Chart Industries, Inc. (NYSE: GTLS) today reported results for the
second quarter ended June 30, 2024. Results shown are from
continuing operations. When referring to any comparative period,
all metrics are pro forma for continuing operations of the combined
business of Chart and Howden (pro forma excludes the following
businesses that were divested in 2023: Roots™, American Fan,
Cofimco and Cryo Diffusion). The second quarter 2024 is the first
year-over-year quarter that includes the full impact of the Howden
acquisition which closed on March 17, 2023.
Second quarter 2024 highlights compared
to second quarter 2023, pro forma:
- All-time record reported sales, backlog, gross profit, gross
margin, reported and adjusted operating income and margin, reported
and adjusted EBITDA and EBITDA margin
- Orders of $1.16 billion, an increase of 12.1% and an increase
of approximately 40% excluding Big LNG
- Record sales of $1.04 billion, an increase of 18.8%; growth of
19.7% when eliminating foreign exchange headwind of (0.9%)
- Record reported gross margin of 33.8%, an increase of 310 basis
points (“bps”)
- Record reported operating income of $167.8 million (16.1% of
sales) and record adjusted operating income of $225.7 million
(21.7% of sales), when adjusted for unusual items primarily related
to the Howden integration and the consolidation and restructure of
our Asia Pacific region into our Middle East and Africa region (now
“AIMA”), increased 53.1%
- Record reported EBITDA of $229.6 million (record 22.1% of
sales) and record adjusted EBITDA of $257.3 million (record 24.7%
of sales) when adjusting for items referenced above, an increase of
37.2%
- Reported diluted earnings per share (“EPS”) of $1.10; adjusted
diluted EPS of $2.18 includes the ($0.14) negative impact of the
mandatory preferred dividend (this was not included in prior
periods nor was it included in our prior full year adjusted diluted
EPS outlook), and ($0.04) of negative FX impact.
- Net leverage ratio of 3.26, a reduction of 0.82 since the close
of the Howden acquisition
- Reported net cash from operating activities of $116.1 million
less capital expenditures of $28.1 million resulted in $88.0
million of free cash flow (“FCF”) (when excluding long-term, beyond
one year, balance sheet account changes this would be $114.7
million which compares to our $175 million Q2 2024 outlook)
- Our record and growing financial metrics year-over-year and
quarter-over-quarter have put us well on the way to our reiterated
medium-term financial targets
“With record sales growth of 18.8%, record gross
margin of 33.8%, record reported operating income, record reported
operating margin, record EBITDA, and associated EBITDA margin, w.
are on the path to our reiterated three-year medium-term targets of
mid-teen organic sales CAGR, reported gross margin in the mid-30%’s
and our target net leverage ratio range of 2.0 to 2.5,” stated Jill
Evanko, Chart’s CEO and President. “I would like to thank our One
Chart team members who delivered these exceptional results safely,
achieving our lowest quarterly total recordable incident rate in
our history of 0.42 and nearing the $1 billion mark in commercial
synergies between Chart and Howden.”
Second Quarter 2024 Summary
Second quarter 2024 sales of $1.04 billion were
an all-time record in our pro forma history and included record
sales in both the Specialty Products and Repair, Service and
Leasing (“RSL”) segments. Second quarter 2024 sales increased 18.8%
(19.7% if eliminating the foreign exchange headwind) when compared
to the second quarter 2023 as we continue to deliver on our record
backlog of $4.4 billion. Second quarter 2024 sales also increased
9.4% sequentially when compared to the first quarter of 2024. Each
segment’s and each region’s sales grew when compared to the second
quarter 2023, with RSL growing 26.2% and Specialty Products growing
20.8%. RSL also grew 19.8% sequentially when compared to the first
quarter 2024 and comprised 34.7% of our total sales in the
quarter.
Demand continues broad-based across our end
markets and regions, with second quarter 2024 orders of $1.16
billion, an increase of 12.1% when compared to the second quarter
2023. Excluding Big LNG orders (of which there were none in the
second quarter 2024 and one in the second quarter 2023), orders
increased approximately 40% compared to the second quarter 2023.
The second quarter 2024 had record orders in our Specialty Products
segment including record orders for carbon capture (“CCUS”),
metals, mining, water treatment and strong, globally diverse
hydrogen and helium awards ranging from compressors for a green
power application, liquefaction, fueling stations, vacuum jacketed
pipe, and offloading equipment.
Third quarter 2024 order activity has started
strong. RSL had a stronger than typical July 2024, including the
receipt of a $10.5 million order for Power Africa power station
spares, and further orders from this customer totaling over $25
million are also expected to be awarded in the second half 2024. We
received an order for approximately $27 million for a significant
petrochemical project in the Asia Pacific region where we will
supply high-pressure vessels, gas coolers, and waste heat boilers.
Space exploration orders in July 2024 were approximately $19
million. Airbus has awarded us a contract to fabricate a liquid
hydrogen inner vessel sub system to integrate into an Airbus ZEROe
physical demonstrator programme. The vessel will be used to test
and prove the viability of LH2 fueled aircraft designs, processes,
fuel, materials and equipment on the ground. This week, we signed a
Memorandum of Understanding (“MOU”) with Verdagy where both parties
will collaborate on hydrogen compression solutions to enhance
Verdagy’s green hydrogen product offering.
LNG activity continues globally, including a
conscious move of LNG operators to more modular solutions,
specifically benefitting our IPSMR® process technology. This is
evidenced by more customers notifying us of their selection to
utilize our IPSMR® technology as well as our expanded Big LNG
commercial pipeline of 32 potential projects (an increase from 30
last quarter) with 16 potential international projects considering
using IPSMR® (an increase from 15 last quarter). We announced our
liquefaction technology and equipment was chosen for Argent’s Port
Fourchon anticipated 20 MTPA project (not yet booked into backlog).
In LNG infrastructure, we booked our largest ever order for our
Decin, Czech Republic facility for an LNG regas solution. LNG
trailer orders in China continued their momentum in the first half
of 2024, totaling 80 sold through June 30, 2024 year-to-date (103
as of July 29, 2024 year-to-date); this compares to 25 for the full
year 2023 and 15 for the full year 2022. HLNG vehicle tank orders
were over $10 million in both the first and the second quarter
2024, with year-to-date orders as of the end of the second quarter
2024 exceeding the full year 2023 HLNG vehicle tank orders (and
July 2024 added another $4.7 million of HLNG vehicle tank orders).
Our service and retrofit offering, particularly our Tuf-Lite IV
fans, which have a uniquely designed backward sweep characteristic
that offers improved efficiency and resiliency, continue to gain
traction, as we booked orders in the second quarter 2024 for two
separate U.S. LNG export facility customers to utilize these fans
in their terminals. We are proud to support Cheniere’s
debottlenecking efforts with our Tuf-Lite IV fans at both their
Sabine Pass and Corpus Christi locations.
Artificial intelligence (“AI”) and in turn, more
and larger data centers are driving an increasing need for
batteries, cooling and storage in an energy intensive environment.
