- Net sales were $3.4 billion, up 7
percent from the year prior; underlying sales1 were up 6
percent
- Strong operational performance to start 2023 offset by foreign
exchange and stock compensation headwinds
- GAAP EPS was $0.56; adjusted
EPS2 was $0.78, including
$0.09 unfavorable impact from stock
compensation
- Completed $2 billion of share
repurchase in the first quarter
- Updated 2023 full year net sales and GAAP EPS outlook;
maintained underlying sales and adjusted EPS outlook despite stock
compensation headwind
- Announced St. Louis selected
as global headquarters
- Declared quarterly cash dividend of $0.52 per share of common stock payable
March 10, 2023 to stockholders of
record February 17, 2023
ST.
LOUIS, Feb. 8, 2023 /PRNewswire/ -- Emerson
(NYSE: EMR) today reported results for its first quarter ended
December 31, 2022 and updated its full year outlook for fiscal
2023, which are presented on a continuing operations basis.
"Emerson continues to execute on the strategy we presented at
our November 29th Investor
Conference," said Emerson President
and Chief Executive Officer Lal Karsanbhai. "Continued strength in
our end markets and operational excellence, enabled by our Emerson
Management System, resulted in a great start to 2023. We delivered
underlying sales growth of 6 percent and strong segment margin
expansion with operational leverage above our targets. Continued
operational performance gives us confidence to reiterate our 2023
underlying sales and adjusted EPS outlook, overcoming the impact of
higher than expected stock compensation expense."
"Emerson remains committed to disciplined capital allocation and
shareholder return, completing $2
billion of share repurchase in the first quarter,"
Karsanbhai continued. "We continue to actively pursue opportunities
to deploy capital effectively, including our proposal to acquire
National Instruments (NI) for $53 per
share, a unique value creation opportunity for Emerson and NI
shareholders."
"Lastly, following a comprehensive review, we selected
St. Louis, Missouri as our
headquarters and are working to identify an appropriate location in
the area," Karsanbhai ended.
Underlying orders3 were up 5 percent. Net sales were
up 7 percent for the quarter and underlying sales were up 6
percent. The Americas were up 13 percent, Europe was down 2 percent, and Asia, Middle
East & Africa was
flat.
Pretax margin was 12.5 percent for the quarter, down 1730 basis
points. Adjusted segment EBITA margin4 was 22.7 percent,
up 130 basis points.
Earnings per share were $0.56 for
the quarter, down 55 percent. Earnings per share growth was
impacted by a prior year gain of $0.60 related to our Vertiv subordinated
interest. Adjusted earnings per share were $0.78, down 1
percent. The quarter was unfavorably impacted by $0.09 due to a 31 percent increase in the company
stock price in the quarter and resulting impact on mark-to-market
stock compensation plans.
Operating cash flow was $302
million for the quarter, down 20 percent, and free cash flow
was $243 million, down 20 percent.
Cash flow results reflected higher working capital versus prior
year.
2023 Outlook
The Company's 2023 continuing operations after the Climate
Technologies divestiture (assumed to close March 31, 2023 for the purposes of guidance) will
reflect the 45% common equity ownership in the income, or loss, of
Climate Technologies. Emerson will not control Climate Technologies
post-closing and is therefore unable to estimate the amount of its
45% share of Climate Technologies' post-close results. The effect
of Emerson's 45% share of Climate Technologies is expected to be
immaterial to post-closing cash flows.
The following tables summarize the fiscal year 2023 guidance
framework for continuing operations5. Full year net
sales and GAAP EPS outlook have been updated. Underlying sales and
adjusted EPS outlook remain unchanged despite stock compensation
headwind. The 2023 outlook includes $2
billion returned to shareholders through share repurchases
completed in the first quarter and approximately $1.2 billion of dividend payments. Guidance
figures are approximate.
2023 Guidance - Continuing Operations5
|
2023
Q2
|
2023
|
|
Net Sales
Growth
|
10.5% -
12.5%
|
8% - 10%
|
|
Underlying Sales
Growth
|
8% - 10%
|
6.5% - 8.5%
|
|
Earnings Per
Share6
|
$0.75 -
$0.80
|
$3.55 -
$3.70
|
|
Amortization of
Intangibles
|
~$0.15
|
~$0.60
|
|
Restructuring /
Related Costs
|
~$0.05
|
~$0.12
|
|
Russia Exit
Costs
|
---
|
$0.08
|
|
AspenTech Micromine
Purchase Price Hedge
|
---
|
($0.03)
|
|
Interest on Note
Receivable From Climate Technologies
|
---
|
~($0.09)
|
|
Interest Income on
Undeployed Proceeds
|
---
|
~($0.23)
|
|
Adjusted Earnings Per
Share
|
$0.95 -
$1.00
|
$4.00 -
$4.15
|
|
|
Notes:
|
|
1 Underlying
sales excludes the impact of currency translation, and acquisitions
and divestitures including heritage AspenTech and Emerson's
businesses contributed to AspenTech.
|
|
2 Adjusted
EPS excludes restructuring, a gain on subordinated interest,
acquisition/divestiture costs, write-offs associated with Emerson's
announced Russia exit, an AspenTech Micromine purchase price hedge
and intangibles amortization expense.
|
|
3 Underlying
orders does not include heritage AspenTech or Emerson's contributed
businesses to AspenTech.
