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Barnes Group (B) Q2 Earnings Miss Estimates, Sales Rise Y/Y
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Barnes Group Inc. (B - Free Report) reported adjusted earnings of 37 cents per share in second-quarter 2024, which missed the Zacks Consensus Estimate of 39 cents. The metric decreased 36% year over year.
Inside the Headlines
Total sales of $382 million missed the Zacks Consensus Estimate of $399 million. The top line increased 13% year over year, with organic sales growth of 5%.
Barnes Group reports sales under two heads, namely Industrial and Aerospace. A brief snapshot of segmental sales is provided below:
Sales from the Industrial segment amounted to $164 million, down 24% year over year. Organic sales were up 3% year over year. Our estimate for segmental sales was $157.8 million.
The Aerospace segment’s sales totaled $218 million, up 79% year over year. Organic sales increased 8% and acquisition-boosted sales by 75%. Our estimate for segmental sales was $240.1 million.
Barnes Group, Inc. Price, Consensus and EPS Surprise
Barnes Group’s cost of sales increased 14.9% year over year to $258.2 million. Selling and administrative expenses decreased 6.4% to $82.7 million.
Adjusted operating income was $47.6 million, up 9.5% year over year, while the margin decreased 40 basis points to 12.4%.
Balance Sheet & Cash Flow
At the end of the second quarter, Barnes Group had cash and cash equivalents of $65.9 million compared with $89.8 million recorded at the end of 2023. Long-term debt was $1.15 billion, down from $1.23 billion at the end of 2023. Liquidity available in the quarter included cash of $66 million and credit under revolving facilities of $419 million.
In the first six months of 2024, B generated net cash of $3.1 million from operating activities compared with $42.5 million cash generated in the year-ago period. Capital expenditures totaled $29.9 million, up 38.1% year over year. Free cash outflow was $26.8 million against free cash inflow of $20.9 million a year ago.
In the first six months of 2024, Barnes Group rewarded its shareholders with dividends of $16.2 million, nearly flat year over year.
2024 Outlook
Barnes Group expects total sales to increase 10-12% year over year and organic sales to grow 4-6%. Adjusted operating margin is estimated to be 12-14%, while adjusted EBITDA margin is projected to be 20-22%.
Adjusted earnings are expected to be $1.55-$1.75 per share. The consensus estimate for earnings is pegged at $1.72 per share.
Management projects capital expenditure of $55-$65 million, while the adjusted free cash flow is expected between $45 million and $55 million. The adjusted effective tax rate is anticipated to be 33-34%.
Pentair plc (PNR - Free Report) reported second-quarter adjusted earnings per share of $1.22, which beat the Zacks Consensus Estimate of $1.15. The reported figure also improved 18% from the year-ago quarter.
Net sales rose 1.6% year over year to $1.1 billion. PNR’s top line outpaced the Zacks Consensus Estimate of $1.09 billion.
Crown Holdings, Inc. (CCK - Free Report) reported second-quarter adjusted earnings per share of $1.81, which beat the Zacks Consensus Estimate of $1.59. The bottom line improved 8% year over year.
Net sales totaled $3.04 billion, down 2.2% from the year-ago quarter. The top line missed the Zacks Consensus Estimate of $3.06 billion.
A. O. Smith Corporation’s (AOS - Free Report) second-quarter adjusted earnings of $1.06 per share missed the Zacks Consensus Estimate of $1.07. However, the bottom line increased 5% on a year-over-year basis.
Net sales of $1.02 billion surpassed the consensus estimate of $992 million. The top line increased 7% year over year, driven by strong demand for residential and commercial water heaters in North America.
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Barnes Group (B) Q2 Earnings Miss Estimates, Sales Rise Y/Y
Barnes Group Inc. (B - Free Report) reported adjusted earnings of 37 cents per share in second-quarter 2024, which missed the Zacks Consensus Estimate of 39 cents. The metric decreased 36% year over year.
Inside the Headlines
Total sales of $382 million missed the Zacks Consensus Estimate of $399 million. The top line increased 13% year over year, with organic sales growth of 5%.
Barnes Group reports sales under two heads, namely Industrial and Aerospace. A brief snapshot of segmental sales is provided below:
Sales from the Industrial segment amounted to $164 million, down 24% year over year. Organic sales were up 3% year over year. Our estimate for segmental sales was $157.8 million.
The Aerospace segment’s sales totaled $218 million, up 79% year over year. Organic sales increased 8% and acquisition-boosted sales by 75%. Our estimate for segmental sales was $240.1 million.
Barnes Group, Inc. Price, Consensus and EPS Surprise
Barnes Group, Inc. price-consensus-eps-surprise-chart | Barnes Group, Inc. Quote
Margin Profile
Barnes Group’s cost of sales increased 14.9% year over year to $258.2 million. Selling and administrative expenses decreased 6.4% to $82.7 million.
Adjusted operating income was $47.6 million, up 9.5% year over year, while the margin decreased 40 basis points to 12.4%.
Balance Sheet & Cash Flow
At the end of the second quarter, Barnes Group had cash and cash equivalents of $65.9 million compared with $89.8 million recorded at the end of 2023. Long-term debt was $1.15 billion, down from $1.23 billion at the end of 2023. Liquidity available in the quarter included cash of $66 million and credit under revolving facilities of $419 million.
In the first six months of 2024, B generated net cash of $3.1 million from operating activities compared with $42.5 million cash generated in the year-ago period. Capital expenditures totaled $29.9 million, up 38.1% year over year. Free cash outflow was $26.8 million against free cash inflow of $20.9 million a year ago.
In the first six months of 2024, Barnes Group rewarded its shareholders with dividends of $16.2 million, nearly flat year over year.
2024 Outlook
Barnes Group expects total sales to increase 10-12% year over year and organic sales to grow 4-6%. Adjusted operating margin is estimated to be 12-14%, while adjusted EBITDA margin is projected to be 20-22%.
Adjusted earnings are expected to be $1.55-$1.75 per share. The consensus estimate for earnings is pegged at $1.72 per share.
Management projects capital expenditure of $55-$65 million, while the adjusted free cash flow is expected between $45 million and $55 million. The adjusted effective tax rate is anticipated to be 33-34%.
Zacks Rank
The company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performances of Other Industrial Companies
Pentair plc (PNR - Free Report) reported second-quarter adjusted earnings per share of $1.22, which beat the Zacks Consensus Estimate of $1.15. The reported figure also improved 18% from the year-ago quarter.
Net sales rose 1.6% year over year to $1.1 billion. PNR’s top line outpaced the Zacks Consensus Estimate of $1.09 billion.
Crown Holdings, Inc. (CCK - Free Report) reported second-quarter adjusted earnings per share of $1.81, which beat the Zacks Consensus Estimate of $1.59. The bottom line improved 8% year over year.
Net sales totaled $3.04 billion, down 2.2% from the year-ago quarter. The top line missed the Zacks Consensus Estimate of $3.06 billion.
A. O. Smith Corporation’s (AOS - Free Report) second-quarter adjusted earnings of $1.06 per share missed the Zacks Consensus Estimate of $1.07. However, the bottom line increased 5% on a year-over-year basis.
Net sales of $1.02 billion surpassed the consensus estimate of $992 million. The top line increased 7% year over year, driven by strong demand for residential and commercial water heaters in North America.