Carrier Reports Strong Third Quarter 2024 Results
Carrier Global (NYSE: CARR) reported strong Q3 2024 results with net sales of $6.0 billion, up 21% versus Q3 2023, including 4% organic growth. GAAP EPS from continuing operations was $0.62, while adjusted EPS was $0.77. The HVAC segment showed 6% organic growth, with Commercial HVAC in Americas up nearly 20%. The company's Board approved a $3 billion share repurchase authorization, bringing total authorization to $4.7 billion. The company updated its full-year 2024 guidance to reflect Fire & Security segment as discontinued operations, projecting sales of ~$22.5B with organic growth of ~3% and adjusted EPS of ~$2.50.
Carrier Global (NYSE: CARR) ha riportato risultati solidi per il terzo trimestre 2024, con vendite nette di $6,0 miliardi, in aumento del 21% rispetto al terzo trimestre 2023, comprendendo una crescita organica del 4%. L'utile per azione (EPS) GAAP dalle operazioni continuative è stato di $0,62, mentre l'EPS rettificato è stato di $0,77. Il segmento HVAC ha mostrato una crescita organica del 6%, con il Commercial HVAC nelle Americhe in aumento di quasi il 20%. Il consiglio di amministrazione della società ha approvato un 'autorizzazione all'acquisto di azioni di $3 miliardi', portando l'autorizzazione totale a $4,7 miliardi. L'azienda ha aggiornato le previsioni per l'intero anno 2024 per riflettere il segmento Fire & Security come operazioni discontinued, prevedendo vendite di circa ~$22,5 miliardi con una crescita organica di circa il 3% e un EPS rettificato di circa ~$2,50.
Carrier Global (NYSE: CARR) reportó fuertes resultados para el tercer trimestre de 2024, con ventas netas de $6.0 mil millones, un aumento del 21% en comparación con el tercer trimestre de 2023, incluyendo un crecimiento orgánico del 4%. El EPS GAAP de las operaciones continuas fue de $0.62, mientras que el EPS ajustado fue de $0.77. El segmento HVAC mostró un crecimiento orgánico del 6%, con el HVAC comercial en las Américas subiendo cerca del 20%. La Junta de la empresa aprobó una 'autorización de recompra de acciones de $3 mil millones', aumentando la autorización total a $4.7 mil millones. La empresa actualizó su guía para todo el año 2024 para reflejar el segmento de Fire & Security como operaciones discontinuadas, proyectando ventas de aproximadamente ~$22.5B con un crecimiento orgánico de aproximadamente 3% y un EPS ajustado de aproximadamente ~$2.50.
캐리어 글로벌 (NYSE: CARR)는 2024년 3분기 강력한 실적을 발표하였으며, 순매출은 $60억으로 2023년 3분기 대비 21% 증가했으며, 4%의 유기적 성장을 포함합니다. 지속 운영에서의 GAAP 주당순이익(EPS)은 $0.62였고, 조정 EPS는 $0.77이었습니다. HVAC 부문은 6%의 유기적 성장을 보였으며, 미국의 상업 HVAC는 거의 20% 증가했습니다. 회사 이사회는 '30억 달러 규모의 자사주 매입 승인'을 승인하여 총 승인을 47억 달러로 늘렸습니다. 이 회사는 Fire & Security 부문을 중단된 운영으로 반영하여 2024년 전체 연도 전망을 업데이트하였으며, 약 ~$225억의 매출과 약 3%의 유기적 성장, 약 ~$2.50의 조정 EPS를 예상하고 있습니다.
Carrier Global (NYSE: CARR) a annoncé de solides résultats pour le troisième trimestre 2024, avec des ventes nettes de $6,0 milliards, en hausse de 21 % par rapport au troisième trimestre 2023, incluant une croissance organique de 4 %. Le BPA GAAP des opérations continues était de 0,62 $, tandis que le BPA ajusté était de 0,77 $. Le segment HVAC a montré une croissance organique de 6 %, avec le HVAC commercial en Amérique augmentant de près de 20 %. Le conseil d'administration de l'entreprise a approuvé une 'autorisation de rachat d'actions de 3 milliards de dollars', portant l'autorisation totale à 4,7 milliards de dollars. L'entreprise a mis à jour ses prévisions pour l'année 2024 afin de refléter le segment Fire & Security en tant qu'opérations discontinuées, projetant des ventes d'environ ~$22,5 milliards avec une croissance organique d'environ 3 % et un BPA ajusté d'environ ~$2,50.
Carrier Global (NYSE: CARR) hat starke Ergebnisse für das dritte Quartal 2024 gemeldet, mit Nettoumsätzen von $6,0 Milliarden, was einem Anstieg von 21 % im Vergleich zum dritten Quartal 2023 entspricht, darunter 4 % organisches Wachstum. Der GAAP-Gewinn je Aktie (EPS) aus fortgeführten Betrieben betrug $0,62, während der bereinigte EPS $0,77 betrug. Der HVAC-Sektor verzeichnete ein organisches Wachstum von 6 %, wobei das Commercial HVAC in den Amerikas fast um 20 % zulegte. Der Vorstand des Unternehmens genehmigte eine 'Aktienrückkaufautorisierung von $3 Milliarden', sodass die Gesamtautorisierung auf $4,7 Milliarden ansteigt. Das Unternehmen hat die Prognose für das gesamte Jahr 2024 aktualisiert, um das Segment Fire & Security als aufgegebene Betriebe widerzuspiegeln, und erwartet Umsätze von ca. ~$22,5 Milliarden mit einem organischen Wachstum von ca. 3 % und einen bereinigten EPS von ca. ~$2,50.
