REGAL REXNORD Reports Fourth Quarter Earnings for FY2022
March 9, 2023
Earnings Overview
REGAL REXNORD ($NYSE:RRX) announced its fourth quarter results for financial year 2022, which ended on December 31, 2022. Additionally, net income was USD 1244.7 million, a 2.3% year-on-year growth.
Transcripts Simplified
Motion Control Solutions (MCS): Organic sales in the fourth quarter were up 9.4% from the prior year, with particular strength in the general industrial, energy, metals and mining, and aerospace end markets, partially offset by weakness in alternative energy. Adjusted EBITDA margin in the quarter for MCS was 27.8%. Orders in MCS for the quarter were down 7% on a daily FX neutral basis. Climate Solutions: Organic sales in the fourth quarter were down 10.7% from the prior year due to global end market volume headwinds, particularly in the North America residential HVAC market.
Adjusted EBITDA margin in the quarter for Climate was 18.5%. Orders in Climate for the fourth quarter were down 22% on a daily FX-neutral basis. Orders in Commercial Systems for the quarter were up 1% on a daily FX-neutral basis.
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Regal Rexnord. More…
| Total Revenues | Net Income | Net Margin |
| 5.22k | 488.9 | 9.4% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Regal Rexnord. More…
| Operations | Investing | Financing |
| 436.2 | -113.3 | -274.2 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Regal Rexnord. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 10.27k | 3.85k | 92.89 |
Key Ratios Snapshot
Some of the financial key ratios for Regal Rexnord are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 17.2% | 29.8% | 13.4% |
| FCF Margin | ROE | ROA |
| 6.8% | 7.0% | 4.3% |
Stock Price
The stock opened at $151.1 per share and closed at $156.1, a rise of 9.4% from the previous closing price of $142.7. This marks a positive trend for the company as investors are showing confidence in the company’s performance. The company’s fourth quarter financial performance reflects the strength of its diversified portfolio, with strong growth in its industrial, aerospace, and commercial products divisions. Although there was some slowdown in the construction and residential sectors, the overall performance of the company was strong. REGAL REXNORD‘s performance was further bolstered by its strong focus on innovation and cost optimization.
The company has continued to invest in R&D to develop new products and technologies, while also reducing costs to maximize shareholder return. With the company continuing to invest in new products and technologies while reducing costs, shareholders can expect further upside potential in the stock price going forward. Live Quote…
Analysis
GoodWhale has conducted an analysis of REGAL REXNORD’s wellbeing and found that, based on our Risk Rating, it is a medium risk investment in terms of financial and business aspects. Our Risk Rating takes into account a variety of factors such as cash flow, liquidity, and profitability. However, we have detected one risk warning in their balance sheet that could potentially impact their financial standing. We urge potential investors to register with GoodWhale to gain access to more detailed information about this warning so that they can make an informed decision about REGAL REXNORD. More…
Peers
The company’s products are used in a variety of industries, including aerospace, defense, transportation, and industrial. Rexnord is a publicly traded company, and its shares are listed on the New York Stock Exchange. The company has a market capitalization of approximately $3 billion. Rexnord’s competitors include Estun Automation Co Ltd, Parker Hannifin Corp, and R Stahl AG.
– Estun Automation Co Ltd ($SZSE:002747)
Estun Automation Co Ltd is a company that manufactures and sells automation equipment. The company has a market cap of 17.8B as of 2022 and a return on equity of 6.3%. The company’s products are used in a variety of industries, including automotive, aerospace, and electronics. Estun Automation Co Ltd is a publicly traded company listed on the Shenzhen Stock Exchange.
– Parker Hannifin Corp ($NYSE:PH)
Parker Hannifin Corp is a manufacturer of motion and control technologies. Its products include hydraulic, pneumatic, and electromechanical systems and components. The company has a market cap of $33.39 billion and a return on equity of 13.12%.
– R Stahl AG ($LTS:0Q9C)
Founded in 1883, thyssenkrupp AG is a German multinational conglomerate with businesses in a wide range of sectors, including automotive, elevators, industrial services, materials, and shipbuilding. The company has a market capitalization of €70.2 billion as of 2022 and a return on equity of -1.36%. thyssenkrupp AG is headquartered in Essen, Germany.
Summary
REGAL REXNORD‘s fourth quarter financial results of FY2022 are indicative of a strong performance by the company. Total revenue increased by a whopping 2214.6% year-over-year to USD 101.5 million, while net income was up 2.3% year-over-year at USD 1244.7 million. This impressive showing was reflected in the stock price, which rose on the same day. Investors may find REGAL REXNORD’s strong performance and growth potential attractive and thus may wish to consider investing in the company.
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