DOWNERS GROVE, Ill., Oct. 20, 2022 /PRNewswire/ -- Dover (NYSE: DOV), a diversified global manufacturer, announced its financial results for the third quarter ended September 30, 2022.
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||
($ in millions, except per share data) | 2022 | 2021 | % Change | 2022 | 2021 | % Change | ||||||
U.S. GAAP | ||||||||||||
Revenue | $ 2,158 | $ 2,018 | 7 % | $ 6,369 | $ 5,918 | 8 % | ||||||
Net earnings | 286 | 264 | 8 % | 802 | 761 | 5 % | ||||||
Diluted EPS | 2.00 | 1.81 | 10 % | 5.55 | 5.24 | 6 % | ||||||
Non-GAAP | ||||||||||||
Organic revenue change | 9 % | 9 % | ||||||||||
Adjusted net earnings 1 | 324 | 288 | 12 % | 908 | 850 | 7 % | ||||||
Adjusted diluted EPS | 2.26 | 1.98 | 14 % | 6.29 | 5.86 | 7 % | ||||||
1 Q3 2022 and 2021 adjusted net earnings exclude after tax purchase accounting expenses of $31.0 million and $26.9 million, respectively, and restructuring and other costs (benefits) of |
For the quarter ended September 30, 2022, Dover generated revenue of $2.2 billion, an increase of 7% (+9% organic) compared to the third quarter of the prior year. GAAP net earnings of $286 million increased 8%, and GAAP diluted EPS of $2.00 was up 10%. On an adjusted basis, net earnings of $324 million increased 12% and adjusted diluted EPS of $2.26 was up 14% versus the comparable quarter of the prior year.
For the nine months ended September 30, 2022, Dover generated revenue of $6.4 billion, an increase of 8% (+9% organic) compared to the comparable period of the prior year. GAAP net earnings of $802 million increased 5%, and GAAP diluted EPS of $5.55 was up 6% year-over-year. On an adjusted basis, net earnings of $908 million increased 7%, and adjusted diluted EPS of $6.29 was also up 7% versus the comparable period of the prior year.
A full reconciliation between GAAP and adjusted measures and definitions of non-GAAP and other performance measures are included as an exhibit herein.
Dover's President and Chief Executive Officer, Richard J. Tobin, said, "Dover delivered strong revenue growth and margin improvement in the third quarter driven by rigorous execution and improving price-cost dynamics that more than offset the significant impact of ongoing input shortages, inflationary cost pressure and foreign currency translation.
"Demand remains constructive across most of the portfolio and our order backlog remains at double its historical level relative to sales. The supply chain challenges that we have endured for the past 18 months continued to improve in the quarter which has allowed us to deplete our backlog at a faster rate and reduce our order conversion lead times closer to pre-pandemic levels. It is our expectation that this will continue for the balance of the year.
"Our full year outlook for cash generation remains robust, further strengthening our balance sheet position. Despite the macroeconomic uncertainty we are deploying capital to drive productivity and expand capacity in several businesses that are expected to deliver robust growth on secular tailwinds, and we are continuing to pursue attractive bolt-on acquisitions. During the quarter we also announced an accelerated share repurchase program to return excess capital to shareholders while preserving sufficient liquidity for value-creating investments.
"While current demand conditions are solid, our current management posture reflects growing caution in the macroeconomic outlook. As such, through the balance of the year we will be proactively reducing output in several businesses to draw down inventory balances and initiating cost containment measures where appropriate. Our business model is flexible, and we firmly believe that ongoing improvements in the supply chain will allow us to match production to meet demand within prevailing lead times in 2023.
"As we enter the final quarter of the year, I am confident in our team's ability to continue to outperform in a challenging operating environment. We remain committed to delivering results in line with our 2022 full-year guidance."
In 2022, Dover expects to generate GAAP EPS in the range of $7.40 to $7.50 (adjusted EPS of $8.40 to $8.50), based on full year revenue growth of 7% to 9% (8% to 10% on an organic basis).
Dover will host a webcast and conference call to discuss its third quarter and year-to-date 2022 results at 9:00 A.M. Eastern Time (8:00 A.M. Central Time) on Thursday, October 20, 2022. The webcast can be accessed on the Dover website at dovercorporation.com. The conference call will also be made available for replay on the website. Additional information on Dover's third quarter results and its operating segments can be found on the Company's website.
Dover is a diversified global manufacturer and solutions provider with annual revenue of over $8 billion. We deliver innovative equipment and components, consumable supplies, aftermarket parts, software and digital solutions, and support services through five operating segments: Engineered Products, Clean Energy & Fueling, Imaging & Identification, Pumps & Process Solutions and Climate & Sustainability Technologies. Dover combines global scale with operational agility to lead the markets we serve. Recognized for our entrepreneurial approach for over 65 years, our team of over 25,000 employees takes an ownership mindset, collaborating with customers to redefine what's possible. Headquartered in Downers Grove, Illinois, Dover trades on the New York Stock Exchange under "DOV." Additional information is available at dovercorporation.com.
This press release contains "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. All statements in this document other than statements of historical fact are statements that are, or could be deemed, "forward-looking" statements. Forward-looking statements are subject to numerous important risks, uncertainties, assumptions and other factors, some of which are beyond the Company's control. Factors that could cause actual results to differ materially from current expectations include, among other things, the impacts of COVID-19, or other future pandemics, on the global economy and on our customers, suppliers, employees, business and cash flows, supply chain constraints and labor shortages that could result in production stoppages, inflation in material input costs and freight logistics, other general economic conditions and conditions in the particular markets in which we operate, the impact on global or a regional economy due to the outbreak or escalation of hostilities or war, changes in customer demand and capital spending, competitive factors and pricing pressures, our ability to develop and launch new products in a cost-effective manner, our ability to realize synergies from newly acquired businesses, and our ability to derive expected benefits from restructuring, productivity initiatives and other cost reduction actions. For details on the risks and uncertainties that could cause our results to differ materially from the forward-looking statements contained herein, we refer you to the documents we file with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the year ended December 31, 2021, and our Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. These documents are available from the Securities and Exchange Commission, and on our website, dovercorporation.com. The Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise.
