Chart Industries Inc (GTLS) Reports Record Financial Results for Q4 and Full Year 2023
Record Orders and Backlog: Q4 orders surged to $1.21 billion, a 28.3% increase, with a year-end backlog of $4.28 billion.
Sales Growth: Q4 sales climbed to $1.02 billion, up 12.5% from the prior year, with full-year sales reaching $3.35 billion.
Profitability Expansion: Q4 gross margin expanded by 540 basis points to 32.9%, driving operating income to $156.0 million.
Earnings Per Share: Q4 reported diluted EPS at $0.88, with an adjusted diluted EPS of $2.25.
Free Cash Flow: Reported free cash flow for Q4 was $110.1 million, with adjusted free cash flow at $119.9 million.
Deleveraging: Net leverage ratio improved to 3.35X, with debt repayment and cash increase totaling approximately $291 million.
2024 Outlook: Anticipates sales growth of 28% to 37% and adjusted EBITDA growth of 52% to 68%.
On February 28, 2024, Chart Industries Inc (NYSE:GTLS) released its 8-K filing, announcing its financial results for the fourth quarter and full year ended December 31, 2023. The company, a leading provider of cryogenic equipment and process technology, reported record-breaking performance across multiple financial metrics, reflecting successful integration of Howden and robust demand in its end markets.
Financial Performance and Strategic Achievements
Chart Industries Inc (NYSE:GTLS) achieved significant milestones in Q4 2023, with record orders contributing to a strong backlog, indicative of sustained demand for its products. The company's sales growth was bolstered by its diversified portfolio, including cryogenic equipment for LNG and industrial gases, as well as solutions for hydrogen, biofuels, and water treatment. The integration of Howden, completed in early 2023, played a pivotal role in surpassing synergy targets and enhancing the company's operational efficiency.
Chart Industries' gross profit margin saw a substantial increase, driven by cost synergies, strong service margins, and effective price/cost actions. The company's operating income and EBITDA margins also reached new highs, reflecting disciplined cost management and operational execution. Adjusted EBITDA for the full year represented 21.2% of sales, showcasing the company's ability to convert revenue into profitable growth.
Segment Performance and Market Expansion
Chart Industries' segments demonstrated robust performance, with Cryo Tank Solutions and Heat Transfer Systems achieving record sales and gross profit margins. The Specialty Products segment secured significant orders, setting up a strong revenue year for 2024. The Repair, Service, and Leasing segment also reported record sales and gross profit margins, highlighting the company's comprehensive service offerings.
The company's global end market demand remains strong, with over $21 billion of identified potential orders in its commercial pipeline for the next three years. Chart Industries' focus on clean energy and industrial decarbonization trends positions it well for continued growth.
Financial Health and Future Outlook
Chart Industries' financial health is underscored by its successful deleveraging efforts, with a net leverage ratio of 3.35X. The company's disciplined capital allocation strategy, including debt repayment and cash flow management, supports its medium-term financial targets.
Looking ahead to 2024, Chart Industries anticipates robust sales and adjusted EBITDA growth, with a focus on cash generation for further debt paydown and balance sheet strengthening. The company's guidance reflects confidence in its market position and the ongoing demand for its diversified product offerings.
Chart Industries' strong financial performance and strategic execution in 2023 set the stage for continued success in the coming year. The company's commitment to innovation, operational excellence, and market expansion supports its vision of leading in the Nexus of Clean, with clean power, clean water, clean food, and clean industrials at the forefront of its growth strategy.
For more detailed financial information and future updates, investors and stakeholders are encouraged to visit Chart Industries' investor relations website.
Explore the complete 8-K earnings release (here) from Chart Industries Inc for further details.
This article first appeared on GuruFocus.
