Parker Hannifin Corporation (NYSE: PH), the global leader in motion
and control technologies, today reported results for the fiscal
2020 fourth quarter and full year ended June 30, 2020.
Fiscal 2020 fourth quarter sales were $3.16 billion, compared with
$3.68 billion in the prior year quarter. Net income was
$295.7 million, compared with $413.7 million in the fourth quarter
of fiscal 2019. Fiscal 2020 fourth quarter earnings per share
were $2.27, compared with $3.17 in the prior year quarter.
Adjusted earnings per share were $2.55, compared with adjusted
earnings per share of $3.31 in the fourth quarter of fiscal
2019. A reconciliation of non-GAAP measures is included in
the financial tables of this press release.
For the full year, fiscal 2020 sales were $13.70 billion,
compared with $14.32 billion in fiscal 2019. Net income was
$1.21 billion, compared with $1.51 billion in fiscal 2019.
Fiscal 2020 earnings per share were $9.29, compared with $11.48 per
share in the prior year. Adjusted earnings per share were
$10.79, compared with $11.85 per share in fiscal 2019. Cash
flow from operations for fiscal 2020 was a record at $2.07 billion
or 15.1% of sales, compared with $1.73 billion or 12.1% of sales in
the prior year period. Excluding a discretionary pension
contribution, cash flow from operations for fiscal 2019 was 13.5%
of sales.
“In light of the economic crisis resulting from the ongoing
COVID-19 pandemic, our global team delivered outstanding
performance in the fiscal 2020 fourth quarter,” said Chairman and
Chief Executive Officer, Tom Williams. “The improvement of
Parker’s portfolio through transformative acquisitions, continued
execution of The Win Strategy™, and near-term actions to reduce
costs and preserve cash, have positioned us to achieve exceptional
levels of performance during such a steep decline in demand.
Despite an organic sales decline of 21%, adjusted total segment
operating margin was 17.4% and our adjusted EBITDA margin was
impressive at 20.4% in the quarter. Our full year cash flow
from operations was a record, surpassing the $2 billion mark for
the first time. We continued to aggressively reduce our debt
by making repayments totaling $687 million in the fourth quarter
and $1.3 billion year to date, which is approximately 25% of the
acquisition related debt issued.”
Williams added, “Our global team has not only delivered
outstanding financial performance but has also taken actions to
manage the impact of the pandemic on our operations. Since
the early stages of this global crisis, we have maintained
manufacturing capacity across the enterprise, demonstrating the
essential nature of Parker's technologies in every major country in
the world. We continue to make the safety of our team
members, their families and our communities our highest priority
and have implemented rigorous safety protocols globally. My
thanks to all Parker team members who continue to serve our
customers, many of whom are on the front-line in the fight against
the pandemic, and keep our operations running safely and
efficiently.”
Segment ResultsDiversified Industrial
Segment: North American fourth quarter sales decreased 18% to
$1.4 billion, and operating income was $219.8 million, compared
with $318.2 million in the same period a year ago.
International fourth quarter sales decreased 13% to $1.1 billion,
and operating income was $175.4 million, compared with $201.0
million in the same period a year ago.
Aerospace Systems Segment: Fourth quarter sales decreased
8% to $624.0 million, and operating income was $105.4 million,
compared with $121.7 million in the same period a year ago.
Parker reported the following orders for the quarter ending
June 30, 2020, compared with the same quarter a year ago:
- Orders decreased 22% for total Parker
- Orders decreased 29% in the Diversified Industrial North
America businesses
- Orders decreased 21% in the Diversified Industrial
International businesses
- Orders decreased 5% in the Aerospace Systems Segment on a
rolling 12-month average basis
OutlookAs previously communicated at our March
2020 Investor Meeting, going forward, Parker will include
intangible asset amortization expense related to acquisitions as a
line item in its adjustments to earnings. The company
believes this change will lead to a better representation of its
core operating earnings, especially since amortization expense has
become much more material because of recent acquisitions.
For the fiscal year ending June 30, 2021, the company has issued
guidance for earnings per share in the range of $7.41 to $8.41, or
$9.80 to $10.80 on an adjusted basis. Fiscal year 2021
guidance is adjusted on a pre-tax basis for expected business
realignment expenses of approximately $65 million, costs to achieve
of approximately $19 million and acquisition-related intangible
asset amortization of approximately $321 million. Guidance
assumes an organic sales decline in the range of 13% to 9%. A
reconciliation of forecasted earnings per share to adjusted
forecasted earnings per share is included in the financial tables
of this press release.