INVESTOR SUPPLEMENT - THIRD QUARTER 2022 | |||||||
DOVER CORPORATION CONSOLIDATED STATEMENTS OF EARNINGS (unaudited)(in thousands, except per share data*) | |||||||
Three Months Ended | Nine Months Ended | ||||||
2022 | 2021 | 2022 | 2021 | ||||
Revenue | $ 2,158,291 | $ 2,018,269 | $ 6,368,907 | $ 5,917,846 | |||
Cost of goods and services | 1,385,541 | 1,263,690 | 4,071,680 | 3,669,547 | |||
Gross profit | 772,750 | 754,579 | 2,297,227 | 2,248,299 | |||
Selling, general, and administrative expenses | 402,339 | 412,553 | 1,270,615 | 1,249,593 | |||
Operating earnings | 370,411 | 342,026 | 1,026,612 | 998,706 | |||
Interest expense | 29,789 | 26,433 | 83,330 | 79,917 | |||
Interest income | (1,244) | (1,466) | (2,968) | (3,088) | |||
Other income, net | (11,167) | (10,460) | (17,842) | (18,236) | |||
Earnings before provision for income taxes | 353,033 | 327,519 | 964,092 | 940,113 | |||
Provision for income taxes | 67,007 | 63,763 | 162,295 | 179,080 | |||
Net earnings | $ 286,026 | $ 263,756 | $ 801,797 | $ 761,033 | |||
Net earnings per share: | |||||||
Basic | $ 2.01 | $ 1.83 | $ 5.59 | $ 5.29 | |||
Diluted | $ 2.00 | $ 1.81 | $ 5.55 | $ 5.24 | |||
Weighted average shares outstanding: | |||||||
Basic | 142,506 | 143,976 | 143,469 | 143,895 | |||
Diluted | 143,257 | 145,440 | 144,413 | 145,220 | |||
Dividends paid per common share | $ 0.505 | $ 0.50 | $ 1.505 | $ 1.49 | |||
* Per share data may be impacted by rounding. | |||||||
DOVER CORPORATION QUARTERLY SEGMENT INFORMATION (unaudited)(in thousands) | |||||||||||
2022 | 2021 | ||||||||||
Q1 | Q2 | Q3 | Q3 YTD | Q1 | Q2 | Q3 | Q3 YTD | Q4 | FY 2021 | ||
REVENUE | |||||||||||
Engineered Products | $ 487,647 | $ 514,436 | $ 516,501 | $ 1,518,584 | $ 428,127 | $ 442,091 | $ 447,798 | $ 1,318,016 | $ 462,811 | $ 1,780,827 | |
Clean Energy & Fueling | 458,395 | 494,075 | 464,022 | 1,416,492 | 389,678 | 437,042 | 410,561 | 1,237,281 | 410,872 | 1,648,153 | |
Imaging & Identification | 272,255 | 275,951 | 282,371 | 830,577 | 284,328 | 294,076 | 292,535 | 870,939 | 292,428 | 1,163,367 | |
Pumps & Process Solutions | 435,195 | 441,127 | 433,558 | 1,309,880 | 394,377 | 428,701 | 438,240 | 1,261,318 | 447,316 | 1,708,634 | |
Climate & Sustainability | 399,078 | 434,164 | 462,671 | 1,295,913 | 372,077 | 430,506 | 429,425 | 1,232,008 | 376,167 | 1,608,175 | |
Intersegment eliminations | (669) | (1,038) | (832) | (2,539) | (686) | (740) | (290) | (1,716) | (359) | (2,075) | |
Total consolidated revenue | $ 2,051,901 | $ 2,158,715 | $ 2,158,291 | $ 6,368,907 | $1,867,901 | $ 2,031,676 | $ 2,018,269 | $ 5,917,846 | $ 1,989,235 | $ 7,907,081 | |
NET EARNINGS | |||||||||||
Segment Earnings: | |||||||||||
Engineered Products | $ 71,130 | $ 81,671 | $ 90,145 | $ 242,946 | $ 76,684 | $ 71,255 | $ 67,376 | $ 215,315 | $ 62,537 | $ 277,852 | |
Clean Energy & Fueling | 72,962 | 99,034 | 90,208 | 262,204 | 79,572 | 93,430 | 80,101 | 253,103 | 74,083 | 327,186 | |
Imaging & Identification | 58,598 | 61,392 | 74,477 | 194,467 | 63,618 | 66,565 | 70,635 | 200,818 | 66,114 | 266,932 | |
Pumps & Process Solutions | 146,617 | 138,048 | 128,573 | 413,238 | 128,895 | 146,759 | 150,275 | 425,929 | 149,664 | 575,593 | |
Climate & Sustainability | 53,609 | 64,181 | 75,190 | 192,980 | 43,475 | 56,905 | 49,734 | 150,114 | 35,403 | 185,517 | |
Total segment earnings | 402,916 | 444,326 | 458,593 | 1,305,835 | 392,244 | 434,914 | 418,121 | 1,245,279 | 387,801 | 1,633,080 | |
Purchase accounting expenses 1 | 53,286 | 47,019 | 40,526 | 140,831 | 35,516 | 35,162 | 35,587 | 106,265 | 35,715 | 141,980 | |
Restructuring and other costs | 10,552 | 7,944 | 8,613 | 27,109 | 4,162 | 10,779 | (3,201) | 11,740 | 26,696 | 38,436 | |
Loss (gain) on dispositions 3 | 194 | — | — | 194 | — | — | — | — | (206,338) | (206,338) | |
Corporate expense / other 4 | 37,404 | 27,967 | 27,876 | 93,247 | 37,173 | 39,910 | 33,249 | 110,332 | 45,966 | 156,298 | |
Interest expense | 26,552 | 26,989 | 29,789 | 83,330 | 26,823 | 26,661 | 26,433 | 79,917 | 26,402 | 106,319 | |
Interest income | (775) | (949) | (1,244) | (2,968) | (680) | (942) | (1,466) | (3,088) | (1,353) | (4,441) | |
Earnings before provision for | 275,703 | 335,356 | 353,033 | 964,092 | 289,250 | 323,344 | 327,519 | 940,113 | 460,713 | 1,400,826 | |
