Ingersoll Rand Inc. Announces Solid Third Quarter 2024 Financial Results
Ingersoll Rand Inc. (NYSE: IR), a global provider in mission-critical flow creation and life sciences solutions, released its financial outcomes for the third quarter of 2024, demonstrating robust revenue growth and strong operating performance.
Key Financial Metrics
| Metric | Q3 2024 Actual | Q3 2023 Actual | YoY Change | Consensus Estimate | Q2 2024 Actual | QoQ Change |
|---|---|---|---|---|---|---|
| Total Revenue | $1.861 billion | $1.739 billion | +7% | $1.87 billion | $1.749 billion | +6.4% |
| GAAP EPS | $0.54 | Not provided | Not provided | $0.81 | $0.49 | +10.2% |
| Adjusted EPS | $0.84 | Not provided | Not provided | $0.84 | $0.60 | +40% |
| Adjusted EBITDA | $533 million | $463 million | +15% | Not provided | $474 million | +12.4% |
The company exhibited a 7% increase in revenue year-over-year (YoY), achieving a total of $1.861 billion. Despite slightly missing the Wall Street consensus estimate of $1.87 billion, the company’s adjusted earnings per share (EPS) of $0.84 surpassed the consensus EPS estimate of $0.81. The operating cash flow increased to $404 million, generating a free cash flow margin of 20%, demonstrating strong financial health.
Revenue Performance by Segment
| Segment | Q3 2024 Revenue | YoY Change | Previous Guidance |
|---|---|---|---|
| Industrial Technologies and Services (IT&S) | $1.467 billion | +3% | Met Guidance |
| Precision and Science Technologies (P&ST) | $394 million | +27% | Surpassed Guidance |
The Industrial Technologies and Services segment reported revenue growth of 3%, while the Precision and Science Technologies segment saw a substantial rise of 27% YoY. Both segments contributed positively to the company’s revenue, with P&ST notably surpassing guidance expectations due to strong demand generation activities and strategic acquisitions.
Key Developments and Operational Highlights
- The company maintained liquidity of $4.0 billion, with $1.4 billion cash on hand and an undrawn capacity of $2.6 billion under credit facilities.
- Continued execution of bolt-on acquisition strategy, acquiring Air Power Systems Co., LLC, Blutek s.r.l., UT Pumps & Systems Private Limited, and Penn Valley Pump.
- Returned approximately $71 million to shareholders through share repurchases and dividends.
Executive Commentary
Vicente Reynal, Chairman and CEO of Ingersoll Rand, highlighted that the company’s 'Economic Growth Engine remains on track to deliver long-term targets of double-digit Adjusted EPS growth and strong free cash flow,' with capital primarily allocated towards mergers and acquisitions (M&A) and innovation.
Shareholder Returns
In the third quarter, Ingersoll Rand repurchased shares totaling $63 million and distributed dividends amounting to $8 million.
Forward Guidance
For 2024, Ingersoll Rand projects revenue growth within a range of 5% to 7% for the full year, with an Adjusted EBITDA guidance of $2,010 million to $2,040 million. The full-year adjusted EPS is expected to be in the range of $3.28 to $3.34.
Stock Price Movement
Following the earnings release, Ingersoll Rand's stock experienced a decline, with a post-event change of -1.32%.
Overall, Ingersoll Rand’s third quarter reflected strong growth indicators despite minor shortfalls on revenue consensus, showcasing its robust operational capabilities and strategic growth initiatives.
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