenges, inflationary pressures including material cost and
pricing increases, business trends, clean energy market
opportunities including addressable markets and projected
industry-wide investments, and U.S. and global governmental
initiatives, including executive orders, environmental factors
including carbon reduction targets, and other information that is
not historical in nature. Forward-looking statements may be
identified by terminology such as "may," "will," "should," "could,"
"expects," "anticipates," "believes," "projects," "forecasts,"
“outlook,” “guidance,” "continue," “target,” or the negative of
such terms or comparable terminology.
Forward-looking statements contained in this
press release or in other statements made by the Company are made
based on management's expectations and beliefs concerning future
events impacting the Company and are subject to uncertainties and
factors relating to the Company's operations and business
environment, all of which are difficult to predict and many of
which are beyond the Company's control, that could cause the
Company's actual results to differ materially from those matters
expressed or implied by forward-looking statements. Factors
that could cause the Company’s actual results to differ materially
from those described in the forward-looking statements
include: The Company’s ability to successfully close and
integrate the pending Howden acquisition and other recent
acquisitions and achieve the anticipated revenue, earnings,
accretion and other benefits from these acquisitions; The Company’s
ability to successfully close on its intention to divest the two
product lines and achieve the anticipated proceeds from these
divestitures; slower than anticipated growth and market acceptance
of new clean energy product offerings; inability to achieve
expected pricing increases or continued supply chain challenges
including volatility in raw materials and supply; risks relating to
the outbreak and continued uncertainty associated with the
coronavirus (COVID-19) and the conflict between Russia and Ukraine,
including potential energy shortages in Europe and elsewhere, and
the other factors discussed in Item 1A (Risk Factors) in the
Company’s most recent Annual Report on Form 10-K filed with the
SEC, which should be reviewed carefully. The Company
undertakes no obligation to update or revise any forward-looking
statement.
USE OF NON-GAAP FINANCIAL INFORMATION
This press release contains non-GAAP financial
information, including adjusted gross profit as a percent of sales,
adjusted earnings per non-diluted share, net income attributable to
Chart Industries, Inc. adjusted, free cash flow and adjusted free
cash flow and adjusted operating income, EBITDA and adjusted
EBITDA. For additional information regarding the Company's
use of non-GAAP financial information, as well as reconciliations
of non-GAAP financial measures to the most directly comparable
financial measures calculated and presented in accordance with
accounting principles generally accepted in the United States
("GAAP"), please see the reconciliation pages at the end of this
news release and the slides titled "Fourth Quarter 2022 Earnings
Per Share," “Fourth Quarter 2022 Free Cash Flow”, and “Fourth
Quarter and Full Year 2022 Adjusted EBITDA” included in the
supplemental slides accompanying this release.
The Company believes these non-GAAP measures are
of interest to investors and facilitate useful period-to-period
comparisons of the Company’s financial results, and this
information is used by the Company in evaluating internal
performance. With respect to the Company’s 2023 full year
outlook, the Company is not able to provide a reconciliation of
adjusted diluted earnings per share, adjusted EBITDA or adjusted
free cash flow because certain items may have not yet occurred or
are out of the Company’s control and/or cannot be reasonably
predicted.
CONFERENCE CALL
As previously announced, the Company will
discuss its fourth quarter and full year 2022 financial results on
a conference call on Friday, February 24, 2023 at 8:30 a.m.
ET. A live webcast and replay will be available on the
Company's investor relations website, ir.chartindustries.com.
Participants wishing to join the live Q&A session may request a
conference call dial-in number by registering in advance using the
following registration link: Conference Registration
(vevent.com)
About Chart Industries,
Inc.Chart Industries, Inc. is a leading independent global
manufacturer of highly engineered equipment servicing multiple
applications in the Energy and Industrial Gas markets. Our
unique product portfolio is used in every phase of the liquid gas
supply chain, including upfront engineering, service and
repair. Being at the forefront of the clean energy
transition, Chart is a leading provider of technology, equipment
and services related to liquefied natural gas, hydrogen, biogas and
carbon capture and storage amongst other applications. We are
committed to excellence in environmental, social and corporate
governance (ESG) issues both for our company as well as our
customers. With over 25 global manufacturing locations from
the United States to China, Australia, India, Europe and South
America, we maintain accountability and transparency to our team
members, suppliers, customers and communities. To learn more,
visit www.Chartindustries.com.