- Net sales increased 21% to $6.0 billion with 4% organic growth
- HVAC segment organic sales grew 6% with Commercial HVAC up nearly 20%
- Board approved $3 billion share repurchase authorization
- Aftermarket sales up 10%
- Orders grew approximately 20%
- Viessmann Climate Solutions sales down around 25% year-over-year
- Negative free cash flow guidance of ~($0.2B) for 2024
- HVAC sales declined in China
- Declines in North America truck and trailer refrigeration segment
Insights
The Q3 2024 results demonstrate strong operational execution amid Carrier's strategic transformation. Sales reached
Key performance highlights include robust HVAC performance in Americas with high-single-digit growth, particularly in Commercial HVAC (up nearly
However, challenges persist in Asia Pacific, with declines in residential light commercial in China, while the Viessmann acquisition shows mixed results with sequential growth but year-over-year decline of about
The strategic repositioning towards intelligent climate and energy solutions is gaining traction, evidenced by aftermarket growth of
The guidance update reflecting continuing operations projects sales of approximately
The substantial share repurchase authorization could provide significant support for the stock price, while the successful resolution of AFFF-related settlements removes a key regulatory overhang.
- Fire & Security segment now reported as discontinued operations making prior guidance not comparable
- Net sales of
up$6.0 billion 21% versus third quarter 2023; organic sales up4% - GAAP EPS from continuing operations of
and adjusted EPS from continuing operations of$0.62 $0.77 - Total GAAP EPS of
and adjusted EPS of$0.49 $0.83 - Final business exit on-track to close around year end
- Board increases remaining share repurchase authorization to
$4.7 billion - Updated full year guidance to reflect the impact of discontinued operations
"We delivered another quarter of strong financial performance while making significant progress on our portfolio transformation," said Carrier Chair & CEO David Gitlin. "Organic sales growth was up mid-single digits – with aftermarket up
Third Quarter 2024 Results
Carrier's third quarter sales of
GAAP operating profit in the quarter of
Year to date, preliminary net cash flows generated from operating activities were
Share Repurchase Authorization
On October 21, 2024, Carrier Global Corporation's Board of Directors approved a
Full-Year 2024 Guidance**
Carrier's updated guidance for 2024 now only reflects continuing operations with the exception of free cash flow.
Current Guidance** | |
Sales | Organic* up ~ FX ( Acquisitions + Divestitures ( |
Adjusted Operating Margin* | ~ |
Adjusted EPS* | |
Free Cash Flow* | ~( Includes the expected results of continuing Includes |
*Note: When the company provides expectations for organic sales, adjusted operating profit, adjusted operating margin, adjusted EPS and free cash flow on a forward-looking basis, a reconciliation of the differences between the non-GAAP expectations and the corresponding GAAP measures generally is not available without unreasonable effort. See "Use and Definitions of Non-GAAP Financial Measures" below for additional information. |
**As of October 24, 2024 |
Conference Call
Carrier will host a webcast of its earnings conference call today, Thursday, October 24, 2024, at 7:30 a.m. ET. To access the webcast, visit the Events & Presentations section of the Carrier Investor Relations site at ir.carrier.com/news-and-events/events-and-presentations or to listen to the earnings call by phone, participants must pre-register at Carrier Earnings Call Registration. All registrants will receive dial-in information and a PIN allowing access to the live call.
Discontinued Operations
In 2023, the Company announced plans to exit its Fire & Security and Commercial Refrigeration businesses over the course of 2024. The announced plan to exit the Fire & Security segment represents a single disposal plan to separately divest multiple businesses over different reporting periods. Upon the Commercial and Residential Fire Business qualifying as held for sale during the three months ended September 30, 2024, the components of the Fire & Security segment in aggregate met the criteria to be presented as discontinued operations in the Company's unaudited condensed consolidated statement of operations and unaudited condensed consolidated statement of cash flows. In addition, the assets and liabilities of the Commercial and Residential Fire Business have been reclassified to held for sale at December 31, 2023. The results of the Commercial Refrigeration business did not meet the criteria to be presented in discontinued operations. Accordingly, all financial measures presented herein, including non-GAAP financial measures, are associated with Carrier's continuing operations unless specifically noted. See "Use and Definitions of Non-GAAP Financial Measures" below.
Cautionary Statement
This communication contains statements which, to the extent they are not statements of historical or present fact, constitute "forward-looking statements" under the securities laws. These forward-looking statements are intended to provide management's current expectations or plans for Carrier's future operating and financial performance, based on assumptions currently believed to be valid. Forward-looking statements can be identified by the use of words such as "believe," "expect," "expectations," "plans," "strategy," "prospects," "preliminary," "estimate," "project," "target," "anticipate," "will," "should," "see," "guidance," "outlook," "confident," "scenario" and other words of similar meaning in connection with a discussion of future operating or financial performance. Forward-looking statements may include, among other things, statements relating to future sales, earnings, cash flow, results of operations, uses of cash, share repurchases, tax rates and other measures of financial performance or potential future plans, strategies or transactions of Carrier, our portfolio transformation and the use of the anticipated proceeds thereof, potential future investments, Carrier's plans with respect to its indebtedness and other statements that are not historical facts.
