(State or other jurisdiction of incorporation or organization) | |||||||||||
(Commission File No.) | (I.R.S. Employer Identification No.) | ||||||||||
(Zip code) | |||||||||||
(Address of principal executive offices) |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |||||
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |||||
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |||||
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Item 2.02 | Results of Operations and Financial Condition |
Item 7.01. | Regulation FD Disclosure |
Item 9.01. | Financial Statements and Exhibits |
Exhibit No. | Description | ||||
99.1 | |||||
99.2 | |||||
104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
WESTINGHOUSE AIR BRAKE TECHNOLOGIES CORPORATION | |||||
By: | /s/ JOHN A. OLIN | ||||
John A. Olin | |||||
Executive Vice President and Chief Financial Officer | |||||
(Duly Authorized Officer and Principal Financial Officer) | |||||
DATE: |
Wabtec Corporation Consolidated Financial Results | ||||||||||||||
$ in millions except earnings per share and percentages; margin change in percentage points (pts) | First Quarter | |||||||||||||
2023 | 2022 | Change | ||||||||||||
Net Sales | $2,194 | $1,927 | 13.9 | % | ||||||||||
GAAP Gross Margin | 30.3 | % | 30.9 | % | (0.6 pts) | |||||||||
Adjusted Gross Margin | 30.5 | % | 31.1 | % | (0.6 pts) | |||||||||
GAAP Operating Margin | 12.6 | % | 12.4 | % | 0.2 pts | |||||||||
Adjusted Operating Margin | 16.4 | % | 16.5 | % | (0.1 pts) | |||||||||
GAAP Diluted EPS | $0.93 | $0.80 | 16.3 | % | ||||||||||
Adjusted Diluted EPS | $1.28 | $1.13 | 13.3 | % | ||||||||||
Cash Flow from Operations | $(25) | $161 | $(186) | |||||||||||
Operating Cash Flow Conversion | (8) | % | 59 | % |
Wabtec Corporation Freight Segment Financial Results | |||||||||||
Net sales $ in millions; margin change in percentage points (pts) | First Quarter | ||||||||||
2023 | 2022 | Change | |||||||||
Net Sales | $1,566 | $1,322 | 18.5 | % | |||||||
GAAP Gross Margin | 30.6 | % | 32.1 | % | (1.5 pts) | ||||||
Adjusted Gross Margin | 30.7 | % | 32.2 | % | (1.5 pts) | ||||||
GAAP Operating Margin | 14.5 | % | 14.3 | % | 0.2 pts | ||||||
Adjusted Operating Margin | 19.0 | % | 19.6 | % | (0.6 pts) |
Wabtec Corporation Transit Segment Financial Results | |||||||||||
Net sales $ in millions; margin change in percentage points (pts) | First Quarter | ||||||||||
2023 | 2022 | Change | |||||||||
Net Sales | $628 | $605 | 3.8 | % | |||||||
GAAP Gross Margin | 29.5 | % | 28.2 | % | 1.3 pts | ||||||
Adjusted Gross Margin | 29.9 | % | 28.7 | % | 1.2 pts | ||||||
GAAP Operating Margin | 11.0 | % | 10.7 | % | 0.3 pts | ||||||
Adjusted Operating Margin | 13.1 | % | 12.3 | % | 0.8 pts |
Wabtec Corporation Consolidated Backlog Comparison | |||||||||||
Backlog $ in millions | March 31, | ||||||||||
2023 | 2022 | Change | |||||||||
12-Month Backlog | $6,925 | $6,631 | 4.4 | % | |||||||
Total Backlog | $22,334 | $22,759 | (1.9) | % |
Appendix A |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
Net sales | $ | 2,194 | $ | 1,927 | |||||||
Cost of sales | (1,529) | (1,332) | |||||||||
Gross profit | 665 | 595 | |||||||||
Gross profit as a % of Net Sales | 30.3 | % | 30.9 | % | |||||||
Selling, general and administrative expenses | (263) | (238) | |||||||||
Engineering expenses | (51) | (45) | |||||||||
Amortization expense | (75) | (73) | |||||||||
Total operating expenses | (389) | (356) | |||||||||
Operating expenses as a % of Net Sales | 17.7 | % | 18.4 | % | |||||||
