Q2 Highlights
(All comparisons are year-over-year,
unless otherwise noted)
- Revenue up 3% to $1.41 billion;
core revenue excluding European Operations up 3% to $1.34 billion
- Operating income up 23% to $279
million; adjusted segment profit up 22% to $281 million
- GAAP diluted EPS up 23% to $6.10;
adjusted diluted EPS up 22% to $6.15
- Operating cash flow up 101% to $196
million
- Raising 2023 outlook with core revenue up 2% to up 4% and an
EPS range of $15.50 to $16.00
DALLAS, July 27,
2023 /PRNewswire/ -- Lennox (NYSE: LII),
a leader in energy-efficient climate-control solutions, today
reported record second quarter revenue of $1.41 billion. Operating income was a record
$279 million and operating margin was
19.8%. GAAP diluted earnings per share was a record $6.10.
Core revenue, excluding European Operations, grew 3% to
$1.34 billion. Adjusted segment
profit rose 22% to $281
million. Adjusted segment margin was 20.9%, up 320
basis points. Adjusted earnings per share rose 22% to $6.15.
"With record setting results in the second quarter, Lennox once
again demonstrates our team's execution prowess and the benefit of
a focused growth strategy," said Chief Executive Officer
Alok Maskara. "Our commercial growth
and profit recovery has gained momentum as our team successfully
improved manufacturing output to meet robust demand."
"Strong commercial results offset challenging residential end
markets impacted by right sizing of industry inventory levels, post
successful transition to the new minimum efficiency standards."
Maskara continued. "Given our record first half performance, we are
raising our 2023 earnings and cash flow guidance which reflects our
exceptional progress towards delivering our long-term financial
targets."
In the second quarter, Residential segment revenue was down 4%
primarily due to continued distributor destocking. Segment profit
was down 6% as the impact of lower sales volume was partially
offset by favorable pricing and mix. As we start the third quarter,
distributor destocking is decelerating, and we expect the recently
announced price increase to fuel margin recovery even though
factory productivity and output will remain constrained as we
right-size our finished goods inventory levels to improve operating
cash flow.
The Commercial segment delivered exceptional second-quarter
results with revenues up 24% and profits up 150% while maintaining
strong backlog. Last year the commercial segment faced
manufacturing and supply chain challenges that tempered revenue and
delayed pricing actions. This year's significant improvement in
results is driven by improved factory productivity, instituted
pricing actions, and product mix benefits. We expect further
manufacturing improvements in the second half of this year as our
factory output remains below historical levels and our delivery
lead times remain extended.
SECOND QUARTER 2023 FINANCIAL HIGHLIGHTS
(All
comparisons are year-over-year, unless otherwise noted)
Revenue: $1.41 billion; Core revenue, which excludes
our European operations, was $1.34
billion, up 3%. Revenue growth was driven by price and
favorable mix and partially offset by lower sales volumes.
Operating Income: $279 million with operating profit
margin of 19.8%.
Adjusted Segment Profit: $281 million, up 22%, and adjusted
segment profit margin of 20.9%, up 320 basis points. Adjusted
segment profit increased $50 million
as $106 million of price and mix
benefits were partially offset by lower sales volumes and
inflationary impacts on SG&A and distribution costs.
Net Income: $217.2 million, or $6.10 per share, compared to $177.2 million, or $4.96 per share, in the prior year quarter.
Adjusted Net Income: $218.8
million, or $6.15 per share,
compared to $179.6 million, or
$5.03 per share, in the prior year
quarter.
Cash: Operating cash flow was $196
million compared to $97
million in the prior-year quarter. Capital expenditures were
$49 million compared to $21 million in the prior year quarter with the
increase driven by the new Commercial factory investment in
Saltillo, Mexico. Total debt at
the end of the second quarter was approximately $1.6 billion. Total cash, cash equivalents and
short-term investments were $59
million at the end of the quarter.
Residential: Business segment revenue was
$936 million, 4% lower than the prior
year. Segment Profit was $203
million, down 6%, and segment margin was 21.6%, down 50
basis points. Versus prior year, profit decreased $14 million. The decrease was driven
predominately by lower sales volumes of $46
million along with other cost and investment headwinds
totaling $8 million, all partially
offset with $40 million in pricing
and mix benefits.
