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Adjusted EPS of $2.16 surpassed the Zacks Consensus Estimate by 2.9% and increased 12.5% year over year. Revenues of $4.2 billion beat the consensus mark by 1.2% and increased 9.4% year over year on a reported basis and 11% organically.
Strong results in the quarter were driven by robust demand. Bookings were up 5% year over year on a reported basis and 6% organically, to $4.3 billion.
Trane’s shares have declined 29.7% over the past year compared with the 39.1% decline of the industry it belongs to.
Revenues and Bookings
The Americas segment’s revenues of $3.4 billion increased 14% year over year on a reported basis and 13% on an organic basis. Bookings increased 11% on a reported basis and 10% organically, to $3.7 billion.
Europe, Middle East and Africa (EMEA) segment’s revenues came in at $521.6 million, flat year over year on a reported basis but up 11% organically. Bookings were down 22% year over year on a reported basis and 12% organically at 493.6 million.
Revenues from the Asia Pacific segment were down 16% year over year on a reported basis and 12% on an organic basis, to $282.5 million. Bookings of $437.4 million increased 11% on a reported basis and 16% organically.
Margin Performance
Adjusted EBITDA came in at $786 million, up 8% year over year. Adjusted EBITDA margin declined 40 basis points (bps) to 18.7%. Adjusted operating income of $707 million increased 8% year over year with adjusted operating margin declining 20 bps to 16.9%.
Key Balance Sheet and Cash Flow Figures
Trane ended the quarter with a cash balance of $1.1 billion compared with $1.3 billion at the end of the previous quarter. Debt balance was $4.8 billion, flat with the previous quarter’s tally.
The company generated $418 million of cash from operating activities and a free cash flow of $387 million through Jun 30, 2022.
Raised 2022 Guidance
Trane expects revenues to increase 11% on a reported basis and 12% on an organic basis compared with the prior expectation of a 9% increase on a reported basis and 10% on an organic basis.
Adjusted EPS is expected to be between $7.05 and $7.15 compared with the previously expected range of $6.95-$7.15. The updated guided range is above the current Zacks Consensus Estimate of $7.02.
Recent Performance of Some Other Business Services Companies
Equifax (EFX - Free Report) reported mixed second-quarter 2022 results, wherein earnings beat estimates but revenues missed the same.
EFX’s adjusted earnings of $2.09 per share beat the Zacks Consensus Estimate by 3% and improved 5.6% on a year-over-year basis. Revenues of $1.32 billion missed the consensus estimate marginally but improved 6.6% year over year.
IQVIA Holdings (IQV - Free Report) reported solid second-quarter 2022 results, wherein its earnings and revenues surpassed the Zacks Consensus Estimate.
IQV’s adjusted earnings per share of $2.44 beat the consensus mark by 2.1% and improved 15% on a year-over-year basis. Total revenues of $3.54 billion outpaced the consensus estimate by 1.2% and increased 3% year over year.
Omnicom Group (OMC - Free Report) reported impressive second-quarter 2022 results, wherein the company’s earnings and revenues surpassed the Zacks Consensus Estimate.
OMC’s earnings of $1.68 per share beat the consensus mark by 7.7% and increased 15.1% year over year, driven by a strong margin performance. Total revenues of $3.6 billion surpassed the consensus estimate by 4.4% but declined slightly year over year.
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Trane Technologies (TT) Q2 Earnings Beat Estimates, Up Y/Y
Trane Technologies plc (TT - Free Report) reported better-than-expected second-quarter 2022 results.
Adjusted EPS of $2.16 surpassed the Zacks Consensus Estimate by 2.9% and increased 12.5% year over year. Revenues of $4.2 billion beat the consensus mark by 1.2% and increased 9.4% year over year on a reported basis and 11% organically.
Strong results in the quarter were driven by robust demand. Bookings were up 5% year over year on a reported basis and 6% organically, to $4.3 billion.
Trane’s shares have declined 29.7% over the past year compared with the 39.1% decline of the industry it belongs to.
Revenues and Bookings
The Americas segment’s revenues of $3.4 billion increased 14% year over year on a reported basis and 13% on an organic basis. Bookings increased 11% on a reported basis and 10% organically, to $3.7 billion.
Europe, Middle East and Africa (EMEA) segment’s revenues came in at $521.6 million, flat year over year on a reported basis but up 11% organically. Bookings were down 22% year over year on a reported basis and 12% organically at 493.6 million.
Revenues from the Asia Pacific segment were down 16% year over year on a reported basis and 12% on an organic basis, to $282.5 million. Bookings of $437.4 million increased 11% on a reported basis and 16% organically.
Margin Performance
Adjusted EBITDA came in at $786 million, up 8% year over year. Adjusted EBITDA margin declined 40 basis points (bps) to 18.7%. Adjusted operating income of $707 million increased 8% year over year with adjusted operating margin declining 20 bps to 16.9%.
Key Balance Sheet and Cash Flow Figures
Trane ended the quarter with a cash balance of $1.1 billion compared with $1.3 billion at the end of the previous quarter. Debt balance was $4.8 billion, flat with the previous quarter’s tally.
The company generated $418 million of cash from operating activities and a free cash flow of $387 million through Jun 30, 2022.
Raised 2022 Guidance
Trane expects revenues to increase 11% on a reported basis and 12% on an organic basis compared with the prior expectation of a 9% increase on a reported basis and 10% on an organic basis.
Adjusted EPS is expected to be between $7.05 and $7.15 compared with the previously expected range of $6.95-$7.15. The updated guided range is above the current Zacks Consensus Estimate of $7.02.
Trane currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Trane Technologies plc Price, Consensus and EPS Surprise
Trane Technologies plc price-consensus-eps-surprise-chart | Trane Technologies plc Quote
Recent Performance of Some Other Business Services Companies
Equifax (EFX - Free Report) reported mixed second-quarter 2022 results, wherein earnings beat estimates but revenues missed the same.
EFX’s adjusted earnings of $2.09 per share beat the Zacks Consensus Estimate by 3% and improved 5.6% on a year-over-year basis. Revenues of $1.32 billion missed the consensus estimate marginally but improved 6.6% year over year.
IQVIA Holdings (IQV - Free Report) reported solid second-quarter 2022 results, wherein its earnings and revenues surpassed the Zacks Consensus Estimate.
IQV’s adjusted earnings per share of $2.44 beat the consensus mark by 2.1% and improved 15% on a year-over-year basis. Total revenues of $3.54 billion outpaced the consensus estimate by 1.2% and increased 3% year over year.
Omnicom Group (OMC - Free Report) reported impressive second-quarter 2022 results, wherein the company’s earnings and revenues surpassed the Zacks Consensus Estimate.
OMC’s earnings of $1.68 per share beat the consensus mark by 7.7% and increased 15.1% year over year, driven by a strong margin performance. Total revenues of $3.6 billion surpassed the consensus estimate by 4.4% but declined slightly year over year.