Income from operations | 276 | 239 | |||||||||
Income from operations as a % of Net Sales | 12.6 | % | 12.4 | % | |||||||
Interest expense, net | (48) | (43) | |||||||||
Other income, net | 5 | 4 | |||||||||
Income before income taxes | 233 | 200 | |||||||||
Income tax expense | (60) | (50) | |||||||||
Effective tax rate | 25.5 | % | 25.1 | % | |||||||
Net income | 173 | 150 | |||||||||
Less: Net income attributable to noncontrolling interest | (4) | (1) | |||||||||
Net income attributable to Wabtec shareholders | $ | 169 | $ | 149 | |||||||
Earnings Per Common Share | |||||||||||
Basic | |||||||||||
Net income attributable to Wabtec shareholders | $ | 0.94 | $ | 0.80 | |||||||
Diluted | |||||||||||
Net income attributable to Wabtec shareholders | $ | 0.93 | $ | 0.80 | |||||||
Weighted average shares outstanding | |||||||||||
Basic | 179.9 | 184.5 | |||||||||
Diluted | 180.6 | 185.0 | |||||||||
Appendix A |
Three Months Ended March 31, | |||||||||||||||||
2023 | 2022 | ||||||||||||||||
Segment Information | |||||||||||||||||
Freight Net sales | $ | 1,566 | $ | 1,322 | |||||||||||||
Freight Income from operations | $ | 227 | $ | 189 | |||||||||||||
Freight Operating margin | 14.5 | % | 14.3 | % | |||||||||||||
Transit Net sales | $ | 628 | $ | 605 | |||||||||||||
Transit Income from operations | $ | 69 | $ | 65 | |||||||||||||
Transit Operating margin | 11.0 | % | 10.7 | % | |||||||||||||
Backlog Information (Note: 12-month is a sub-set of total) | March 31, 2023 | December 31, 2022 | March 31, 2022 | ||||||||||||||
Freight Total | $ | 18,362 | $ | 18,641 | $ | 19,024 | |||||||||||
Transit Total | 3,972 | 3,800 | 3,735 | ||||||||||||||
Wabtec Total | $ | 22,334 | $ | 22,441 | $ | 22,759 | |||||||||||
Freight 12-month | $ | 4,978 | $ | 4,901 | $ | 4,812 | |||||||||||
Transit 12-month | 1,947 | 1,859 | 1,819 | ||||||||||||||
Wabtec 12-month | $ | 6,925 | $ | 6,760 | $ | 6,631 |
Appendix B |
March 31, 2023 | December 31, 2022 | ||||||||||
In millions | |||||||||||
Cash, cash equivalents and restricted cash | $ | 417 | $ | 541 | |||||||
Receivables, net | 1,576 | 1,519 | |||||||||
Inventories, net | 2,228 | 2,034 | |||||||||
Other current assets | 275 | 233 | |||||||||
Total current assets | 4,496 | 4,327 | |||||||||
Property, plant and equipment, net | 1,422 | 1,429 | |||||||||
Goodwill | 8,540 | 8,508 | |||||||||
Other intangible assets, net | 3,333 | 3,402 | |||||||||
Other noncurrent assets | 878 | 850 | |||||||||
Total Assets | $ | 18,669 | $ | 18,516 | |||||||
Current liabilities | $ | 4,165 | $ | 3,467 | |||||||
Long-term debt | 3,189 | 3,751 | |||||||||
Other long-term liabilities | 1,181 | 1,151 | |||||||||
Total Liabilities | 8,535 | 8,369 | |||||||||
Shareholders' equity | 10,085 | 10,102 | |||||||||
Noncontrolling interest | 49 | 45 | |||||||||
Total Equity | 10,134 | 10,147 | |||||||||
Total Liabilities and Equity | $ | 18,669 | $ | 18,516 |
Appendix C |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
In millions | |||||||||||
Operating activities | |||||||||||
Net income | $ | 173 | $ | 150 | |||||||
Non-cash expense | 124 | 122 | |||||||||
Receivables | (51) | 93 | |||||||||
Inventories | (188) | (137) | |||||||||
Accounts payable | 47 | 48 | |||||||||
Other assets and liabilities | (130) | (115) | |||||||||
Net cash (used for) provided by operating activities | (25) | 161 | |||||||||
Net cash used for investing activities | (32) | (18) | |||||||||
Net cash used for financing activities | (72) | (133) | |||||||||