Commercial: Business segment revenue was
$408 million, up 24%. Segment profit
was $103 million, up 150%, and
segment margin expanded 1,270 basis points to 25.3%. Segment
profit increased $62 million compared
to prior year, driven by $66 million
of pricing and mix benefits and $3
million generated by higher sales volumes. Inflationary
impacts on materials and production costs partially offset these
gains.
Corporate and Other: Revenue in the European
Refrigeration operations was $67.7
million, up 10%. European operations had $2.4 million in profit compared to a $0.6 million loss in the prior year
quarter. Corporate expenses were $25
million, or down $2 million
compared to the prior year quarter.
As previously announced, beginning in 2023 our North American
Refrigeration operations are reported in the Commercial Segment and
European operations are classified as non-core and included in the
Corporate and Other Segment until disposition.
FULL-YEAR 2023 GUIDANCE
For the full year of 2023, we
now expect core revenue to be up 2% to up 4% (previous: flat to up
4%) and we expect earnings per share of $15.50 to $16.00
(previous: $14.25 to $15.25).
Based on our record first half performance and confidence in our
outlook for the balance of the year, we are updating our free cash
flow outlook to include operating cash flow of $550 million to $600
million and capital expenditures of approximately
$250 million.
"Our primary focus remains on self-help operational excellence
which includes prioritizing pricing excellence and increasing
commercial production output, while normalizing inventory levels to
further improve cash flow. Looking ahead, we are excited to build
on the current momentum to meet or exceed our long-range targets,"
Maskara concluded.
CONFERENCE CALL INFORMATION
A conference call to
discuss the company's second-quarter results and 2023 outlook will
be held this morning at 8:30 a.m. Central
Time. To participate in the earnings conference, please call
800-274-8461 (U.S.) or +1 203-518-9765 (international) at least 10
minutes prior to the scheduled start time and use conference ID
LIIQ223. The conference call also will be webcast live on the
company's investor relations web site at www.investor.lennox.com. A
replay of the conference call will be available until August 10, 2023, by calling toll-free
800-925-9354 (U.S.) or +1 402-220-5384 (international). The call
will also be archived on the company's web site.
ABOUT LENNOX
Lennox (NYSE: LII) is a leader in
energy-efficient climate-control solutions. Dedicated to
sustainability and creating comfortable and healthier environments
for our residential and commercial customers while reducing their
carbon footprint, we lead the field in innovation with our cooling,
heating, indoor air quality, and refrigeration systems. Additional
information on Lennox is available at www.investor.lennox.com or by
contacting investor@lennoxintl.com.
FORWARD-LOOKING STATEMENTS & NON-GAAP FINANCIAL
MEASURES
The statements in this document that are not
historical statements, including statements regarding the 2023
full-year outlook and expected consolidated and segment financial
results, as well as financial targets for future years, are
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. These forward-looking
statements are based on information currently available as well as
management's assumptions and beliefs today. These statements are
subject to numerous risks and uncertainties that could cause actual
results to differ materially from the results expressed or implied
by the statements, and investors should not place undue reliance on
them. Risks and uncertainties that could cause actual results to
differ materially from such statements include risks that the North
American unitary HVAC and refrigeration markets perform worse than
current assumptions. Additional risks include but are not limited
to the impact of higher raw material prices, availability and
timely delivery of raw materials and other components, competition
in the HVACR business, ability to meet customer demand, the impact
of new or increased trade tariffs, LII's ability to successfully
execute its business strategy including implementing price
increases for its products and services, economic conditions in our
markets, regulatory changes, the impact of unfavorable weather, and
a decline in new construction activity and related demand for
products and services. For information concerning these and other
risks and uncertainties, see LII's publicly available filings with
the Securities and Exchange Commission. LII disclaims any intention
or obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise,
except as required by law.
A reconciliation of non-GAAP financial measures appearing in
this document to financial measures prepared in accordance with
U.S. Generally Accepted Accounting Principles (GAAP) are included
in the Annex to this document.
