Ingersoll-Rand (IR) Misses Q1 EPS by 40c, Revenues Miss

Ingersoll-Rand (NYSE: IR) reported Q1 EPS of ($0.13), $0.40 worse than the analyst estimate of $0.27. Revenue for the quarter came in at $800 million versus the consensus estimate of $1.24 billion.

Reported revenues of $800 million, up 29%, due primarily to the Transaction

• ◦ Supplemental adjusted revenues of $1.3 billion, down 14% excluding impact of foreign exchange (“FX”)
• Reported net loss of $37 million, or a loss of $0.13 per share, including $197 million of pre-tax amortization, restructuring and related business transformation costs, acquisition-related expenses and other adjustments; reported Adjusted Net Income of $75 million
  • Supplemental Further Adjusted Net Income of $106 million, or $0.25 per share
• Supplemental Adjusted EBITDA of $208 million with a margin of 16.4%
• Reported operating cash flow of $68 million and free cash flow of $60 million, both including Transaction-related outflows of $63 million
• Ample liquidity of $1.6 billion, including $556 million of cash on hand and undrawn capacity of $1.0 billion under available credit facilities
• Accelerated integration-related synergy actions to deliver approximately $80 to $90 million of in-year savings, largely from structural cost reductions; remain on track to deliver total cost synergies of $250 million by the end of year three after the completion of the Transaction1

“In this unprecedented first quarter, our employees dedicated themselves to delivering for our customers, especially those supporting the frontlines of the COVID-19 pandemic, all while we fast-tracked our integration-related synergies,” said Vicente Reynal, Chief Executive Officer. “The unwavering commitment of Ingersoll Rand employees to our top priorities is making us a stronger company. We remain focused on keeping our employees, communities and customers safe while executing on our strategies around talent, sustainability, growth, margins and capital allocation.”

2020 Outlook

Due to the uncertainty of current economic conditions associated with COVID-19 and its impact on end markets, Ingersoll Rand is not providing 2020 guidance at this time. The company will look to provide annual guidance at an appropriate time.

1. The company expects to incur approximately $450 million of expense in connection with both achieving these cost synergies and the associated stand-up of the combined company.
2. Supplemental financial information presents the results as if the Transaction was completed on January 1, 2018.
3. Prior year comparisons for Specialty Vehicle Technologies Segment not available on a reported basis

For earnings history and earnings-related data on Ingersoll-Rand (IR) click here.

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