Provision for income taxes | 49,550 | 45,738 | 67,007 | 162,295 | 56,481 | 58,836 | 63,763 | 179,080 | 97,928 | 277,008 | |
Net earnings | $ 226,153 | $ 289,618 | $ 286,026 | $ 801,797 | $ 232,769 | $ 264,508 | $ 263,756 | $ 761,033 | $ 362,785 | $ 1,123,818 | |
SEGMENT EARNINGS MARGIN | |||||||||||
Engineered Products | 14.6 % | 15.9 % | 17.5 % | 16.0 % | 17.9 % | 16.1 % | 15.0 % | 16.3 % | 13.5 % | 15.6 % | |
Clean Energy & Fueling | 15.9 % | 20.0 % | 19.4 % | 18.5 % | 20.4 % | 21.4 % | 19.5 % | 20.5 % | 18.0 % | 19.9 % | |
Imaging & Identification | 21.5 % | 22.2 % | 26.4 % | 23.4 % | 22.4 % | 22.6 % | 24.1 % | 23.1 % | 22.6 % | 22.9 % | |
Pumps & Process Solutions | 33.7 % | 31.3 % | 29.7 % | 31.5 % | 32.7 % | 34.2 % | 34.3 % | 33.8 % | 33.5 % | 33.7 % | |
Climate & Sustainability | 13.4 % | 14.8 % | 16.3 % | 14.9 % | 11.7 % | 13.2 % | 11.6 % | 12.2 % | 9.4 % | 11.5 % | |
Total segment earnings margin | 19.6 % | 20.6 % | 21.2 % | 20.5 % | 21.0 % | 21.4 % | 20.7 % | 21.0 % | 19.5 % | 20.7 % | |
1 Purchase accounting expenses are primarily comprised of amortization of intangible assets and charges related to fair value step-ups for acquired inventory sold | |||||||||||
2 Restructuring and other costs (benefits) relate to actions taken for employee reductions, facility consolidations and site closures, product line exits, and other asset | |||||||||||
3 Loss (gain) on dispositions includes working capital adjustments related to dispositions. | |||||||||||
4 Certain expenses are maintained at the corporate level and not allocated to the segments. These expenses include executive and functional compensation costs, non- | |||||||||||
DOVER CORPORATION QUARTERLY EARNINGS PER SHARE (unaudited)(in thousands, except per share data*) | |||||||||||
Earnings Per Share | |||||||||||
2022 | 2021 | ||||||||||
Q1 | Q2 | Q3 | Q3 YTD | Q1 | Q2 | Q3 | Q3 YTD | Q4 | FY 2021 | ||
Net earnings per share: | |||||||||||
Basic | $ 1.57 | $ 2.01 | $ 2.01 | $ 5.59 | $ 1.62 | $ 1.84 | $ 1.83 | $ 5.29 | $ 2.52 | $ 7.81 | |
Diluted | $ 1.56 | $ 2.00 | $ 2.00 | $ 5.55 | $ 1.61 | $ 1.82 | $ 1.81 | $ 5.24 | $ 2.49 | $ 7.74 | |
Net earnings and weighted average shares used in calculated earnings per share amounts are as follows: | |||||||||||
Net earnings | $ 226,153 | $ 289,618 | $ 286,026 | $ 801,797 | $ 232,769 | $ 264,508 | $ 263,756 | $ 761,033 | $ 362,785 | $ 1,123,818 | |
Weighted average shares outstanding: | |||||||||||
Basic | 144,087 | 143,832 | 142,506 | 143,469 | 143,765 | 143,941 | 143,976 | 143,895 | 144,005 | 143,923 | |
Diluted | 145,329 | 144,669 | 143,257 | 144,413 | 144,938 | 145,118 | 145,440 | 145,220 | 145,460 | 145,273 | |
* Per share data may be impacted by rounding. | |||||||||||
DOVER CORPORATION QUARTERLY ADJUSTED EARNINGS AND ADJUSTED EARNINGS PER SHARE (NON-GAAP) (unaudited)(in thousands, except per share data*) | |||||||||||
Non-GAAP Reconciliations | |||||||||||
2022 | 2021 | ||||||||||
Q1 | Q2 | Q3 | Q3 YTD | Q1 | Q2 | Q3 | Q3 YTD | Q4 | FY 2021 | ||
Adjusted net earnings: | |||||||||||
Net earnings | $ 226,153 | $ 289,618 | $ 286,026 | $ 801,797 | $ 232,769 | $ 264,508 | $ 263,756 | $ 761,033 | $ 362,785 | $ 1,123,818 | |
Purchase accounting expenses, pre-tax 1 | 53,286 | 47,019 | 40,526 | 140,831 | 35,516 | 35,162 | 35,587 | 106,265 | 35,715 | 141,980 | |
Purchase accounting expenses, tax | (12,538) | (11,013) | (9,494) | (33,045) | (8,720) | (8,571) | (8,700) | (25,991) | (8,763) | (34,754) | |
Restructuring and other costs (benefits), | 10,552 | 7,944 | 8,613 | 27,109 | 4,162 | 10,779 | (3,201) | 11,740 | 26,696 | 38,436 | |
Restructuring and other costs (benefits), | (2,191) | (1,803) | (1,921) | (5,915) | (1,031) | (2,597) | 902 | (2,726) | (4,610) | (7,336) | |
Loss (gain) on dispositions, pre-tax 4 | 194 | — | — | 194 | — | — | — | — | (206,338) | (206,338) | |
Loss (gain) on dispositions, tax-impact 2 | (27) | — | — | (27) | — | — | — | — | 53,218 | 53,218 | |
Tax Cuts and Jobs Act 5 | — | (22,579) | — | (22,579) | — | — | — | — | — | — | |
Adjusted net earnings | $ 275,429 | $ 309,186 | $ 323,750 | $ 908,365 | $ 262,696 | $ 299,281 | $ 288,344 | $ 850,321 | $ 258,703 | $ 1,109,024 | |
Adjusted diluted net earnings per share: | |||||||||||
Diluted net earnings per share | $ 1.56 | $ 2.00 | $ 2.00 | $ 5.55 | $ 1.61 | $ 1.82 | $ 1.81 | $ 5.24 | $ 2.49 | $ 7.74 | |