This document includes forward-looking statements regarding core
revenue, segment profit, adjusted segment profit, adjusted net
income, adjusted earnings per share and free cash flow which are
non-GAAP financial measures. These non-GAAP financial measures are
derived by excluding certain amounts from the corresponding
financial measures determined in accordance with GAAP. The
determination of the amounts excluded is a matter of management
judgment and depends upon, among other factors, the nature of the
underlying expense or income amounts recognized in a given period
and the high variability of certain amounts, such as unusual gains
and losses, the ultimate outcome of pending litigation,
fluctuations in foreign currency exchange rates, changes in
environmental liabilities, the impact and timing of potential
acquisitions and divestitures, future restructuring costs, and
other structural changes or their probable significance. Core
revenue excludes net sales from our European portfolio, which we
plan to divest. We are unable to present a quantitative
reconciliation of the aforementioned forward-looking non-GAAP
financial measures to their most directly comparable
forward-looking GAAP financial measures because such information is
not available, and management cannot reliably predict the necessary
components of such GAAP measures without unreasonable effort or
expense. The unavailable information could have a significant
impact on LII's full year GAAP financial results.
LENNOX INTERNATIONAL
INC. AND SUBSIDIARIES
Consolidated
Statements of Operations
(Unaudited)
|
(Amounts in millions, except per share
data)
|
For the Three Months Ended
June 30,
|
|
For the Six Months Ended
June 30,
|
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Net sales
|
$
1,411.4
|
|
$
1,366.3
|
|
$
2,460.7
|
|
$
2,379.7
|
Cost of goods
sold
|
953.6
|
|
969.2
|
|
1,696.2
|
|
1,714.4
|
Gross
profit
|
457.8
|
|
397.1
|
|
764.5
|
|
665.3
|
Operating Expenses:
|
|
|
|
|
|
|
|
Selling, general and
administrative expenses
|
181.3
|
|
169.6
|
|
348.8
|
|
324.9
|
Losses (gains) and
other expenses, net
|
0.8
|
|
1.6
|
|
1.1
|
|
2.0
|
Restructuring
charges
|
—
|
|
0.5
|
|
—
|
|
1.0
|
Income from equity
method investments
|
(3.1)
|
|
(1.5)
|
|
(3.8)
|
|
(1.4)
|
Operating income
|
278.8
|
|
226.9
|
|
418.4
|
|
338.8
|
Pension
settlements
|
0.1
|
|
0.2
|
|
0.3
|
|
0.3
|
Interest expense,
net
|
15.0
|
|
8.7
|
|
29.2
|
|
15.6
|
Other expense (income),
net
|
—
|
|
0.7
|
|
—
|
|
1.2
|
Net income before
income taxes
|
263.7
|
|
217.3
|
|
388.9
|
|
321.7
|
Provision for income
taxes
|
46.5
|
|
40.1
|
|
73.7
|
|
60.9
|
Net income
|
$
217.2
|
|
$
177.2
|
|
$
315.2
|
|
$
260.8
|
|
|
|
|
|
|
|
|
Earnings per share – Basic:
|
$
6.12
|
|
$
4.97
|
|
$
8.88
|
|
$
7.25
|
|
|
|
|
|
|
|
|
Earnings per share –
Diluted:
|
$
6.10
|
|
$
4.96
|
|
$
8.85
|
|
$
7.23
|
|
|
|
|
|
|
|
|
Weighted Average Number of Shares Outstanding -
Basic
|
35.5
|
|
35.6
|
|
35.5
|
|
36.0
|
Weighted Average Number of Shares Outstanding -
Diluted
|
35.6
|
|
35.7
|
|
35.6
|
|
36.1
|
LENNOX INTERNATIONAL
INC. AND SUBSIDIARIES
Segment Net Sales
and Profit (Loss)
(Unaudited)
|
|
(Amounts in millions)
|
For the Three Months
Ended June 30,
|
|
For the Six Months
Ended June 30,
|
|
|
|
2023
|
|
2022(2)
|
|
2023
|
|
2022(2)
|
Net Sales
|
|
|
|
|
|
|
|