|
|
4 Adjusted
segment EBITA margin excludes corporate items and interest expense,
restructuring, a gain on subordinated interest,
acquisition/divestiture costs, write-offs associated with Emerson's
announced Russia exit, an AspenTech Micromine purchase price hedge
and intangibles amortization expense.
|
|
5 Following
the announcement of its Climate Technologies divestiture, Emerson
will report financial results for Climate Technologies,
InSinkErator and Therm-O-Disc as discontinued operations for all
periods presented, beginning in 2023. The earnings from
discontinued operations for 2023 are expected to be $10.5 billion
to $11.5 billion, or $18 to $20 per share, including the net gains
on 2023 divestitures. The Company's 2023 continuing operations
after the Climate Technologies divestiture (assumed to close March
31, 2023 for the purposes of guidance) will include interest income
from the $2.25 billion note receivable from Climate Technologies
and reflect the 45% common equity ownership in the income, or loss,
of Climate Technologies. Emerson will not control Climate
Technologies post-closing and is therefore unable to estimate the
amount of its 45% share of Climate Technologies' post-close
results. The Company will exclude the interest income from the note
receivable from Climate Technologies and its share of Climate
Technologies' operations in its calculation of 2023 adjusted
earnings per share. Also excluded from adjusted earnings per share
is the interest income on any undeployed net proceeds. The effect
of Emerson's 45% share of Climate Technologies is expected to be
immaterial to post-closing cash flows.
|
|
6 2023
earnings per share guidance from continuing operations excludes any
potential impact from the 45% common equity ownership in Climate
Technologies' income or loss post-close. Emerson will not control
Climate Technologies post-closing and is therefore unable to
estimate the probable significance or impact on our earnings per
share results from the 45% share of Climate Technologies'
post-close results. Emerson will exclude its 45% share of Climate
Technologies' post-close operations from the calculation of its
2023 adjusted earnings per share.
|
Upcoming Investor Events
Today, beginning at 7:30 a.m. Central
Time / 8:30 a.m. Eastern Time,
Emerson management will discuss the first quarter results during an
investor conference call. Participants can access a live webcast
available at www.emerson.com/investors at the time of the
call. A replay of the call will be available for 90 days.
Conference call slides will be posted in advance of the call on the
company website.
Forward-Looking and Cautionary Statements
Statements in this press release that are not strictly
historical may be "forward-looking" statements, which involve risks
and uncertainties, and Emerson undertakes no obligation to update
any such statements to reflect later developments. These risks and
uncertainties include the Company's ability to successfully
complete on the terms and conditions contemplated, and the
financial impact of, the proposed Climate Technologies transaction,
the potential National Instruments transaction, the scope, duration
and ultimate impacts of the COVID-19 pandemic and the Russia-Ukraine conflict, as well as economic and
currency conditions, market demand, including related to the
pandemic and oil and gas price declines and volatility, pricing,
protection of intellectual property, cybersecurity, tariffs,
competitive and technological factors, inflation, among others, as
set forth in the Company's most recent Annual Report on Form 10-K
and subsequent reports filed with the SEC. The outlook contained
herein represents the Company's expectation for its consolidated
results, other than as noted herein.
|
|
|
|
|
Table
1
|
|
EMERSON AND
SUBSIDIARIES
|
|
CONSOLIDATED OPERATING
RESULTS
|
|
(AMOUNTS IN MILLIONS
EXCEPT PER SHARE, UNAUDITED)
|
|
|
|
|
|
|
|
Quarter Ended Dec