Data centers could consume 9% of the United States’ electricity
generation by 2030 — double the amount consumed today, according to
a study released in July 2024 by the Electric Power Research
Institute. This trend positively impacts us, and in the second
quarter 2024 we received an approximately $40 million award from a
data center provider for a specific, uniquely designed air-cooled
heat exchanger for heat rejection. The data center and AI
opportunity for us specifically based on 3 Gigawatts of data center
addition per year is approximately $500 million, and as it expands
to heavy industrial cooling, where our blowers, heat exchangers,
and compressors play, this adds an additional incremental $600 to
$800 million of addressable market per year.
Our commercial pipeline of opportunities for the
next three years is at an all-time high, over $23 billion, and
includes over $5 billion of hydrogen-related opportunities
(approximately 35% of which are for the Americas, remainder for
rest of the world).
Reported gross margin of 33.8% was our highest
in pro forma history. This represents an increase of 310 bps from
the second quarter 2023 and a sequential increase in gross margin
of 200 bps compared to the first quarter 2024.
This strong gross margin for the second quarter
2024 contributed to record reported operating income of $167.8
million resulting in record reported operating margin of 16.1% and
when adjusted for one-time and unusual items, specifically Howden
integration and the consolidation of our APAC/India region into our
Africa/Middle East region, resulted in a record adjusted operating
income of $225.7 million and record adjusted operating margin of
21.7%. This contributed to our record EBITDA of $229.6 million
(22.1% of sales), and adjusted EBITDA of $257.3 million (24.7% of
sales).
Second quarter 2024 segment results (as
compared to the second quarter 2023, pro forma continuing
operations unless noted otherwise).
Cryo Tank Solutions (“CTS”):
Second quarter 2024 CTS orders of $159.0 million increased 4.5%
when compared to the second quarter 2023. Second quarter 2024 sales
of $165.5 million increased 12.4% when compared to the second
quarter 2023. Reported gross profit margin of 20.2% increased 170
bps compared to the second quarter 2023.
Heat Transfer Systems (“HTS”):
Second quarter 2024 HTS orders of $269.6 million decreased 9.4%
when compared to the second quarter 2023. When excluding the one
Big LNG project award in the second quarter 2023, HTS orders grew
over 300%. This increase was driven in part by our air cooler data
center award and a small-scale LNG award in South America. Second
quarter 2024 HTS sales of $236.7 million grew 3.4% compared to the
second quarter 2023 and had associated reported gross profit margin
of 25.7%, a 280 bps decrease compared to the second quarter 2023.
This decrease resulted from certain lower margin projects that were
completed and are no longer in our backlog.
Specialty Products (“SPC”):
Second quarter 2024 Specialty Products orders of $423.7 million
increased 48.4% when compared to the second quarter 2023. Second
quarter 2024 Specialty Products sales of $277.6 million were an
all-time high for the segment and increased 20.8% when compared to
the second quarter 2023 driven by increasing throughput, the start
of production at our new facility in Theodore, Alabama (“Teddy 2”),
and timing of larger projects in backlog. Reported gross profit
margin of 29.1% increased 430 basis points when compared to the
second quarter 2023 and 420 basis points sequentially when compared
to the first quarter 2024. As previously shared, we forecast
Specialty Products sales mix to be a tailwind in 2024 relative to
2023, and the second quarter 2024 was a positive indicator of this
trend.
Repair, Service and Leasing
(“RSL”): Second quarter 2024 RSL orders of $312.4 million
increased 0.5% when compared to the second quarter 2023, which
included a South African Air Heater Element pack for $17.2 million
and approximately $19 million of orders related to two large APAC
aftermarket projects. Second quarter 2024 sales of $360.5 million
were a historical record, and grew 26.2%. Reported RSL gross profit
margin of 49.0% was a record driven by strong field service work
which commanded higher margins. This level of gross margin for RSL
is not consistently typical; as a reference, gross profit as a
percent of sales in RSL has been at or above 43% each quarter since
we closed on the Howden acquisition (RSL margins have been on
average 200 bps higher than RSL pro forma pre-acquisition, driven
by cost and commercial synergies). As of June 30, 2024, our assets
under management metric (Uptime, Framework agreements, LTSAs) has
grown 27.0% since year-end 2023.
Commercial synergies to date have far
exceeded year-three’s (2026) target of $350 million; cost synergies
to date are on track to be ahead of year-three (2026) target of
$250 million before year-end 2024.
Commercial synergies of $924 million to date far
exceeded year-three’s target of $350 million. Cost synergies of
$223 million to date are on track to be ahead of year-three (2026)
target before year-end 2024. In the second quarter 2024, we
executed a consolidation of two of our regional organization
structures as part of further integration of Howden into Chart.
Sourcing savings are ahead of schedule year-to-date 2024, with more
expected in the second half 2024. Going forward we are accelerating
the localization of products utilizing our global footprint. Within
the third quarter 2024 we will complete the manufacture of the
first Earthly Labs unit in Germany further expanding our European
market opportunities for this product line.
Reiterating our target net leverage
ratio of 2.0 to 2.5.
Reported net cash from operating activities of
$116.1 million less capital expenditures of $28.1 million resulted
in $88.0 million of free cash flow (“FCF”) (when excluding
long-term, beyond one year, balance sheet account changes this
would be $114.7 million which compares to our $175 million second
quarter 2024 outlook). Our June 30, 2024 net leverage ratio was
3.26, as we continue to focus on executing to achieve our target
net leverage ratio range of 2.0 to 2.5.
Our margins are strong, capital spending is
anticipated to be related to our normal recurring capital spend as
our significant capacity expansions complete, and working capital
metrics continue to improve as a percent of revenue. As we had
previously shared on our first quarter 2024 earnings call, we
expected over $125 million of milestone payments in the second
quarter 2024 for our top four projects and we collected all of
that. In the second quarter 2024, our management of accounts
receivable, accounts payable and inventory generated positive cash
flows. The difference from our prior second quarter 2024 FCF
outlook of $175 million was driven by timing. There were two
decisions that occurred within the second quarter 2024 that
affected cash flow. First, a major emergency field service
situation arose within the second quarter 2024. We dedicated a
large field service team from other work to respond, and the
associated timing of cash payment will be in the second half 2024.
We also had a key customer whose project has a cash milestone in
the second half 2024 request that they needed specific steps taken
to hold schedule and the related materials purchase occurred
earlier than we had previously planned.
We continue to take opportunistic steps to
optimize our balance sheet, including the completion of our reprice
of our Term Loan B, which resulted in 85 basis points of interest
rate reduction, or approximately $14 million in annualized interest
savings, as well as launching a targeted supply chain finance
program to certain suppliers.
2024 Outlook
We anticipate our full year 2024 sales to be in
the range of approximately $4.45 billion to $4.60 billion with
forecasted full year 2024 adjusted EBITDA in the range of $1.08
billion to $1.15 billion. Our anticipated 2024 full year adjusted
EPS range is $10.75 to $11.75. This range is based on an effective
tax rate range of approximately 20% to 21% and a diluted share
count of approximately 47 million. FCF guidance is in the range of
approximately $400 million to $475 million.