Residential
|
$ 936.2
|
|
$ 977.5
|
|
$
1,617.2
|
|
$
1,659.6
|
Commercial
(2)
|
407.5
|
|
327.4
|
|
716.1
|
|
606.9
|
Corporate and
other (2)
|
67.7
|
|
61.4
|
|
127.4
|
|
113.2
|
|
$
1,411.4
|
|
$
1,366.3
|
|
$
2,460.7
|
|
$
2,379.7
|
Segment Profit (Loss)
(1)
|
|
|
|
|
|
|
|
Residential
|
$ 202.6
|
|
$ 216.3
|
|
$ 313.7
|
|
$ 324.0
|
Commercial
(2)
|
103.0
|
|
41.2
|
|
153.0
|
|
64.9
|
Corporate and
other (2)
|
(22.5)
|
|
(27.7)
|
|
(41.9)
|
|
(44.5)
|
Total segment
profit
|
283.1
|
|
229.8
|
|
424.8
|
|
344.4
|
Reconciliation to Operating
income:
|
|
|
|
|
|
|
|
Items in Losses (gains)
and other expenses, net which are excluded from
segment profit (loss) (1)
|
4.3
|
|
$
2.4
|
|
6.4
|
|
4.6
|
Restructuring
charges
|
—
|
|
0.5
|
|
—
|
|
1.0
|
Operating income
|
$
278.8
|
|
$
226.9
|
|
$
418.4
|
|
$
338.8
|
|
|
(1)
|
We define segment
profit (loss) as a segment's operating income included in the
accompanying Consolidated Statements of Operations,
excluding:
|
|
• The following items in
Losses (gains) and other expenses, net:
|
|
• Net
change in unrealized losses (gains) on unsettled futures
contracts,
|
|
• Environmental
liabilities and special litigation charges, and
|
|
• Other
items, net,
|
|
• Restructuring
charges.
|
(2)
|
Previously, we operated
in three reportable business segments. In November 2022, we
announced the decision to explore strategic alternatives for our
European portfolio and that we would continue to invest in our
Heatcraft Worldwide Refrigeration business, all of which were
previously in our Refrigeration segment. On January 1, 2023,
we adjusted our segment presentation to better align with how the
segments are managed and evaluated after the change in
portfolio. Heatcraft Worldwide Refrigeration is now part of
the Commercial segment while the European portfolio is presented
with Corporate and Other until disposition. Amounts presented in
this table have been recast to reflect the revised segment
presentation.
|
LENNOX INTERNATIONAL
INC. AND SUBSIDIARIES
Consolidated Balance
Sheets
(Unaudited)
|
|
|
(Amounts in millions, except shares and par
values)
|
As of June 30, 2023
|
|
As of December 31, 2022
|
ASSETS
|
(Unaudited)
|
|
|
Current Assets:
|
|
|
|
Cash and cash
equivalents
|
$
51.4
|
|
$
52.6
|
Short-term
investments
|
7.2
|
|
8.5
|
Accounts and notes
receivable, net of allowances of $17.0 and $15.5 in
2023 and 2022, respectively
|
843.6
|
|
608.5
|
Inventories,
net
|
856.0
|
|
753.0
|
Other
assets
|
68.6
|
|
73.9
|
Total current
assets
|
1,826.8
|
|
1,496.5
|
Property, plant and
equipment, net of accumulated depreciation of $953.4
and $920.8 in 2023 and 2022, respectively
|
608.5
|
|
548.9
|
Right-of-use assets
from operating leases
|
214.2
|
|
219.9
|
Goodwill
|
186.4
|
|
186.3
|
Deferred income
taxes
|
46.3
|
|
27.5
|
Other assets,
net
|
99.1
|
|
88.5
|
Total assets
|
$
2,981.3
|
|
$
2,567.6
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY
(DEFICIT)
|
|
|
|
Current Liabilities:
|
|
|
|
Current maturities of
long-term debt
|
$
761.3
|
|
$
710.6
|
Current operating
lease liabilities
|
63.2
|
|
63.3
|
Accounts
payable
|
470.1
|
|
427.3
|
Accrued
expenses
|
425.5
|
|
376.9
|
Income taxes
payable
|
21.8
|
|
17.6
|
Total current
liabilities
|
1,741.9
|
|
1,595.7
|
Long-term
debt
|
817.7
|
|
814.2
|
Long-term operating
lease liabilities
|
159.6