31
|
|
Percent
|
|
2021
|
|
2022
|
|
Change
|
|
|
|
|
|
|
|
Net
sales
|
$3,156
|
|
$3,373
|
|
7 %
|
|
Cost of sales
|
1,741
|
|
1,753
|
|
|
|
SG&A expenses
|
849
|
|
1,030
|
|
|
|
Gain on subordinated
interest
|
(453)
|
|
—
|
|
|
|
Other deductions,
net
|
38
|
|
120
|
|
|
|
Interest expense,
net
|
39
|
|
48
|
|
|
|
Earnings before
income taxes
|
942
|
|
422
|
|
(55) %
|
|
Income taxes
|
196
|
|
98
|
|
|
|
Earnings from
continuing operations
|
746
|
|
324
|
|
(57) %
|
|
Discontinued
operations, net of tax
|
149
|
|
2,002
|
|
|
|
Net
earnings
|
895
|
|
2,326
|
|
|
|
Less: Noncontrolling
interests in subsidiaries
|
(1)
|
|
(5)
|
|
|
|
Net earnings common
stockholders
|
$896
|
|
$2,331
|
|
160 %
|
|
|
|
|
|
|
|
Diluted avg. shares
outstanding
|
598.1
|
|
586.7
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
share common stockholders
|
|
|
|
|
|
|
Earnings from
continuing operations
|
$1.25
|
|
$0.56
|
|
(55) %
|
|
Discontinued
operations
|
0.25
|
|
3.41
|
|
|
|
Diluted earnings per
common share
|
$1.50
|
|
$3.97
|
|
165 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter Ended Dec
31
|
|
|
|
2021
|
|
2022
|
|
|
|
Other deductions,
net
|
|
|
|
|
|
|
Amortization of
intangibles
|
$57
|
|
$118
|
|
|
|
Restructuring
costs
|
6
|
|
10
|
|
|
|
Other
|
(25)
|
|
(8)
|
|
|
|
Total
|
$38
|
|
$120
|
|
|
|
|
|
Table
2
|
|
EMERSON AND
SUBSIDIARIES
|
|
CONSOLIDATED BALANCE
SHEETS
|
|
(DOLLARS IN MILLIONS,
UNAUDITED)
|
|
|
|
|
|
Quarter Ended Dec
31
|
|
2021
|
|
2022
|
|
Assets
|
|
|
|
|
Cash and
equivalents
|
$4,726
|
|
$2,271
|
|
Receivables, net
|
2,005
|
|
2,231
|
|
Inventories
|
1,752
|
|
1,999
|
|
Other current
assets
|
986
|
|
1,290
|
|
Current assets
held-for-sale
|
1,391
|
|
1,209
|
|
Total current assets
|
10,860
|
|
9,000
|
|
Property, plant &
equipment, net
|
2,392
|
|
2,263
|
|
Goodwill
|
6,941
|
|
14,087
|
|
Other intangible
assets
|
2,617
|
|
6,460
|
|
Other
|
1,776
|
|
2,268
|
|
Noncurrent assets
held-for-sale
|
2,373
|
|
2,163
|
|
Total assets
|
$26,959
|
|
$36,241
|
|
|
|
|
|
Liabilities and
equity
|
|
|
|
|
Short-term borrowings and
current
|
|
|
|
|
maturities
of long-term debt
|
$37
|
|
$1,792
|
|
Accounts payable
|
1,208
|
|
1,219
|
|
Accrued expenses
|
2,751
|
|
3,949
|
|
Current liabilities
held-for-sale
|
1,335
|
|
1,200
|
|
Total current liabilities
|
5,331
|
|
8,160
|
|
Long-term debt
|
8,718
|
|
8,159
|
|
Other liabilities
|
2,403
|
|
3,057
|
|
Noncurrent liabilities
held-for-sale
|
219
|
|
151
|
|
Equity
|
|
|
|
|
Common stockholders'
equity
|
10,249
|
|
10,727
|
|
Noncontrolling interests in
subsidiaries
|
39
|
|
5,987
|
|
Total equity
|
10,288
|
|
16,714
|
|
Total liabilities and equity
|
$26,959
|
|
$36,241
|
|
|
|
|
Table
3
|
|
EMERSON AND
SUBSIDIARIES
|
|
CONSOLIDATED STATEMENTS
OF CASH FLOWS
|
|
(DOLLARS IN MILLIONS,
UNAUDITED)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended Dec
31
|
|
|
2021
|
|
2022
|
|
Operating
activities
|
|
|
|
|
|
Net
earnings
|
|
$895
|
|
$2,326
|
|
Earnings from
discontinued operations, net of tax
|
|
(149)
|
|
(2,002)
|
|
Adjustments to
reconcile net earnings to net cash provided by operating
activities:
|
|
|
|
|
|
Depreciation and amortization
|
|
178
|
|
260
|
|
Stock
compensation
|
|
34
|
|
102
|
|
Changes in
operating working capital
|
|
(125)
|
|
(289)
|
|
Gain on
subordinated interest
|
|
(453)
|
|
—
|
|
Other,
net
|
|
(3)
|
|
(95)
|
|
Cash from continuing operations
|
|
377
|
|
302
|
|
Cash from discontinued operations
|
|
146
|
|
116
|
|
Cash provided by operating activities
|
|
523
|
|
418
|
|
Investing
activities
|
|
|
|
|
|
Capital
expenditures
|
|
(73)
|
|
(59)
|
|
Purchases of
businesses, net of cash and equivalents acquired
|
|
(39)
|
|
—
|
|
Proceeds from
subordinated interest
|
|
438
|
|
15
|
|
Other, net
|
|
3
|
|
(23)
|
|
Cash from continuing operations
|
|
329
|
|
(67)
|
|
Cash from discontinued operations
|
|
(44)
|
|
2,953
|
|
Cash provided by investing activities
|
|