For more information, click here:
http://ir.chartindustries.com/
Investor Relations Contact:
John WalshVP, Investor
Relations770-721-8899john.walsh@chartindustries.com
CHART INDUSTRIES, INC. AND
SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF
INCOME (UNAUDITED)(Dollars and shares in millions,
except per share amounts)
|
Three Months Ended December 31, |
|
Year Ended December 31, |
|
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
|
Sales |
$ |
441.4 |
|
|
$ |
378.9 |
|
|
$ |
1,612.4 |
|
|
$ |
1,317.7 |
|
|
Cost of sales |
|
317.1 |
|
|
|
296.7 |
|
|
|
1,205.0 |
|
|
|
993.5 |
|
|
Gross profit |
|
124.3 |
|
|
|
82.2 |
|
|
|
407.4 |
|
|
|
324.2 |
|
|
Selling, general, and
administrative expenses |
|
55.2 |
|
|
|
51.4 |
|
|
|
214.5 |
|
|
|
196.8 |
|
|
Amortization expense |
|
9.0 |
|
|
|
10.4 |
|
|
|
41.4 |
|
|
|
38.9 |
|
|
Operating expenses |
|
64.2 |
|
|
|
61.8 |
|
|
|
255.9 |
|
|
|
235.7 |
|
|
Operating income(1) (2) (3)
(4) |
|
60.1 |
|
|
|
20.4 |
|
|
|
151.5 |
|
|
|
88.5 |
|
|
Acquisition related finance fees |
|
37.0 |
|
|
|
— |
|
|
|
37.0 |
|
|
|
— |
|
|
Interest expense, net |
|
15.5 |
|
|
|
3.3 |
|
|
|
28.8 |
|
|
|
10.7 |
|
|
Financing costs amortization |
|
0.8 |
|
|
|
4.8 |
|
|
|
2.9 |
|
|
|
8.3 |
|
|
Unrealized gain on investment in equity securities |
|
(24.0 |
) |
|
|
(2.0 |
) |
|
|
(13.1 |
) |
|
|
(3.2 |
) |
|
Realized gain on equity method investment |
|
— |
|
|
|
— |
|
|
|
(0.3 |
) |
|
|
— |
|
|
Realized gain on investment in equity securities |
|
— |
|
|
|
(2.6 |
) |
|
|
— |
|
|
|
(2.6 |
) |
|
Foreign currency loss (gain) |
|
1.8 |
|
|
|
1.2 |
|
|
|
(0.8 |
) |
|
|
0.9 |
|
|
Other (income) expense, net |
|
(0.4 |
) |
|
|
(0.1 |
) |
|
|
(1.9 |
) |
|
|
0.3 |
|
|
Income from continuing
operations before income taxes and equity in (loss) earnings of
unconsolidated affiliates, net |
|
29.4 |
|
|
|
15.8 |
|
|
|
98.9 |
|
|
|
74.1 |
|
|
Income tax expense |
|
11.9 |
|
|
|
3.6 |
|
|
|
15.9 |
|
|
|
13.5 |
|
|
Income from continuing
operations before equity in (loss) earnings of unconsolidated
affiliates, net |
|
17.5 |
|
|
|
12.2 |
|
|
|
83.0 |
|
|
|
60.6 |
|
|
Equity in (loss) earnings of
unconsolidated affiliates, net |
|
(0.1 |
) |
|
|
0.2 |
|
|
|
(0.4 |
) |
|
|
0.3 |
|
|
Net income from continuing
operations |
|
17.4 |
|
|
|
12.4 |
|
|
|
82.6 |
|
|
|
60.9 |
|
|
(Loss) income from
discontinued operations, net of tax |
|
(57.6 |
) |
|
|
— |
|
|
|
(57.6 |
) |
|
|
— |
|
|
Net (loss) income |
|
(40.2 |
) |
|
|
12.4 |
|
|
|
25.0 |
|
|
|
60.9 |
|
|
Less: Income attributable to
noncontrolling interests of continuing operations, net of
taxes |
|
0.2 |
|
|
|
0.3 |
|
|
|
1.0 |
|
|
|
1.8 |
|
|
Net (loss) income attributable
to Chart Industries, Inc. |
$ |
(40.4 |
) |
|
$ |
12.1 |
|
|
$ |
24.0 |
|
|
$ |
59.1 |
|
|
|
|
|
|
|
|
|
|
|
CHART INDUSTRIES, INC. AND
SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF
INCOME (UNAUDITED) — (Continued)(Dollars and
shares in millions, except per share amounts) |
|
|
|
|
|
|
|
|
|
|
|
Amounts attributable
to Chart common stockholders |
|
|
|
|
|
|
|
|
Income from continuing
operations |
$ |
17.2 |
|
|
$ |
12.1 |
|
|
$ |
81.6 |
|
|
$ |
59.1 |
|
|
Less: Mandatory convertible
preferred stock dividend requirement |
|
1.4 |
|
|
|
— |
|
|
|
1.4 |
|
|
|
— |
|
|
Income from continuing
operations attributable to Chart |
$ |
15.8 |
|
|
$ |
12.1 |
|
|
$ |
80.2 |
|
|
$ |
59.1 |
|
|
(Loss) from discontinued
operations, net of tax |
|
(57.6 |
) |
|
|
— |
|
|
|
(57.6 |
) |
|
|
— |
|
|
Net (loss) income attributable
to Chart common stockholders |
$ |
(41.8 |
) |
|
$ |
12.1 |
|
|
$ |
22.6 |
|
|
$ |
59.1 |
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per
common share attributable to Chart Industries, Inc. |
|
|
|
|
|
|
|
|
Income from continuing operations |
$ |
0.42 |
|
|
$ |
0.34 |
|
|
$ |
2.21 |
|
|
$ |
1.66 |
|
|
Loss from discontinued operations |
|
(1.54 |
) |
|
|
— |
|
|
|
(1.59 |
) |
|
|
— |
|
|
Net (loss) income attributable
to Chart Industries, Inc. |
$ |
(1.12 |
) |
|
$ |
0.34 |
|
|
$ |
0.62 |
|
|
$ |
1.66 |
|
|
Diluted earnings per
common share attributable to Chart Industries, Inc. |
|
|
|
|
|
|
|
|
Income from continuing operations |
$ |
0.37 |
|
|
$ |
0.29 |
|
|
$ |
1.92 |
|
|
$ |
1.44 |
|
|
Loss from discontinued operations |
|
(1.34 |
) |
|
|
— |
|
|
|
(1.38 |
) |
|
|
— |
|
|
Net (loss) income attributable
to Chart Industries, Inc. |
$ |
(0.97 |
) |
|
$ |
0.29 |
|
|
$ |
0.54 |
|
|
$ |
1.44 |
|
|
Weighted-average
number of common shares outstanding: |
|
|
|
|
|
|
|
|
Basic |
|
37.42 |
|
|
|
35.65 |
|
|
|
36.25 |
|
|
|
35.61 |
|
|
Diluted(5) (6) |
|
42.93 |
|
|
|
41.57 |
|
|
|
41.80 |
|
|
|
41.11 |
|
|
_______________
(1) Includes depreciation expense of:
-
$10.5 and $10.4 for the quarter ended December 31, 2022 and
2021, respectively, and
-
$40.5 and $41.7 for the year ended December 31, 2022 and 2021,
respectively.
(2) Includes restructuring costs/(credits)
of:
-
$0.1 and $0.6 for the quarter ended December 31, 2022 and
2021, respectively, and
-
$(1.0) and $3.5 for the year ended December 31, 2022 and 2021,
respectively.
(3) Includes acquisition-related contingent
consideration (credits)/charges in our Specialty Products segment
of:
-
$(1.1) and $(1.2) for the quarter ended December 31, 2022 and
2021, respectively, and
-
$(3.9) and $1.1 for the year ended December 31, 2022 and 2021,
respectively.
(4) Includes deal-related and integration
costs of:
-
$1.6 and $17.6 for the quarter and year ended December 31,
2022, respectively.