This communication also contains estimated net cash flow and free cash flow results for the quarter ended September 30, 2024. These estimated net cash flow and free cash results are preliminary and subject to completion and may change as a result of management's continued review. Such preliminary results are subject to the finalization of quarter-end financial and accounting procedures. The preliminary net cash flow and free cash flow financial results represent management estimates that constitute forward-looking statements.
All forward-looking statements involve risks, uncertainties and other factors that may cause actual results to differ materially from those expressed or implied in the forward-looking statements. For additional information on identifying factors that may cause actual results to vary materially from those stated in forward-looking statements, see Carrier's reports on Forms 10-K, 10-Q and 8-K filed with or furnished to the
About Carrier
Carrier Global Corporation, global leader in intelligent climate and energy solutions, is committed to creating solutions that matter for people and our planet for generations to come. From the beginning, we've led in inventing new technologies and entirely new industries. Today, we continue to lead because we have a world-class, diverse workforce that puts the customer at the center of everything we do. For more information, visit corporate.carrier.com or follow Carrier on social media at @Carrier.
CARR-IR
Contact: | |||
Investor Relations | |||
561-365-2251 | |||
Investor.Relations@Carrier.com | |||
Media Inquiries | |||
Rob Six | |||
561-281-2362 | |||
Rob.Six@Carrier.com |
SELECTED FINANCIAL DATA, NON-GAAP MEASURES AND DEFINITIONS
Following are tables that present selected financial data of Carrier Global Corporation ("Carrier"). Also included are reconciliations of non-GAAP measures to their most comparable GAAP measures.
Use and Definitions of Non-GAAP Financial Measures
Carrier reports its financial results in accordance with accounting principles generally accepted in
Organic sales, adjusted operating profit, adjusted operating margin, incremental margins / earnings conversion, earnings before interest, taxes and depreciation and amortization ("EBITDA"), adjusted EBITDA, adjusted net income, adjusted earnings per share ("EPS"), adjusted interest expense, net, adjusted effective tax rate and net debt are non-GAAP financial measures and are associated with Carrier's continuing operations unless specifically noted.
Organic sales represents consolidated net sales (a GAAP measure), excluding the impact of foreign currency translation, acquisitions and divestitures completed in the preceding twelve months and other significant items of a nonoperational nature (hereinafter referred to as "other significant items"). Adjusted operating profit represents operating profit (a GAAP measure), excluding restructuring costs, amortization of acquired intangibles and other significant items. Adjusted operating margin represents adjusted operating profit as a percentage of net sales (a GAAP measure). Incremental margins / earnings conversion represents the year-over-year change in adjusted operating profit divided by the year-over-year change in net sales. EBITDA represents net income attributable to common shareholders (a GAAP measure), adjusted for interest income and expense, income tax expense, and depreciation and amortization. Adjusted EBITDA represents EBITDA, as calculated above, excluding non-service pension benefit, non-controlling interest in subsidiaries' earnings from operations, restructuring costs and other significant items. Adjusted net income represents net income attributable to common shareowners (a GAAP measure), excluding restructuring costs, amortization of acquired intangibles and other significant items. Adjusted EPS represents diluted earnings per share (a GAAP measure), excluding restructuring costs, amortization of acquired intangibles and other significant items. Adjusted interest expense, net represents interest expense (a GAAP measure) and interest income (a GAAP measure), net excluding other significant items. The adjusted effective tax rate represents the effective tax rate (a GAAP measure), excluding restructuring costs, amortization of acquired intangibles and other significant items. Net debt represents long-term debt (a GAAP measure) less cash and cash equivalents (a GAAP measure). For the business segments, when applicable, adjustments of operating profit and operating margins represent operating profit, excluding restructuring, amortization of acquired intangibles and other significant items.
Free cash flow is a non-GAAP financial measure that represents net cash flows provided by continuing operating activities (a GAAP measure) less capital expenditures. Management believes free cash flow is a useful measure of liquidity and an additional basis for assessing Carrier's ability to fund its activities, including the financing of acquisitions, debt service, repurchases of Carrier's common stock and distribution of earnings to shareowners.
Orders are contractual commitments with customers to provide specified goods or services for an agreed upon price and may not be subject to penalty if cancelled.
When Carrier provides our expectations for organic sales, adjusted operating profit, adjusted operating margin, adjusted interest expense, net, adjusted effective tax rate, incremental margins/earnings conversion, EBITDA, adjusted EBITDA, adjusted EPS and free cash flow on a forward-looking basis, a reconciliation of the differences between the non-GAAP expectations and the corresponding GAAP measures (expected net sales, operating profit, operating margin, interest expense, effective tax rate, incremental operating margin, net income attributable to common shareowners, diluted EPS and net cash flows provided by operating activities) generally is not available without unreasonable effort due to potentially high variability, complexity and low visibility as to the items that would be excluded from the GAAP measure in the relevant future period, such as unusual gains and losses, the ultimate outcome of pending litigation, fluctuations in foreign currency exchange rates, the impact and timing of potential acquisitions and divestitures, future restructuring costs, and other structural changes or their probable significance. The variability of the excluded items may have a significant, and potentially unpredictable, impact on our future GAAP results.
