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Timken reports 3Q18 financial results

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World Cement,


Timken has reported its 3Q18 results, posting sales of US$881 million, up 14% from last year. The company has reported earnings per diluted share of US$0.91 on a GAAP basis, with record 3Q18 adjusted earnings per diluted share of US$1.06. In addition, cash from operations was US$137 million and free cash flow was US$114 million in 3Q18. The company has also raised its earnings outlook, now expecting 2018 GAAP earnings per diluted share of US$3.98 to US$4.03, as well as earnings of diluted share of US$4.18 to US$4.23.

For 3Q18, Timken posted a net income of US$71.6 million, or US$0.91 per diluted share, compared to US$53.5 million, or US$0.68 per diluted share, for 3Q17. This improvement is thought to have been driven by higher volume, favourable price/mix, and the impact of acquisitions, which were partially offset by higher material and logistics costs, including tariffs. 3Q18 also included higher pension- and acquisition-related charges.

Adjusted net income in 3Q18, excluding special items, was US$82.9 million, or US$1.06 per diluted share. This was an earnings per share record for the third quarter, compared to 3Q17 results of an adjusted net income of US$55.9 million or US$0.71 per diluted share. Cash from operations in 3Q18 was US$137.1 million and free cash flow was US$113.9 million.

During the quarter, Timken completed its previously-announced acquisitions of Cone Drive, Rollon Group, and ABC Bearings. These acquisitions have added new and complementary products, capabilities, and customers to Timken’s portfolio. The company also priced a public offering of US$400 million of 10 year senior unsecured notes, at an interest rate of 4.5%. The proceeds were used to fund the acquisitions of Cone Driven and Rollon Group. The company has also reported that it returned US$35 million in capital to shareholders during the quarter. This was the payment of its 385th consecutive quarterly dividend and repurchase of 300 000 shares, bringing its full year share repurchases to 1.4 million shares.

The company also reported sales for its mobile industries of US$464.2 million, which was up 9.8% compared with 3Q17. This increase was primarily driven by growth in the aerospace, automotive, off-highway, and heavy truck sectors, and was partially offset by unfavourable currency. EBIT in mobile industries was reported as US$50.6 million, or 10.9% of sales, compared to US$35 million, or 8.3% of sales in 3Q17. This increase in EBIT reflects the impact of higher volume and favourable price/mix, and was partially offset by higher material and logistics costs. Adjusted EBIT for the company’s mobile industries in 3Q18 was US$52.5 million, or 11.3% of sales, compared with US$37.7 million, or 8.9% of sales in 3Q17.

In comparison, process industries sales were reported of US$417.1 million, which was an increase of 19.7% from 3Q17. This is thought to have been driven by broad growth across all sectors and the favourable impact of pricing and acquisitions, which was partially offset by unfavourable currency. EBIT for process industries in the quarter was reported to be US$81.8 million, or 19.6% of sales. This is compared to an EBIT of US$61.7 million, or 17.7% of sales in 3Q17. This increase in EBIT is thought to have been driven by higher volumes and favourable price/mix, which was partially offset by higher material and logistics costs, including tariffs, alongside increased selling, and general and administrative expenses. Adjusted EBIT in 3Q18, excluding special items, was US$84 million, or 20.1% of sales, compared with US$61.7 million or 17.7% of sales in 3Q17.

“We posted another outstanding quarter,” said Richard G. Kyle, President and CEO of Timken. “We generated double-digit top-line growth, expanded operating margins despite tariff and other cost headwinds, and delivered a nearly 50% increase in adjusted earnings per share. Our recent acquisitions are off to a good start and, organically, we are doing an excellent job of serving our customers’ needs while pursuing profitable growth opportunities.
“Looking ahead to the fourth quarter, our markets remain strong, and we continue to execute well and advance the company’s strategy. As a result, we have modestly increased our earnings outlook for the year and we are planning for our strong execution and positive market momentum to carry into 2019.”

The Timken Company engineers, manufactures, and markets bearings, gear drives, automated lubrication systems, belts, chain, couplings, and linear motion products.

Read the article online at: https://www.worldcement.com/the-americas/01112018/timken-reports-3q18-financial-results/

 

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US cement news Cement news 2018