|
|
161.8
|
Pensions
|
39.6
|
|
40.1
|
Other
liabilities
|
159.9
|
|
158.9
|
Total liabilities
|
2,918.7
|
|
2,770.7
|
Commitments and
contingencies
|
|
|
|
Stockholders' equity
(deficit):
|
|
|
|
Preferred stock, $0.01
par value, 25,000,000 shares authorized, no shares
issued or outstanding
|
—
|
|
—
|
Common stock, $0.01
par value, 200,000,000 shares authorized,
87,170,197 shares issued
|
0.9
|
|
0.9
|
Additional paid-in
capital
|
1,169.3
|
|
1,155.2
|
Retained
earnings
|
3,309.0
|
|
3,070.6
|
Accumulated other
comprehensive loss
|
(75.8)
|
|
(90.6)
|
Treasury stock, at
cost, 51,658,951 shares and 51,700,260 shares for
2023 and 2022, respectively
|
(4,340.8)
|
|
(4,339.2)
|
Total stockholders' equity
(deficit)
|
62.6
|
|
(203.1)
|
Total liabilities and stockholders' equity
(deficit)
|
$
2,981.3
|
|
$
2,567.6
|
LENNOX INTERNATIONAL
INC. AND SUBSIDIARIES
Consolidated
Statements of Cash Flows
(Unaudited)
|
|
(Amounts in millions)
|
For the Six Months Ended
June 30,
|
|
2023
|
|
2022
|
Cash flows from operating
activities:
|
|
|
|
Net income
|
$
315.2
|
|
$
260.8
|
Adjustments to
reconcile net income to net cash provided by (used in) operating
activities:
|
|
|
|
Income from equity
method investments
|
(3.8)
|
|
(1.4)
|
Restructuring charges,
net of cash paid
|
—
|
|
0.5
|
Provision for credit
losses
|
3.8
|
|
2.7
|
Unrealized losses, net
on derivative contracts
|
3.9
|
|
2.0
|
Stock-based
compensation expense
|
13.8
|
|
10.6
|
Depreciation and
amortization
|
40.5
|
|
37.8
|
Deferred income
taxes
|
(18.9)
|
|
(11.6)
|
Pension
expense
|
1.4
|
|
3.5
|
Pension
contributions
|
(2.0)
|
|
(0.5)
|
Other items,
net
|
(1.2)
|
|
(0.9)
|
Changes in assets and
liabilities:
|
|
|
|
Accounts and notes
receivable
|
(236.5)
|
|
(281.6)
|
Inventories
|
(100.4)
|
|
(187.3)
|
Other current
assets
|
8.7
|
|
1.2
|
Accounts
payable
|
45.4
|
|
93.7
|
Accrued
expenses
|
45.6
|
|
14.8
|
Income taxes payable
and receivable, net
|
4.1
|
|
39.4
|
Leases,
net
|
3.3
|
|
0.9
|
Other, net
|
(6.2)
|
|
14.6
|
Net cash provided by (used in) operating
activities
|
116.7
|
|
(0.8)
|
Cash flows from investing
activities:
|
|
|
|
Proceeds from the
disposal of property, plant and equipment
|
1.5
|
|
0.5
|
Purchases of property,
plant and equipment
|
(85.3)
|
|
(46.7)
|
Proceeds from
short-term investments, net
|
1.5
|
|
—
|
Net cash used in investing
activities
|
(82.3)
|
|
(46.2)
|
Cash flows from financing
activities:
|
|
|
|
Asset securitization
borrowings
|
140.0
|
|
211.0
|
Asset securitization
payments
|
(90.0)
|
|
(61.0)
|
Long-term debt
payments
|
(7.3)
|
|
(6.4)
|
Borrowings from credit
facility
|
1,182.0
|
|
1,331.0
|
Payments on credit
facility
|
(1,182.0)
|
|
(1,029.0)
|
Proceeds from employee
stock purchases
|
1.9
|
|
1.8
|
Repurchases of common
stock
|
—
|
|
(300.0)
|
Repurchases of common
stock to satisfy employee withholding tax obligations
|
(3.2)
|
|
(5.1)
|
Cash dividends
paid
|
(75.2)
|
|
(66.9)
|
Net cash (used in) provided by financing
activities
|
(33.8)
|
|
75.4
|
Increase in cash and
cash equivalents
|
0.6
|
|
28.4
|
Effect of exchange
rates on cash and cash equivalents
|
(1.8)
|
|
(2.0)
|
Cash and cash
equivalents, beginning of period
|
52.6
|
|
31.0
|
Cash and cash equivalents, end of
period
|
$
51.4
|
|
$
57.4
|
|
|
|
|
Supplemental disclosures of cash flow
information:
|
|
|
|