Carrier Global Corporation | ||||||||
Condensed Consolidated Statement of Operations | ||||||||
(Unaudited) | ||||||||
Three Months Ended | Nine Months Ended | |||||||
(In millions, except per share amounts) | 2024 | 2023 | 2024 | 2023 | ||||
Net sales | ||||||||
Product sales | $ 5,307 | $ 4,344 | $ 15,460 | $ 12,939 | ||||
Service sales | 677 | 591 | 1,878 | 1,696 | ||||
Total Net sales | 5,984 | 4,935 | 17,338 | 14,635 | ||||
Costs and expenses | ||||||||
Cost of products sold | (3,796) | (2,986) | (11,245) | (9,269) | ||||
Cost of services sold | (511) | (463) | (1,456) | (1,321) | ||||
Research and development | (172) | (126) | (524) | (355) | ||||
Selling, general and administrative | (799) | (664) | (2,394) | (1,870) | ||||
Total Costs and expenses | (5,278) | (4,239) | (15,619) | (12,815) | ||||
Equity method investment net earnings | 66 | 75 | 187 | 171 | ||||
Other income (expense), net | (9) | (261) | (34) | (370) | ||||
Operating profit | 763 | 510 | 1,872 | 1,621 | ||||
Non-service pension (expense) benefit | (1) | — | (1) | — | ||||
Interest (expense) income, net | 8 | (39) | (290) | (126) | ||||
Earnings before income taxes | 770 | 471 | 1,581 | 1,495 | ||||
Income tax (expense) benefit | (172) | (177) | (339) | (453) | ||||
Earnings from continuing operations | 598 | 294 | 1,242 | 1,042 | ||||
Discontinued operations, net of tax | (117) | 87 | 1,897 | (41) | ||||
Net earnings (loss) | 481 | 381 | 3,139 | 1,001 | ||||
Less: Non-controlling interest in subsidiaries' | 34 | 24 | 86 | 72 | ||||
Net earnings (loss) attributable to common shareowners | $ 447 | $ 357 | $ 3,053 | $ 929 | ||||
Amounts attributable to common shareowners: | ||||||||
Continuing operations | $ 564 | $ 270 | $ 1,156 | $ 970 | ||||
Discontinued operations | (117) | 87 | 1,897 | (41) | ||||
Net earnings (loss) attributable to common shareowners | $ 447 | $ 357 | $ 3,053 | $ 929 | ||||
Earnings per share | ||||||||
Basic: | ||||||||
Continuing operations | $ 0.63 | $ 0.32 | $ 1.28 | $ 1.16 | ||||
Discontinued operations | (0.13) | 0.11 | 2.11 | (0.05) | ||||
Net earnings (loss) | $ 0.50 | $ 0.43 | $ 3.39 | $ 1.11 | ||||
Diluted: | ||||||||
Continuing operations | $ 0.62 | $ 0.32 | $ 1.26 | $ 1.14 | ||||
Discontinued operations | (0.13) | 0.10 | 2.08 | (0.05) | ||||
Net earnings (loss) | $ 0.49 | $ 0.42 | $ 3.34 | $ 1.09 | ||||
Weighted-average number of shares outstanding | ||||||||
Basic | 901.2 | 838.7 | 900.9 | 836.6 | ||||
Diluted | 915.0 | 854.7 | 914.4 | 852.7 |
Carrier Global Corporation | ||||
Condensed Consolidated Balance Sheet | ||||
(Unaudited) | ||||
(In millions) | September 30, 2024 | December 31, 2023 | ||
Assets | ||||
Cash and cash equivalents | $ 2,225 | $ 9,852 | ||
Accounts receivable, net | 2,726 | 2,080 | ||
Inventories, net | 2,646 | 1,823 | ||
Assets held for sale | 2,680 | 5,093 | ||
Other current assets | 917 | 728 | ||
Total current assets | 11,194 | 19,576 | ||
Future income tax benefits | 1,142 | 718 | ||
Fixed assets, net | 3,015 | 2,160 | ||
Operating lease right-of-use assets | 568 | 421 | ||
Intangible assets, net | 7,118 | 945 | ||
Goodwill | 15,294 | 7,520 | ||
Pension and post-retirement assets | 54 | 32 | ||
Equity method investments | 1,287 | 1,140 | ||
Other assets | 529 | 310 | ||
Total Assets | $ 40,201 | $ 32,822 | ||
Liabilities and Equity | ||||
Accounts payable | $ 2,829 | $ 2,483 | ||
Accrued liabilities | 4,233 | 2,997 | ||
Liabilities held for sale | 1,221 | 1,450 | ||
Current portion of long-term debt | 2,095 | 51 | ||
Total current liabilities | 10,378 | 6,981 | ||
Long-term debt | 10,337 | 14,242 | ||
Future pension and post-retirement obligations | 209 | 149 | ||
Future income tax obligations | 2,241 | 523 | ||
Operating lease liabilities | 445 | 333 | ||
Other long-term liabilities | 1,549 | 1,589 | ||
Total Liabilities | 25,159 | 23,817 | ||
Equity | ||||
Common stock | 9 | 9 | ||
Treasury stock | (2,403) | (1,972) | ||
Additional paid-in capital | 8,588 | 5,535 | ||
Retained earnings | 9,301 | 6,591 | ||
Accumulated other comprehensive loss | (802) | (1,486) | ||