285
|
|
2,886
|
|
Financing
activities
|
|
|
|
|
|
Net increase in
short-term borrowings
|
|
(335)
|
|
(539)
|
|
Proceeds from
long-term debt
|
|
2,975
|
|
—
|
|
Payments of long-term
debt
|
|
(501)
|
|
(9)
|
|
Dividends
paid
|
|
(307)
|
|
(306)
|
|
Purchases of common
stock
|
|
(253)
|
|
(2,000)
|
|
Other, net
|
|
22
|
|
(41)
|
|
Cash provided by (used in) financing activities
|
|
1,601
|
|
(2,895)
|
|
Effect of exchange rate
changes on cash and equivalents
|
|
(37)
|
|
58
|
|
Increase in cash and
equivalents
|
|
2,372
|
|
467
|
|
Beginning cash and
equivalents
|
|
2,354
|
|
1,804
|
|
Ending cash and
equivalents
|
|
$4,726
|
|
$2,271
|
|
|
|
|
|
|
|
|
Table
4
|
|
EMERSON AND
SUBSIDIARIES
|
|
SEGMENT SALES AND
EARNINGS
|
|
(DOLLARS IN MILLIONS,
UNAUDITED)
|
|
|
|
|
|
Quarter Ended Dec
31
|
|
2021
|
|
2022
|
|
Sales
|
|
|
|
|
Final
Control
|
$817
|
|
$862
|
|
Measurement &
Analytical
|
737
|
|
749
|
|
Discrete
Automation
|
617
|
|
618
|
|
Safety &
Productivity
|
351
|
|
310
|
|
Intelligent
Devices
|
2,522
|
|
2,539
|
|
|
|
|
|
Control Systems &
Software
|
570
|
|
606
|
|
AspenTech
|
82
|
|
243
|
|
Software and
Control
|
652
|
|
849
|
|
Eliminations
|
(18)
|
|
(15)
|
|
Net sales
|
$3,156
|
|
$3,373
|
|
|
|
|
|
Earnings
|
|
|
|
|
Final
Control
|
$
122
|
|
$
158
|
|
Measurement &
Analytical
|
170
|
|
175
|
|
Discrete
Automation
|
120
|
|
121
|
|
Safety &
Productivity
|
65
|
|
63
|
|
Intelligent
Devices
|
477
|
|
517
|
|
|
|
|
|
Control Systems &
Software
|
116
|
|
107
|
|
AspenTech
|
(2)
|
|
(33)
|
|
Software and
Control
|
114
|
|
74
|
|
|
|
|
|
Stock
compensation
|
(34)
|
|
(102)
|
|
Unallocated pension
and postretirement costs
|
26
|
|
45
|
|
Corporate and
other
|
(55)
|
|
(64)
|
|
Gain on subordinated
interest
|
453
|
|
—
|
|
Interest expense,
net
|
(39)
|
|
(48)
|
|
Earnings before income taxes
|
$942
|
|
$422
|
|
|
|
|
|
Restructuring
costs
|
|
|
|
|
Final
Control
|
$—
|
|
($1)
|
|
Measurement &
Analytical
|
2
|
|
1
|
|
Discrete
Automation
|
2
|
|
1
|
|
Safety &
Productivity
|
—
|
|
—
|
|
Intelligent
Devices
|
4
|
|
1
|
|
|
|
|
|
Control Systems &
Software
|
1
|
|
1
|
|
AspenTech
|
—
|
|
—
|
|
Software and
Control
|
1
|
|
1
|
|
|
|
|
|
Corporate
|
1
|
|
8
|
|
Total
|
$6
|
|
$10
|
|
|
The table above does
not include $8 and $5 of costs related to restructuring actions
that were reported in cost
of sales and selling, general and administrative expenses for the
three months ended December 31, 2021 and
2022, respectively.
|
|
|
|
|
|
Depreciation and
Amortization
|
|
|
|
|
Final
Control
|
$53
|
|
$45
|
|
Measurement &
Analytical
|
31
|
|
30
|
|
Discrete
Automation
|
23
|
|
21
|
|
Safety &
Productivity
|
15
|
|
14
|
|
Intelligent
Devices
|
122
|
|
110
|
|
|
|
|
|
Control Systems &
Software
|
25
|
|
21
|
|
AspenTech
|
23
|
|
123
|
|
Software and
Control
|
48
|
|
144
|
|
|
|
|
|
Corporate
|
8
|
|
6
|
|
Total
|
$178
|
|
$260
|
|
Table
5
|
|
EMERSON AND
SUBSIDIARIES
|
|
ADJUSTED EBITA &
EPS SUPPLEMENTAL
|
|
(AMOUNTS IN MILLIONS
EXCEPT PER SHARE, UNAUDITED)
|
|
|
The following tables,
which show results on an adjusted EBITA basis and diluted earnings
per share on an adjusted basis, are intended to supplement the
Company's discussion of its results of operations herein. The
Company defines adjusted EBITA as earnings excluding interest
expense, net, income taxes, intangibles amortization expense,
restructuring expense, first year purchase accounting related items
and transaction fees, and certain gains, losses or impairments.
Adjusted earnings per share excludes intangibles amortization
expense, restructuring expense, first year purchase accounting
related items and transaction fees, interest on note receivable and
interest on undeployed assets, and certain gains, losses or
impairments. Adjusted EBITA, adjusted EBITA margin, and adjusted
earnings per share are measures used by management and may be
useful for investors to evaluate the Company's operational
performance.
