Summary
Emerson Electric Co. reported strong performance in the quarter ending December 31, 2022, driven by significant gains from discontinued operations, primarily the divestiture of the InSinkErator business, which resulted in a substantial increase in net earnings. While net sales from continuing operations saw a modest increase, driven by growth in Intelligent Devices and Software & Control segments, earnings from continuing operations declined year-over-year. This decline was largely attributed to the absence of a significant gain from a subordinated interest in Vertiv realized in the prior year and increased expenses, including higher stock compensation and amortization costs related to the AspenTech acquisition. The company continues to actively manage its portfolio, with the pending sale of a majority stake in its Climate Technologies business expected to further reshape its operational footprint. Emerson is focusing on strategic deployment of capital, including significant share repurchases, while managing ongoing economic uncertainties.
Financial Highlights
55 data points| Revenue | $3.37B |
| Cost of Revenue | $1.75B |
| Gross Profit | $1.62B |
| SG&A Expenses | $1.03B |
| Operating Income | $329.00M |
| Net Income | $2.33B |
| EPS (Basic) | $3.99 |
| EPS (Diluted) | $3.97 |
| Shares Outstanding (Basic) | 583.60M |
| Shares Outstanding (Diluted) | 586.70M |
Key Highlights
- 1Net earnings common stockholders increased significantly to $2,331 million from $896 million in the prior year, primarily due to a $2.1 billion after-tax gain from the InSinkErator divestiture.
- 2Net sales from continuing operations grew 7% to $3.4 billion, with underlying sales up 6%, driven by pricing and volume, though foreign currency translation had a negative impact.
- 3Earnings from continuing operations attributable to common stockholders decreased by 56% to $329 million, and diluted EPS from continuing operations fell to $0.56 from $1.25, impacted by the absence of a prior year gain from Vertiv and increased expenses.
- 4The Software and Control segment experienced significant sales growth of 30% due to the AspenTech acquisition, while the Intelligent Devices segment saw a 1% increase in sales.
- 5The company repurchased $2.0 billion of its common stock during the quarter, a significant deployment of capital.
- 6Emerson anticipates closing the sale of a majority stake in its Climate Technologies business in the first half of calendar year 2023, which will result in substantial cash proceeds and a retained non-controlling interest.