Purchase accounting expenses, pre-tax 1 | 0.37 | 0.33 | 0.28 | 0.98 | 0.25 | 0.24 | 0.24 | 0.73 | 0.25 | 0.98 | |
Purchase accounting expenses, tax | (0.09) | (0.08) | (0.07) | (0.23) | (0.06) | (0.06) | (0.06) | (0.18) | (0.06) | (0.24) | |
Restructuring and other costs (benefits), | 0.07 | 0.05 | 0.06 | 0.19 | 0.03 | 0.07 | (0.02) | 0.08 | 0.18 | 0.26 | |
Restructuring and other costs (benefits), | (0.02) | (0.01) | (0.01) | (0.04) | (0.01) | (0.02) | 0.01 | (0.02) | (0.03) | (0.05) | |
Loss (gain) on dispositions, pre-tax 4 | — | — | — | — | — | — | — | — | (1.42) | (1.42) | |
Loss (gain) on dispositions, tax-impact 2 | — | — | — | — | — | — | — | — | 0.37 | 0.37 | |
Tax Cuts and Jobs Act 5 | — | (0.16) | — | (0.16) | — | — | — | — | — | — | |
Adjusted diluted net earnings per share | $ 1.90 | $ 2.14 | $ 2.26 | $ 6.29 | $ 1.81 | $ 2.06 | $ 1.98 | $ 5.86 | $ 1.78 | $ 7.63 | |
1 Purchase accounting expenses are primarily comprised of amortization of intangible assets and charges related to fair value step-ups for acquired | |||||||||||
2 Adjustments were tax effected using the statutory tax rates in the applicable jurisdictions or the effective tax rate, where applicable, for each period. | |||||||||||
3 Restructuring and other costs (benefits) relate to actions taken for employee reductions, facility consolidations and site closures, product line exits, | |||||||||||
4 Q1 2022 represents working capital adjustments related to the disposition of Unified Brands ("UB") and the Race Winning Brands ("RWB") equity | |||||||||||
5 Q2 and Q3 YTD 2022 represent a reduction to income taxes previously recorded related to the Tax Cuts and Jobs Act. | |||||||||||
* Per share data and totals may be impacted by rounding. | |||||||||||
DOVER CORPORATION QUARTERLY ADJUSTED SEGMENT EBITDA (NON-GAAP) (unaudited)(in thousands) | |||||||||||
Non-GAAP Reconciliations | |||||||||||
2022 | 2021 | ||||||||||
Q1 | Q2 | Q3 | Q3 YTD | Q1 | Q2 | Q3 | Q3 YTD | Q4 | FY 2021 | ||
ADJUSTED SEGMENT EBITDA | |||||||||||
Engineered Products: | |||||||||||
Segment earnings | $ 71,130 | $ 81,671 | $ 90,145 | $ 242,946 | $ 76,684 | $ 71,255 | $ 67,376 | $ 215,315 | $ 62,537 | $ 277,852 | |
Other depreciation and amortization 1 | 7,274 | 6,799 | 6,819 | 20,892 | 6,708 | 5,814 | 7,132 | 19,654 | 7,382 | 27,036 | |
Adjusted segment EBITDA 2 | 78,404 | 88,470 | 96,964 | 263,838 | 83,392 | 77,069 | 74,508 | 234,969 | 69,919 | 304,888 | |
Adjusted segment EBITDA margin 2 | 16.1 % | 17.2 % | 18.8 % | 17.4 % | 19.5 % | 17.4 % | 16.6 % | 17.8 % | 15.1 % | 17.1 % | |
Clean Energy & Fueling: | |||||||||||
Segment earnings 3 | $ 72,962 | $ 99,034 | $ 90,208 | $ 262,204 | $ 79,572 | $ 93,430 | $ 80,101 | $ 253,103 | $ 74,083 | $ 327,186 | |
Other depreciation and amortization 1 | 8,466 | 6,533 | 6,893 | 21,892 | 6,489 | 6,571 | 6,411 | 19,471 | 6,371 | 25,842 | |
Adjusted segment EBITDA 2 | 81,428 | 105,567 | 97,101 | 284,096 | 86,061 | 100,001 | 86,512 | 272,574 | 80,454 | 353,028 | |
Adjusted segment EBITDA margin 2 | 17.8 % | 21.4 % | 20.9 % | 20.1 % | 22.1 % | 22.9 % | 21.1 % | 22.0 % | 19.6 % | 21.4 % | |
Imaging & Identification: | |||||||||||
Segment earnings | $ 58,598 | $ 61,392 | $ 74,477 | $ 194,467 | $ 63,618 | $ 66,565 | $ 70,635 | $ 200,818 | $ 66,114 | $ 266,932 | |
Other depreciation and amortization 1 | 3,497 | 3,496 | 3,372 | 10,365 | 3,274 | 3,544 | 3,896 | 10,714 | 3,475 | 14,189 | |
Adjusted segment EBITDA 2 | 62,095 | 64,888 | 77,849 | 204,832 | 66,892 | 70,109 | 74,531 | 211,532 | 69,589 | 281,121 | |
Adjusted segment EBITDA margin 2 | 22.8 % | 23.5 % | 27.6 % | 24.7 % | 23.5 % | 23.8 % | 25.5 % | 24.3 % | 23.8 % | 24.2 % | |
Pumps & Process Solutions: | |||||||||||
Segment earnings | $ 146,617 | $ 138,048 | $ 128,573 | $ 413,238 | $ 128,895 | $ 146,759 | $ 150,275 | $ 425,929 | $ 149,664 | $ 575,593 | |
Other depreciation and amortization 1 | 9,922 | 9,787 | 10,137 | 29,846 | 9,670 | 9,638 | 9,832 | 29,140 | 10,132 | 39,272 | |
Adjusted segment EBITDA 2 | 156,539 | 147,835 | 138,710 | 443,084 | 138,565 | 156,397 | 160,107 | 455,069 | 159,796 | 614,865 | |
Adjusted segment EBITDA margin 2 | 36.0 % | 33.5 % | 32.0 % | 33.8 % | 35.1 % | 36.5 % | 36.5 % | 36.1 % | 35.7 % | 36.0 % | |
Climate & Sustainability Technologies: | |||||||||||
Segment earnings | $ 53,609 | $ 64,181 | $ 75,190 | $ 192,980 | $ 43,475 | $ 56,905 | $ 49,734 | $ 150,114 | $ 35,403 | $ 185,517 | |