Compared to our prior 2024 full year outlook the
main drivers of the change are timing of sales recognition for
backlog conversion on larger and longer projects (these are not
cancellations; our cancellation rate remains substantially below 1%
of backlog), negative foreign exchange, timing of larger awards in
the second quarter 2024 having revenue impacts in 2025 and 2026 (we
booked approximately $275 million for projects in late second
quarter 2024 which will have 2025 and 2026 revenue impact) and a
change to adjusted EPS calculation by no longer excluding the
negative ($0.60) mandatory preferred dividend EPS impact.
Our previous sales outlook was expected to be in
a range of $4.7 to $5.0 billion; previously forecasted full year
2024 adjusted EBITDA in the range of $1.175 to $1.30 billion;
Reported free cash flow (FCF) guidance of $575 million to $625
million and prior anticipated 2024 full year adjusted EPS range of
$12.00 to $14.00 which did not include the full year $0.60 negative
impact of the preferred mandatory dividend and was based on a prior
full year effective tax rate of 20%.
Medium Term Outlook
With our strong momentum, additional cost
synergies identified and anticipated, Chart Business Excellence
(“CBE”) productivity actions and backlog, we reiterate our
medium-term outlook. These metrics do not include any additional
Big LNG project revenue not already booked as of September 30,
2023. Further growth and margin is anticipated from several known
big LNG projects awards not currently reflected in our backlog and
not assumed in our guidance metrics, including IPSMR® for an
integrated oil company’s (“IOC”) international Big LNG project,
Argent LNG’s Port Fourchon 20 MTPA facility and Driftwood LNG’s 27
MTPA export terminal which is already permitted (these three Big
LNG projects that are not yet in backlog total approximately $1.5
billion of Chart content).
We anticipate to sequentially grow sales in 2025
and 2026 each in double digits, continue our margin expansion and
generate more cash with capital expenditures as a percentage of
sales in the 2.0 to 2.5% range. Our medium-term financial targets
are:
- Mid-teens organic revenue growth through 2026
- Reported gross profit margin of mid-30%’s by 2026
- Double-digit adjusted diluted EPS growth CAGR of mid-40%’s
- 95-100% FCF conversion
- Return on invested capital (“ROIC”) of mid-teens
FORWARD-LOOKING STATEMENTSCertain statements
made in this press release are forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. Forward-looking statements include statements concerning the
Company’s business plans, including statements regarding completed
acquisitions, divestitures, and investments, cost and commercial
synergies and efficiency savings, objectives, future orders,
revenues, margins, segment sales mix, earnings or performance,
liquidity and cash flow, inventory levels, capital expenditures,
supply chain challenges, inflationary pressures including material
cost and pricing increases, business trends, clean energy market
opportunities including addressable markets, and governmental
initiatives, including executive orders and other information that
is not historical in nature. Forward-looking statements may be
identified by terminology such as "may," "will," "should," "could,"
"expects," "anticipates," "believes," "projects," "forecasts,"
“outlook,” “guidance,” "continue," “target,” or the negative of
such terms or comparable terminology.
Forward-looking statements contained in this
press release or in other statements made by the Company are made
based on management's expectations and beliefs concerning future
events impacting the Company and are subject to uncertainties and
factors relating to the Company's operations and business
environment, all of which are difficult to predict and many of
which are beyond the Company's control, that could cause the
Company's actual results to differ materially from those matters
expressed or implied by forward-looking statements. Factors that
could cause the Company’s actual results to differ materially from
those described in the forward-looking statements include: the
Company’s ability to successfully integrate the Howden acquisition
and other recent acquisitions and achieve the anticipated revenue,
earnings, accretion and other benefits from these acquisitions;
slower than anticipated growth and market acceptance of new clean
energy product offerings; inability to achieve expected pricing
increases or continued supply chain challenges including volatility
in raw materials and supply; risks relating to the outbreak and
continued uncertainty associated with the coronavirus (COVID-19)
and regional conflicts and unrest, including the recent turmoil in
the Middle East and the conflict between Russia and Ukraine
including potential energy shortages in Europe and elsewhere; and
the other factors discussed in Item 1A (Risk Factors) in the
Company’s most recent Annual Report on Form 10-K filed with the
SEC, which should be reviewed carefully. The Company undertakes no
obligation to update or revise any forward-looking statement.
USE OF NON-GAAP FINANCIAL INFORMATIONThis press release contains
non-GAAP financial information, including adjusted net income,
adjusted operating income, adjusted earnings per diluted share, net
income attributable to Chart Industries, Inc. adjusted, free cash
flow and adjusted free cash flow and EBITDA and adjusted EBITDA.
For additional information regarding the Company's use of non-GAAP
financial information, as well as reconciliations of non-GAAP
financial measures to the most directly comparable financial
measures calculated and presented in accordance with accounting
principles generally accepted in the United States ("GAAP"), please
see the reconciliation pages at the end of this news release.
The Company believes these non-GAAP measures are
of interest to investors and facilitate useful period-to-period
comparisons of the Company’s financial results, and this
information is used by the Company in evaluating internal
performance. With respect to the Company’s 2024 full year earnings
outlook, the Company is not able to provide a reconciliation of the
adjusted EBITDA, FCF or adjusted EPS because certain items may have
not yet occurred or are out of the Company’s control and/or cannot
be reasonably predicted.
CONFERENCE CALLAs previously announced, the
Company has scheduled a conference call for Friday, August 2, 2024
at 8:30 a.m. ET to discuss its second quarter 2024 financial
results. Participants wishing to join the live Q&A session must
dial-in with the following information:
PARTICIPANT INFORMATION:Toll-Free – North America: (+1) 800 549
8228Toll North America and other locations: (+1) 289 819
1520Conference ID: 39844
A live webcast and replay, as well as presentation slides, will
be available on the Company’s investor relations website through
the following link: Q2 2024 Webcast Registration. A telephone
replay of the conference call can be accessed approximately two
hours following the end of the call at 1-888-660-6264 with passcode
39844 through September 1, 2024.