(5) Includes an additional 5.23 and 5.28
shares related to the convertible notes due 2024 and associated
warrants in our diluted earnings per share calculation for the
fourth quarter and full year 2022, respectively. The associated
hedge, which helps offset this dilution, cannot be taken into
account under U.S. generally accepted accounting principles
(“GAAP”). If the hedge could have been considered, it would have
reduced the additional shares by 2.80 and 2.81 for the fourth
quarter and full year 2022, respectively.
(6) Includes an additional 5.56 and 5.17
shares related to the convertible notes due 2024 and associated
warrants in our diluted earnings per share calculation for the
fourth quarter and full year 2021, respectively. The
associated hedge, which helps offset this dilution, cannot be taken
into account under U.S. GAAP. If the hedge could have been
considered, it would have reduced the additional shares by 2.94 and
2.76 for the fourth quarter and full year ended 2021,
respectively.
CHART INDUSTRIES, INC. AND
SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF
CASH FLOWS (UNAUDITED)(Dollars in
millions)
|
Three Months Ended December 31, |
|
Year Ended December 31, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Net Cash Provided By
(Used In) Operating Activities |
$ |
30.5 |
|
|
$ |
20.4 |
|
|
$ |
80.8 |
|
|
$ |
(21.3 |
) |
Investing
Activities |
|
|
|
|
|
|
|
Acquisition of businesses, net of cash acquired |
|
— |
|
|
|
(36.0 |
) |
|
|
(25.8 |
) |
|
|
(205.1 |
) |
Investments |
|
(5.0 |
) |
|
|
(0.7 |
) |
|
|
(9.9 |
) |
|
|
(103.9 |
) |
Capital expenditures |
|
(26.0 |
) |
|
|
(16.2 |
) |
|
|
(74.2 |
) |
|
|
(52.7 |
) |
Cash received from settlement of cross-currency swap
agreements |
|
— |
|
|
|
— |
|
|
|
9.4 |
|
|
|
— |
|
Government grants |
|
(0.3 |
) |
|
|
0.1 |
|
|
|
(1.1 |
) |
|
|
0.5 |
|
Net Cash Used In Investing Activities |
|
(31.3 |
) |
|
|
(52.8 |
) |
|
|
(101.6 |
) |
|
|
(361.2 |
) |
Financing
Activities |
|
|
|
|
|
|
|
Borrowings on senior secured and senior unsecured notes |
|
1,940.0 |
|
|
|
— |
|
|
|
1,940.0 |
|
|
|
— |
|
Borrowings on revolving credit facilities |
|
132.0 |
|
|
|
717.0 |
|
|
|
635.3 |
|
|
|
1,361.1 |
|
Repayments on revolving credit facilities |
|
(617.0 |
) |
|
|
(552.0 |
) |
|
|
(1,128.2 |
) |
|
|
(873.6 |
) |
Repayments on term loan |
|
— |
|
|
|
(103.1 |
) |
|
|
— |
|
|
|
(103.1 |
) |
Payments for debt issuance costs |
|
(4.7 |
) |
|
|
(3.0 |
) |
|
|
(4.7 |
) |
|
|
(3.0 |
) |
Proceeds from issuance of common stock, net |
|
675.5 |
|
|
|
— |
|
|
|
675.5 |
|
|
|
— |
|
Proceeds from issuance of preferred stock, net |
|
388.4 |
|
|
|
— |
|
|
|
388.4 |
|
|
|
— |
|
Payments for equity issuance costs |
|
(0.7 |
) |
|
|
— |
|
|
|
(0.7 |
) |
|
|
— |
|
Proceeds from exercise of stock options |
|
0.3 |
|
|
|
(0.1 |
) |
|
|
2.2 |
|
|
|
6.9 |
|
Common stock repurchases from share-based compensation plans |
|
(0.2 |
) |
|
|
(3.2 |
) |
|
|
(3.6 |
) |
|
|
(6.4 |
) |
Net Cash Provided By Financing Activities |
|
2,513.6 |
|
|
|
55.6 |
|
|
|
2,504.2 |
|
|
|
381.9 |
|
Effect of exchange rate
changes on cash |
|
3.0 |
|
|
|
(3.8 |
) |
|
|
(0.5 |
) |
|
|
(3.1 |
) |
Net increase (decrease) in
cash, cash equivalents, restricted cash, and restricted cash
equivalents |
|
2,515.8 |
|
|
|
19.4 |
|
|
|
2,482.9 |
|
|
|
(3.7 |
) |
Cash, cash equivalents,
restricted cash, and restricted cash equivalents at beginning of
period(1) |
|
89.5 |
|
|
|
103.0 |
|
|
|
122.4 |
|
|
|
126.1 |
|
CASH, CASH
EQUIVALENTS, RESTRICTED CASH, AND RESTRICTED CASH EQUIVALENTS AT
END OF PERIOD(1) |
$ |
2,605.3 |
|
|
$ |
122.4 |
|
|
$ |
2,605.3 |
|
|
$ |
122.4 |
|
_______________
(1) Includes cash and restricted cash
equivalents of $1,941.7 and $0.2 classified within restricted cash
on our consolidated balance sheet as of December 31, 2022 and
December 31, 2021, respectively.
