NYSE$TKR

The Timken Company · Q4 2020 earnings

Q4 2020 earnings · · Investor relations

Briefing

Reported Q4 2020 results, with revenue slightly down but EPS exceeding expectations, driven by cost reduction initiatives and strong cash flow.

Timken reported fourth-quarter sales of $892 million, a slight decrease of less than one percent from the previous year. GAAP earnings per diluted share were $0.69, while adjusted EPS reached $0.84. The company generated strong full-year net operating cash flow of $578 million and free cash flow of $456 million. Timken expects strong revenue growth in 2021 and forecasts earnings per diluted share between $4.45 and $4.85 on a GAAP basis, or $4.70 to $5.10 adjusted.

  • Fourth-quarter sales reached $892 million, a decrease of less than one percent year-over-year.
  • Fourth-quarter GAAP earnings per diluted share were $0.69, with adjusted EPS at $0.84.
  • Full-year 2020 net operating cash flow was $578 million, and free cash flow was $456 million.
  • The company anticipates strong revenue growth in 2021 and projects GAAP earnings per diluted share of $4.45-$4.85, with adjusted EPS between $4.70 and $5.10.

Headline financials

Total Revenue

$892M

Previous: $896M-0.5%
EPS (adj)

$0.84

Previous: $0.84+0.0%
Capital Expenditures

$122M

Previous: $141M-13.5%
Free Cash Flow

$84.6M

Previous: $138M-38.5%
Net Income

$53.1M

Previous: $118M-54.9%
Operating Income

$98.8M

Previous: $93.5M+5.7%
Gross Profit

$237M

Previous: $256M-7.4%
Cash & Equivalents

$320M

Previous: $210M+52.9%
Total Assets

$5.04B

Previous: $4.86B+3.7%
Stock-Based Comp

$4M

Previous: $6.4M-37.5%

Revenue & EPS history

Timken · Revenue · Quarterly

$892M

Q4 2020-0.5%vs Q4 2019
Beat estimate in 10 of 16 quarters(63%)
ActualEstimate

Revenue by segment

Timken · $892M total across 2 segments · Q4 2020

  • Engineered Bearings
    $458M
  • Industrial Motion
    $434M

Forward guidance

Timken anticipates 2021 earnings per diluted share to range from $4.45 to $4.85 for the full year on a GAAP basis. Excluding special items, the company expects 2021 adjusted earnings per diluted share ranging from $4.70 to $5.10, which at the midpoint is up almost 20 percent versus 2020. At the midpoint of the outlook, the company expects 2021 revenue to be up approximately 12 percent in total versus 2020.

Tailwinds

  • Improving industrial markets
  • An active pipeline of new business wins
  • Continued outgrowth in sectors like renewable energy and marine
  • Seeing sequential strengthening in our business to start the year
  • A sustainable industrial expansion is underway

Headwinds

  • Some near-term uncertainty related to the COVID-19 pandemic
  • Supply chain challenges related to the COVID-19 pandemic

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 Q4 2020

Historical avgQ4 2020

-0.4%

Avg return

Earnings day

+0.4%

Avg return

5 days after

+1.7%

Avg return

30 days after

50%

34 / 68 earnings

Positive

+14.9%

Q4 2015

Best reaction

-14.6%

Q3 2013

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-0.3%+7.0%+20.2%
Q4 2025+3.2%+13.3%+3.7%
Q3 2025+2.4%+0.9%+5.4%
Q1 2025-1.6%+1.7%+4.9%
Q4 2024+3.5%+3.3%-2.3%
Q3 2024-5.0%-7.8%-8.7%
Q2 2024-1.2%-5.4%-1.2%
Q1 2024+0.9%+3.2%-0.3%
Q4 2023-5.6%-3.9%-1.1%
Q3 2023+2.6%+3.6%+8.0%
Q2 2023-11.4%-13.1%-14.1%
Q1 2023-4.0%-1.6%+1.2%
Q4 2022-1.4%-3.2%+1.7%
Q3 2022+0.2%+4.0%+9.6%
Q2 2022+5.5%+2.5%+4.6%
Q1 2022+5.6%+2.4%+4.0%
Q4 2021-1.2%-1.7%-4.7%
Q3 2021+1.2%+2.5%-8.3%
Q2 2021-4.0%-4.4%-8.4%
Q1 2021+4.2%+2.0%+5.6%
Q4 2020-9.3%-7.2%+0.6%
Q3 2020+5.5%+13.0%+32.1%
Q2 2020+7.4%+13.5%+25.7%
Q1 2020-2.6%-3.4%+13.2%
Q4 2019-0.2%+2.2%-18.0%
Q3 2019-0.1%+8.1%+7.2%
Q2 2019-10.9%-12.6%-17.1%
Q1 2019+5.4%+7.2%-8.2%
Q4 2018-3.5%-0.5%-2.0%
Q3 2018+1.5%+8.1%+5.9%
Q2 2018+1.2%+1.1%+6.3%
Q1 2018+6.3%+8.2%+10.6%
Q4 2017-9.7%-8.6%-4.0%
Q3 2017-5.4%-8.8%-8.8%
Q2 2017-6.5%-7.8%-11.1%
Q1 2017+1.1%-0.2%-4.4%
Q4 2016+2.6%+3.1%+1.2%
Q3 2016-5.6%-6.7%+13.3%
Q2 2016+3.2%+2.9%+5.4%
Q1 2016-1.5%
Q4 2015+14.9%
Q3 2015+7.9%
Q2 2015+1.0%
Q1 2015-3.8%
Q4 2014-6.2%
Q3 2014+0.7%
Q2 2014-4.3%
Q1 2014+2.9%
Q4 2013+3.3%
Q3 2013-14.6%
Q2 2013-5.5%
Q1 2013+1.0%
Q4 2012+2.7%
Q3 2012+2.5%
Q2 2012-0.3%
Q1 2012-0.2%
Q4 2011+1.6%
Q1 2010+1.6%
Q3 2011+8.7%
Q2 2011-8.9%
Q1 2011+1.6%
Q4 2010-7.6%
Q4 2008-7.6%
Q3 2009+6.0%
Q3 2010+6.0%
Q2 2009-0.5%
Q2 2010-0.5%
Q4 2009-0.5%

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