Regal-Beloit (NYSE: RBC) reported Q4 EPS of $1.14, $0.01 better than the analyst estimate of $1.13. Revenue for the quarter came in at $820.7 million versus the consensus estimate of $794.65 million.

2018 Outlook

"We are off to a good start this year with order strength in all three segments. In 2018, we are forecasting another year of low to mid-single digit organic sales growth, and we expect to improve our adjusted operating margin for the third consecutive year. We expect the benefits from our price actions and simplification projects will more than offset the commodity inflation headwind. Accordingly, we forecast our 2018 adjusted diluted earnings per share to be $5.35 to $5.75," continued Mr. Gliebe.

Key financial results for the fourth quarter 2017 included:

• Total net sales of $820.7 million increased 8.3% from the prior year and included a positive 1.3% foreign currency translation impact. The result was a positive organic sales growth rate of 6.9%.
• Income from operations was $78.3 million or 9.5% of net sales, up 30 basis points from prior year. Adjusted income from operations was $79.5 million or 9.7% of net sales, up 20 basis points from prior year.
• The Company repatriated $90.0 million of cash and paid down $74.3 million of debt.

Fourth quarter 2017 segment results versus the prior year fourth quarter included:

• Commercial and Industrial Systems Segment net sales were $407.7 million, an increase of 10.4%. Foreign currency had a positive 1.7% translation impact. The result was a positive organic sales growth rate of 8.7% driven by broad based global end market strength in both the OEM and distribution channels. Operating margin was 5.9%. Excluding $1.1 million in restructuring and related costs and a $0.4 million gain on sale of assets, adjusted operating margin was 6.1%.
• Climate Solutions Segment net sales were $216.4 million, an increase of 0.6%. Foreign currency had a positive 0.7% translation impact. The result was an organic sales growth rate that was essentially flat at negative 0.1%. North American residential HVAC sales were unchanged from a strong prior year. Operating margin was 14.0%. Excluding restructuring and related costs of $0.5 million, adjusted operating margin was 14.3%.
• Power Transmission Solutions Segment net sales were $196.6 million, an increase of 13.2%. Foreign currency had a positive 1.3% translation impact. The result was a positive organic sales growth rate of 11.9% driven by increased demand in the oil & gas and renewable energy end markets as well as in the distribution channel. Operating margin was 12.2%. There were no adjustments to the segment operating margin in the quarter.

GUIDANCE:

Regal-Beloit sees FY2018 EPS of $5.35 to $5.75, versus the consensus of $5.36.

For earnings history and earnings-related data on Regal-Beloit (RBC) click here.

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