Non-controlling interest | 349 | 328 | ||
Total Equity | 15,042 | 9,005 | ||
Total Liabilities and Equity | $ 40,201 | $ 32,822 |
Carrier Global Corporation | ||||
Condensed Consolidated Statement of Cash Flows | ||||
(Unaudited) | ||||
Nine Months Ended | ||||
(In millions) | 2024 | 2023 | ||
Operating Activities | ||||
Net earnings (loss) | $ 3,139 | $ 1,001 | ||
Discontinued operations, net of tax | (1,897) | 41 | ||
Adjustments for non-cash items, net: | ||||
Depreciation and amortization | 914 | 368 | ||
Deferred income tax provision | (296) | (150) | ||
Stock-based compensation costs | 65 | 55 | ||
Equity method investment net earnings | (187) | (171) | ||
(Gain) loss on extinguishment of debt | (88) | — | ||
(Gain) loss on sale of investments / deconsolidation | (2) | (19) | ||
Changes in operating assets and liabilities | ||||
Accounts receivable, net | (135) | (279) | ||
Inventories, net | 76 | (72) | ||
Accounts payable and accrued liabilities | (247) | 622 | ||
Distributions from equity method investments | 36 | 45 | ||
Other operating activities, net | (260) | (96) | ||
Preliminary net cash flows provided by (used in) continuing operating activities | 1,118 | 1,345 | ||
Preliminary net cash flows provided by (used in) discontinued operating activities | (687) | 200 | ||
Preliminary net cash flows provided by (used in) operating activities | 431 | 1,545 | ||
Investing Activities | ||||
Capital expenditures | (302) | (217) | ||
Investment in businesses, net of cash acquired | (10,873) | (69) | ||
Dispositions of businesses | — | 54 | ||
Settlement of derivative contracts, net | (187) | (66) | ||
Other investing activities, net | 31 | 14 | ||
Net cash flows provided by (used in) continuing investing activities | (11,331) | (284) | ||
Net cash flows provided by (used in) discontinued investing activities | 6,217 | (147) | ||
Net cash flows provided by (used in) investing activities | (5,114) | (431) | ||
Financing Activities | ||||
Increase (decrease) in short-term borrowings, net | 37 | (27) | ||
Issuance of long-term debt | 2,586 | 14 | ||
Repayment of long-term debt | (4,530) | (15) | ||
Repurchases of common stock | (431) | (62) | ||
Dividends paid on common stock | (514) | (465) | ||
Dividends paid to non-controlling interest | (72) | (46) | ||
Other financing activities, net | (15) | (72) | ||
Net cash flows provided by (used in) continuing financing activities | (2,939) | (673) | ||
Net cash flows provided by (used in) discontinued financing activities | (11) | (15) | ||
Net cash flows provided by (used in) financing activities | (2,950) | (688) | ||
Effect of foreign exchange rate changes on cash and cash equivalents | (18) | (45) | ||
Net increase (decrease) in cash and cash equivalents and restricted cash, including cash classified | (7,651) | 381 | ||
Less: Change in cash balances classified as assets held for sale | (36) | (5) | ||
Net increase (decrease) in cash and cash equivalents and restricted cash | (7,615) | 386 | ||
Cash, cash equivalents and restricted cash, beginning of period | 9,854 | 3,303 | ||
Cash, cash equivalents and restricted cash, end of period | 2,239 | 3,689 | ||
Less: restricted cash | 14 | 4 | ||
Cash and cash equivalents, end of period | $ 2,225 | $ 3,685 |
Carrier Global Corporation | |||||||||||||||
Segment Net Sales and Operating Profit | |||||||||||||||
(Unaudited) | |||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2024 | 2023 | 2024 | 2023 | ||||||||||||
(In millions) | Reported | Adjusted | Reported | Adjusted | Reported | Adjusted | Reported | Adjusted | |||||||
Net sales | |||||||||||||||
HVAC | $ 5,058 | $ 5,058 | $ 4,008 | $ 4,008 | $ 14,569 | $ 14,569 | $ 11,846 | $ 11,846 | |||||||
Refrigeration | 938 | 938 | 924 | 924 | 2,795 | 2,795 | 2,794 | 2,794 | |||||||
Segment sales | 5,996 | 5,996 | 4,932 | 4,932 | 17,364 | 17,364 | 14,640 | 14,640 | |||||||
Eliminations and other | (12) | (12) | 3 | 3 | (26) | (26) | (5) | (5) | |||||||
Net sales | $ 5,984 | $ 5,984 | $ 4,935 | $ 4,935 | $ 17,338 | $ 17,338 | $ 14,635 | $ 14,635 | |||||||
