Recently, Emerson released its Q1 performance for the fiscal year ended December 31, 2023, and updated its full year forecast for fiscal year 2024. Emerson also announced that it will distribute a quarterly cash dividend of $0.525 per common share to shareholders registered on February 16, 2024, on March 11, 2024.
Management perspective
”Emerson’s first quarter performance exceeded expectations in key financial indicators, including basic sales, operational leverage, and adjusted earnings per share. Our strong start to the year, sustained focus on operational execution, and a focus on flexible terminal and hybrid market demand have injected confidence into our 2024 expectations.
Enai, also known as the testing and measurement business, achieved strong sales and profit margins at the beginning of this fiscal year. We have accelerated our technology diversification collaboration plan in testing and measurement, and continue to create value for shareholders
——Lal Karsanbhai
Emerson President and CEO
Overview of Q1 2024 Financial Year Performance
Basic order rate 2 increased by 4% year-on-year
Net sales in the first quarter amounted to 4.117 billion US dollars, a year-on-year increase of 22%
Basic sales revenue increased by 10% year-on-year
Adjusted EBITA4 of $1.014 billion, profit margin of 24.6%, up 190 basis points year-on-year
Adjusted earnings per share of $51.22, a year-on-year increase of 56%
Operating cash flow of 444 million US dollars, a year-on-year increase of 47%
Free cash flow of $367 million, a year-on-year increase of 51%
Full year performance summary for fiscal year 2024
The following table summarizes the expected framework for the fiscal year 2024. In the fiscal year 2024, it is expected to return approximately $500 million to shareholders and distribute dividends of approximately $1.2 billion through share buybacks.
Q2 2024
Net sales increased by 12.5% -14.5%
Basic sales increased by 3.5% -5.5%
Earnings per share of $0.68- $0.72
Adjusted earnings per share of $1.22- $1.26
Full year forecast for fiscal year 2024
Net sales increased by 14.5% -17%
Basic sales increased by 4.5% -6.5%
Earnings per share $2.80- $2.95
Adjusted earnings per share of $5.30- $5.45
Operating cash flow of $300 million – $310 million
Free cash flow of $260 million – $270 million
Remarks:
- Performance is reported based on ongoing business operations.
The basic order rate is not included in AspenTech business.
The basic sales revenue does not take into account the impact of currency conversion or major business acquisitions and divestitures.
Adjusted EBITA refers to the business income that does not include restructuring and intangible asset amortization expenses.
After adjustment, earnings per share do not include intangible asset amortization expenses, restructuring and related costs, Emerson’s income/loss from holding 40% of Gulun shares, amortization of inventory increases related to acquisitions, acquisition/divestment costs, discrete tax incentives, hedging of acquisition prices for AspenTech and Micromine, and write offs related to the Russian market.
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