About Chart Industries,
Inc.Chart Industries, Inc. is a leading independent global
leader in the design, engineering, and manufacturing of process
technologies and equipment for gas and liquid molecule handling for
the Nexus of Clean™ - clean power, clean water, clean food, and
clean industrials, regardless of molecule. The company’s unique
product and solution portfolio across stationary and rotating
equipment is used in every phase of the liquid gas supply chain,
including engineering, service and repair from installation to
preventive maintenance and digital monitoring. Chart is a leading
provider of technology, equipment and services related to liquefied
natural gas, hydrogen, biogas and CO2 capture amongst other
applications. Chart is committed to excellence in environmental,
social and corporate governance (ESG) issues both for its company
as well as its customers. With 64 global manufacturing locations
and over 50 service centers from the United States to Asia,
Australia, India, Europe and South America, the company maintains
accountability and transparency to its team members, suppliers,
customers and communities. To learn more, visit
www.chartindustries.com
For more information, click here:
http://ir.chartindustries.com/
Chart Industries Investor Relations
Contact:
John WalshSVP, Investor and Government
Relations1-770-721-8899john.walsh@chartindustries.com
CHART INDUSTRIES, INC. AND
SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS (UNAUDITED)(Dollars and shares in
millions, except per share amounts) |
|
|
Three Months Ended |
|
Six Months Ended |
|
June 30, 2024 |
|
June 30, 2023 |
|
March 31, 2024 |
|
June 30, 2024 |
|
June 30, 2023 |
Sales |
$ |
1,040.3 |
|
|
$ |
908.1 |
|
|
$ |
950.7 |
|
|
$ |
1,991.0 |
|
|
$ |
1,439.6 |
|
Cost of sales |
|
688.7 |
|
|
|
627.5 |
|
|
|
648.4 |
|
|
|
1,337.1 |
|
|
|
1,009.7 |
|
Gross profit |
|
351.6 |
|
|
|
280.6 |
|
|
|
302.3 |
|
|
|
653.9 |
|
|
|
429.9 |
|
Selling, general and
administrative expenses |
|
136.2 |
|
|
|
140.7 |
|
|
|
141.5 |
|
|
|
277.7 |
|
|
|
233.6 |
|
Amortization expense |
|
47.6 |
|
|
|
44.2 |
|
|
|
47.9 |
|
|
|
95.5 |
|
|
|
66.0 |
|
Operating expenses |
|
183.8 |
|
|
|
184.9 |
|
|
|
189.4 |
|
|
|
373.2 |
|
|
|
299.6 |
|
Operating income (1) –
(3) |
|
167.8 |
|
|
|
95.7 |
|
|
|
112.9 |
|
|
|
280.7 |
|
|
|
130.3 |
|
Acquisition related finance fees |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
26.1 |
|
Interest expense, net |
|
84.3 |
|
|
|
83.9 |
|
|
|
83.8 |
|
|
|
168.1 |
|
|
|
112.2 |
|
Other expense, net |
|
3.6 |
|
|
|
1.3 |
|
|
|
3.2 |
|
|
|
6.8 |
|
|
|
3.0 |
|
Income (loss) from continuing
operations before income taxes and equity in (loss) income of
unconsolidated affiliates, net |
|
79.9 |
|
|
|
10.5 |
|
|
|
25.9 |
|
|
|
105.8 |
|
|
|
(11.0 |
) |
Income tax expense
(benefit) |
|
15.5 |
|
|
|
2.4 |
|
|
|
8.8 |
|
|
|
24.3 |
|
|
|
(4.3 |
) |
Income (loss) from continuing
operations before equity in (loss) income of unconsolidated
affiliates, net |
|
64.4 |
|
|
|
8.1 |
|
|
|
17.1 |
|
|
|
81.5 |
|
|
|
(6.7 |
) |
Equity in (loss) income of unconsolidated affiliates, net |
|
(1.3 |
) |
|
|
1.5 |
|
|
|
(0.3 |
) |
|
|
(1.6 |
) |
|
|
1.1 |
|
Net income (loss) from
continuing operations |
|
63.1 |
|
|
|
9.6 |
|
|
|
16.8 |
|
|
|
79.9 |
|
|
|
(5.6 |
) |
(Loss) income from
discontinued operations, net of tax |
|
(0.2 |
) |
|
|
2.5 |
|
|
|
(2.2 |
) |
|
|
(2.4 |
) |
|
|
3.4 |
|
Net income (loss) |
|
62.9 |
|
|
|
12.1 |
|
|
|
14.6 |
|
|
|
77.5 |
|
|
|
(2.2 |
) |
Less: Income attributable to
noncontrolling interests of continuing operations, net of
taxes |
|
4.3 |
|
|
|
3.0 |
|
|
|
3.3 |
|
|
|
7.6 |
|
|
|
3.7 |
|
Net income (loss) attributable
to Chart Industries, Inc. |
$ |
58.6 |
|
|
$ |
9.1 |
|
|
$ |
11.3 |
|
|
$ |
69.9 |
|
|
$ |
(5.9 |
) |
|
|
|
|
|
|
|
|
|
|
Amounts attributable
to Chart common stockholders |
|
|
|
|
|
|
|
|
|
Income (loss) from continuing
operations |
$ |
58.8 |
|
|
$ |
6.6 |
|
|
$ |
13.5 |
|
|
$ |
72.3 |
|
|
$ |
(9.3 |
) |
Less: Mandatory convertible preferred stock dividend
requirement |
|
6.8 |
|
|
|
6.9 |
|
|
|
6.8 |
|
|
|
13.6 |
|
|
|
13.7 |
|
Income (loss) from continuing
operations attributable to Chart |
|
52.0 |
|
|
|
(0.3 |
) |
|
|
6.7 |
|
|
|
58.7 |
|
|
|
(23.0 |
) |
(Loss) income from
discontinued operations, net of tax |
|
(0.2 |
) |
|
|
2.5 |
|
|
|
(2.2 |
) |
|
|
(2.4 |
) |
|
|
3.4 |
|
Net income (loss) attributable
to Chart common shareholders |
$ |
51.8 |
|
|
$ |
2.2 |
|
|
$ |
4.5 |
|
|
$ |
56.3 |
|
|
$ |
(19.6 |
) |
|
|
|
|
|
|
|
|
|
|
Basic earnings per
common share attributable to Chart Industries, Inc. |
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations |
$ |
1.24 |
|
|
$ |
(0.01 |
) |
|
$ |
0.16 |
|
|
$ |
1.40 |
|
|
$ |
(0.55 |
) |
(Loss) income from discontinued operations |
|
(0.01 |
) |
|
|
0.06 |
|
|
|
(0.05 |
) |
|
|
(0.06 |
) |
|
|
0.08 |
|
Net income (loss) attributable
to Chart Industries, Inc. |
$ |
1.23 |
|
|
$ |
0.05 |
|
|
$ |
0.11 |
|
|
$ |
1.34 |
|
|
$ |
(0.47 |
) |
Diluted earnings per
common share attributable to Chart Industries, Inc. |
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations |
$ |
1.10 |
|
|
$ |
(0.01 |
) |
|
$ |
0.14 |
|
|
$ |
1.25 |
|
|
$ |
(0.55 |
) |
(Loss) income from discontinued operations |
|
— |
|
|
|
0.06 |
|
|
|
(0.04 |
) |
|
|
(0.05 |
) |
|
|
0.08 |
|
Net income (loss) attributable
to Chart Industries, Inc. |
$ |
1.10 |
|
|
$ |
0.05 |
|
|
$ |
0.10 |
|
|
$ |
1.20 |
|
|
$ |
(0.47 |
) |
|
|
|
|
|
|
|
|
|
|
Weighted-average
number of common shares outstanding: |
|
|
|
|
|
|
|
|
|
Basic |
|
42.04 |
|
|
|
41.97 |
|
|
|
42.03 |
|
|
|
42.03 |
|
|
|
41.96 |
|
Diluted (4) (5) |
|
47.25 |
|
|
|
46.45 |
|
|
|
46.73 |
|
|
|
46.99 |
|
|
|
41.96 |
|
_______________
(1) Includes depreciation expense of:
- $18.3, $18.7 and
$18.0 for the three months ended June 30, 2024, June 30, 2023
and March 31, 2024, respectively, and
- $36.3 and $30.2 for
the six months ended June 30, 2024 and 2023, respectively.