Operating profit | |||||||||||||||
HVAC | $ 741 | $ 1,001 | $ 763 | $ 833 | $ 1,857 | $ 2,712 | $ 1,940 | $ 2,114 | |||||||
Refrigeration | 109 | 117 | 107 | 111 | 319 | 334 | 327 | 341 | |||||||
Segment operating profit | 850 | 1,118 | 870 | 944 | 2,176 | 3,046 | 2,267 | 2,455 | |||||||
Eliminations and other | (25) | (23) | (252) | 6 | (84) | (38) | (399) | (28) | |||||||
General corporate expenses | (62) | (51) | (108) | (73) | (220) | (144) | (247) | (189) | |||||||
Operating profit | $ 763 | $ 1,044 | $ 510 | $ 877 | $ 1,872 | $ 2,864 | $ 1,621 | $ 2,238 | |||||||
Operating margin | |||||||||||||||
HVAC | 14.7 % | 19.8 % | 19.0 % | 20.8 % | 12.7 % | 18.6 % | 16.4 % | 17.8 % | |||||||
Refrigeration | 11.6 % | 12.5 % | 11.6 % | 12.0 % | 11.4 % | 11.9 % | 11.7 % | 12.2 % | |||||||
Total Carrier | 12.8 % | 17.4 % | 10.3 % | 17.8 % | 10.8 % | 16.5 % | 11.1 % | 15.3 % |
Carrier Global Corporation | |||||||||
Reconciliation of Reported (GAAP) to Adjusted (Non-GAAP) | |||||||||
Operating Profit | |||||||||
(Unaudited) | |||||||||
Three Months Ended September 30, 2024 | |||||||||
(In millions) | HVAC | Refrigeration | Eliminations | General | Carrier | ||||
Net sales | $ 5,058 | $ 938 | $ (12) | $ — | $ 5,984 | ||||
Segment operating profit | $ 741 | $ 109 | $ (25) | $ (62) | $ 763 | ||||
Reported operating margin | 14.7 % | 11.6 % | 12.8 % | ||||||
Adjustments to segment operating profit: | |||||||||
Restructuring costs | $ 54 | $ 4 | $ 2 | $ — | $ 60 | ||||
Amortization of acquired intangibles | 175 | — | — | — | 175 | ||||
Acquisition step-up amortization (1) | 31 | — | — | — | 31 | ||||
Acquisition/divestiture-related costs | — | 4 | — | 11 | 15 | ||||
Total adjustments to operating profit | $ 260 | $ 8 | $ 2 | $ 11 | $ 281 | ||||
Adjusted operating profit | $ 1,001 | $ 117 | $ (23) | $ (51) | $ 1,044 | ||||
Adjusted operating margin | 19.8 % | 12.5 % | 17.4 % | ||||||
(Unaudited) | |||||||||
Three Months Ended September 30, 2023 | |||||||||
(In millions) | HVAC | Refrigeration | Eliminations | General | Carrier | ||||
Net sales | $ 4,008 | $ 924 | $ 3 | $ — | $ 4,935 | ||||
Segment operating profit | $ 763 | $ 107 | $ (252) | $ (108) | $ 510 | ||||
Reported operating margin | 19.0 % | 11.6 % | 10.3 % | ||||||
Adjustments to segment operating profit: | |||||||||
Restructuring costs | $ 25 | $ 4 | $ — | $ — | $ 29 | ||||
Amortization of acquired intangibles | 35 | — | — | — | 35 | ||||
Acquisition step-up amortization (1) | 10 | — | — | — | 10 | ||||
Acquisition/divestiture-related costs | — | — | — | 35 | 35 | ||||
Bridge loan financing costs | — | — | 1 | — | 1 | ||||
Viessmann-related hedges | — | — | 257 | — | 257 | ||||
Total adjustments to operating profit | $ 70 | $ 4 | $ 258 | $ 35 | $ 367 | ||||
Adjusted operating profit | $ 833 | $ 111 | $ 6 | $ (73) | $ 877 | ||||
Adjusted operating margin | 20.8 % | 12.0 % | 17.8 % |
(1) Amortization of the step-up to fair value of acquired inventory and backlog. |
Carrier Global Corporation | |||||||||
Reconciliation of Reported (GAAP) to Adjusted (Non-GAAP) | |||||||||
Operating Profit | |||||||||
(Unaudited) | |||||||||
Nine Months Ended September 30, 2024 | |||||||||
(In millions) | HVAC | Refrigeration | Eliminations | General | Carrier | ||||
Net sales | $ 14,569 | $ 2,795 | $ (26) | $ — | $ 17,338 | ||||
Segment operating profit | $ 1,857 | $ 319 | $ (84) | $ (220) | $ 1,872 | ||||
Reported operating margin | 12.7 % | 11.4 % | 10.8 % | ||||||
Adjustments to segment operating profit: | |||||||||
Restructuring costs | $ 86 | $ 5 | $ 6 | $ — | $ 97 | ||||
Amortization of acquired intangibles | 517 | — | — | — | 517 | ||||
Acquisition step-up amortization (1) | 251 | — | — | — | 251 | ||||
Acquisition/divestiture-related costs | 1 | 10 | — | 76 | 87 | ||||
Viessmann-related hedges | — | — | 86 | — | 86 | ||||
Gain on liability adjustment (2) | — | — | (46) | — | (46) | ||||
Total adjustments to operating profit | $ 855 | $ 15 | $ 46 | $ 76 | $ 992 | ||||
Adjusted operating profit | $ 2,712 | $ 334 | $ (38) | $ (144) | $ 2,864 | ||||