Effect of changes in currency exchange rates | 5 | 5 | |||||||||
(Decrease) increase in cash | (124) | 15 | |||||||||
Cash, cash equivalents and restricted cash, beginning of period | $ | 541 | $ | 473 | |||||||
Cash, cash equivalents and restricted cash, end of period | 417 | 488 | |||||||||
Wabtec Corporation | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliation of Reported Results to Adjusted Results | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(in millions) | First Quarter 2023 Actual Results | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net | Gross | Operating | Income from | Interest & | Net | Noncontrolling | Wabtec | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Sales | Profit | Expenses | Operations | Other Exp | Tax | Income | Interest | Net Income | EPS | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reported Results | $ | 2,194 | $ | 665 | $ | (389) | $ | 276 | $ | (43) | $ | (60) | $ | 173 | $ | (4) | $ | 169 | $ | 0.93 | |||||||||||||||||||||||||||||||||||||||||||||
Restructuring costs | — | 4 | 5 | 9 | — | (2) | 7 | — | 7 | $ | 0.04 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Non-cash Amortization expense | — | — | 75 | 75 | — | (20) | 55 | — | 55 | $ | 0.31 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Adjusted Results | $ | 2,194 | $ | 669 | $ | (309) | $ | 360 | $ | (43) | $ | (82) | $ | 235 | $ | (4) | $ | 231 | $ | 1.28 | |||||||||||||||||||||||||||||||||||||||||||||
Fully Diluted Shares Outstanding | 180.6 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Wabtec Corporation | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliation of Reported Results to Adjusted Results | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(in millions) | First Quarter 2022 Actual Results | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net | Gross | Operating | Income from | Interest & | Net | Noncontrolling | Wabtec | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Sales | Profit | Expenses | Operations | Other Exp | Tax | Income | Interest | Net Income | EPS | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reported Results | $ | 1,927 | $ | 595 | $ | (356) | $ | 239 | $ | (39) | $ | (50) | $ | 150 | $ | (1) | $ | 149 | $ | 0.80 | |||||||||||||||||||||||||||||||||||||||||||||
Restructuring costs | — | 5 | 2 | 7 | — | (2) | 5 | — | 5 | $ | 0.03 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Non-cash Amortization expense | — | — | 73 | 73 | — | (18) | 55 | — | 55 | $ | 0.30 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Adjusted Results | $ | 1,927 | $ | 600 | $ | (281) | $ | 319 | $ | (39) | $ | (70) | $ | 210 | $ | (1) | $ | 209 | $ | 1.13 | |||||||||||||||||||||||||||||||||||||||||||||
Fully Diluted Shares Outstanding | 185.0 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Wabtec Corporation | |||||||||||||||||||||||||||||||||||||||||
First Quarter 2023 EBITDA Reconciliation | |||||||||||||||||||||||||||||||||||||||||
(in millions) | |||||||||||||||||||||||||||||||||||||||||
Reported Income | + | Other Income | + | Depreciation & | = | EBITDA | + | Restructuring | = | Adjusted | |||||||||||||||||||||||||||||||
from Operations | (Expense) | Amortization | Costs | EBITDA | |||||||||||||||||||||||||||||||||||||
Consolidated Results | $ | 276 | $ | 5 | $ | 121 | $ | 402 | $ | 6 | $ | 408 | |||||||||||||||||||||||||||||
Wabtec Corporation | |||||||||||||||||||||||||||||||||||||||||