|
|
|
Quarter Ended Dec
31
|
|
2021
|
|
2022
|
|
Pretax
earnings
|
$942
|
|
$422
|
|
Percent of
sales
|
29.8 %
|
|
12.5 %
|
|
Interest expense,
net
|
39
|
|
48
|
|
Amortization of
intangibles
|
71
|
|
167
|
|
Restructuring and
related costs
|
14
|
|
15
|
|
Gain on subordinated
interest
|
(453)
|
|
—
|
|
Acquisition/divestiture costs
|
23
|
|
—
|
|
Russia business
exit
|
—
|
|
47
|
|
AspenTech Micromine
purchase price hedge
|
—
|
|
(35)
|
|
Adjusted
EBITA
|
$636
|
|
$664
|
|
Percent of
sales
|
20.1 %
|
|
19.7 %
|
|
|
|
|
|
Quarter Ended Dec
31
|
|
2021
|
|
2022
|
|
GAAP earnings from
continuing operations per share
|
$1.25
|
|
$0.56
|
|
Amortization of
intangibles
|
0.09
|
|
0.15
|
|
Restructuring and
related costs
|
0.02
|
|
0.02
|
|
Gain on subordinated
interest
|
(0.60)
|
|
—
|
|
Acquisition/divestiture costs
|
0.03
|
|
—
|
|
Russia business
exit
|
—
|
|
0.08
|
|
AspenTech Micromine
purchase price hedge
|
—
|
|
(0.03)
|
|
Adjusted earnings
from continuing operations per share
|
$0.79
|
|
$0.78
|
|
|
|
Table
6
|
|
EMERSON AND
SUBSIDIARIES
|
|
SEGMENT
EBITA
|
|
(DOLLARS IN MILLIONS,
UNAUDITED)
|
|
|
|
|
|
Quarter Ended Dec
31
|
|
2021
|
|
2022
|
|
Intelligent
Devices
|
|
|
|
|
|
|
|
|
Intelligent Devices
EBIT
|
$477
|
|
$517
|
|
Percent of
sales
|
18.9 %
|
|
20.4 %
|
|
Amortization of
intangibles
|
44
|
|
40
|
|
Restructuring and
related costs
|
12
|
|
6
|
|
Intelligent Devices
EBITA
|
$533
|
|
$563
|
|
Percent of
sales
|
21.1 %
|
|
22.2 %
|
|
|
|
|
|
Software and
Control
|
|
|
|
|
|
|
|
|
Software and Control
EBIT
|
$114
|
|
$74
|
|
Percent of
sales
|
17.6 %
|
|
8.7 %
|
|
Amortization of
intangibles
|
27
|
|
127
|
|
Restructuring and
related costs
|
1
|
|
1
|
|
Software and Control
EBITA
|
$142
|
|
$202
|
|
Percent of
sales
|
21.8 %
|
|
23.8 %
|
|
|
|
|
|
Reconciliations of
Non-GAAP Financial Measures & Other
|
|
Table
7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliations of
Non-GAAP measures with the most directly comparable GAAP measure
(dollars in millions,
except per share amounts). See tables 5, 6 and 8 for additional
non-GAAP reconciliations.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q1 2023 Underlying
Sales Change
|
Emerson
|
|
|
|
|
|
|
Reported
(GAAP)
|
|
7 %
|
|
|
|
|
|
|
(Favorable) /
Unfavorable FX
|
4 %
|
|
|
|
|
|
|
(Acquisitions) /
Divestitures
|
(5) %
|
|
|
|
|
|
|
Underlying
(Non-GAAP)
|
6 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2023E February
Guidance Underlying Sales Change
|
Q2
FY23E
|
|
FY23E
|
|
|
|
|
Reported
(GAAP)
|
|
10.5% -
12.5%
|
|
8% - 10%
|
|
|
|
|
(Favorable) /
Unfavorable FX
|
~ 3%
|
|
~ 2%
|
|
|
|
|
(Acquisitions) /
Divestitures
|
~ (5.5)%
|
|
~ (3.5)%
|
|
|
|
|
Underlying
(Non-GAAP)
|
8% - 10%
|
|
6.5% - 8.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q1 Earnings Per
Share
|
Q1
FY22
|
|
Q1
FY23
|
|
Change
|
|
|
Earnings per share
(GAAP)
|
$
1.25
|
|
$
0.56
|
|
(55) %
|
|
|
Amortization of
intangibles
|
0.09
|
|
0.15
|
|
5 %
|
|
|
Restructuring and
related costs
|
0.02
|
|
0.02
|
|
— %
|
|
|
Gain on subordinated
interest
|
(0.60)
|
|
—
|
|
47 %
|
|
|
Acquisition/divestiture
costs
|
0.03
|
|
—
|
|
(2) %
|
|
|
Russia business
exit
|
—
|
|
0.08
|
|
6 %
|
|
|
AspenTech Micromine
purchase price hedge
|
—
|
|
(0.03)
|
|
(2) %
|
|
|
Adjusted earnings per
share (Non-GAAP)
|
$
0.79
|
|
$
0.78
|
|
(1) %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2023E February
Guidance Earnings Per Share
|
Q2
FY23E
|
|
FY23E
|
|
|
|
|
Earnings per share
(GAAP)
|
$0.75 -
$0.80
|
|
$3.55 -
$3.70
|
|
|
|
|
Amortization of
intangibles
|
~ 0.15
|
|
~ 0.60
|
|
|
|
|
Restructuring and
related costs
|
~ 0.05
|
|
~ 0.12
|
|
|
|
|
Russia business
exit
|
—
|
|
0.08
|
|
|
|
|
AspenTech Micromine
purchase price hedge
|
—
|
|
(0.03)
|
|
|
|
|
Interest on note
receivable from Climate Technologies
|
—
|
|
~
(0.09)
|
|
|
|
|
Interest income on
undeployed proceeds
|
—
|
|
~ (0.23)
|
|
|
|
|
Adjusted earnings per
share (Non-GAAP)
|
$0.95 -
$1.00
|
|
$4.00 -
$4.15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Business Segment
EBIT Margin
|
Q1
FY22
|
|
Q1
FY23
|
|
Change
|
|
|
Pretax margin
(GAAP)
|
29.8 %
|
|
12.5 %
|
|
(1730) bps
|
|
|
Corp. items and
interest expense, net % of sales
|
(11.1) %
|
|
5.0 %
|
|
1610 bps
|
|
|
Business Segment EBIT
margin (GAAP)
|
18.7 %
|
|
17.5 %
|
|
(120) bps
|
|
|
Amortization of
intangibles
|
2.3 %
|
|
5.0 %
|
|
270 bps
|
|
|
Restructuring and
related costs
|
0.4 %
|
|
0.2 %
|
|
(20) bps
|
|
|
Adjusted Business
Segment EBITA margin (Non-GAAP)
|
21.4 %
|
|
22.7 %
|
|
130 bps
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q1 Cash
Flow
|
|
|
|
Q1
FY22
|
|
Q1
FY23
|
|
Change
|
|
|
Operating cash flow
(GAAP)
|
|
$
377
|
|
$
302
|
|
(20) %
|
|
|
Capital
expenditures
|
|
|
|
(73)
|
|
(59)
|
|
- %
|
|
|
Free cash flow
(Non-GAAP)
|
|
|
|
$
304
|
|
$
243
|
|
(20) %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note 1: Underlying
sales and orders exclude the impact of acquisitions, divestitures
and currency translation.
