10-KPeriod: FY2009

Trane Technologies plc Annual Report, Year Ended Dec 31, 2009

Filed February 26, 2010For Securities:TT

Summary

Trane Technologies plc (formerly Ingersoll-Rand Company Limited) operates as a diversified global company providing products and solutions across four segments: Climate Solutions, Residential Solutions, Industrial Technologies, and Security Technologies. For the fiscal year ending December 31, 2009, the company generated $13.2 billion in net revenues. The company underwent a significant corporate reorganization in July 2009, changing its jurisdiction of incorporation from Bermuda to Ireland. This move aimed to optimize its corporate structure and tax position. Financially, 2009 saw a stabilization in revenues compared to the prior year, which was heavily impacted by the acquisition of Trane in June 2008. While 2008 experienced a substantial net loss attributed to a significant asset impairment charge of $3.7 billion, 2009 reported a net profit from continuing operations. The company's strategy continues to focus on portfolio transformation through divestitures and acquisitions, operational excellence, and increasing recurring revenue streams from parts, service, and rentals.

Financial Highlights

56 data points
Beta

Revenue

$13.01B

26.6% Gross Margin

Net Income

$451.30M

3.5% Net Margin

EPS (Diluted)

$1.37

Total Assets

$19.99B

Cash & Equivalents

$840.60M

Free Cash Flow

$1.55B

Financial Statements
Beta
Revenue$13.01B
Cost of Revenue$9.54B
Gross Profit$3.47B
R&D Expenses$255.00M
SG&A Expenses$2.69B
Operating Income$885.20M
Interest Expense$301.60M
Net Income$451.30M
EPS (Basic)$1.41
EPS (Diluted)$1.37
Shares Outstanding (Basic)321.10M
Shares Outstanding (Diluted)329.10M

Key Highlights

  • 1Completed a corporate reorganization in July 2009, changing domicile from Bermuda to Ireland. This restructuring did not materially impact financial results.
  • 2Generated $13.2 billion in net revenues for the fiscal year ending December 31, 2009.
  • 3Reported a net profit from continuing operations of $487.8 million in 2009, a significant improvement from a net loss of $2.6 billion in 2008, which included a substantial asset impairment charge.
  • 4The acquisition of Trane in June 2008 significantly impacted the company's financial statements, contributing to higher revenues in 2008 and 2009, but also to increased debt and integration-related expenses.
  • 5The company operates across four key segments: Climate Solutions, Residential Solutions, Industrial Technologies, and Security Technologies, each contributing to its diversified revenue base.
  • 6Focused on increasing recurring revenue streams through parts, service, used equipment, and rentals as part of its strategic growth initiatives.
  • 7The company is actively managing financial risks, including currency exchange rate and commodity price fluctuations, through hedging strategies and long-term supply contracts.

Frequently Asked Questions

The Ireland Reorganization, completed on July 1, 2009, involved changing the company's jurisdiction of incorporation from Bermuda to Ireland. This move did not have a material impact on the company's financial results. Ingersoll-Rand plc (IR-Ireland) continues to be subject to U.S. SEC reporting requirements and prepares financial statements in accordance with U.S. GAAP. The company's shares continue to trade on the NYSE under the same symbol ('IR').

The acquisition of Trane in June 2008 for approximately $9.6 billion significantly influenced the company's financials in 2009. Trane's results were consolidated for the full year of 2009. While Trane's inclusion boosted net revenues in 2009 (contributing to the segment reporting of Climate Solutions and Residential Solutions), it also added to debt levels and incurred restructuring and integration costs. The prior year (2008) was heavily impacted by a significant non-cash asset impairment charge of $3.7 billion, largely related to the acquired businesses, which resulted in a substantial net loss.

As of the filing date, the company's business is organized into four primary segments: Climate Solutions (HVAC and refrigeration systems), Residential Solutions (home comfort, safety, and efficiency products), Industrial Technologies (compressed air systems, tools, vehicles, and microturbines), and Security Technologies (access control, locks, and security systems for commercial and industrial markets).

In 2009, net revenues remained relatively stable at $13.2 billion, a slight decrease of 0.2% from 2008, largely due to the impact of the Trane acquisition being recognized for a full year in 2009 versus part of 2008. The company returned to profitability from continuing operations in 2009 ($487.8 million) after a significant loss in 2008 ($2.5 billion from continuing operations), primarily driven by the large asset impairment charge in 2008. Operating income improved significantly from a negative 19.5% in 2008 to 6.4% in 2009. The company also focused on restructuring actions to streamline operations and reduce costs.