CHART INDUSTRIES, INC. AND
SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)(Dollars in millions)
|
December 31, |
|
|
2022 |
|
|
2021 |
ASSETS |
|
|
|
Cash and cash equivalents |
$ |
663.6 |
|
$ |
122.2 |
Restricted cash |
|
1,941.7 |
|
|
0.2 |
Accounts receivable, net |
|
278.4 |
|
|
236.3 |
Inventories, net |
|
357.9 |
|
|
321.5 |
Other current assets |
|
449.3 |
|
|
173.3 |
Property, plant, and
equipment, net |
|
430.0 |
|
|
416.0 |
Goodwill |
|
992.0 |
|
|
994.6 |
Identifiable intangible
assets, net |
|
535.3 |
|
|
556.1 |
Equity method investments |
|
93.0 |
|
|
99.6 |
Investments in equity
securities |
|
96.5 |
|
|
77.8 |
Other assets |
|
64.2 |
|
|
46.2 |
TOTAL
ASSETS |
$ |
5,901.9 |
|
$ |
3,043.8 |
|
|
|
|
LIABILITIES AND
EQUITY |
|
|
|
Current liabilities |
$ |
1,081.6 |
|
$ |
693.9 |
Long-term debt |
|
2,039.8 |
|
|
600.8 |
Other long-term
liabilities |
|
96.2 |
|
|
123.9 |
Equity |
|
2,684.3 |
|
|
1,625.2 |
TOTAL LIABILITIES AND
EQUITY |
$ |
5,901.9 |
|
$ |
3,043.8 |
CHART INDUSTRIES, INC. AND
SUBSIDIARIESOPERATING SEGMENTS
(UNAUDITED)(Dollars in millions)
|
Three Months Ended December 31, |
|
Year Ended December 31, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Sales |
|
|
|
|
|
|
|
Cryo Tank Solutions |
$ |
126.4 |
|
|
$ |
133.5 |
|
|
$ |
504.3 |
|
|
$ |
447.4 |
|
Heat Transfer Systems |
|
148.4 |
|
|
|
71.9 |
|
|
|
462.7 |
|
|
|
262.7 |
|
Specialty Products |
|
117.4 |
|
|
|
131.9 |
|
|
|
448.3 |
|
|
|
432.9 |
|
Repair, Service &
Leasing |
|
55.2 |
|
|
|
44.7 |
|
|
|
209.6 |
|
|
|
187.0 |
|
Intersegment eliminations |
|
(6.0 |
) |
|
|
(3.1 |
) |
|
|
(12.5 |
) |
|
|
(12.3 |
) |
Consolidated |
$ |
441.4 |
|
|
$ |
378.9 |
|
|
$ |
1,612.4 |
|
|
$ |
1,317.7 |
|
Gross
Profit |
|
|
|
|
|
|
|
Cryo Tank Solutions |
$ |
28.9 |
|
|
$ |
22.5 |
|
|
$ |
98.7 |
|
|
$ |
93.5 |
|
Heat Transfer Systems |
|
37.2 |
|
|
|
6.4 |
|
|
|
90.6 |
|
|
|
35.6 |
|
Specialty Products |
|
32.4 |
|
|
|
39.9 |
|
|
|
138.6 |
|
|
|
145.5 |
|
Repair, Service &
Leasing |
|
25.8 |
|
|
|
13.4 |
|
|
|
79.5 |
|
|
|
49.6 |
|
Consolidated |
$ |
124.3 |
|
|
$ |
82.2 |
|
|
$ |
407.4 |
|
|
$ |
324.2 |
|
Gross Profit
Margin |
|
|
|
|
|
|
|
Cryo Tank Solutions |
|
22.9 |
% |
|
|
16.9 |
% |
|
|
19.6 |
% |
|
|
20.9 |
% |
Heat Transfer Systems |
|
25.1 |
% |
|
|
8.9 |
% |
|
|
19.6 |
% |
|
|
13.6 |
% |
Specialty Products |
|
27.6 |
% |
|
|
30.3 |
% |
|
|
30.9 |
% |
|
|
33.6 |
% |
Repair, Service &
Leasing |
|
46.7 |
% |
|
|
30.0 |
% |
|
|
37.9 |
% |
|
|
26.5 |
% |
Consolidated |
|
28.2 |
% |
|
|
21.7 |
% |
|
|
25.3 |
% |
|
|
24.6 |
% |
Operating
Income(Loss) |
|
|
|
|
|
|
|
Cryo Tank Solutions |
$ |
17.8 |
|
|
$ |
10.9 |
|
|
$ |
54.0 |
|
|
$ |
52.9 |
|
Heat Transfer Systems |
|
27.9 |
|
|
|
(5.8 |
) |
|
|
51.7 |
|
|
|
(12.3 |
) |
Specialty Products |
|
19.2 |
|
|
|
26.4 |
|
|
|
72.9 |
|
|
|
94.1 |
|
Repair, Service &
Leasing |
|
18.7 |
|
|
|
7.2 |
|
|
|
51.0 |
|
|
|
23.3 |
|
Corporate |
|
(23.5 |
) |
|
|
(18.3 |
) |
|
|
(78.1 |
) |
|
|
(69.5 |
) |
Consolidated(1) (2) (3) (4) |
$ |
60.1 |
|
|
$ |
20.4 |
|
|
$ |
151.5 |
|
|
$ |
88.5 |
|
Operating
Margin |
|
|
|
|
|
|
|
Cryo Tank Solutions |
|
14.1 |
% |
|
|
8.2 |
% |
|
|
10.7 |
% |
|
|
11.8 |
% |
Heat Transfer Systems |
|
18.8 |
% |
|
|
(8.1 |
)% |
|
|
11.2 |
% |
|
|
(4.7 |
)% |
Specialty Products |
|
16.4 |
% |
|
|
20.0 |
% |
|
|
16.3 |
% |
|
|
21.7 |
% |
Repair, Service &
Leasing |
|
33.9 |
% |
|
|
16.1 |
% |
|
|
24.3 |
% |
|
|
12.5 |
% |
Consolidated |
|
13.6 |
% |
|
|
5.4 |
% |
|
|
9.4 |
% |
|
|
6.7 |
% |
(1) Restructuring costs/(credits) for the
quarter ended:
- December 31,
2022 were $0.1 ($0.2 – Heat Transfer Systems and $(0.1) – Repair,
Service & Leasing).
- December 31, 2021
were $0.6 ($0.5 – Heat Transfer Systems and $0.1 –
Repair, Service & Leasing).
(2) Restructuring (credits)/costs for the
year ended:
- December 31,
2022 were $(1.0) ($0.1 – Cryo Tank Solutions, $0.3 – Heat Transfer
Systems and $(1.4) – Repair, Service & Leasing).
- December 31,
2021 were $3.5 ($0.3 – Cryo Tank Solutions, $1.7 – Heat Transfer
Systems, $1.5 – Repair, Service & Leasing).