Other depreciation and amortization 1 | 6,495 | 6,443 | 6,736 | 19,674 | 6,349 | 6,682 | 7,019 | 20,050 | 6,937 | 26,987 | |
Adjusted segment EBITDA 2 | 60,104 | 70,624 | 81,926 | 212,654 | 49,824 | 63,587 | 56,753 | 170,164 | 42,340 | 212,504 | |
Adjusted segment EBITDA margin 2 | 15.1 % | 16.3 % | 17.7 % | 16.4 % | 13.4 % | 14.8 % | 13.2 % | 13.8 % | 11.3 % | 13.2 % | |
Total Segments: | |||||||||||
Segment earnings 2, 3, 4 | $ 402,916 | $ 444,326 | $ 458,593 | $ 1,305,835 | $ 392,244 | $ 434,914 | $ 418,121 | $ 1,245,279 | $ 387,801 | $ 1,633,080 | |
Other depreciation and amortization 1 | 35,654 | 33,058 | 33,957 | 102,669 | 32,490 | 32,249 | 34,290 | 99,029 | 34,297 | 133,326 | |
Adjusted segment EBITDA 2 | 438,570 | 477,384 | 492,550 | 1,408,504 | 424,734 | 467,163 | 452,411 | 1,344,308 | 422,098 | 1,766,406 | |
Adjusted segment EBITDA margin 2 | 21.4 % | 22.1 % | 22.8 % | 22.1 % | 22.7 % | 23.0 % | 22.4 % | 22.7 % | 21.2 % | 22.3 % | |
1 Other depreciation and amortization relates to property, plant, and equipment and intangibles, and excludes amounts related to purchase accounting expenses and | |||||||||||
2 Refer to Non-GAAP Disclosures section for definition. | |||||||||||
3 Q1, Q2, and Q3 YTD 2022 exclude $12,097, $6,898, and $18,995 of amortization of inventory step-up, respectively, related to the Q4 2021 acquisitions within our | |||||||||||
4 Refer to Quarterly Segment Information section for reconciliation of total segment earnings to net earnings. | |||||||||||
DOVER CORPORATION QUARTERLY ADJUSTED SEGMENT EBITDA TO NET EARNINGS RECONCILIATION (NON-GAAP) (unaudited)(in thousands) | |||||||||||
Non-GAAP Reconciliations | |||||||||||
2022 | 2021 | ||||||||||
Q1 | Q2 | Q3 | Q3 YTD | Q1 | Q2 | Q3 | Q3 YTD | Q4 | FY 2021 | ||
Net earnings: | |||||||||||
Adjusted segment EBITDA1: | |||||||||||
Engineered Products | $ 78,404 | $ 88,470 | 96,964 | 263,838 | $ 83,392 | $ 77,069 | $ 74,508 | $ 234,969 | $ 69,919 | $ 304,888 | |
Clean Energy & Fueling | 81,428 | 105,567 | 97,101 | 284,096 | 86,061 | 100,001 | 86,512 | 272,574 | 80,454 | 353,028 | |
Imaging & Identification | 62,095 | 64,888 | 77,849 | 204,832 | 66,892 | 70,109 | 74,531 | 211,532 | 69,589 | 281,121 | |
Pumps & Process Solutions | 156,539 | 147,835 | 138,710 | 443,084 | 138,565 | 156,397 | 160,107 | 455,069 | 159,796 | 614,865 | |
Climate & Sustainability | 60,104 | 70,624 | 81,926 | 212,654 | 49,824 | 63,587 | 56,753 | 170,164 | 42,340 | 212,504 | |
Total adjusted segment EBITDA 1 | 438,570 | 477,384 | 492,550 | 1,408,504 | 424,734 | 467,163 | 452,411 | 1,344,308 | 422,098 | 1,766,406 | |
Less: Other depreciation and | 35,654 | 33,058 | 33,957 | 102,669 | 32,490 | 32,249 | 34,290 | 99,029 | 34,297 | 133,326 | |
Total segment earnings 1 | 402,916 | 444,326 | 458,593 | 1,305,835 | 392,244 | 434,914 | 418,121 | 1,245,279 | 387,801 | 1,633,080 | |
Purchase accounting expenses 3 | 53,286 | 47,019 | 40,526 | 140,831 | 35,516 | 35,162 | 35,587 | 106,265 | 35,715 | 141,980 | |
Restructuring and other costs | 10,552 | 7,944 | 8,613 | 27,109 | 4,162 | 10,779 | (3,201) | 11,740 | 26,696 | 38,436 | |
Loss (gain) on dispositions 5 | 194 | — | — | 194 | — | — | — | — | (206,338) | (206,338) | |
Corporate expense / other 6 | 37,404 | 27,967 | 27,876 | 93,247 | 37,173 | 39,910 | 33,249 | 110,332 | 45,966 | 156,298 | |
Interest expense | 26,552 | 26,989 | 29,789 | 83,330 | 26,823 | 26,661 | 26,433 | 79,917 | 26,402 | 106,319 | |
Interest income | (775) | (949) | (1,244) | (2,968) | (680) | (942) | (1,466) | (3,088) | (1,353) | (4,441) | |
Earnings before provision for | 275,703 | 335,356 | 353,033 | 964,092 | 289,250 | 323,344 | 327,519 | 940,113 | 460,713 | 1,400,826 | |
Provision for income taxes | 49,550 | 45,738 | 67,007 | 162,295 | 56,481 | 58,836 | 63,763 | 179,080 | 97,928 | 277,008 | |
Net earnings | $ 226,153 | $ 289,618 | $ 286,026 | $ 801,797 | $ 232,769 | $ 264,508 | $ 263,756 | $ 761,033 | $ 362,785 | $ 1,123,818 | |
1 Refer to Non-GAAP Disclosures section for definition. | |||||||||||
2 Other depreciation and amortization relates to property, plant, and equipment and intangibles, and excludes amounts related to purchase | |||||||||||
3 Purchase accounting expenses are primarily comprised of amortization of intangible assets and charges related to fair value step-ups for acquired | |||||||||||
