NASDAQ$FELE

Franklin Electric Co Inc · Q3 2020 earnings

Q3 2020 earnings · · Investor relations

Briefing

Franklin Electric's third quarter earnings were reported, achieving a record EPS before restructuring of $0.83, a 14% increase year-over-year, and sales of $351.2 million.

Franklin Electric reported a strong third quarter with record earnings. EPS before restructuring expenses grew by 14% year-over-year. The company's water businesses outside the U.S. and Canada experienced organic growth, and the distribution business also saw organic growth. The fueling systems sales declined, but improved sequentially from the previous quarter. Management is optimistic about the remainder of 2020 and looking forward to 2021.

  • Third quarter EPS before restructuring expense was $0.83, a 14% increase year-over-year.
  • Third quarter sales were $351.2 million, compared to $348.4 million in the third quarter 2019.
  • Water businesses outside the U.S. and Canada grew organically by about 15%.
  • Distribution business grew by 13% organically.

Headline financials

Total Revenue

$351M

Previous: $348M+0.8%
EPS (adj)

$0.83

Previous: $0.73+13.7%
Operating Margin

13.8%

No prior period
Capital Expenditures

-$15.2M

Previous: -$15.6M+2.3%
Free Cash Flow

$23.1M

Previous: $18.3M+26.3%
Net Income

$38.4M

Previous: $33.9M+13.2%
Operating Income

$48.4M

Previous: $42.7M+13.3%
Gross Profit

$124M

Previous: $118M+5.7%
Cash & Equivalents

$114M

Previous: $47.8M+139.5%
Total Assets

$1.2B

Previous: $1.24B-2.9%
Stock-Based Comp

$1.3M

Previous: $1.94M-33.0%

Revenue & EPS history

Franklin Electric · Revenue · Quarterly

$351M

Q3 2020+0.8%vs Q3 2019
Beat estimate in 10 of 16 quarters(63%)
ActualEstimate

Revenue by segment

Franklin Electric · $369M total across 3 segments · Q3 2020

  • Water Systems
    $203M+1.6%
  • Distribution
    $98M+12.6%
  • Energy Systems
    $68.4M-12.4%

Forward guidance

Franklin Electric raised its full year guidance for both earnings per share and free cash flow. The company now expects full year 2020 earnings per share before restructuring expenses to be between $2.10 and $2.15. They expect free cash flow as a percent of net income to be over 170 percent for the full year 2020.

Tailwinds

  • Water Systems and Distribution segments are expected to continue to have solid top line performance, except for large dewatering products.
  • Expects free cash flow as a percent of net income to be over 170 percent for the full year 2020.
  • Full year 2020 earnings per share before restructuring expenses will be between $2.10 and $2.15.
  • Commitment to safety
  • Ethical compliance with established policies

Headwinds

  • Continued weakness in filling station builds and upgrades globally.
  • Large dewatering equipment sales in the Water Systems segment continue to be depressed.
  • The deferral or cancellation of the construction of new filling stations in the Fueling Systems segment continues.
  • The strengthening of the U.S. dollar versus most international currencies has resulted in lower translations of both Net Sales and earnings.
  • Company’s financial results are also impacted negatively by continuing government mandated closures and related customer behaviors.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q3 2020

Historical avgQ3 2020

-0.6%

Avg return

Earnings day

-1.0%

Avg return

5 days after

-0.4%

Avg return

30 days after

37%

24 / 65 earnings

Positive

+22.0%

Q3 2015

Best reaction

-14.6%

Q4 2025

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-0.5%-3.9%-4.4%
Q4 2025-14.6%-12.0%-16.1%
Q3 2025-3.5%-3.8%-2.4%
Q1 2025-4.4%-0.3%-2.3%
Q4 2024+6.0%+4.3%-2.0%
Q3 2024-5.9%-4.9%+4.5%
Q2 2024-3.1%+1.9%-3.9%
Q1 2024-5.5%-4.2%-5.4%
Q4 2023-2.0%+0.3%+1.0%
Q3 2023-0.0%-0.2%+6.3%
Q2 2023-7.1%-8.6%-10.8%
Q1 2023+5.8%+5.3%+1.3%
Q4 2022+3.6%+4.4%-2.1%
Q3 2022-5.5%-6.7%-3.2%
Q2 2022+9.0%+14.6%+17.2%
Q1 2022-10.0%-12.6%-9.2%
Q4 2021+2.0%-0.7%-0.4%
Q3 2021-3.0%-1.2%+9.0%
Q2 2021-2.9%-0.9%+0.6%
Q1 2021-0.1%-0.1%+3.6%
Q4 2020-0.4%-1.6%+6.6%
Q3 2020-5.5%-4.3%+9.3%
Q2 2020+5.3%-0.1%+10.0%
Q1 2020+5.6%-3.9%+1.5%
Q4 2019-2.6%-2.5%-20.8%
Q3 2019+5.7%+3.3%+5.9%
Q2 2019+2.5%+3.2%-0.1%
Q1 2019-7.3%-7.2%-13.9%
Q4 2018+7.6%+8.4%+2.5%
Q3 2018+2.0%+4.2%+7.2%
Q2 2018+0.0%+1.7%+3.3%
Q1 2018+5.2%+6.8%+12.8%
Q4 2017-8.1%-8.1%-7.8%
Q3 2017-1.7%+2.4%+2.0%
Q2 2017-4.4%-5.0%-9.7%
Q1 2017-8.2%-11.7%-15.9%
Q4 2016+5.9%+5.5%+0.7%
Q3 2016-6.8%-4.7%+3.5%
Q2 2016+6.5%+4.3%+5.0%
Q1 2016+3.0%
Q4 2015-0.9%
Q3 2015+22.0%
Q2 2015+3.6%
Q1 2015-6.2%
Q4 2014+4.2%
Q3 2014-6.2%
Q2 2014-2.9%
Q1 2014-2.7%
Q4 2013+6.5%
Q3 2013-2.7%
Q2 2013-0.4%
Q1 2013-3.5%
Q4 2012-3.4%
Q3 2012+2.1%
Q2 2012-4.4%
Q1 2012-1.9%
Q4 2011-1.3%
Q3 2011-4.0%
Q2 2011+1.0%
Q4 2009+2.0%
Q1 2011+1.1%
Q3 2010-1.3%
Q2 2010-0.4%
Q4 2010-0.4%
Q1 2010+0.7%

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