Interest
paid
|
$
27.1
|
|
$
14.2
|
Income taxes paid (net
of refunds)
|
$
88.4
|
|
$
32.9
|
LENNOX INTERNATIONAL INC. AND
SUBSIDIARIES
|
Reconciliation to U.S. GAAP (Generally Accepted
Accounting Principles) Measures
|
(Unaudited, in millions, except per share and ratio
data)
|
Use of Non-GAAP Financial
Measures
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
To supplement the
Company's consolidated financial statements and segment net sales
and profit (loss) presented in accordance with U.S. GAAP,
additional non-GAAP financial measures are provided and reconciled
in the following tables. In addition to these non-GAAP
measures, the Company also provides rates of revenue change at
constant currency on a consolidated and segment basis if different
than the reported measures. The Company believes that these
non-GAAP financial measures, when considered together with the GAAP
financial measures, provide information that is useful to investors
in understanding period-over-period operating results and enhance
the ability of investors to analyze the Company's business trends
and operating performance.
In November 2022, we
announced the decision to explore strategic alternatives for our
European portfolio. The results from operations for these
businesses have been shown in the tables below as "Non-Core
business results." The prior period results have been updated to
provide period-over-period comparability.
|
|
Reconciliation of Net income, a GAAP measure, to
Adjusted Net income, a Non-GAAP measure
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended June
30,
|
|
For the Six Months Ended June
30,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
Amount
after tax
|
Per
Diluted Share
|
|
Amount after tax
|
Per
Diluted Share
|
|
Amount
after tax
|
Per
Diluted Share
|
|
Amount
after tax
|
Per
Diluted Share
|
Net income, a GAAP measure
|
$ 217.2
|
$
6.10
|
|
$ 177.2
|
$
4.96
|
|
$ 315.2
|
$
8.85
|
|
$ 260.8
|
$
7.23
|
Restructuring
charges
|
—
|
—
|
|
0.4
|
0.01
|
|
—
|
—
|
|
0.8
|
0.02
|
Pension
settlements
|
0.1
|
—
|
|
0.1
|
—
|
|
0.3
|
0.01
|
|
0.2
|
0.01
|
Items in Losses
(gains) and other expenses, net which are excluded from segment
profit (loss) (a)
|
2.9
|
0.09
|
|
2.0
|
0.06
|
|
3.5
|
0.10
|
|
3.7
|
0.10
|
Excess tax (benefit)
expense from share-based compensation (b)
|
(0.1)
|
—
|
|
0.1
|
—
|
|
(0.1)
|
—
|
|
0.5
|
0.01
|
Other tax items, net
(b)
|
0.1
|
—
|
|
(1.4)
|
(0.03)
|
|
0.4
|
0.01
|
|
(1.4)
|
(0.04)
|
Non-core business
results (c)
|
(1.4)
|
(0.04)
|
|
1.2
|
0.03
|
|
—
|
—
|
|
4.9
|
0.14
|
Adjusted net income, a non-GAAP
measure
|
$ 218.8
|
$
6.15
|
|
$ 179.6
|
$
5.03
|
|
$ 319.3
|
$
8.97
|
|
$ 269.5
|
$
7.47
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Recorded in Losses
(gains) and other expenses, net in the Consolidated Statements of
Operations
|
|
|
|
|
|
|
|
(b) Recorded in
Provision for income taxes in the Consolidated Statements of
Operations
|
|
|
|
|
|
|
|
(c) Non-core business
results represent activity related to our business operations in
Europe not included elsewhere in the reconciliations
|
|
|
|
|
|
|
|
Reconciliation of Average Shares Outstanding -
Diluted, a GAAP measure, to Adjusted Average Shares Outstanding -
Diluted, a Non-GAAP
measure (shares in millions):
|
|
|
For the Three Months
Ended June 30,
|
|
For the Six Months