|
|
|
Note 2: All fiscal year
2023E figures are approximate, except where range is
given.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 8
|
|
The following tables
provide supplemental unaudited fiscal 2022 quarterly historical
results on a continuing
operations basis which reflect the previously announced realignment
of the Company's segments. Such
supplemental information does not represent a restatement of
previously issued financial statements and should be
read in conjunction with the Company's Annual Report on Form
10-K.
|
|
|
|
Consolidated
Statements of Earnings
|
|
EMERSON ELECTRIC CO.
& SUBSIDIARIES
|
|
(Dollars in
millions, except per share amounts; unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4
|
|
2022
|
|
|
Net
sales
|
|
$
3,156
|
|
3,291
|
|
3,465
|
|
3,892
|
|
13,804
|
|
|
Cost of
sales
|
|
1,741
|
|
1,815
|
|
1,879
|
|
2,063
|
|
7,498
|
|
|
Selling, general and
administrative expenses
|
|
849
|
|
888
|
|
894
|
|
983
|
|
3,614
|
|
|
Gain on subordinated
interest
|
|
(453)
|
|
—
|
|
—
|
|
—
|
|
(453)
|
|
|
Other deductions,
net
|
|
38
|
|
28
|
|
264
|
|
189
|
|
519
|
|
|
Interest expense,
net
|
|
39
|
|
51
|
|
50
|
|
54
|
|
194
|
|
|
Earnings from
continuing operations before income taxes
|
|
942
|
|
509
|
|
378
|
|
603
|
|
2,432
|
|
|
Income taxes
|
|
196
|
|
80
|
|
123
|
|
150
|
|
549
|
|
|
Earnings from
continuing operations
|
|
746
|
|
429
|
|
255
|
|
453
|
|
1,883
|
|
|
Discontinued
operations, net of tax: $84, $56, $120, $46, and $306,
respectively
|
|
149
|
|
246
|
|
697
|
|
255
|
|
1,347
|
|
|
Net
earnings
|
|
895
|
|
675
|
|
952
|
|
708
|
|
3,230
|
|
|
Less: Noncontrolling
interests in subsidiaries
|
|
(1)
|
|
1
|
|
31
|
|
(32)
|
|
(1)
|
|
|
Net earnings common
stockholders
|
|
$ 896
|
|
674
|
|
921
|
|
740
|
|
3,231
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings common
stockholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings from continuing
operations
|
|
$ 746
|
|
428
|
|
226
|
|
486
|
|
1,886
|
|
|
Discontinued
operations
|
|
150
|
|
246
|
|
695
|
|
254
|
|
1,345
|
|
|
Net earnings common
stockholders
|
|
$ 896
|
|
674
|
|
921
|
|
740
|
|
3,231
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per
share common stockholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings from continuing
operations
|
|
$ 1.25
|
|
0.72
|
|
0.38
|
|
0.82
|
|
3.17
|
|
|
Discontinued
operations
|
|
0.26
|
|
0.41
|
|
1.17
|
|
0.43
|
|
2.27
|
|
|
Basic earnings per
common share
|
|
$ 1.51
|
|
1.13
|
|
1.55
|
|
1.25
|
|
5.44
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
share common stockholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings from
continuing operations
|
|
$ 1.25
|
|
0.72
|
|
0.38
|
|
0.82
|
|
3.16
|
|
|
Discontinued
operations
|
|
0.25
|
|
0.41
|
|
1.16
|
|
0.42
|
|
2.25
|
|
|
Diluted earnings per
common share
|
|
$ 1.50
|
|
1.13
|
|
1.54
|
|
1.24
|
|
5.41
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
outstanding shares:
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
594.6
|
|
593.3
|
|
592.8
|
|
590.8
|
|
592.9
|
|
|
Diluted
|
|
598.1
|
|
596.5
|
|
596.2
|
|
594.5
|
|
596.3
|
|
|
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4
|
|
2022
|
|
|
Diluted earnings from
continuing operations per share
|
|
$
1.25
|
|
0.72
|
|
0.38
|
|
0.82
|
|
3.16
|
|
|
Amortization of
intangibles
|
|
0.09
|
|
0.09
|
|
0.12
|
|
0.14
|
|
0.45
|
|
|
Restructuring and
related costs
|
|
0.02
|
|
0.02
|
|
0.04
|
|
0.06
|
|
0.14
|
|
|
Gain on subordinated
interest
|
|
(0.60)
|
|
—
|
|
—
|
|
—
|
|
(0.60)
|
|
|
Russia business
exit
|
|
—
|
|
—
|
|
0.29
|
|
0.03
|
|
0.32
|
|
|
Acquisition/divestiture
costs and pre-acquisition interest on AspenTech debt
|
|
0.03
|
|
0.04
|
|
0.09
|
|
—
|
|
0.15
|
|
|
AspenTech Micromine
purchase price hedge
|
|
—
|
|
—
|
|
—
|
|
0.04
|
|
0.04
|
|
|
Investment-related
gains
|
|
—
|
|
—
|
|
—
|
|
(0.02)
|
|
(0.02)
|
|
|
Adjusted diluted
earnings from continuing operations per share
|
|
$
0.79
|
|
0.87
|
|
0.92
|
|
1.07
|
|
3.64
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share are
computed independently each period; as a result, the quarterly
amounts may not sum to the calculated annual figure.