4 Restructuring and other costs (benefits) relate to actions taken for employee reductions, facility consolidations and site closures, product line exits, | |||||||||||
5 Loss (gain) on dispositions includes working capital adjustments related to dispositions. | |||||||||||
6 Certain expenses are maintained at the corporate level and not allocated to the segments. These expenses include executive and functional | |||||||||||
DOVER CORPORATION REVENUE GROWTH FACTORS AND ADJUSTED EPS GUIDANCE RECONCILIATIONS (NON-GAAP) (unaudited)(in thousands, except per share data*) | ||||||||||||||||||||
Non-GAAP Reconciliations | ||||||||||||||||||||
Revenue Growth Factors | ||||||||||||||||||||
2022 | ||||||||||||||||||||
Q3 | Q3 YTD | |||||||||||||||||||
Organic | ||||||||||||||||||||
Engineered Products | 17.6 % | 16.9 % | ||||||||||||||||||
Clean Energy & Fueling | (0.5) % | (0.5) % | ||||||||||||||||||
Imaging & Identification | 4.9 % | 1.0 % | ||||||||||||||||||
Pumps & Process Solutions | 1.9 % | 6.9 % | ||||||||||||||||||
Climate & Sustainability Technologies | 19.3 % | 16.0 % | ||||||||||||||||||
Total Organic | 9.0 % | 8.6 % | ||||||||||||||||||
Acquisitions | 4.4 % | 4.3 % | ||||||||||||||||||
Dispositions | (1.7) % | (1.7) % | ||||||||||||||||||
Currency translation | (4.8) % | (3.6) % | ||||||||||||||||||
Total* | 6.9 % | 7.6 % | ||||||||||||||||||
* Totals may be impacted by rounding. | ||||||||||||||||||||
2022 | ||||||||||||||||||||
Q3 | Q3 YTD | |||||||||||||||||||
Organic | ||||||||||||||||||||
United States | 11.2 % | 10.9 % | ||||||||||||||||||
Other Americas | (5.6) % | (5.5) % | ||||||||||||||||||
Europe | 8.7 % | 8.9 % | ||||||||||||||||||
Asia | 13.0 % | 10.1 % | ||||||||||||||||||
Other | (1.5) % | (2.4) % | ||||||||||||||||||
Total Organic | 9.0 % | 8.6 % | ||||||||||||||||||
Acquisitions | 4.4 % | 4.3 % | ||||||||||||||||||
Dispositions | (1.7) % | (1.7) % | ||||||||||||||||||
Currency translation | (4.8) % | (3.6) % | ||||||||||||||||||
Total* | 6.9 % | 7.6 % | ||||||||||||||||||
* Totals may be impacted by rounding. | ||||||||||||||||||||
Adjusted EPS Guidance Reconciliation | ||||||||||||||||||||
Range | ||||||||||||||||||||
2022 Guidance for Earnings per Share (GAAP) | $ 7.40 | $ 7.50 | ||||||||||||||||||
Purchase accounting expenses, net | 0.99 | |||||||||||||||||||
Restructuring and other costs, net | 0.17 | |||||||||||||||||||
Tax Cuts and Jobs Act | (0.16) | |||||||||||||||||||
2022 Guidance for Adjusted Earnings per Share (Non-GAAP) | $ 8.40 | $ 8.50 | ||||||||||||||||||
* Per share data and totals may be impacted by rounding. | ||||||||||||||||||||
DOVER CORPORATION QUARTERLY CASH FLOW AND FREE CASH FLOW (NON-GAAP) (unaudited)(in thousands) | |||||||||||
Quarterly Cash Flow | |||||||||||
2022 | 2021 | ||||||||||
Q1 | Q2 | Q3 | Q3 YTD | Q1 | Q2 | Q3 | Q3 YTD | Q4 | FY 2021 | ||
Net Cash Flows Provided By (Used In): | |||||||||||
Operating activities | $ 23,683 | $ 178,773 | $ 264,625 | $ 467,081 | $ 177,184 | $ 260,073 | $ 351,329 | $ 788,586 | $ 327,279 | $ 1,115,865 | |
Investing activities | (46,963) | (68,890) | (286,208) | (402,061) | (29,572) | (121,631) | (135,439) | (286,642) | (706,111) | (992,753) | |
Financing activities | (75,204) | 120,469 | (178,844) | (133,579) | (124,239) | (75,949) | (74,610) | (274,798) | 24,918 | (249,880) | |
Quarterly Free Cash Flow (Non-GAAP) | |||||||||||
2022 | 2021 | ||||||||||
Q1 | Q2 | Q3 | Q3 YTD | Q1 | Q2 | Q3 | Q3 YTD | Q4 | FY 2021 | ||
Cash flow from operating | $ 23,683 | $ 178,773 | $ 264,625 | $ 467,081 | $ 177,184 | $ 260,073 | $ 351,329 | $ 788,586 | $ 327,279 | $ 1,115,865 | |
Less: Capital expenditures | (50,381) | (50,196) | (65,462) | (166,039) | (31,260) | (41,971) | (47,926) | (121,157) | (50,308) | (171,465) | |
Free cash flow | $ (26,698) | $ 128,577 | $ 199,163 | $ 301,042 | $ 145,924 | $ 218,102 | $ 303,403 | $ 667,429 | $ 276,971 | $ 944,400 | |
Cash flow from operating | 1.2 % | 8.3 % | 12.3 % | 7.3 % | 9.5 % | 12.8 % | 17.4 % | 13.3 % | 16.5 % | 14.1 % | |
Cash flow from operating | 8.6 % | 57.8 % | 81.7 % | 51.4 % | 67.4 % | 86.9 % | 121.8 % | 92.7 % | 126.5 % | 100.6 % | |
Free cash flow as a | -1.3 % | 6.0 % | 9.2 % | 4.7 % | 7.8 % | 10.7 % | 15.0 % | 11.3 % | 13.9 % | 11.9 % | |