(3) Includes acquisition-related contingent
consideration (credits)/charges in our Specialty Products segment
of:
-
$(1.1) and $(1.2) for the quarter ended December 31, 2022 and
2021, respectively, and
-
$(3.9) and $1.1 for the year ended December 31, 2022 and 2021,
respectively.
(4) Includes deal-related and integration
costs of:
-
$1.6 and $17.6 for the quarter and year ended December 31,
2022, respectively.
CHART INDUSTRIES, INC. AND
SUBSIDIARIESORDERS AND BACKLOG
(UNAUDITED)(Dollars in millions)
|
Three Months Ended |
|
Year Ended December 31, |
|
December 31,2022 |
|
September 30,2022 |
|
|
2022 |
|
|
|
2021 |
|
Orders |
|
|
|
|
|
|
|
Cryo Tank Solutions |
$ |
139.7 |
|
|
$ |
120.2 |
|
|
$ |
508.4 |
|
|
$ |
555.4 |
|
Heat Transfer Systems(1) |
|
235.8 |
|
|
|
357.7 |
|
|
|
1,417.6 |
|
|
|
312.0 |
|
Specialty Products |
|
96.4 |
|
|
|
202.9 |
|
|
|
665.5 |
|
|
|
648.6 |
|
Repair, Service &
Leasing |
|
66.3 |
|
|
|
61.7 |
|
|
|
218.9 |
|
|
|
180.6 |
|
Intersegment eliminations |
|
(12.3 |
) |
|
|
(13.1 |
) |
|
|
(30.5 |
) |
|
|
(20.5 |
) |
Consolidated |
$ |
525.9 |
|
|
$ |
729.4 |
|
|
$ |
2,779.9 |
|
|
$ |
1,676.1 |
|
|
As of |
|
December 31,2022 |
|
September 30,2022 |
|
December 31,2021 |
Backlog |
|
|
|
|
|
Cryo Tank Solutions |
$ |
371.0 |
|
|
$ |
355.2 |
|
|
$ |
346.8 |
|
Heat Transfer Systems(1)
(2) |
|
1,300.1 |
|
|
|
1,225.4 |
|
|
|
370.4 |
|
Specialty Products |
|
645.9 |
|
|
|
666.1 |
|
|
|
438.2 |
|
Repair, Service &
Leasing |
|
57.0 |
|
|
|
41.6 |
|
|
|
56.5 |
|
Intersegment eliminations |
|
(35.9 |
) |
|
|
(34.2 |
) |
|
|
(21.8 |
) |
Consolidated |
$ |
2,338.1 |
|
|
$ |
2,254.1 |
|
|
$ |
1,190.1 |
|
_______________
CHART INDUSTRIES, INC. AND
SUBSIDIARIESRECONCILIATION OF BASIC EARNINGS PER
COMMON SHARE ATTRIBUTABLE TO CHART INDUSTRIES, INC. TO NORMALIZED
NON-DILUTED EARNINGS PER COMMON SHARE ATTRIBUTABLE TO CHART
INDUSTRIES INC. AND ADJUSTED NON-DILUTED EARNINGS PER COMMON SHARE
ATTRIBUTABLE TO CHART INDUSTRIES, INC.
(UNAUDITED)(Dollars in millions, except per share
amounts)
|
Three Months Ended December 31, |
|
Year Ended December 31, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
|
Basicshare count |
|
Adjustedshare count(1) |
|
Basicshare count |
|
Change forshare count |
|
Basicshare count |
|
Adjustedshare count(1) |
|
Basicshare count |
|
Change forshare count |
Basic earnings per common share attributable to Chart Industries,
Inc. – continuing operations (U.S. GAAP) |
$ |
0.42 |
|
|
$ |
0.44 |
|
|
$ |
0.34 |
|
|
$ |
0.10 |
|
|
$ |
2.21 |
|
|
$ |
2.24 |
|
|
$ |
1.66 |
|
|
$ |
0.58 |
|
Investment equities mark-to-market |
|
(0.61 |
) |
|
|
(0.63 |
) |
|
|
(0.06 |
) |
|
|
(0.57 |
) |
|
|
(0.25 |
) |
|
|
(0.25 |
) |
|
|
(0.12 |
) |
|
|
(0.13 |
) |
Gains on purchase or sale |
|
— |
|
|
|
— |
|
|
|
(0.07 |
) |
|
|
0.07 |
|
|
|
— |
|
|
|
— |
|
|
|
(0.07 |
) |
|
|
0.07 |
|
Debt and debt refinance costs |
|
1.21 |
|
|
|
1.26 |
|
|
|
0.12 |
|
|
|
1.14 |
|
|
|
1.25 |
|
|
|
1.26 |
|
|
|
0.12 |
|
|
|
1.14 |
|
Mandatory convertible preferred stock dividend |
|
0.04 |
|
|
|
0.04 |
|
|
|
— |
|
|
|
0.04 |
|
|
|
0.04 |
|
|
|
0.04 |
|
|
|
— |
|
|
|
0.04 |
|
Tax effects |
|
(0.01 |
) |
|
|
(0.01 |
) |
|
|
— |
|
|
|
(0.01 |
) |
|
|
(0.06 |
) |
|
|
(0.06 |
) |
|
|
0.01 |
|
|
|
(0.07 |
) |
Normalized non-diluted
earnings per common share attributable to Chart Industries, Inc.
(non-GAAP) |
$ |
1.05 |
|
|
$ |
1.10 |
|
|
$ |
0.33 |
|
|
$ |
0.77 |
|
|
$ |
3.19 |
|
|
$ |
3.23 |
|
|
$ |
1.60 |
|
|
$ |
1.63 |
|
Restructuring and related(2) |
|
0.22 |
|
|
|
0.23 |
|
|
|
0.21 |
|
|
|
0.02 |
|
|
|
0.58 |
|
|
|
0.59 |
|
|
|
0.60 |
|
|
|
(0.01 |
) |
Deal related and integration costs |
|
0.26 |
|
|
|
0.27 |
|
|
|
0.17 |
|
|
|
0.10 |
|
|
|
0.71 |
|
|
|
0.71 |
|
|
|
0.47 |
|
|
|
0.24 |
|
Start-up costs (organic) |
|
0.08 |
|
|
|
0.08 |
|
|
|
0.08 |
|
|
|
— |
|
|
|
0.30 |
|
|
|
0.31 |
|
|
|
0.25 |
|
|
|
0.06 |
|
Other one time |
|
— |
|
|
|
— |
|
|
|
0.01 |
|
|
|
(0.01 |
) |
|
|
— |
|
|
|
— |
|
|
|
0.14 |
|
|
|
(0.14 |
) |
Tax effects |
|
(0.01 |
) |
|
|
(0.01 |
) |
|
|
(0.07 |
) |
|
|
0.06 |
|
|
|
(0.15 |
) |
|
|
(0.15 |
) |
|
|
(0.22 |
) |
|
|
0.07 |
|
Adjusted non-diluted
earnings per common share attributable to Chart Industries, Inc.
