ITT Inc

Latest Results (18.12.2024):

Revenue Growth

ITT Inc. reported an 8% increase in revenue for the third quarter of 2024 compared to the previous year, with a 6% organic growth. This growth was primarily driven by gains in Friction and rail share in Motion Technologies, short cycle demand in Industrial Process, and connectors growth in Connect & Control Technologies. The acquisitions of Svanehøj and kSARIA contributed significantly to the revenue growth, while the divestiture of Wolverine had a negative impact.

Operating Income

For the third quarter of 2024, ITT Inc.'s operating income increased by 45% to $208 million, largely due to a $48 million preliminary gain from the divestiture of Wolverine. On an adjusted basis, operating income saw an 11% increase, driven by higher sales volume, pricing actions, and productivity improvements, despite facing higher material and labor costs and unfavorable foreign currency impacts.

Earnings Per Share

ITT Inc. reported earnings per share (EPS) of $1.96 for the third quarter of 2024, marking a 46% increase from the previous year. This growth was primarily attributed to the gain from the Wolverine divestiture. The adjusted EPS was $1.46, reflecting a 7% increase, supported by higher operating income, although partially offset by increased interest expenses due to acquisitions.

Cash Flow

Net cash from operating activities for ITT Inc. in the third quarter of 2024 was $124 million, a 27% decrease from the previous year, primarily due to higher working capital requirements. Free cash flow for the quarter was $87 million, down 41% year-over-year. On a year-to-date basis, both operating cash flow and free cash flow were negatively impacted by higher working capital, interest payments, and capital expenditures, despite higher segment operating income.

2024 Outlook

ITT Inc. has raised its full-year revenue and operating margin guidance for 2024, expecting revenue growth of 10% to 12% and an operating margin of 18.4% to 18.7%. The company also increased the midpoint of its adjusted EPS outlook, anticipating full-year EPS between $6.16 and $6.22, and adjusted EPS between $5.80 and $5.86. This optimistic outlook is supported by strong performance, a growing backlog, and contributions from recent acquisitions.