Commenting on the outlook, Williams added, “We expect that the
global COVID-19 pandemic will continue to have a negative effect on
economic activity in fiscal 2021. We will continue to manage
our costs and preserve cash for the current environment and
position ourselves for economic recovery. The actions we have
taken under the Win Strategy to strengthen our portfolio and
improve our performance have built a business that is better
equipped than ever before to be resilient across macro-economic
cycles. Importantly, we remain committed to achieving our
long-term targets for sales growth, margins, earnings growth and
cash flow that would solidify Parker as a top quartile
performer. While significant challenges lie ahead, we are
positioned to weather these conditions and emerge stronger than
ever before. Guided by our purpose: Enabling Engineering
Breakthroughs that lead to a Better Tomorrow, Parker has a very
bright future."
NOTICE OF CONFERENCE CALL: Parker
Hannifin's conference call and slide presentation to discuss its
fiscal 2020 fourth quarter and full year results are available to
all interested parties via live webcast today at 11:00 a.m. ET, at
www.phstock.com. A replay of the webcast will be available on
the site approximately one hour after the completion of the call
and will remain available for one year. To register for
e-mail notification of future events please visit
www.phstock.com.
About Parker HannifinParker Hannifin is a
Fortune 250 global leader in motion and control technologies.
For more than a century the company has been enabling engineering
breakthroughs that lead to a better tomorrow. Parker has
increased its annual dividend per share paid to shareholders for 64
consecutive fiscal years, among the top five longest-running
dividend-increase records in the S&P 500 index. Learn
more at www.parker.com or @parkerhannifin.
Note on OrdersOrders provide near-term
perspective on the company's outlook, particularly when viewed in
the context of prior and future quarterly order rates. However,
orders are not in themselves an indication of future performance.
All comparisons are at constant currency exchange rates, with the
prior year restated to the current-year rates. All exclude
acquisitions until they can be reflected in both the numerator and
denominator. Aerospace comparisons are rolling 12-month average
computations. The total Parker orders number is derived from a
weighted average of the year-over-year quarterly % change in orders
for Diversified Industrial North America and Diversified Industrial
International, and the year-over-year 12-month rolling average of
orders for the Aerospace Systems Segment.
Note on Net IncomeNet income referenced in this
press release is equal to net income attributable to common
shareholders.
Note on Non-GAAP Financial MeasuresThis press
release contains references to non-GAAP financial information
including (a) adjusted earnings per share; (b) adjusted cash flow
from operations; (c) adjusted total segment operating margin;
EBITDA margin; and adjusted EBITDA margin. The adjusted
earnings per share, cash flow from operations and total segment
operating margin measures are presented to allow investors and the
company to meaningfully evaluate changes in earnings per share,
cash flows from operations and total segment operating margin on a
comparable basis from period to period. This press release also
contains references to EBITDA, EBITDA margin and adjusted EBITDA
margin. EBITDA is defined as earnings before interest, taxes,
depreciation and amortization. Although EBITDA, EBITDA margin and
adjusted EBITDA margin are not measures of performance calculated
in accordance with GAAP, we believe that they are useful to an
investor in evaluating the results of this quarter versus the prior
period. A reconciliation of non-GAAP measures is included in
the financial tables of this press release.
Forward-Looking StatementsForward-looking
statements contained in this and other written and oral reports are
made based on known events and circumstances at the time of
release, and as such, are subject in the future to unforeseen
uncertainties and risks. These statements may be identified from
the use of forward-looking terminology such as “anticipates,”
“believes,” “may,” “should,” “could,” “potential,” “continues,”
“plans,” “forecasts,” “estimates,” “projects,” “predicts,” “would,”
“intends,” “anticipates,” “expects,” “targets,” “is likely,”
“will,” or the negative of these terms and similar expressions, and
include all statements regarding future performance, earnings
projections, events or developments. Parker cautions readers
not to place undue reliance on these statements. It is possible
that the future performance and earnings projections of the
company, including its individual segments, may differ materially
from current expectations, depending on economic conditions within
its mobile, industrial and aerospace markets, and the company's
ability to maintain and achieve anticipated benefits associated
with announced realignment activities, strategic initiatives to
improve operating margins, actions taken to combat the effects of
the current economic environment, and growth, innovation and global
diversification initiatives. Additionally, the actual impact of
changes in tax laws in the United States and foreign jurisdictions
and any judicial or regulatory interpretation thereof on future
performance and earnings projections may impact the company’s tax
calculations. A change in the economic conditions in individual
markets may have a particularly volatile effect on segment
performance.