(2) Includes restructuring costs of:
- $4.3, $5.4, and
$5.1 for the three months ended June 30, 2024, June 30, 2023
and March 31, 2024, respectively, and
- $9.4 and $7.0 for
the six months ended June 30, 2024 and 2023, respectively.
(3) Includes deal-related and integration costs
of:
- $7.4, $11.3 and
$6.5 for the three months ended June 30, 2024, June 30, 2023
and March 31, 2024, respectively, and
- $13.9 and $93.0 for
the six months ended June 30, 2024 and 2023, respectively.
(4) Includes an additional 5.00, 4.31 and 4.53
shares related to the convertible notes due 2024 and associated
warrants in our diluted earnings per share calculation for the
three months ended June 30, 2024, June 30, 2023 and
March 31, 2024, respectively. The associated hedge, which
helps offset this dilution, cannot be taken into account under U.S.
generally accepted accounting principles (“GAAP”). If the hedge
could have been considered, it would have reduced the additional
shares by 2.69, 2.38 and 2.48 for the three months ended June 30,
2024, June 30, 2023 and March 31, 2024, respectively.
(5) Includes an additional 4.77 shares related
to the convertible notes due 2024 and associated warrants in our
diluted earnings per share calculation for the six months ended
June 30, 2024. The associated hedge, which helps offset this
dilution, cannot be taken into account under U.S. GAAP. If the
hedge could have been considered, it would have reduced the
additional shares by 2.59 for the six months ended June 30,
2024.
CHART INDUSTRIES, INC. AND
SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF
CASH FLOWS (UNAUDITED)(Dollars in
millions) |
|
|
Three Months Ended |
|
Six Months Ended |
|
June 30, 2024 |
|
June 30, 2023 |
|
March 31, 2024 |
|
June 30, 2024 |
|
June 30, 2023 |
Operating
Activities |
|
|
|
|
|
|
|
|
|
Net income (loss) |
$ |
62.9 |
|
|
$ |
12.1 |
|
|
$ |
14.6 |
|
|
$ |
77.5 |
|
|
$ |
(2.2 |
) |
Less: (Loss) income from discontinued operations, net of tax |
|
(0.2 |
) |
|
|
2.5 |
|
|
|
(2.2 |
) |
|
|
(2.4 |
) |
|
|
3.4 |
|
Net income (loss) from continuing operations |
|
63.1 |
|
|
|
9.6 |
|
|
|
16.8 |
|
|
|
79.9 |
|
|
|
(5.6 |
) |
Adjustments to reconcile net income (loss) to net cash provided by
(used in) operating activities: |
|
|
|
|
|
|
|
|
|
Bridge loan facility fees |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
26.1 |
|
Depreciation and amortization |
|
66.0 |
|
|
|
62.9 |
|
|
|
65.9 |
|
|
|
131.9 |
|
|
|
96.2 |
|
Employee share-based compensation expense |
|
4.1 |
|
|
|
2.6 |
|
|
|
6.0 |
|
|
|
10.1 |
|
|
|
6.6 |
|
Financing costs amortization |
|
4.7 |
|
|
|
4.4 |
|
|
|
4.7 |
|
|
|
9.4 |
|
|
|
7.2 |
|
Unrealized foreign currency transaction gain |
|
(0.2 |
) |
|
|
(2.6 |
) |
|
|
(13.5 |
) |
|
|
(13.7 |
) |
|
|
(0.9 |
) |
Unrealized loss on investments in equity securities |
|
0.3 |
|
|
|
4.6 |
|
|
|
1.7 |
|
|
|
2.0 |
|
|
|
6.6 |
|
Equity in loss (income) of unconsolidated affiliates |
|
1.3 |
|
|
|
(1.7 |
) |
|
|
0.3 |
|
|
|
1.6 |
|
|
|
(1.2 |
) |
Loss on sale of business |
|
— |
|
|
|
— |
|
|
|
7.8 |
|
|
|
7.8 |
|
|
|
— |
|
Other non-cash operating activities |
|
(0.8 |
) |
|
|
1.3 |
|
|
|
1.8 |
|
|
|
1.0 |
|
|
|
1.4 |
|
Changes in assets and liabilities, net of acquisitions: |
|
|
|
|
|
|
|
|
|
Accounts receivable |
|
51.2 |
|
|
|
(53.6 |
) |
|
|
(51.0 |
) |
|
|
0.2 |
|
|
|
(60.2 |
) |
Inventories |
|
9.1 |
|
|
|
(15.4 |
) |
|
|
(4.1 |
) |
|
|
5.0 |
|
|
|
(5.0 |
) |
Unbilled contract revenue |
|
(109.5 |
) |
|
|
(22.6 |
) |
|
|
(76.7 |
) |
|
|
(186.2 |
) |
|
|
(82.8 |
) |
Prepaid expenses and other current assets |
|
5.6 |
|
|
|
4.8 |
|
|
|
(48.6 |
) |
|
|
(43.0 |
) |
|
|
12.4 |
|
Accounts payable and other current liabilities |
|
59.5 |
|
|
|
83.6 |
|
|
|
(17.1 |
) |
|
|
42.4 |
|
|
|
129.1 |
|
Customer advances and billings in excess of contract revenue |
|
(11.3 |
) |
|
|
27.8 |
|
|
|
17.3 |
|
|
|
6.0 |
|
|
|
34.6 |
|
Long-term assets and liabilities |
|
(27.0 |
) |
|
|
(8.9 |
) |
|
|
(0.9 |
) |
|
|
(27.9 |
) |
|
|
(29.1 |
) |
Net Cash Provided By (Used In) Continuing Operating
Activities |
|
116.1 |
|
|
|
96.8 |
|
|
|
(89.6 |
) |
|
|
26.5 |
|
|
|
135.4 |
|
Net Cash Used In Discontinued Operating
Activities |
|
— |
|
|
|
(5.2 |
) |
|
|
(5.5 |
) |
|
|
(5.5 |
) |
|
|
(75.9 |
) |
Net Cash Provided By (Used In) Operating
Activities |
|
116.1 |
|
|
|
91.6 |
|
|
|
(95.1 |
) |
|
|
21.0 |
|
|
|
59.5 |
|
Investing
Activities |
|
|
|
|
|
|
|
|
|
Acquisition of businesses, net of cash acquired |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(4,339.8 |