Free cash flow as a | -9.7 % | 41.6 % | 61.5 % | 33.1 % | 55.5 % | 72.9 % | 105.2 % | 78.5 % | 107.1 % | 85.2 % | |
DOVER CORPORATION PERFORMANCE MEASURES (unaudited)(in thousands) | |||||||||||
2022 | 2021 | ||||||||||
Q1 | Q2 | Q3 | Q3 YTD | Q1 | Q2 | Q3 | Q3 YTD | Q4 | FY 2021 | ||
BOOKINGS | |||||||||||
Engineered Products | $ 541,035 | $ 452,668 | $ 512,374 | $ 1,506,077 | $ 528,310 | $ 497,200 | $ 502,767 | $ 1,528,277 | $ 585,452 | $ 2,113,729 | |
Clean Energy & Fueling | 501,491 | 487,861 | 432,259 | 1,421,611 | 422,668 | 453,146 | 467,821 | 1,343,635 | 398,844 | 1,742,479 | |
Imaging & Identification | 307,104 | 292,136 | 281,789 | 881,029 | 293,614 | 299,608 | 293,782 | 887,004 | 303,400 | 1,190,404 | |
Pumps & Process Solutions | 459,790 | 471,693 | 415,253 | 1,346,736 | 551,365 | 521,010 | 490,581 | 1,562,956 | 460,105 | 2,023,061 | |
Climate & Sustainability | 444,852 | 403,574 | 422,820 | 1,271,246 | 537,326 | 606,545 | 540,280 | 1,684,151 | 632,849 | 2,317,000 | |
Intersegment eliminations | (2,295) | (1,207) | (423) | (3,925) | (863) | (498) | (407) | (1,768) | (290) | (2,058) | |
Total consolidated bookings | $ 2,251,977 | $ 2,106,725 | $ 2,064,072 | $ 6,422,774 | $ 2,332,420 | $ 2,377,011 | $ 2,294,824 | $ 7,004,255 | $ 2,380,360 | $ 9,384,615 | |
BACKLOG | |||||||||||
Engineered Products | $ 830,135 | $ 759,589 | $ 742,766 | $ 562,557 | $ 613,517 | $ 662,834 | $ 785,085 | ||||
Clean Energy & Fueling | 426,342 | 411,350 | 368,050 | 238,822 | 256,497 | 312,176 | 383,572 | ||||
Imaging & Identification | 243,411 | 255,255 | 241,896 | 198,556 | 206,125 | 204,766 | 212,098 | ||||
Pumps & Process Solutions | 704,935 | 715,646 | 679,955 | 539,097 | 634,477 | 682,415 | 688,931 | ||||
Climate & Sustainability Technologies | 1,218,155 | 1,186,180 | 1,139,737 | 677,309 | 854,188 | 964,233 | 1,174,479 | ||||
Intersegment | (1,756) | (1,839) | (1,439) | (544) | (262) | (252) | (225) | ||||
Total consolidated | $ 3,421,222 | $ 3,326,181 | $ 3,170,965 | $ 2,215,797 | $ 2,564,542 | $ 2,826,172 | $ 3,243,940 | ||||
Bookings Growth Factors | ||||
2022 | ||||
Q3 | Q3 YTD | |||
Organic | ||||
Engineered Products | 0.8 % | (1.2) % | ||
Clean Energy & Fueling | (17.6) % | (8.5) % | ||
Imaging & Identification | 3.7 % | 4.7 % | ||
Pumps & Process Solutions | (12.2) % | (10.9) % | ||
Climate & Sustainability Technologies | (11.3) % | (15.3) % | ||
Total Organic | (8.2) % | (7.5) % | ||
Acquisitions | 3.6 % | 3.7 % | ||
Dispositions | (1.7) % | (1.7) % | ||
Currency translation | (3.8) % | (2.8) % | ||
Total* | (10.1) % | (8.3) % | ||
* Totals may be impacted by rounding. | ||||
In an effort to provide investors with additional information regarding our results as determined by GAAP, management also discloses non-GAAP information that management believes provides useful information to investors. Adjusted net earnings, adjusted diluted net earnings per share, total segment earnings, total segment earnings margin, adjusted segment EBITDA, adjusted segment EBITDA margin, free cash flow, free cash flow as a percentage of revenue, free cash flow as a percentage of adjusted net earnings, and organic revenue growth are not financial measures under GAAP and should not be considered as a substitute for net earnings, diluted net earnings per share, cash flows from operating activities, or revenue as determined in accordance with GAAP, and they may not be comparable to similarly titled measures reported by other companies.
Adjusted net earnings represents net earnings adjusted for the effect of purchase accounting expenses, restructuring and other costs/benefits, Tax Cuts and Jobs Act, and gain/loss on dispositions. Purchase accounting expenses are primarily comprised of amortization of intangible assets and charges related to fair value step-ups for acquired inventory sold during the period. We exclude after-tax purchase accounting expenses because the amount and timing of such charges are significantly impacted by the timing, size, number and nature of the acquisitions the Company consummates. While we have a history of acquisition activity, our acquisitions do not happen in a predictive cycle. Exclusion of purchase accounting expenses facilitates more consistent comparisons of operating results over time. We believe it is important to understand that such intangible assets were recorded as part of purchase accounting and contribute to revenue generation. We exclude the other items because they occur for reasons that may be unrelated to the Company's commercial performance during the period and/or management believes they are not indicative of the Company's ongoing operating costs or gains in a given period.
