02.04.22
Emerson reported results for its first fiscal quarter ended Dec. 31, 2021 and updated its full year outlook for fiscal 2022.
Net sales were $4.5 billion, up 8% from the year prior. December trailing three-month underlying orders were up 17%, as demand continued to be strong across all world areas and major end markets. First quarter net sales and underlying sales were up 8%. By ge-ography, the Americas grew 11%, Europe grew 3%, and Asia, Middle East & Africa grew 6%. China grew 12%.
First quarter pretax margin of 26.3% was up 1280 basis points. Adjusted EBITA margin, which excludes restructuring, first year purchase accounting charges and transaction fees, intangibles amortization expense and a gain from the Vertiv subordinated interest, was 19.6%, up 140 basis points.
Operating cash flow was $523 million for the quarter, down 35%, and free cash flow was $407 million, down 41%. Cash flow results reflected higher inventory due to supply chain constraints but are on track to meet full year guidance expectations shared in November.
"We are pleased with our first quarter results. Strong demand continued in both the Automation Solutions and Commercial & Residential Solutions platforms with ongoing growth in residential, discrete and hybrid end markets, as well as strong recovery in our commer-cial and process automation end markets. Much like the rest of the industry, labor short-ages, inflation and supply chain challenges remain a hurdle, but a strong focus on opera-tional excellence and a steadfast commitment to our cost reset targets have proven valua-ble in offsetting these headwinds,” said Lal Karsanbhai, Emerson president and CEO.
Net sales were $4.5 billion, up 8% from the year prior. December trailing three-month underlying orders were up 17%, as demand continued to be strong across all world areas and major end markets. First quarter net sales and underlying sales were up 8%. By ge-ography, the Americas grew 11%, Europe grew 3%, and Asia, Middle East & Africa grew 6%. China grew 12%.
First quarter pretax margin of 26.3% was up 1280 basis points. Adjusted EBITA margin, which excludes restructuring, first year purchase accounting charges and transaction fees, intangibles amortization expense and a gain from the Vertiv subordinated interest, was 19.6%, up 140 basis points.
Operating cash flow was $523 million for the quarter, down 35%, and free cash flow was $407 million, down 41%. Cash flow results reflected higher inventory due to supply chain constraints but are on track to meet full year guidance expectations shared in November.
"We are pleased with our first quarter results. Strong demand continued in both the Automation Solutions and Commercial & Residential Solutions platforms with ongoing growth in residential, discrete and hybrid end markets, as well as strong recovery in our commer-cial and process automation end markets. Much like the rest of the industry, labor short-ages, inflation and supply chain challenges remain a hurdle, but a strong focus on opera-tional excellence and a steadfast commitment to our cost reset targets have proven valua-ble in offsetting these headwinds,” said Lal Karsanbhai, Emerson president and CEO.