First Quarter 2022 EBITDA Reconciliation | |||||||||||||||||||||||||||||||||||||||||
(in millions) | |||||||||||||||||||||||||||||||||||||||||
Reported Income | + | Other Income | + | Depreciation & | = | EBITDA | + | Restructuring | = | Adjusted | |||||||||||||||||||||||||||||||
from Operations | (Expense) | Amortization | Costs | EBITDA | |||||||||||||||||||||||||||||||||||||
Consolidated Results | $ | 239 | $ | 4 | $ | 121 | $ | 364 | $ | 7 | $ | 371 | |||||||||||||||||||||||||||||
Three Months Ended March 31, | |||||||||||
In millions | 2023 | 2022 | |||||||||
Freight Segment | |||||||||||
Services | $ | 707 | $ | 666 | |||||||
Equipment | 393 | 274 | |||||||||
Components | 279 | 229 | |||||||||
Digital Intelligence | 187 | 153 | |||||||||
Total Freight Segment | $ | 1,566 | $ | 1,322 | |||||||
Transit Segment | |||||||||||
Original Equipment Manufacturer | $ | 282 | $ | 292 | |||||||
Aftermarket | 346 | 313 | |||||||||
Total Transit Segment | $ | 628 | $ | 605 | |||||||
Three Months Ended March 31, | |||||||||||||||||||||||
2023 | 2022 | ||||||||||||||||||||||
In millions | Gross Profit | Income from Operations | Gross Profit | Income from Operations | |||||||||||||||||||
Freight Segment Reported Results | $ | 480 | $ | 227 | $ | 424 | $ | 189 | |||||||||||||||
Freight Segment Reported Margin | 30.6 | % | 14.5 | % | 32.1 | % | 14.3 | % | |||||||||||||||
Restructuring costs | 1 | 2 | 2 | 2 | |||||||||||||||||||
Non-cash Amortization expense | — | 68 | — | 68 | |||||||||||||||||||
Freight Segment Adjusted Results | $ | 481 | $ | 297 | $ | 426 | $ | 259 | |||||||||||||||
Freight Segment Adjusted Margin | 30.7 | % | 19.0 | % | 32.2 | % | 19.6 | % | |||||||||||||||
Transit Segment Reported Results | $ | 185 | $ | 69 | $ | 171 | $ | 65 | |||||||||||||||
Transit Segment Reported Margin | 29.5 | % | 11.0 | % | 28.2 | % | 10.7 | % | |||||||||||||||
Restructuring costs | 3 | 7 | 3 | 4 | |||||||||||||||||||
Non-cash Amortization expense | — | 7 | — | 5 | |||||||||||||||||||
Transit Segment Adjusted Results | $ | 188 | $ | 83 | $ | 174 | $ | 74 | |||||||||||||||
Transit Segment Adjusted Margin | 29.9 | % | 13.1 | % | 28.7 | % | 12.3 | % | |||||||||||||||
Three Months Ended March 31, | ||||||||||||||||||||
In millions | Freight | Transit | Consolidated | |||||||||||||||||
2022 Net Sales | $ | 1,322 | $ | 605 | $ | 1,927 | ||||||||||||||
Acquisitions | 21 | — | 21 | |||||||||||||||||
Foreign Exchange | (21) | (35) | (56) | |||||||||||||||||
Organic | 244 | 58 | 302 | |||||||||||||||||
2023 Net Sales | $ | 1,566 | $ | 628 | $ | 2,194 | ||||||||||||||
Change ($) | 244 | 23 | 267 | |||||||||||||||||
Change (%) | 18.5 | % | 3.8 | % | 13.9 | % | ||||||||||||||
Wabtec Corporation | |||||||||||||||||||||||||||||
2023 First Quarter Cash Conversion Calculation | |||||||||||||||||||||||||||||
(in millions) | |||||||||||||||||||||||||||||
Reported Cash from Operations | ÷ | (Net Income | + | Depreciation & Amortization) | = | Cash Conversion | |||||||||||||||||||||||
Consolidated Results | $(25) | $173 | $123 | (8)% | |||||||||||||||||||||||||
Wabtec Corporation | |||||||||||||||||||||||||||||
2022 First Quarter Cash Conversion Calculation | |||||||||||||||||||||||||||||
(in millions) | |||||||||||||||||||||||||||||
Reported Cash from Operations | ÷ | (Net Income | + | Depreciation & Amortization) | = | Cash Conversion | |||||||||||||||||||||||
Consolidated Results | $161 | $150 | $122 | 59% | |||||||||||||||||||||||||
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