Adjusted diluted net earnings per share or adjusted earnings per share represents diluted EPS adjusted for the effect of purchase accounting expenses, restructuring and other costs/benefits, Tax Cuts and Jobs Act, and gain/loss on dispositions.
Total segment earnings is defined as the sum of earnings before purchase accounting expenses, restructuring and other costs/benefits, gain/loss on dispositions, corporate expenses/other, interest expense, interest income and provision for income taxes for all segments. Total segment earnings margin is defined as total segment earnings divided by revenue.
Adjusted segment EBITDA is defined as segment earnings plus other depreciation and amortization expense, which relates to property, plant, and equipment and intangibles, and excludes amounts related to purchase accounting expenses and restructuring and other costs/benefits. Adjusted segment EBITDA margin is defined as adjusted segment EBITDA divided by revenue.
Management believes the non-GAAP measures above are useful to investors to better understand the Company's ongoing profitability as they will better reflect the Company's core operating results, offer more transparency and facilitate easier comparability to prior and future periods and to its peers.
Free cash flow represents net cash provided by operating activities minus capital expenditures. Free cash flow as a percentage of revenue equals free cash flow divided by revenue. Free cash flow as a percentage of adjusted net earnings equals free cash flow divided by adjusted net earnings. Management believes that free cash flow and free cash flow ratios are important measures of performance because they provide management and investors a measurement of cash generated from operations that is available for mandatory payment obligations and investment opportunities, such as funding acquisitions, paying dividends, repaying debt and repurchasing our common stock.
Management believes that reporting organic revenue growth, which excludes the impact of foreign currency exchange rates and the impact of acquisitions and dispositions, provides a useful comparison of our revenue and bookings performance and trends between periods. We do not provide a reconciliation of forward-looking organic revenue to the most directly comparable GAAP financial measure because we are not able to provide a meaningful or accurate compilation of reconciling items. This is due to the inherent difficulty in accurately forecasting the timing and amounts of the items that would be excluded from the most directly comparable GAAP financial measure or are out of our control. For the same reasons, we are unable to address the probable significance of unavailable information which may be material.
Bookings represent total orders received from customers in the current reporting period. This metric is an important measure of performance and an indicator of revenue order trends.
Organic bookings represent total orders received from customers in the current reporting period excluding the impact of foreign currency exchange rates and the impact of acquisitions and dispositions. This metric is an important measure of performance and an indicator of revenue order trends.
Backlog represents an estimate of the total remaining bookings at a point in time for which performance obligations have not yet been satisfied. This metric is useful as it represents the aggregate amount we expect to recognize as revenue in the future.
We use the above operational metrics in monitoring the performance of the business. We believe the operational metrics are useful to investors and other users of our financial information in assessing the performance of our segments.
Investor Contact: | Media Contact: |
Jack Dickens | Adrian Sakowicz |
Senior Director - Investor Relations | Vice President - Communications |
(630) 743-2566 | (630) 743-5039 |
jdickens@dovercorp.com | asakowicz@dovercorp.com |
SOURCE Dover
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