|
|
Supplemental
Business Segment Information
|
|
EMERSON ELECTRIC CO.
& SUBSIDIARIES
|
|
(Dollars in millions;
unaudited)
|
|
|
INTELLIGENT
DEVICES
|
|
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4
|
|
2022
|
|
|
Sales:
|
|
|
|
|
|
|
|
|
|
|
|
|
Final
Control
|
|
$ 817
|
|
884
|
|
905
|
|
1,001
|
|
3,607
|
|
|
Measurement &
Analytical
|
|
737
|
|
769
|
|
788
|
|
921
|
|
3,215
|
|
|
Discrete
Automation
|
|
617
|
|
644
|
|
633
|
|
718
|
|
2,612
|
|
|
Safety &
Productivity
|
|
351
|
|
355
|
|
360
|
|
336
|
|
1,402
|
|
|
Total
|
|
$
2,522
|
|
2,652
|
|
2,686
|
|
2,976
|
|
10,836
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings:
|
|
|
|
|
|
|
|
|
|
|
|
|
Final
Control
|
|
$ 122
|
|
152
|
|
150
|
|
168
|
|
592
|
|
|
Margin
|
|
14.9 %
|
|
17.2 %
|
|
16.6 %
|
|
16.7 %
|
|
16.4 %
|
|
|
Measurement &
Analytical
|
|
170
|
|
176
|
|
189
|
|
250
|
|
785
|
|
|
Margin
|
|
23.0 %
|
|
23.0 %
|
|
23.9 %
|
|
27.2 %
|
|
24.4 %
|
|
|
Discrete
Automation
|
|
120
|
|
130
|
|
115
|
|
177
|
|
542
|
|
|
Margin
|
|
19.4 %
|
|
20.3 %
|
|
18.2 %
|
|
24.6 %
|
|
20.7 %
|
|
|
Safety &
Productivity
|
|
65
|
|
65
|
|
69
|
|
51
|
|
250
|
|
|
Margin
|
|
18.6 %
|
|
18.1 %
|
|
19.3 %
|
|
15.1 %
|
|
17.8 %
|
|
|
Total
|
|
$ 477
|
|
523
|
|
523
|
|
646
|
|
2,169
|
|
|
Margin
|
|
18.9 %
|
|
19.7 %
|
|
19.5 %
|
|
21.7 %
|
|
20.0 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of
intangibles:
|
|
|
|
|
|
|
|
|
|
|
|
|
Final
Control
|
|
$
24
|
|
24
|
|
23
|
|
23
|
|
94
|
|
|
Measurement &
Analytical
|
|
6
|
|
5
|
|
4
|
|
6
|
|
21
|
|
|
Discrete
Automation
|
|
8
|
|
7
|
|
8
|
|
7
|
|
30
|
|
|
Safety &
Productivity
|
|
6
|
|
7
|
|
7
|
|
6
|
|
26
|
|
|
Total
|
|
$
44
|
|
43
|
|
42
|
|
42
|
|
171
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring and
related costs:
|
|
|
|
|
|
|
|
|
|
|
|
|
Final
Control
|
|
$
7
|
|
8
|
|
18
|
|
42
|
|
75
|
|
|
Measurement &
Analytical
|
|
2
|
|
3
|
|
4
|
|
(6)
|
|
3
|
|
|
Discrete
Automation
|
|
2
|
|
1
|
|
1
|
|
(4)
|
|
—
|
|
|
Safety &
Productivity
|
|
1
|
|
—
|
|
(1)
|
|
10
|
|
10
|
|
|
Total
|
|
$
12
|
|
12
|
|
22
|
|
42
|
|
88
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITA:
|
|
|
|
|
|
|
|
|
|
|
|
|
Final
Control
|
|
$ 153
|
|
184
|
|
191
|
|
233
|
|
761
|
|
|
Adjusted EBITA
Margin
|
|
18.7 %
|
|
20.8 %
|
|
21.2 %
|
|
23.2 %
|
|
21.1 %
|
|
|
Measurement &
Analytical
|
|
$ 178
|
|
184
|
|
197
|
|
250
|
|
809
|
|
|
Adjusted EBITA
Margin
|
|
24.1 %
|
|
24.0 %
|
|
25.1 %
|
|
27.1 %
|
|
25.2 %
|
|
|
Discrete
Automation
|
|
$ 130
|
|
138
|
|
124
|
|
180
|
|
572
|
|
|
Adjusted EBITA
Margin
|
|
21.0 %
|
|
21.6 %
|
|
19.6 %
|
|
24.1 %
|
|
21.9 %
|
|
|
Safety &
Productivity
|
|
$
72
|
|
72
|
|
75
|
|
67
|
|
286
|
|
|
Adjusted EBITA
Margin
|
|
20.8 %
|
|
20.0 %
|
|
20.6 %
|
|