Among other factors which may affect future performance are: the
impact of the global outbreak of COVID-19 and governmental and
other actions taken in response; changes in business relationships
with and purchases by or from major customers, suppliers or
distributors, including delays or cancellations in shipments;
disputes regarding contract terms or significant changes in
financial condition, changes in contract cost and revenue estimates
for new development programs and changes in product mix; ability to
identify acceptable strategic acquisition targets; uncertainties
surrounding timing, successful completion or integration of
acquisitions and similar transactions, including the integration of
CLARCOR, LORD Corporation or Exotic Metals; the ability to
successfully divest businesses planned for divestiture and realize
the anticipated benefits of such divestitures; the determination to
undertake business realignment activities and the expected costs
thereof and, if undertaken, the ability to complete such activities
and realize the anticipated cost savings from such activities;
ability to implement successfully capital allocation initiatives,
including timing, price and execution of share repurchases;
availability, limitations or cost increases of raw materials,
component products and/or commodities that cannot be recovered in
product pricing; ability to manage costs related to insurance and
employee retirement and health care benefits; compliance costs
associated with environmental laws and regulations; potential labor
disruptions; threats associated with and efforts to combat
terrorism and cyber-security risks; uncertainties surrounding the
ultimate resolution of outstanding legal proceedings, including the
outcome of any appeals; global competitive market conditions,
including global reactions to U.S. trade policies, and resulting
effects on sales and pricing; and global economic factors,
including manufacturing activity, air travel trends, currency
exchange rates, difficulties entering new markets and general
economic conditions such as inflation, deflation, interest rates
and credit availability, as well as uncertainties associated with
the timing and conditions surrounding the return to service of the
Boeing 737 MAX. The company makes these statements as of the date
of this disclosure and undertakes no obligation to update them
unless otherwise required by law.
|
PARKER
HANNIFIN CORPORATION - JUNE 30, 2020 |
CONSOLIDATED STATEMENT OF INCOME |
(Unaudited) |
Three Months Ended June 30, |
|
Twelve Months Ended June 30, |
(Dollars in thousands, except
per share amounts) |
2020 |
|
|
2019 |
|
|
2020 |
|
|
2019 |
|
Net sales |
$ |
3,160,603 |
|
|
$ |
3,681,467 |
|
|
$ |
13,695,520 |
|
|
$ |
14,320,324 |
|
Cost of sales |
2,357,319 |
|
|
2,739,578 |
|
|
10,286,518 |
|
|
10,703,484 |
|
Selling, general and
administrative expenses |
352,793 |
|
|
391,493 |
|
|
1,656,553 |
|
|
1,543,939 |
|
Interest expense |
74,549 |
|
|
50,072 |
|
|
308,161 |
|
|
190,138 |
|
Other expense (income),
net |
5,374 |
|
|
(13,024 |
) |
|
(68,339 |
) |
|
(50,662 |
) |
Income before income
taxes |
370,568 |
|
|
513,348 |
|
|
1,512,627 |
|
|
1,933,425 |
|
Income taxes |
74,873 |
|
|
99,610 |
|
|