(non-GAAP) |
$ |
1.60 |
|
|
$ |
1.67 |
|
|
$ |
0.73 |
|
|
$ |
0.94 |
|
|
$ |
4.63 |
|
|
$ |
4.69 |
|
|
$ |
2.84 |
|
|
$ |
1.85 |
|
_______________
(1) Includes adjusted basic share count of
35.88 for the quarter ended December 31, 2022 and 35.86 for the
year ended December 31, 2022 which excludes impact of common shares
issued in December 2022.
(2) Includes restructuring costs/(credits)
of:
-
$0.1 and $0.6 for the quarter ended December 31, 2022 and
2021, respectively, and
-
$(1.0) and $3.5 for the year ended December 31, 2022 and 2021,
respectively.
_______________
Normalized non-diluted earnings per common share
attributable to Chart Industries, Inc. and adjusted non-diluted
earnings per common share attributable to Chart Industries, Inc.
are not measures of financial performance under U.S. GAAP and
should not be considered as an alternative to earnings per share in
accordance with U.S. GAAP. Management believes that normalized
non-diluted earnings per common share attributable to Chart
Industries, Inc. and adjusted non-diluted earnings per common share
attributable to Chart Industries, Inc. facilitate useful
period-to-period comparisons of our financial results and this
information is used by us in evaluating internal performance. Our
calculation of these non-GAAP measures may not be comparable to the
calculations of similarly titled measures reported by other
companies.
CHART INDUSTRIES, INC. AND
SUBSIDIARIESRECONCILIATION OF NET INCOME
ATTRIBUTABLE TO CHART INDUSTRIES, INC. TO NET INCOME, ADJUSTED
(UNAUDITED)(Dollars in millions)
|
Three Months Ended December 31, |
|
Year Ended December 31, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Net (loss) income attributable
to Chart Industries, Inc. (U.S. GAAP) |
$ |
(40.4 |
) |
|
$ |
12.1 |
|
|
$ |
24.0 |
|
|
$ |
59.1 |
|
Income attributable to noncontrolling interests of continuing
operations, net of taxes (U.S. GAAP) |
|
0.2 |
|
|
|
0.3 |
|
|
|
1.0 |
|
|
|
1.8 |
|
Net (loss) income (U.S.
GAAP) |
|
(40.2 |
) |
|
|
12.4 |
|
|
|
25.0 |
|
|
|
60.9 |
|
Financing costs amortization |
|
0.8 |
|
|
|
4.8 |
|
|
|
2.9 |
|
|
|
8.3 |
|
Unrealized foreign currency transaction loss (gain) |
|
0.1 |
|
|
|
4.7 |
|
|
|
(4.1 |
) |
|
|
(1.1 |
) |
Employee share-based compensation expense |
|
2.7 |
|
|
|
3.1 |
|
|
|
10.6 |
|
|
|
11.2 |
|
Realized loss (gain) on investment of equity securities |
|
0.3 |
|
|
|
(2.6 |
) |
|
|
— |
|
|
|
(2.6 |
) |
Unrealized (gain) on investment in equity securities |
|
(24.0 |
) |
|
|
(2.0 |
) |
|
|
(13.1 |
) |
|
|
(3.2 |
) |
Realized gain on equity method investment |
|
(0.3 |
) |
|
|
— |
|
|
|
(0.3 |
) |
|
|
— |
|
Equity in loss (earnings) of unconsolidated affiliates, net |
|
0.2 |
|
|
|
(0.2 |
) |
|
|
0.5 |
|
|
|
(0.3 |
) |
Deferred income tax benefit |
|
(1.7 |
) |
|
|
(7.9 |
) |
|
|
(1.7 |
) |
|
|
(7.9 |
) |
Other non-cash operating activities |
|
7.9 |
|
|
|
(7.3 |
) |
|
|
11.3 |
|
|
|
(4.8 |
) |
Net (loss) income
adjusted (non-GAAP) |
$ |
(54.2 |
) |
|
$ |
5.0 |
|
|
$ |
31.1 |
|
|
$ |
60.5 |
|
_______________
Net income adjusted is not a measure of
financial performance under U.S. GAAP and should not be considered
as an alternative to net income in accordance with U.S. GAAP.
Management believes that net income adjusted, facilitates useful
period-to-period comparisons of our financial results and this
information is used by us in evaluating internal performance. Our
calculation of this non-GAAP measure may not be comparable to the
calculations of similarly titled measures reported by other
companies.
RECONCILIATION OF NET CASH PROVIDED BY
(USED IN) OPERATING ACTIVITIES TO FREE CASH FLOW AND ADJUSTED FREE
CASH FLOW (UNAUDITED)(Dollars in
millions)
|
Three Months Ended December 31, |
|
Year Ended December 31, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Net cash provided by (used in)
operating activities from continuing operations |
$ |
30.5 |
|
|
$ |
20.4 |
|
|
$ |
80.8 |
|
|
$ |
(21.3 |
) |
Capital expenditures |
|
(26.0 |
) |
|
|
(16.2 |
) |
|
|
(74.2 |
) |
|
|
(52.7 |
) |
Free cash flow
(non-GAAP) |
$ |
4.5 |
|
|
$ |
4.2 |
|
|
$ |
6.6 |
|
|
$ |
(74.0 |
) |
_______________
Free cash flow is not a measure of financial
performance under U.S. GAAP and should not be considered as an
alternative to net cash provided by (used in) operating activities
in accordance with U.S. GAAP. Management believes that free cash
flow facilitates useful period-to-period comparisons of our
financial results and this information is used by us in evaluating
internal performance. Our calculation of this non-GAAP measure may
not be comparable to the calculations of similarly titled measures
reported by other companies.