19.9 %
|
|
20.3 %
|
|
|
Intelligent
Devices
|
|
$ 533
|
|
578
|
|
587
|
|
730
|
|
2,428
|
|
|
Adjusted EBITA
Margin
|
|
21.1 %
|
|
21.8 %
|
|
21.9 %
|
|
24.5 %
|
|
22.4 %
|
|
|
SOFTWARE AND
CONTROL
|
|
|
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4
|
|
2022
|
|
|
Sales:
|
|
|
|
|
|
|
|
|
|
|
|
|
Control Systems &
Software
|
|
$
570
|
|
573
|
|
568
|
|
687
|
|
2,398
|
|
|
AspenTech
|
|
82
|
|
84
|
|
239
|
|
251
|
|
656
|
|
|
Total
|
|
$
652
|
|
657
|
|
807
|
|
938
|
|
3,054
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings:
|
|
|
|
|
|
|
|
|
|
|
|
|
Control Systems &
Software
|
|
$
116
|
|
101
|
|
77
|
|
143
|
|
437
|
|
|
Margin
|
|
20.4 %
|
|
17.7 %
|
|
13.5 %
|
|
20.8 %
|
|
18.2 %
|
|
|
AspenTech
|
|
$ (2)
|
|
(4)
|
|
57
|
|
(39)
|
|
12
|
|
|
Margin
|
|
(2.3) %
|
|
(5.0) %
|
|
23.7 %
|
|
(15.2) %
|
|
1.9 %
|
|
|
Total
|
|
$
114
|
|
97
|
|
134
|
|
104
|
|
449
|
|
|
Margin
|
|
17.6 %
|
|
14.7 %
|
|
16.5 %
|
|
11.2 %
|
|
14.7 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of
intangibles:
|
|
|
|
|
|
|
|
|
|
|
|
|
Control Systems &
Software
|
|
$ 5
|
|
5
|
|
6
|
|
6
|
|
22
|
|
|
AspenTech
|
|
22
|
|
23
|
|
71
|
|
121
|
|
237
|
|
|
Total
|
|
$ 27
|
|
28
|
|
77
|
|
127
|
|
259
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring and
related costs:
|
|
|
|
|
|
|
|
|
|
|
|
|
Control Systems &
Software
|
|
$ 1
|
|
—
|
|
7
|
|
3
|
|
11
|
|
|
AspenTech
|
|
—
|
|
—
|
|
1
|
|
(1)
|
|
—
|
|
|
Total
|
|
$ 1
|
|
—
|
|
8
|
|
2
|
|
11
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITA:
|
|
|
|
|
|
|
|
|
|
|
|
|
Control Systems &
Software
|
|
$
122
|
|
106
|
|
90
|
|
152
|
|
470
|
|
|
Adjusted EBITA
Margin
|
|
21.4 %
|
|
18.7 %
|
|
15.7 %
|
|
22.0 %
|
|
19.6 %
|
|
|
AspenTech
|
|
$ 20
|
|
19
|
|
129
|
|
81
|
|
249
|
|
|
Adjusted EBITA
Margin
|
|
24.9 %
|
|
21.5 %
|
|
53.8 %
|
|
32.9 %
|
|
38.0 %
|
|
|
Software and
Control
|
|
$
142
|
|
125
|
|
219
|
|
233
|
|
719
|
|
|
Adjusted EBITA
Margin
|
|
21.8 %
|
|
19.1 %
|
|
27.0 %
|
|
24.9 %
|
|
23.5 %
|
|
|
Corporate &
Other
|
|
|
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4
|
|
2022
|
|
|
Stock
compensation
|
|
$ (34)
|
|
(43)
|
|
(15)
|
|
(33)
|
|
(125)
|
|
|
Unallocated pension and
postretirement costs
|
|
26
|
|
25
|
|
25
|
|
23
|
|
99
|
|
|
Corporate and
other
|
|
(55)
|
|
(42)
|
|
(239)
|
|
(83)
|
|
(419)
|
|
|
Gain on subordinated
interest
|
|
453
|
|
—
|
|
—
|
|
—
|
|
453
|
|
|
Interest
|
|
(39)
|
|
(51)
|
|
(50)
|
|
(54)
|
|
(194)
|
|
|
Total
|
|
$ 351
|
|
(111)
|
|
(279)
|
|
(147)
|
|
(186)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
###
View original content to download
multimedia:https://www.prnewswire.com/news-releases/emerson-reports-first-quarter-2023-results-updates-2023-outlook-301741483.html
SOURCE Emerson