305,924 |
|
|
420,494 |
|
Net income |
295,695 |
|
|
413,738 |
|
|
1,206,703 |
|
|
1,512,931 |
|
Less: Noncontrolling
interests |
(21 |
) |
|
70 |
|
|
362 |
|
|
567 |
|
Net income
attributable to common shareholders |
$ |
295,716 |
|
|
$ |
413,668 |
|
|
$ |
1,206,341 |
|
|
$ |
1,512,364 |
|
|
|
|
|
|
|
|
|
Earnings per share
attributable to common shareholders: |
|
|
|
|
|
|
|
Basic earnings per share |
$ |
2.30 |
|
|
$ |
3.22 |
|
|
$ |
9.39 |
|
|
$ |
11.63 |
|
Diluted earnings per
share |
$ |
2.27 |
|
|
$ |
3.17 |
|
|
$ |
9.29 |
|
|
$ |
11.48 |
|
|
|
|
|
|
|
|
|
Average shares outstanding
during period - Basic |
128,523,334 |
|
|
128,561,494 |
|
|
128,418,495 |
|
|
129,997,640 |
|
Average shares outstanding
during period - Diluted |
129,993,001 |
|
|
130,460,247 |
|
|
129,805,034 |
|
|
131,781,617 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH DIVIDENDS PER
COMMON SHARE |
|
|
|
|
|
|
|
(Unaudited) |
Three Months Ended June 30, |
|
Twelve Months Ended June 30, |
(Amounts in dollars) |
2020 |
|
|
2019 |
|
|
2020 |
|
|
2019 |
|
Cash dividends per
common share |
$ |
0.88 |
|
|
$ |
0.88 |
|
|
$ |
3.52 |
|
|
$ |
3.16 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RECONCILIATION OF EARNINGS PER DILUTED SHARE TO ADJUSTED
EARNINGS PER DILUTED SHARE |
(Unaudited) |
Three Months Ended June 30, |
|
Twelve Months Ended June 30, |
(Amounts in dollars) |
2020 |
|
|
2019 |
|
|
2020 |
|
|
2019 |
|
Earnings per diluted
share |
$ |
2.27 |
|
|
$ |
3.17 |
|
|
$ |
9.29 |
|
|
$ |
11.48 |
|
Adjustments: |
|
|
|
|
|
|
|
Business realignment charges |
0.37 |
|
|
0.05 |
|
|
0.59 |
|
|
0.12 |
|
Clarcor costs to achieve |
— |
|
|
0.01 |
|
|
— |
|
|
0.10 |
|
Lord costs to achieve |
0.02 |
|
|
0.01 |
|
|
0.16 |
|
|
0.01 |
|
Exotic costs to achieve |
— |
|
|
— |
|
|
0.01 |
|
|
— |
|
Acquisition-related expenses |
0.03 |
|
|
0.12 |
|
|
1.45 |
|
|
0.12 |
|
Tax effect of adjustments1 |
(0.09 |
) |
|
(0.05 |
) |
|
(0.52 |
) |
|
(0.09 |
) |
Favorable tax settlement |
(0.05 |
) |
|
— |
|
|
(0.19 |
) |
|
— |
|
Tax expense related to U.S. Tax Reform |
— |
|
|
— |
|
|
— |
|
|
0.11 |
|
Adjusted earnings per
diluted share |
$ |
2.55 |
|
|
$ |
3.31 |
|
|
$ |
10.79 |
|
|
$ |
11.85 |
|
|
|
|
|
|
|
|
|
1This line item
reflects the aggregate tax effect of all non-tax adjustments
reflected in the preceding line items of the table. We estimate the
tax effect of each adjustment item by applying our overall
effective tax rate for continuing operations to the pre-tax amount,
unless the nature of the item and/or the tax jurisdiction in which
the item has been recorded requires application of a specific tax
rate or tax treatment, in which case the tax effect of such item is
estimated by applying such specific tax rate or tax treatment. |
PARKER
HANNIFIN CORPORATION - JUNE 30, 2020 |
RECONCILIATION OF EBITDA TO ADJUSTED EBITDA |
(Unaudited) |
Three Months Ended June 30, |
|
Twelve Months Ended June 30, |
(Dollars in thousands) |
2020 |
|
|
2019 |
|
|
2020 |
|
|
2019 |
|
Net sales |
$ |
3,160,603 |
|
|
$ |
3,681,467 |
|
|
$ |
13,695,520 |
|
|
$ |
14,320,324 |
|
|
|
|
|
|
|
|
|
Net income |
295,695 |
|
|
413,738 |
|
|
1,206,703 |
|
|
1,512,931 |
|
Income taxes |
74,873 |
|
|
99,610 |
|
|
305,924 |
|
|
420,494 |
|