Ended June 30,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Average shares outstanding - diluted, a GAAP
measure
|
35.6
|
|
35.7
|
|
35.6
|
|
36.1
|
Impact on diluted
shares from excess tax benefits from share-based
compensation
|
—
|
|
—
|
|
—
|
|
—
|
Adjusted average shares outstanding - diluted, a
Non-GAAP measure
|
35.6
|
|
35.7
|
|
35.6
|
|
36.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Cash Provided by (Used in) Operating Activities,
a GAAP measure, to Free Cash Flow, a Non-GAAP measure (dollars in
millions)
|
|
|
For the Three Months
Ended June 30,
|
|
For the Six Months
Ended June 30,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Net cash provided by (used in) operating
activities
|
$
195.5
|
|
$
97.1
|
|
$
116.7
|
|
$
(0.8)
|
Purchases of property,
plant and equipment
|
(49.9)
|
|
(20.9)
|
|
(85.3)
|
|
(46.7)
|
Proceeds from the
disposal of property, plant and equipment
|
1.2
|
|
0.2
|
|
1.5
|
|
0.5
|
Free cash flow, a Non-GAAP
measure
|
$
146.8
|
|
$
76.4
|
|
$
32.9
|
|
$
(47.0)
|
Reconciliation of Net sales, a GAAP measure to Core
net sales, a Non-GAAP measure
|
|
For the Three Months Ended June
30,
|
|
Corporate and other
|
|
Consolidated
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Net sales, a GAAP
measure
|
$
67.7
|
|
$
61.4
|
|
$
1,411.4
|
|
$
1,366.3
|
Net sales from non-core
businesses (a)
|
(67.7)
|
|
(61.4)
|
|
(67.7)
|
|
(61.4)
|
Core net sales, a
Non-GAAP measure
|
$
—
|
|
$
—
|
|
$
1,343.7
|
|
$
1,304.9
|
|
|
|
|
|
|
|
|
(a) Non-Core businesses
represent our business operations in Europe
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Six Months Ended June
30,
|
|
Corporate and other
|
|
Consolidated
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Net sales, a GAAP
measure
|
$
127.4
|
|
$
113.2
|
|
$
2,460.7
|
|
$
2,379.7
|
Net sales from non-core
businesses (a)
|
(127.4)
|
|
(113.2)
|
|
(127.4)
|
|
(113.2)
|
Core net sales, a
Non-GAAP measure
|
$
—
|
|
$
—
|
|
$
2,333.3
|
|
$
2,266.5
|
|
|
|
|
|
|
|
|
(a) Non-Core businesses
represent our business operations in Europe
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Segment profit (loss), a Non-GAAP
measure to Adjusted Segment profit (loss), a Non-GAAP
measure
|
|
|
For the Three Months Ended June
30,
|
|
Corporate and other
|
|
Consolidated
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Segment profit (loss),
a Non-GAAP measure
|
$
(22.5)
|
|
$
(27.7)
|
|
$
283.1
|
|
$
229.8
|
Profit (loss) from
non-core businesses (a)
|
2.4
|
|
(0.6)
|
|
2.4
|
|
(0.6)
|
Adjusted Segment profit
(loss), a Non-GAAP measure
|
$
(24.9)
|
|
$
(27.1)
|
|
$
280.7
|
|
$
230.4
|
|
|
|
|
|
|
|
|
(a) Non-Core businesses
represent our business operations in Europe
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Six Months Ended June
30,
|
|
Corporate and other
|
|
Consolidated
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Segment profit (loss),
a Non-GAAP measure
|
$
(41.9)
|
|
$
(44.5)
|
|
$
424.8
|
|
$
344.4
|
Profit (loss) from
non-core businesses (a)
|
2.1
|
|
(4.0)
|
|
2.1
|
|
(4.0)
|
Adjusted Segment profit
(loss), a Non-GAAP measure
|
$
(44.0)
|
|
$
(40.5)
|
|
$
422.7
|
|
$
348.4
|
|
|
|
|
|
|
|
|
(a) Non-Core businesses
represent our business operations in Europe
|
|
|
|
|
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SOURCE Lennox International Inc.