) |
Capital expenditures |
|
(28.1 |
) |
|
|
(20.9 |
) |
|
|
(46.1 |
) |
|
|
(74.2 |
) |
|
|
(52.3 |
) |
Investments |
|
(7.1 |
) |
|
|
(0.5 |
) |
|
|
(6.0 |
) |
|
|
(13.1 |
) |
|
|
(2.6 |
) |
Other investing activities |
|
(6.1 |
) |
|
|
(0.5 |
) |
|
|
0.3 |
|
|
|
(5.8 |
) |
|
|
(1.0 |
) |
Net Cash Used In Continuing Investing
Activities |
|
(41.3 |
) |
|
|
(21.9 |
) |
|
|
(51.8 |
) |
|
|
(93.1 |
) |
|
|
(4,395.7 |
) |
Net Cash Used In Discontinued Investing
Activities |
|
(2.5 |
) |
|
|
(2.1 |
) |
|
|
— |
|
|
|
(2.5 |
) |
|
|
(2.1 |
) |
Net Cash Used In Investing Activities |
|
(43.8 |
) |
|
|
(24.0 |
) |
|
|
(51.8 |
) |
|
|
(95.6 |
) |
|
|
(4,397.8 |
) |
Financing
Activities |
|
|
|
|
|
|
|
|
|
Borrowings on credit facilities |
|
850.6 |
|
|
|
88.0 |
|
|
|
634.2 |
|
|
|
1,484.8 |
|
|
|
722.8 |
|
Repayments on credit facilities |
|
(857.0 |
) |
|
|
(339.8 |
) |
|
|
(479.3 |
) |
|
|
(1,336.3 |
) |
|
|
(384.8 |
) |
Borrowings on term loan |
|
— |
|
|
|
250.0 |
|
|
|
— |
|
|
|
— |
|
|
|
1,747.2 |
|
Repayments on term loan |
|
— |
|
|
|
(3.8 |
) |
|
|
— |
|
|
|
— |
|
|
|
(3.8 |
) |
Payments for debt issuance costs |
|
(3.8 |
) |
|
|
(11.9 |
) |
|
|
(1.5 |
) |
|
|
(5.3 |
) |
|
|
(133.4 |
) |
Payment of contingent consideration |
|
— |
|
|
|
(1.7 |
) |
|
|
— |
|
|
|
— |
|
|
|
(1.7 |
) |
Proceeds from issuance of common stock, net |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
11.7 |
|
Proceeds from exercise of stock options |
|
0.1 |
|
|
|
0.1 |
|
|
|
0.3 |
|
|
|
0.4 |
|
|
|
0.2 |
|
Common stock repurchases from share-based compensation plans |
|
(0.1 |
) |
|
|
(0.1 |
) |
|
|
(3.0 |
) |
|
|
(3.1 |
) |
|
|
(2.7 |
) |
Dividend distribution to noncontrolling interests |
|
— |
|
|
|
(8.4 |
) |
|
|
— |
|
|
|
— |
|
|
|
(8.4 |
) |
Dividends paid on mandatory convertible preferred stock |
|
(6.8 |
) |
|
|
(6.8 |
) |
|
|
(6.8 |
) |
|
|
(13.6 |
) |
|
|
(13.7 |
) |
Net Cash (Used In) Provided By Financing
Activities |
|
(17.0 |
) |
|
|
(34.4 |
) |
|
|
143.9 |
|
|
|
126.9 |
|
|
|
1,933.4 |
|
Effect of exchange rate
changes on cash and cash equivalents |
|
(0.2 |
) |
|
|
(0.3 |
) |
|
|
(2.6 |
) |
|
|
(2.8 |
) |
|
|
1.9 |
|
Net increase (decrease) in
cash, cash equivalents, restricted cash and restricted cash
equivalents |
|
55.1 |
|
|
|
32.9 |
|
|
|
(5.6 |
) |
|
|
49.5 |
|
|
|
(2,403.0 |
) |
Cash, cash equivalents,
restricted cash, and restricted cash equivalents at beginning of
period (1) |
|
195.5 |
|
|
|
169.4 |
|
|
|
201.1 |
|
|
|
201.1 |
|
|
|
2,605.3 |
|
CASH, CASH
EQUIVALENTS, RESTRICTED CASH, AND RESTRICTED CASH EQUIVALENTS AT
END OF PERIOD (1) |
$ |
250.6 |
|
|
$ |
202.3 |
|
|
$ |
195.5 |
|
|
$ |
250.6 |
|
|
$ |
202.3 |
|
_______________
(1) Includes restricted cash and restricted cash
equivalents of $3.2, $12.5, $12.8 and $1,941.7 as of June 30,
2024, June 30, 2023, March 31, 2024 and December 31,
2022, respectively.
CHART INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)(Dollars in millions) |
|
|
June 30,2024 |
|
December 31,2023 |
ASSETS |
|
|
|
Current
Assets |
|
|
|
Cash and cash equivalents |
$ |
247.4 |
|
|
$ |
188.3 |
|
Accounts receivable, less allowances of $5.1 and $5.9,
respectively |
|
748.5 |
|
|
|
758.9 |
|
Inventories, net |
|
554.6 |
|
|
|
576.3 |
|
Unbilled contract revenue |
|
661.4 |
|
|
|
481.7 |
|
Prepaid expenses |
|
101.4 |
|
|
|
74.9 |
|
Other current assets |
|
131.4 |
|
|
|
134.3 |
|
Total Current
Assets |
|
2,444.7 |
|
|
|
2,214.4 |
|
Property, plant, and
equipment, net |
|
872.9 |
|
|
|
837.6 |
|
Goodwill |
|
2,929.6 |
|
|
|
2,906.8 |
|
Identifiable intangible
assets, net |
|
2,645.4 |
|
|
|
2,791.9 |
|
Equity method investments |
|
104.6 |
|
|
|
109.9 |
|
Investments in equity
securities |
|
102.0 |
|
|
|
91.2 |
|
Other assets |
|
178.3 |
|
|
|
150.6 |
|
TOTAL
ASSETS |
$ |
9,277.5 |
|
|
$ |
9,102.4 |
|
|
|
|
|
LIABILITIES AND EQUITY |
|
|
|
Current
Liabilities |
|
|
|
Accounts payable |
$ |
906.3 |
|
|
$ |
811.0 |
|
Customer advances and billings in excess of contract revenue |
|
378.1 |
|
|
|
376.6 |
|
Accrued salaries, wages, and benefits |
|
65.5 |
|
|
|
81.5 |
|
Accrued interest |
|
91.4 |
|
|
|
92.5 |
|
Accrued income taxes |
|
39.2 |
|
|
|
60.0 |
|
Current portion of warranty reserve |
|
26.7 |
|
|
|
29.4 |
|
Current portion of long-term debt |
|
259.8 |
|
|
|
258.5 |
|
Operating lease liabilities, current |
|
18.6 |
|
|
|
18.5 |
|
Other current liabilities |
|
140.6 |
|
|
|
138.2 |
|
Total Current
Liabilities |
|
1,926.2 |
