Earnings Highlights and Review: Rexnord Outperformed Expectations
Research Desk Line-up: Zebra Technologies Post Earnings Coverage
LONDON, UK / ACCESSWIRE / June 6, 2017 / Pro-Trader Daily publishes post-earnings coverage on Rexnord Corp. (NYSE: RXN) following the Company's reporting of its fourth quarter (Q4 FY17) and fiscal 2017 (FY17) earnings on May 17, 2017. The Milwaukee-based Company's quarterly total revenues increased 2% y-o-y. Our daily stock reports are accessible for free, and with those to look forward today you also will be signing up for a complimentary member's account at:
http://protraderdaily.com/register/
Get more of our free earnings reports coverage from other constituents of the Diversified Machinery industry. Pro-TD has currently selected Zebra Technologies Corporation (NASDAQ: ZBRA) for due-diligence and potential coverage as the Company announced on May 09, 2017, its financial results for Q1 which ended on April 01, 2017. Register for a free membership today, and be among the early birds that get access to our report on Zebra Technologies when we publish it.
At Pro-TD, we make it our mission to bring you news that matter about the stock you follow. Today, our research desk covers a blog story on RXN; also brushing on ZBRA. With the links below you can directly download the report of your stock of interest free of charge at:
http://protraderdaily.com/optin/?symbol=RXN
http://protraderdaily.com/optin/?symbol=ZBRA
Earnings Reviewed
During Q4 FY17, Rexnord's net sales were $503.6 million up 2% compared to net sales of $492.6 million. The Company's Core sales were flat, excluding a 2% impact from the Rodney Hunt Fontaine (RHF) product line exit. Rexnord's revenue number had surpassed analysts' estimates of $494.5 million. For FY17, the Company's net sales totaled $1.92 billion, essentially flat on a y-o-y basis.
For Q4 FY17, Rexnord's adjusted EBITDA was $98 million, or 19.5% of net sales. The Company reported adjusted EBITDA of $347 million, or 18.1% of net sales, for FY17.
For Q4 FY17, net income attributable to Rexnord's common stockholders was $21.6 million, or $0.21 per diluted share, compared to net loss of $0.4 million, or $0.00 per share, in Q4 FY16. The Company's earnings, adjusted for one-time gains and costs, were $0.35 per share, above Wall Street's expectations of $0.33 per share and below the year ago adjusted earnings of $0.37 per share.
Segment Results
During the quarter ended March 31, 2017, Rexnord's Process & Motion Control (PMC) net sales increased 7% on a y-o-y basis to $314 million. The Cambridge acquisition contributed 7% to growth, while PMC core growth was flat y-o-y. The segment's core growth in its consumer-facing and aerospace end-markets was offset by lower sales in the process industry end-markets.
PMC income from operations for Q4 FY17 was $44 million, or 13.9% of net sales. Income from operations as a percentage of net sales decreased 30 basis points on a y-o-y basis, primarily due to higher costs and accelerated depreciation associated with its Supply Chain Optimization and Footprint Repositioning program. PMC's adjusted EBITDA in Q4 FY17 was $70 million and adjusted EBITDA as a percentage of sales increased 20 basis points y-o-y to 22.3%.
For Q4 FY17, Rexnord's Water Management segment's net sales declined 4% on a y-o-y basis to $190 million. The segment's core net sales decreased 1% y-o-y, which excludes a 3% adverse impact associated with exiting the RHF product line. Water Management's growth in the nonresidential construction end-markets was more than offset by the timing of water infrastructure project shipments.
Water Management's income from operations was $22 million, or 11.6% of net sales, for Q4 FY17. Operating income as a percentage of net sales increased y-o-y primarily as a result of lower restructuring expenses and the reduced impact from the exit of RHF. Water Management's adjusted EBITDA in Q4 FY17 was $34 million and adjusted EBITDA as a percentage of sales increased 40 basis points on y-o-y to 18.0%.
Cash Matters
As of March 31, 2017 Rexnord reported cash and cash equivalents of $490.1 million, up compared to $429.3 million at the end of Q3 FY17. The Company's long-term debt fell marginally to $1.61 billion. During FY17, Rexnord generated cash of $195.1 million from its operating activities compared to $219 million in FY16. The Company finished fiscal 2017 with free cash flow of $141 million, including an impact of approximately $42 million from the Company's SCOFR initiative.