Depreciation and
amortization |
146,582 |
|
|
105,388 |
|
|
537,531 |
|
|
436,189 |
|
Interest expense |
74,549 |
|
|
50,072 |
|
|
308,161 |
|
|
190,138 |
|
EBITDA |
591,699 |
|
|
668,808 |
|
|
2,358,319 |
|
|
2,559,752 |
|
Adjustments: |
|
|
|
|
|
|
|
Business realignment charges |
47,601 |
|
|
6,393 |
|
|
75,614 |
|
|
15,677 |
|
Clarcor costs to achieve |
— |
|
|
928 |
|
|
— |
|
|
12,458 |
|
Lord costs to achieve |
2,166 |
|
|
912 |
|
|
20,669 |
|
|
912 |
|
Exotic costs to achieve |
338 |
|
|
— |
|
|
1,908 |
|
|
— |
|
Acquisition-related expenses |
4,437 |
|
|
16,234 |
|
|
188,518 |
|
|
16,234 |
|
Adjusted
EBITDA |
$ |
646,241 |
|
|
$ |
693,275 |
|
|
$ |
2,645,028 |
|
|
$ |
2,605,033 |
|
|
|
|
|
|
|
|
|
EBITDA
margin |
18.7 |
% |
|
18.2 |
% |
|
17.2 |
% |
|
17.9 |
% |
Adjusted EBITDA
margin |
20.4 |
% |
|
18.8 |
% |
|
19.3 |
% |
|
18.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
PARKER
HANNIFIN CORPORATION - JUNE 30, 2020 |
BUSINESS
SEGMENT INFORMATION |
(Unaudited) |
Three Months Ended June 30, |
|
Twelve Months Ended June 30, |
(Dollars in thousands) |
2020 |
|
|
2019 |
|
|
2020 |
|
|
2019 |
|
Net
sales |
|
|
|
|
|
|
|
Diversified Industrial: |
|
|
|
|
|
|
|
North America |
$ |
1,440,263 |
|
|
$ |
1,745,291 |
|
|
$ |
6,456,298 |
|
|
$ |
6,808,948 |
|
International |
1,096,380 |
|
|
1,258,288 |
|
|
4,504,587 |
|
|
5,000,599 |
|
Aerospace Systems |
623,960 |
|
|
677,888 |
|
|
2,734,635 |
|
|
2,510,777 |
|
Total net
sales |
$ |
3,160,603 |
|
|
$ |
3,681,467 |
|
|
$ |
13,695,520 |
|
|
$ |
14,320,324 |
|
Segment operating
income |
|
|
|
|
|
|
|
Diversified Industrial: |
|
|
|
|
|
|
|
North America |
$ |
219,785 |
|
|
$ |
318,175 |
|
|
$ |
985,944 |
|
|
$ |
1,138,586 |
|
International |
175,420 |
|
|
201,004 |
|
|
674,763 |
|
|
804,890 |
|
Aerospace Systems |
105,441 |
|
|
121,650 |
|
|
476,900 |
|
|
487,757 |
|
Total segment
operating income |
500,646 |
|
|
640,829 |
|
|
2,137,607 |
|
|
2,431,233 |
|
Corporate general and
administrative expenses |
37,999 |
|
|
47,977 |
|
|
170,903 |
|
|
194,994 |
|
Income before interest expense
and other expense |
462,647 |
|
|
592,852 |
|
|
1,966,704 |
|
|
2,236,239 |
|
Interest expense |
74,549 |
|
|
50,072 |
|
|
308,161 |
|
|
190,138 |
|
Other expense |
17,530 |
|
|
29,432 |
|
|
145,916 |
|
|
112,676 |
|
Income before income
taxes |
$ |
370,568 |
|
|
$ |
513,348 |
|
|
$ |
1,512,627 |
|
|
$ |
1,933,425 |
|
|
|
|
|
|
|
|
|
PARKER
HANNIFIN CORPORATION - JUNE 30, 2020 |
RECONCILIATION OF TOTAL SEGMENT OPERATING MARGIN TO
ADJUSTED TOTAL SEGMENT OPERATING MARGIN |
|
|
|
|
|
|
|
|
(Unaudited) |
Three Months Ended |
|
Three Months Ended |
(Dollars in thousands) |
June 30, 2020 |
|
June 30, 2019 |
|
Operatingincome |
|
Operatingmargin |
|
|
Operating income |
|
Operatingmargin |
|
Total segment operating income |
$ |
500,646 |
|
15.8 |
% |
|
$ |
640,829 |
|
17.4 |
% |
Adjustments: |
|
|
|
|
|
|
|
Business realignment charges |
46,619 |
|
|
|
6,219 |
|
|
Clarcor costs to achieve |
— |
|
|
|
1,072 |
|
|
Lord costs to achieve |
2,166 |
|
|
|
912 |
|
|
Exotic costs to achieve |
338 |
|
|
|
— |
|
|
Adjusted total segment
operating income |
$ |
549,769 |
|
17.4 |
% |
|
$ |
649,032 |
|
17.6 |
% |
|
|
|
|
|
|
|
|
|
Twelve Months Ended |
|