|
|
|
1,866.2 |
|
Long-term debt |
|
3,729.0 |
|
|
|
3,576.4 |
|
Long-term deferred tax
liabilities |
|
569.5 |
|
|
|
568.2 |
|
Accrued pension
liabilities |
|
6.7 |
|
|
|
6.7 |
|
Operating lease liabilities,
non-current |
|
50.1 |
|
|
|
50.7 |
|
Other long-term
liabilities |
|
86.9 |
|
|
|
95.2 |
|
Total
Liabilities |
|
6,368.4 |
|
|
|
6,163.4 |
|
Equity |
|
|
|
Preferred stock, par value $0.01 per share, $1,000 aggregate
liquidation preference — 10,000,000 shares authorized, 402,500
shares issued and outstanding at both June 30, 2024 and
December 31, 2023 |
|
— |
|
|
|
— |
|
Common stock, par value $0.01 per share — 150,000,000 shares
authorized, 42,804,031 and 42,754,241 shares issued and outstanding
at June 30, 2024 and December 31, 2023, respectively |
|
0.4 |
|
|
|
0.4 |
|
Additional paid-in capital |
|
1,879.7 |
|
|
|
1,872.5 |
|
Treasury stock; 760,782 shares at both June 30, 2024 and
December 31, 2023 |
|
(19.3 |
) |
|
|
(19.3 |
) |
Retained earnings |
|
978.3 |
|
|
|
922.1 |
|
Accumulated other comprehensive (loss) income |
|
(90.0 |
) |
|
|
10.8 |
|
Total Chart Industries, Inc. Shareholders’ Equity |
|
2,749.1 |
|
|
|
2,786.5 |
|
Noncontrolling interests |
|
160.0 |
|
|
|
152.5 |
|
Total Equity |
|
2,909.1 |
|
|
|
2,939.0 |
|
TOTAL LIABILITIES AND
EQUITY |
$ |
9,277.5 |
|
|
$ |
9,102.4 |
|
CHART INDUSTRIES, INC. AND
SUBSIDIARIESOPERATING SEGMENTS
(UNAUDITED)(Dollars in millions) |
|
|
Three Months Ended |
|
Six Months Ended |
|
June 30, 2024 |
|
June 30, 2023 |
|
March 31, 2024 |
|
June 30, 2024 |
|
June 30, 2023 |
Sales |
|
|
|
|
|
|
|
|
|
Cryo Tank Solutions |
$ |
165.5 |
|
|
$ |
152.7 |
|
|
$ |
159.7 |
|
|
$ |
325.2 |
|
|
$ |
276.2 |
|
Heat Transfer Systems |
|
236.7 |
|
|
|
236.0 |
|
|
|
253.6 |
|
|
|
490.3 |
|
|
|
403.5 |
|
Specialty Products |
|
277.6 |
|
|
|
236.7 |
|
|
|
236.5 |
|
|
|
514.1 |
|
|
|
362.9 |
|
Repair, Service &
Leasing |
|
360.5 |
|
|
|
298.7 |
|
|
|
301.0 |
|
|
|
661.5 |
|
|
|
417.2 |
|
Intersegment eliminations |
|
— |
|
|
|
(16.0 |
) |
|
|
(0.1 |
) |
|
|
(0.1 |
) |
|
|
(20.2 |
) |
Consolidated |
$ |
1,040.3 |
|
|
$ |
908.1 |
|
|
$ |
950.7 |
|
|
$ |
1,991.0 |
|
|
$ |
1,439.6 |
|
Gross
Profit |
|
|
|
|
|
|
|
|
|
Cryo Tank Solutions |
$ |
33.4 |
|
|
$ |
28.8 |
|
|
$ |
32.8 |
|
|
$ |
66.2 |
|
|
$ |
50.3 |
|
Heat Transfer Systems |
|
60.8 |
|
|
|
67.3 |
|
|
|
70.1 |
|
|
|
130.9 |
|
|
|
108.6 |
|
Specialty Products |
|
80.8 |
|
|
|
61.0 |
|
|
|
58.9 |
|
|
|
139.7 |
|
|
|
96.9 |
|
Repair, Service &
Leasing |
|
176.6 |
|
|
|
123.5 |
|
|
|
140.5 |
|
|
|
317.1 |
|
|
|
174.1 |
|
Consolidated |
$ |
351.6 |
|
|
$ |
280.6 |
|
|
$ |
302.3 |
|
|
$ |
653.9 |
|
|
$ |
429.9 |
|
Gross Profit
Margin |
|
|
|
|
|
|
|
|
|
Cryo Tank Solutions |
|
20.2 |
% |
|
|
18.9 |
% |
|
|
20.5 |
% |
|
|
20.4 |
% |
|
|
18.2 |
% |
Heat Transfer Systems |
|
25.7 |
% |
|
|
28.5 |
% |
|
|
27.6 |
% |
|
|
26.7 |
% |
|
|
26.9 |
% |
Specialty Products |
|
29.1 |
% |
|
|
25.8 |
% |
|
|
24.9 |
% |
|
|
27.2 |
% |
|
|
26.7 |
% |
Repair, Service &
Leasing |
|
49.0 |
% |
|
|
41.3 |
% |
|
|
46.7 |
% |
|
|
47.9 |
% |
|
|
41.7 |
% |
Consolidated |
|
33.8 |
% |
|
|
30.9 |
% |
|
|
31.8 |
% |
|
|
32.8 |
% |
|
|
29.9 |
% |
Operating Income
(Loss) |
|
|
|
|
|
|
|
|
|
Cryo Tank Solutions |
$ |
16.0 |
|
|
$ |
10.5 |
|
|
$ |
14.0 |
|
|
$ |
30.0 |
|
|
$ |
14.8 |
|
Heat Transfer Systems |
|
45.1 |
|
|
|
49.8 |
|
|
|
51.2 |
|
|
|
96.3 |
|
|
|
77.1 |
|
Specialty Products |
|
55.0 |
|
|
|
29.1 |
|
|
|
25.1 |
|
|
|
80.1 |
|
|
|
50.9 |
|
Repair, Service &
Leasing |
|
98.0 |
|
|
|
45.6 |
|
|
|
65.1 |
|
|
|
163.1 |
|
|
|
78.7 |
|
Corporate |
|
(46.3 |
) |
|
|
(39.3 |
) |
|
|
(42.5 |
) |
|
|
(88.8 |
) |
|
|
(91.2 |
) |
Consolidated (1) – (4) |
$ |
167.8 |
|
|
$ |
95.7 |
|
|
$ |
112.9 |
|
|
$ |
280.7 |
|
|
$ |
130.3 |
|
Operating
Margin |
|
|
|
|
|
|
|
|
|
Cryo Tank Solutions |
|
9.7 |
% |
|
|
6.9 |
% |
|
|
8.8 |
% |
|
|
9.2 |
% |
|
|
5.4 |
% |
Heat Transfer Systems |
|
19.1 |
% |
|
|
21.1 |
% |
|
|
20.2 |
% |
|
|
19.6 |
% |
|
|
19.1 |
% |
Specialty Products |
|
19.8 |
% |
|
|
12.3 |
% |
|
|
10.6 |
% |
|
|
15.6 |
% |
|
|
14.0 |
% |
Repair, Service &
Leasing |
|
27.2 |
% |
|
|
15.3 |
% |
|
|
21.6 |
% |
|
|
24.7 |
% |
|
|
18.9 |
% |
Consolidated |
|
16.1 |
% |
|
|
10.5 |
% |
|
|
11.9 |
% |
|
|
14.1 |
% |
|
|
9.1 |
% |
_______________
(1) Restructuring costs for the three months
ended:
- June 30, 2024
were $4.3 ($1.9 - Repair, Service & Leasing, $1.2 - Specialty
Products, $0.5 - Cryo Tank Solutions, $0.4 - Heat Transfer Systems
and $0.3 - Corporate).