On June 03, 2017, Rexnord announced that its Board of Directors declared a quarterly dividend to holders of the 5.75% Series A Mandatory Convertible Preferred Stock of $14.375 per share, payable on August 15, 2017, to stockholders of record as of August 01, 2017.
Outlook
For FY18, Rexnord is forecasting GAAP net income to be in a range of $87 million to $107 million while adjusted EBITDA is expected to be in the band of $365 million to $385 million. The Company expects its free cash flow to exceed net income in FY18.
Stock Performance
At the closing bell, on Monday, June 05, 2017, Rexnord's stock slipped 1.44%, ending the trading session at $23.28. A total volume of 366.18 thousand shares have exchanged hands. The Company's stock price surged 0.61% in the last three months, 10.91% in the past six months, and 12.52% in the previous twelve months. Moreover, the stock rallied 18.84% since the start of the year. The stock is trading at a PE ratio of 36.55. At Monday's closing price, the stock's net capitalization stands at $2.41 billion.
Pro-Trader Daily:
Pro-Trader Daily (Pro-TD) produces regular sponsored and non-sponsored reports, articles, stock market blogs, and popular investment newsletters covering equities listed on NYSE and NASDAQ and Canadian stocks. PRO-TD has two distinct and independent departments. One department produces non-sponsored analyst certified content generally in the form of press releases, articles and reports covering equities listed on NYSE and NASDAQ and the other produces sponsored content (in most cases not reviewed by a registered analyst), which typically consists of compensated investment newsletters, articles and reports covering listed stocks and micro-caps. Such sponsored content is outside the scope of procedures detailed below.
PRO-TD has not been compensated; directly or indirectly; for producing or publishing this document.
PRESS RELEASE PROCEDURES:
The non-sponsored content contained herein has been prepared by a writer (the "Author") and is fact checked and reviewed by a third party research service company (the "Reviewer") represented by a credentialed financial analyst, for further information on analyst credentials, please email contact@protraderdaily.com. Rohit Tuli, a CFA® charterholder (the "Sponsor"), provides necessary guidance in preparing the document templates. The Reviewer has reviewed and revised the content, as necessary, based on publicly available information which is believed to be reliable. Content is researched, written and reviewed on a reasonable-effort basis. The Reviewer has not performed any independent investigations or forensic audits to validate the information herein. The Reviewer has only independently reviewed the information provided by the Author according to the procedures outlined by PRO-TD. PRO-TD is not entitled to veto or interfere in the application of such procedures by the third-party research service company to the articles, documents or reports, as the case may be. Unless otherwise noted, any content outside of this document has no association with the Author or the Reviewer in any way.
NO WARRANTY
PRO-TD, the Author, and the Reviewer are not responsible for any error which may be occasioned at the time of printing of this document or any error, mistake or shortcoming. No liability is accepted whatsoever for any direct, indirect or consequential loss arising from the use of this document. PRO-TD, the Author, and the Reviewer expressly disclaim any fiduciary responsibility or liability for any consequences, financial or otherwise arising from any reliance placed on the information in this document. Additionally, PRO-TD, the Author, and the Reviewer do not (1) guarantee the accuracy, timeliness, completeness or correct sequencing of the information, or (2) warrant any results from use of the information. The included information is subject to change without notice.
NOT AN OFFERING
This document is not intended as an offering, recommendation, or a solicitation of an offer to buy or sell the securities mentioned or discussed, and is to be used for informational purposes only. Please read all associated disclosures and disclaimers in full before investing. Neither PRO-TD nor any party affiliated with us is a registered investment adviser or broker-dealer with any agency or in any jurisdiction whatsoever. To download our report(s), read our disclosures, or for more information, visit http://protraderdaily.com/disclaimer/.
CONTACT
For any questions, inquiries, or comments reach out to us directly. If you're a company we are covering and wish to no longer feature on our coverage list contact us via email and/or phone between 09:30 EDT to 16:00 EDT from Monday to Friday at:
Email: contact@protraderdaily.com
Phone number: (917) 341.4653
Office Address: Mainzer Landstrasse 50 Frankfurt am Main, Germany 60325
CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute.
SOURCE: Pro-Trader Daily