CHART INDUSTRIES, INC. AND
SUBSIDIARIESRECONCILIATIONS OF GROSS PROFIT TO
ADJUSTED GROSS PROFIT AND OPERATING INCOME (LOSS) TO ADJUSTED
OPERATING INCOME (LOSS) (UNAUDITED)(Dollars in
millions)
|
Year Ended December 31, 2022 |
|
Cryo TankSolutions |
|
Heat TransferSystems |
|
SpecialtyProducts |
|
Repair,Service & Leasing |
|
IntersegmentEliminations |
|
Corporate |
|
Consolidated |
Sales |
$ |
504.3 |
|
|
$ |
462.7 |
|
|
$ |
448.3 |
|
|
$ |
209.6 |
|
|
$ |
(12.5 |
) |
|
$ |
— |
|
|
$ |
1,612.4 |
|
Gross profit as reported (U.S.
GAAP) |
|
98.7 |
|
|
|
90.6 |
|
|
|
138.6 |
|
|
|
79.5 |
|
|
|
— |
|
|
|
— |
|
|
|
407.4 |
|
Restructuring, transaction-related and other one-time costs |
|
9.3 |
|
|
|
11.4 |
|
|
|
9.6 |
|
|
|
1.8 |
|
|
|
— |
|
|
|
— |
|
|
|
32.1 |
|
Adjusted gross profit
(non-GAAP) |
$ |
108.0 |
|
|
$ |
102.0 |
|
|
$ |
148.2 |
|
|
$ |
81.3 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
439.5 |
|
Adjusted gross profit
margin (non-GAAP) |
|
21.4 |
% |
|
|
22.0 |
% |
|
|
33.1 |
% |
|
|
38.8 |
% |
|
|
— |
% |
|
|
— |
% |
|
|
27.3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss) as reported (U.S. GAAP) |
$ |
54.0 |
|
|
$ |
51.7 |
|
|
$ |
72.9 |
|
|
$ |
51.0 |
|
|
$ |
— |
|
|
$ |
(78.1 |
) |
|
|
151.5 |
|
Restructuring, transaction-related and other one-time costs |
|
9.5 |
|
|
|
11.8 |
|
|
|
10.9 |
|
|
|
2.0 |
|
|
|
— |
|
|
|
11.8 |
|
|
|
46.0 |
|
Adjusted operating
income (loss) (non-GAAP) |
$ |
63.5 |
|
|
$ |
63.5 |
|
|
$ |
83.8 |
|
|
$ |
53.0 |
|
|
$ |
— |
|
|
$ |
(66.3 |
) |
|
$ |
197.5 |
|
Adjusted operating
margin (non-GAAP) |
|
12.6 |
% |
|
|
13.7 |
% |
|
|
18.7 |
% |
|
|
25.3 |
% |
|
|
— |
% |
|
|
— |
% |
|
|
12.2 |
% |
CHART INDUSTRIES, INC. AND
SUBSIDIARIESRECONCILIATIONS OF GROSS PROFIT TO
ADJUSTED GROSS PROFIT AND OPERATING INCOME (LOSS) TO ADJUSTED
OPERATING INCOME (LOSS) (UNAUDITED)
(CONTINUED)(Dollars in millions)
|
Three Months Ended December 31, 2022 |
|
Cryo TankSolutions |
|
Heat TransferSystems |
|
SpecialtyProducts |
|
Repair,Service & Leasing |
|
IntersegmentEliminations |
|
Corporate |
|
Consolidated |
Sales |
$ |
126.4 |
|
|
$ |
148.4 |
|
|
$ |
117.4 |
|
|
$ |
55.2 |
|
|
$ |
(6.0 |
) |
|
$ |
— |
|
|
$ |
441.4 |
|
Gross profit as reported (U.S.
GAAP) |
|
28.9 |
|
|
|
37.2 |
|
|
|
32.4 |
|
|
|
25.8 |
|
|
|
— |
|
|
|
— |
|
|
|
124.3 |
|
Restructuring, transaction-related and other one-time costs |
|
1.0 |
|
|
|
4.5 |
|
|
|
2.0 |
|
|
|
0.3 |
|
|
|
— |
|
|
|
— |
|
|
|
7.8 |
|
Adjusted gross profit
(non-GAAP) |
$ |
29.9 |
|
|
$ |
41.7 |
|
|
$ |
34.4 |
|
|
$ |
26.1 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
132.1 |
|
Adjusted gross profit
margin (non-GAAP) |
|
23.7 |
% |
|
|
28.1 |
% |
|
|
29.3 |
% |
|
|
47.3 |
% |
|
|
— |
% |
|
|
— |
% |
|
|
29.9 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss) as reported (U.S. GAAP) |
$ |
17.8 |
|
|
$ |
27.9 |
|
|
$ |
19.2 |
|
|
$ |
18.7 |
|
|
$ |
— |
|
|
$ |
(23.5 |
) |
|
|
60.1 |
|
Restructuring, transaction-related and other one-time costs |
|
1.1 |
|
|
|
4.4 |
|
|
|
1.6 |
|
|
|
0.4 |
|
|
|
— |
|
|
|
7.4 |
|
|
|
14.9 |
|
Adjusted operating
income (loss) (non-GAAP) |
$ |
18.9 |
|
|
$ |
32.3 |
|
|
$ |
20.8 |
|
|
$ |
19.1 |
|
|
$ |
— |
|
|
$ |
(16.1 |
) |
|
$ |
75.0 |
|
Adjusted operating
margin (non-GAAP) |
|
15.0 |
% |
|
|
21.8 |
% |
|
|
17.7 |
% |
|
|
34.6 |
% |
|
|
— |
% |
|
|
— |
% |
|
|
17.0 |
% |
CHART INDUSTRIES, INC. AND
SUBSIDIARIESRECONCILIATIONS OF GROSS PROFIT TO
ADJUSTED GROSS PROFIT AND OPERATING INCOME (LOSS) TO ADJUSTED
OPERATING INCOME (LOSS) (UNAUDITED)
(CONTINUED)(Dollars in millions)
|
Year Ended December 31, 2021 |
|
Cryo Tank Solutions |
|
Heat Transfer Systems |
|
Specialty Products |
|
Repair, Service & Leasing |
|
Intersegment Eliminations |
|
Corporate |
|
Consolidated |
Sales |
$ |
447.4 |
|
|
$ |
262.7 |
|
|
$ |
432.9 |
|
|
$ |
187.0 |
|
|
$ |
(12.3 |
) |
|
$ |
— |
|
|
$ |
1,317.7 |
|
Gross profit as reported (U.S.