Adjusted operating margin | 18.6 % | 11.9 % | 16.5 % | ||||||
(Unaudited) | |||||||||
Nine Months Ended September 30, 2023 | |||||||||
(In millions) | HVAC | Refrigeration | Eliminations | General | Carrier | ||||
Net sales | $ 11,846 | $ 2,794 | $ (5) | $ — | $ 14,635 | ||||
Segment operating profit | $ 1,940 | $ 327 | $ (399) | $ (247) | $ 1,621 | ||||
Reported operating margin | 16.4 % | 11.7 % | 11.1 % | ||||||
Adjustments to segment operating profit: | |||||||||
Restructuring costs | $ 27 | $ 14 | $ 2 | $ — | $ 43 | ||||
Amortization of acquired intangibles | 108 | — | — | — | 108 | ||||
Acquisition step-up amortization (1) | 31 | — | — | — | 31 | ||||
Acquisition/divestiture-related costs | — | — | — | 58 | 58 | ||||
Bridge loan financing costs | — | — | 1 | — | 1 | ||||
Viessmann-related hedges | — | — | 368 | — | 368 | ||||
TCC acquisition-related gain (3) | 8 | — | — | — | 8 | ||||
Total adjustments to operating profit | $ 174 | $ 14 | $ 371 | $ 58 | $ 617 | ||||
Adjusted operating profit | $ 2,114 | $ 341 | $ (28) | $ (189) | $ 2,238 | ||||
Adjusted operating margin | 17.8 % | 12.2 % | 15.3 % |
(1) Amortization of the step-up to fair value of acquired inventory and backlog. |
(2) Gain associated with an adjustment to our tax-related liability owed to UTC. |
(3) The carrying value of our previously held TCC equity investments were recognized at fair value and subsequently adjusted. |
Carrier Global Corporation | |||||||||||
Reconciliation of Reported (GAAP) to Adjusted (Non-GAAP) Results | |||||||||||
Net Income, Earnings Per Share and Effective Tax Rate | |||||||||||
(Unaudited) | |||||||||||
Three Months Ended September 30, 2024 | Nine Months Ended September 30, 2024 | ||||||||||
(In millions, except per share amounts) | Reported | Adjustments | Adjusted | Reported | Adjustments | Adjusted | |||||
Net sales | $ 5,984 | $ — | $ 5,984 | $ 17,338 | $ — | $ 17,338 | |||||
Operating profit | $ 763 | 281 | a | $ 1,044 | $ 1,872 | 992 | a | $ 2,864 | |||
Operating margin | 12.8 % | 17.4 % | 10.8 % | 16.5 % | |||||||
Earnings before income taxes | $ 770 | 195 | a,b | $ 965 | $ 1,581 | 918 | a,b | $ 2,499 | |||
Income tax (expense) benefit | $ (172) | (54) | c | $ (226) | $ (339) | (227) | c | $ (566) | |||
Effective tax rate | 22.3 % | 23.4 % | 21.4 % | 22.6 % | |||||||
Earnings from continuing operations | $ 564 | $ 141 | $ 705 | $ 1,156 | $ 691 | $ 1,847 | |||||
Summary of Adjustments: | |||||||||||
Restructuring costs | $ 60 | a | $ 97 | a | |||||||
Amortization of acquired intangibles | 175 | a | 517 | a | |||||||
Acquisition step-up amortization (1) | 31 | a | 251 | a | |||||||
Acquisition/divestiture-related costs | 15 | a | 87 | a | |||||||
Viessmann-related hedges | — | a | 86 | a | |||||||
Gain on liability adjustment (2) | — | a | (46) | a | |||||||
Debt extinguishment (gain) | (97) | b | (97) | b | |||||||
Debt prepayment costs | 11 | b | 23 | b | |||||||
Total adjustments | $ 195 | $ 918 | |||||||||
Tax effect on adjustments above | $ (54) | $ (227) | |||||||||
Tax specific adjustments | — | — | |||||||||
Total tax adjustments | $ (54) | c | $ (227) | c | |||||||
Diluted shares outstanding | 915.0 | 915.0 | 914.4 | 914.4 | |||||||
Diluted earnings per share: | |||||||||||
Continuing operations | $ 0.62 | $ 0.77 | $ 1.26 | $ 2.02 |
(1) Amortization of the step-up to fair value of acquired inventory and backlog. |
(2) Gain associated with an adjustment to our tax-related liability owed to UTC. |
Carrier Global Corporation | |||||||||||
Reconciliation of Reported (GAAP) to Adjusted (Non-GAAP) Results | |||||||||||
Net Income, Earnings Per Share and Effective Tax Rate | |||||||||||
(Unaudited) | |||||||||||
Three Months Ended September 30, 2023 | Nine Months Ended September 30, 2023 | ||||||||||
(In millions, except per share amounts) | Reported | Adjustments | Adjusted | Reported | Adjustments | Adjusted | |||||
Net sales | $ 4,935 | $ — | $ 4,935 | $ 14,635 | $ — | $ 14,635 | |||||
Operating profit | $ 510 | 367 | a | $ 877 | $ 1,621 | 617 | a | $ 2,238 | |||