Twelve Months Ended |
|
June 30, 2020 |
|
June 30, 2019 |
|
Operatingincome |
|
Operatingmargin |
|
|
Operatingincome |
|
Operatingmargin |
|
Total segment
operating income |
$ |
2,137,607 |
|
15.6 |
% |
|
$ |
2,431,233 |
|
17.0 |
% |
Adjustments: |
|
|
|
|
|
|
|
Business realignment charges |
74,389 |
|
|
|
15,503 |
|
|
Clarcor costs to achieve |
— |
|
|
|
12,327 |
|
|
Lord costs to achieve |
20,669 |
|
|
|
912 |
|
|
Exotic costs to achieve |
1,908 |
|
|
|
— |
|
|
Acquisition-related expenses |
69,304 |
|
|
|
— |
|
|
Adjusted total segment
operating income |
$ |
2,303,877 |
|
16.8 |
% |
|
$ |
2,459,975 |
|
17.2 |
% |
|
|
|
|
|
|
|
|
PARKER
HANNIFIN CORPORATION - JUNE 30, 2020 |
CONSOLIDATED BALANCE SHEET |
(Unaudited) |
June 30 |
|
June 30 |
(Dollars in thousands) |
2020 |
|
2019 |
Assets |
|
|
|
Current
assets: |
|
|
|
Cash and cash equivalents |
$ |
685,514 |
|
$ |
3,219,767 |
Marketable securities and
other investments |
70,805 |
|
150,931 |
Trade accounts receivable,
net |
1,854,398 |
|
2,131,054 |
Non-trade and notes
receivable |
244,870 |
|
310,708 |
Inventories |
1,814,631 |
|
1,678,132 |
Prepaid expenses and
other |
214,986 |
|
182,494 |
Total current
assets |
4,885,204 |
|
7,673,086 |
Plant and equipment, net |
2,292,735 |
|
1,768,287 |
Deferred income taxes |
126,839 |
|
150,462 |
Investments and other
assets |
764,563 |
|
747,773 |
Intangible assets, net |
3,798,913 |
|
1,783,277 |
Goodwill |
7,869,935 |
|
5,453,805 |
Total
assets |
$ |
19,738,189 |
|
$ |
17,576,690 |
|
|
|
|
Liabilities and
equity |
|
|
|
Current
liabilities: |
|
|
|
Notes payable and long-term
debt payable within one year |
$ |
809,529 |
|
$ |
587,014 |
Accounts payable, trade |
1,111,759 |
|
1,413,155 |
Accrued payrolls and other
compensation |
424,231 |
|
426,285 |
Accrued domestic and foreign
taxes |
195,314 |
|
167,312 |
Other accrued liabilities |
607,540 |
|
558,007 |
Total current
liabilities |
3,148,373 |
|
3,151,773 |
Long-term debt |
7,652,256 |
|
6,520,831 |
Pensions and other
postretirement benefits |
1,887,414 |
|
1,304,379 |
Deferred income taxes |
382,528 |
|
193,066 |
Other liabilities |
539,089 |
|
438,489 |
Shareholders' equity |
6,113,983 |
|
5,961,969 |
Noncontrolling interests |
14,546 |
|
6,183 |
Total liabilities and
equity |
$ |
19,738,189 |
|
$ |
17,576,690 |
|
|
|
|
|
|
PARKER
HANNIFIN CORPORATION - JUNE 30, 2020 |
CONSOLIDATED STATEMENT OF CASH FLOWS |
(Unaudited) |
Twelve Months Ended June 30, |
(Dollars in thousands) |
2020 |
|
|
2019 |
|
Cash flows from
operating activities: |
|
|
|
Net income |
$ |
1,206,703 |
|
|
$ |
1,512,931 |
|
Depreciation and
amortization |
537,531 |
|
|
436,189 |
|
Stock incentive plan
compensation |
111,375 |
|
|
104,078 |
|
Loss on sale of
businesses |
— |
|
|
5,854 |
|
(Gain) loss on plant and
equipment and intangible assets |
(1,850 |
) |
|
5,091 |
|
(Gain) loss on marketable
securities |
(587 |
) |
|
7,563 |
|
Gain on investments |
(2,084 |
) |
|
(16,749 |
) |
Net change in receivables,
inventories and trade payables |
409,252 |
|
|
(61,762 |
) |
Net change in other assets and
liabilities |
(211,049 |
) |
|
(301,480 |
) |
Other, net |
21,658 |
|
|
38,425 |
|
Net cash provided by
operating activities |
2,070,949 |
|
|
1,730,140 |
|