GAAP) |
|
93.5 |
|
|
|
35.6 |
|
|
|
145.5 |
|
|
|
49.6 |
|
|
|
— |
|
|
|
— |
|
|
$ |
324.2 |
|
Restructuring, transaction-related and other one-time costs |
|
7.9 |
|
|
|
13.0 |
|
|
|
6.4 |
|
|
|
6.9 |
|
|
|
— |
|
|
|
— |
|
|
|
34.2 |
|
Adjusted gross profit
(non-GAAP) |
$ |
101.4 |
|
|
$ |
48.6 |
|
|
$ |
151.9 |
|
|
$ |
56.5 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
358.4 |
|
Adjusted gross profit
margin (non-GAAP) |
|
22.7 |
% |
|
|
18.5 |
% |
|
|
35.1 |
% |
|
|
30.2 |
% |
|
|
— |
% |
|
|
— |
% |
|
|
27.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss) as reported (U.S.GAAP) |
$ |
52.9 |
|
|
$ |
(12.3 |
) |
|
$ |
94.1 |
|
|
$ |
23.3 |
|
|
$ |
— |
|
|
$ |
(69.5 |
) |
|
$ |
88.5 |
|
Restructuring, transaction-related and other one-time costs |
$ |
8.5 |
|
|
$ |
13.8 |
|
|
$ |
9.0 |
|
|
$ |
7.0 |
|
|
$ |
— |
|
|
$ |
7.1 |
|
|
$ |
45.4 |
|
Adjusted operating
income (loss) (non-GAAP) |
$ |
61.4 |
|
|
$ |
1.5 |
|
|
$ |
103.1 |
|
|
$ |
30.3 |
|
|
$ |
— |
|
|
$ |
(62.4 |
) |
|
$ |
133.9 |
|
Adjusted operating
margin (non-GAAP) |
|
13.7 |
% |
|
|
0.6 |
% |
|
|
23.8 |
% |
|
|
16.2 |
% |
|
|
— |
% |
|
|
— |
% |
|
|
10.2 |
% |
CHART INDUSTRIES, INC. AND
SUBSIDIARIESRECONCILIATIONS OF GROSS PROFIT TO
ADJUSTED GROSS PROFIT AND OPERATING INCOME (LOSS) TO ADJUSTED
OPERATING INCOME (LOSS) (UNAUDITED)
(CONTINUED)(Dollars in millions)
|
Three Months Ended December 31, 2021 |
|
Cryo TankSolutions |
|
Heat TransferSystems |
|
SpecialtyProducts |
|
Repair,Service & Leasing |
|
IntersegmentEliminations |
|
Corporate |
|
Consolidated |
Sales |
$ |
133.5 |
|
|
$ |
71.9 |
|
|
$ |
131.9 |
|
|
$ |
44.7 |
|
|
$ |
(3.1 |
) |
|
$ |
— |
|
|
$ |
378.9 |
|
Gross profit as reported (U.S.
GAAP) |
|
22.5 |
|
|
|
6.4 |
|
|
|
39.9 |
|
|
|
13.4 |
|
|
|
— |
|
|
|
— |
|
|
|
82.2 |
|
Restructuring, transaction-related and other one-time costs |
|
2.7 |
|
|
|
3.6 |
|
|
|
1.2 |
|
|
|
2.1 |
|
|
|
— |
|
|
|
— |
|
|
|
9.6 |
|
Adjusted gross profit
(non-GAAP) |
$ |
25.2 |
|
|
$ |
10.0 |
|
|
$ |
41.1 |
|
|
$ |
15.5 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
91.8 |
|
Adjusted gross profit
margin (non-GAAP) |
|
18.9 |
% |
|
|
13.9 |
% |
|
|
31.2 |
% |
|
|
34.7 |
% |
|
|
— |
% |
|
|
— |
% |
|
|
24.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss) as reported (U.S.GAAP) |
$ |
10.9 |
|
|
$ |
(5.8 |
) |
|
$ |
26.4 |
|
|
$ |
7.2 |
|
|
$ |
— |
|
|
$ |
(18.3 |
) |
|
$ |
20.4 |
|
Restructuring, transaction-related and other one-time costs |
$ |
2.9 |
|
|
$ |
4.2 |
|
|
$ |
1.4 |
|
|
$ |
2.1 |
|
|
$ |
— |
|
|
$ |
1.8 |
|
|
$ |
12.4 |
|
Adjusted operating
income (loss) (non-GAAP) |
$ |
13.8 |
|
|
$ |
(1.6 |
) |
|
$ |
27.8 |
|
|
$ |
9.3 |
|
|
$ |
— |
|
|
$ |
(16.5 |
) |
|
$ |
32.8 |
|
Adjusted operating
margin (non-GAAP) |
|
10.3 |
% |
|
|
(2.2 |
)% |
|
|
21.1 |
% |
|
|
20.8 |
% |
|
|
— |
% |
|
|
— |
% |
|
|
8.7 |
% |
_______________
Adjusted gross profit and adjusted operating
income (loss) are not measures of financial performance under U.S.
GAAP and should not be considered as an alternative to gross profit
and operating income (loss) in accordance with U.S. GAAP.
Management believes that adjusted gross profit and adjusted
operating income (loss) facilitate useful period-to-period
comparisons of our financial results and this information is used
by us in evaluating internal performance. Our calculation of these
non-GAAP measures may not be comparable to the calculations of
similarly titled measures reported by other companies.
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