Operating margin | 10.3 % | 17.8 % | 11.1 % | 15.3 % | |||||||
Earnings before income taxes | $ 471 | 378 | a,b | $ 849 | $ 1,495 | 649 | a,b | $ 2,144 | |||
Income tax (expense) benefit | $ (177) | (10) | c | $ (187) | $ (453) | (44) | c | $ (497) | |||
Effective tax rate | 37.6 % | 22.0 % | 30.3 % | 23.2 % | |||||||
Earnings from continuing operations | $ 270 | $ 368 | $ 638 | $ 970 | $ 605 | $ 1,575 | |||||
Summary of Adjustments: | |||||||||||
Restructuring costs | $ 29 | a | $ 43 | a | |||||||
Amortization of acquired intangibles | 35 | a | 108 | a | |||||||
Acquisition step-up amortization (1) | 10 | a | 31 | a | |||||||
Acquisition/divestiture-related costs | 35 | a | 58 | a | |||||||
Viessmann-related hedges | 257 | a | 368 | a | |||||||
TCC acquisition-related gain (2) | — | a | 8 | a | |||||||
Bridge loan financing costs (3) | 12 | a,b | 33 | a,b | |||||||
Total adjustments | $ 378 | $ 649 | |||||||||
Tax effect on adjustments above | $ (29) | $ (63) | |||||||||
Tax specific adjustments | 19 | 19 | |||||||||
Total tax adjustments | $ (10) | c | $ (44) | c | |||||||
Diluted shares outstanding | 854.7 | 854.7 | 852.7 | 852.7 | |||||||
Diluted earnings per share: | |||||||||||
Continuing operations | $ 0.32 | $ 0.75 | $ 1.14 | $ 1.85 |
(1) Amortization of the step-up to fair value of acquired inventory and backlog. |
(2) The carrying value of our previously held TCC equity investments were recognized at fair value at the TCC acquisition date. |
(3) Includes commitment fees recognized in Selling, general and administrative. |
Carrier Global Corporation | |||||||||
Reconciliation of Reported (GAAP) to Adjusted (Non-GAAP) Results | |||||||||
Components of Changes in Net Sales | |||||||||
Three Months Ended September 30, 2024 Compared with Three Months Ended September 30, 2023 | |||||||||
(Unaudited) | |||||||||
Factors Contributing to Total % change in Net Sales | |||||||||
Organic | FX | Acquisitions / | Other | Total | |||||
HVAC | 6 % | — % | 20 % | — % | 26 % | ||||
Refrigeration | 1 % | — % | — % | — % | 1 % | ||||
Consolidated | 4 % | — % | 17 % | — % | 21 % | ||||
Nine Months Ended September 30, 2024 Compared with Nine Months Ended September 30, 2023 | |||||||||
(Unaudited) | |||||||||
Factors Contributing to Total % change in Net Sales | |||||||||
Organic | FX | Acquisitions / | Other | Total | |||||
HVAC | 3 % | — % | 20 % | — % | 23 % | ||||
Refrigeration | — % | — % | — % | — % | — % | ||||
Consolidated | 2 % | (1) % | 17 % | — % | 18 % |
Preliminary Free Cash Flow Reconciliation | ||||
(Unaudited) | ||||
Nine Months Ended | ||||
(In millions) | 2024 | 2023 | ||
Preliminary net cash flows provided by (used in) operating activities | $ 431 | $ 1,545 | ||
Less: Capital expenditures (1) | 312 | 236 | ||
Free cash flow | $ 119 | $ 1,309 |
(1) Includes |
Net Debt Reconciliation | ||||
(Unaudited) | ||||
(In millions) | September 30, 2024 | December 31, 2023 | ||
Long-term debt | $ 10,337 | $ 14,242 | ||
Current portion of long-term debt | 2,095 | 51 | ||
Less: Cash and cash equivalents | 2,225 | 9,852 | ||
Net debt | $ 10,207 | $ 4,441 |
Carrier Global Corporation | ||
Reconciliation of Reported (GAAP) to Adjusted (Non-GAAP) Results | ||
Discontinued operations, net of tax Reconciliation | ||
(Unaudited) | ||
Three Months | ||
(In millions, except per share amounts) | 2024 | |
Discontinued operations, net of tax | $ (117) | |
Summary of adjustments, net of tax: | ||
Divestiture-related costs | $ 33 | |
Gain on sale of Industrial business | (310) | |
AFFF legal reserve | 420 | |
Tax specific adjustments | 26 | |
Total adjustments | $ 169 | |
Adjusted Discontinued operations, net of tax | $ 52 | |
Adjusted diluted earnings per share | $ 0.06 |
Diluted EPS Reconciliation - Adjusted | ||
(Unaudited) | ||
Three Months | ||
2024 | ||
Continuing operations | $ 0.77 | |
Discontinued operations | 0.06 | |
Total | $ 0.83 |
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SOURCE Carrier Global Corporation
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