Cash flows from
investing activities: |
|
|
|
Acquisitions (less acquired
cash of $82,192 in 2020 and $690 in 2019) |
(5,076,064 |
) |
|
(2,042 |
) |
Capital expenditures |
(232,591 |
) |
|
(195,089 |
) |
Proceeds from sale of plant
and equipment |
26,345 |
|
|
46,592 |
|
Proceeds from sale of
businesses |
— |
|
|
19,678 |
|
Purchases of marketable
securities and other investments |
(194,742 |
) |
|
(181,780 |
) |
Maturities and sales of
marketable securities and other investments |
275,483 |
|
|
74,908 |
|
Other |
177,576 |
|
|
19,223 |
|
Net cash used in
investing activities |
(5,023,993 |
) |
|
(218,510 |
) |
Cash flows from
financing activities: |
|
|
|
Net payments for common stock
activity |
(213,426 |
) |
|
(857,577 |
) |
Acquisition of noncontrolling
interests |
(1,200 |
) |
|
— |
|
Net proceeds from debt |
1,117,774 |
|
|
2,172,351 |
|
Dividends paid |
(453,838 |
) |
|
(412,468 |
) |
Net cash provided by
financing activities |
449,310 |
|
|
902,306 |
|
Effect of exchange rate
changes on cash |
(30,519 |
) |
|
(16,306 |
) |
Net (decrease) increase in
cash and cash equivalents |
(2,534,253 |
) |
|
2,397,630 |
|
Cash and cash equivalents at
beginning of period |
3,219,767 |
|
|
822,137 |
|
Cash and cash
equivalents at end of period |
$ |
685,514 |
|
|
$ |
3,219,767 |
|
|
|
|
|
|
|
|
|
RECONCILIATION OF CASH FLOW FROM OPERATIONS TO ADJUSTED
CASH FLOW FROM OPERATIONS |
(Unaudited) |
Twelve Months Ended |
|
Twelve Months Ended |
(Dollars in thousands) |
June 30, 2020 |
|
Percent of sales |
|
June 30, 2019 |
|
Percent of sales |
As reported cash flow from operations |
$ |
2,070,949 |
|
|
15.1 |
% |
|
$ |
1,730,140 |
|
|
12.1 |
% |
Discretionary pension
contribution |
— |
|
|
|
|
200,000 |
|
|
|
Adjusted cash flow
from operations |
$ |
2,070,949 |
|
|
15.1 |
% |
|
$ |
1,930,140 |
|
|
13.5 |
% |
|
|
|
|
|
|
|
|
PARKER
HANNIFIN CORPORATION - JUNE 30, 2020 |
|
RECONCILIATION OF FORECASTED EARNINGS PER DILUTED SHARE TO
ADJUSTED FORECASTED EARNINGS PER DILUTED SHARE |
|
|
(Unaudited) |
|
(Amounts in dollars) |
Fiscal Year 2021 |
Forecasted earnings
per diluted share |
$7.41 to $8.41 |
Adjustments: |
|
Business realignment charges |
0.50 |
Costs to achieve |
0.14 |
Acquisition-related intangible asset amortization expense |
2.46 |
Tax effect of adjustments1 |
(0.71) |
Adjusted forecasted
earnings per diluted share |
$9.80 to $10.80 |
|
|
1This line item
reflects the aggregate tax effect of all non-tax adjustments
reflected in the preceding line items of the table. We estimate the
tax effect of each adjustment item by applying our overall
effective tax rate for continuing operations to the pre-tax amount,
unless the nature of the item and/or the tax jurisdiction in which
the item has been recorded requires application of a specific tax
rate or tax treatment, in which case the tax effect of such item is
estimated by applying such specific tax rate or tax treatment. |
Contact: |
Media
- |
|
|
Aidan Gormley - Director, Global Communications and
Branding |
216-896-3258 |
|
aidan.gormley@parker.com |
|
|
|
|
|
Financial Analysts - |
|
|
Robin J. Davenport, Vice President, Corporate Finance |
216-896-2265 |
|
rjdavenport@parker.com |
|
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