- June 30, 2023
were $5.4 ($3.7 - Corporate, $0.7 - Repair, Service & Leasing,
$0.5 - Specialty Products, $0.3 - Cryo Tank Solutions and $0.2 -
Heat Transfer Systems).
- March 31, 2024
were $5.1 ($2.3 - Repair, Service & Leasing, $1.3 - Specialty
Products, $0.6 - Cryo Tank Solutions, $0.5 - Heat Transfer Systems
and $0.4 - Corporate).
(2) Restructuring costs for the six months
ended:
- June 30, 2024
were $9.4 ($4.2 - Repair, Service & Leasing, $2.5 - Specialty
Products, $1.1 - Cryo Tank Solutions, $0.9 - Heat Transfer Systems
and $0.7 - Corporate).
- June 30, 2023
were $7.0 ($3.7 - Corporate, $1.5 - Repair, Service & Leasing,
$1.1 - Cryo Tank Solutions, $0.5 - Specialty Products and $0.2 -
Heat Transfer Systems).
(3) Deal-related and integration costs for the
three months ended:
- June 30, 2024
were $7.4.
- June 30, 2023
were $11.3.
- March 31, 2024
were $6.5.
(4) Deal-related and integration costs for the
six months ended:
- June 30, 2024
were $13.9.
- June 30, 2023
were $93.0.
CHART INDUSTRIES, INC. AND
SUBSIDIARIESORDERS AND BACKLOG
(UNAUDITED)(Dollars in millions) |
|
|
Three Months Ended |
|
June 30,2024 |
|
June 30,2023 |
|
March 31,2024 |
Orders |
|
|
|
|
|
Cryo Tank Solutions |
$ |
159.0 |
|
$ |
155.0 |
|
|
$ |
159.3 |
|
Heat Transfer Systems |
|
269.6 |
|
|
302.2 |
|
|
|
237.3 |
|
Specialty Products |
|
423.7 |
|
|
293.2 |
|
|
|
391.3 |
|
Repair, Service &
Leasing |
|
312.4 |
|
|
319.7 |
|
|
|
333.9 |
|
Intersegment eliminations |
|
— |
|
|
(7.0 |
) |
|
|
(0.2 |
) |
Consolidated |
$ |
1,164.7 |
|
$ |
1,063.1 |
|
|
$ |
1,121.6 |
|
|
As of |
|
June 30,2024 |
|
June 30,2023 |
|
March 31,2024 |
Backlog |
|
|
|
|
|
Cryo Tank Solutions |
$ |
358.2 |
|
|
$ |
452.7 |
|
|
$ |
367.5 |
|
Heat Transfer Systems |
|
1,709.7 |
|
|
|
1,708.9 |
|
|
|
1,685.9 |
|
Specialty Products |
|
1,806.4 |
|
|
|
1,259.6 |
|
|
|
1,678.2 |
|
Repair, Service &
Leasing |
|
562.7 |
|
|
|
580.7 |
|
|
|
611.3 |
|
Intersegment eliminations |
|
(11.0 |
) |
|
|
(37.0 |
) |
|
|
(11.8 |
) |
Consolidated |
$ |
4,426.0 |
|
|
$ |
3,964.9 |
|
|
$ |
4,331.1 |
|
CHART INDUSTRIES, INC. AND
SUBSIDIARIESRECONCILIATION OF EARNINGS (LOSS) PER
COMMON SHARE ATTRIBUTABLE TO CHART INDUSTRIES, INC. – CONTINUING
OPERATIONS TO ADJUSTED EARNINGS PER COMMON SHARE ATTRIBUTABLE TO
CHART INDUSTRIES, INC. (UNAUDITED)(Dollars in
millions, except per share amounts) |
|
|
Q2 2024 Diluted EPS |
|
Q2 2023 Diluted EPS |
|
Q1 2024 Diluted EPS |
|
YTD June 2024 Diluted EPS |
Amounts attributable
to Chart common stockholders |
|
|
|
|
|
|
|
Net income attributable to Chart Industries, Inc. |
$ |
58.6 |
|
|
$ |
9.1 |
|
|
$ |
11.3 |
|
|
$ |
69.9 |
|
Less: (Loss) income from
discontinued operations, net of tax |
|
(0.2 |
) |
|
|
2.5 |
|
|
|
(2.2 |
) |
|
|
(2.4 |
) |
Income from continuing
operations |
|
58.8 |
|
|
|
6.6 |
|
|
|
13.5 |
|
|
|
72.3 |
|
Less: Mandatory convertible
preferred stock dividend requirement |
|
6.8 |
|
|
|
6.9 |
|
|
|
6.8 |
|
|
|
13.6 |
|
Reported income (loss) from
continuing operations attributable to Chart (U.S. GAAP) |
$ |
52.0 |
|
|
$ |
(0.3 |
) |
|
$ |
6.7 |
|
|
$ |
58.7 |
|
Earnings (loss) per
common share attributable to Chart Industries, Inc. – continuing
operations |
$ |
1.10 |
|
|
$ |
(0.01 |
) |
|
$ |
0.14 |
|
|
$ |
1.25 |
|
Unrealized loss on investments in equity securities and loss from
strategic equity method investments (1) |
|
0.05 |
|
|
|
0.10 |
|
|
|
0.09 |
|
|
|
0.14 |
|
Deal related and integration costs (2) |
|
0.15 |
|
|
|
0.16 |
|
|
|
0.31 |
|
|
|
0.46 |
|
Howden amortization (3) |
|
1.00 |
|
|
|
0.99 |
|
|
|
1.00 |
|
|
|
1.99 |
|
Restructuring & related costs (4) |
|
0.09 |
|
|
|
0.13 |
|
|
|
0.11 |
|
|
|
0.20 |
|
Other one-time items (5) |
|
0.04 |
|
|
|
— |
|
|
|
— |
|
|
|
0.04 |
|
Tax effects |
|
(0.25 |
) |
|
|
(0.33 |
) |
|
|
(0.31 |
) |
|
|
(0.56 |
) |
Adjusted earnings per
common share attributable to Chart Industries, Inc.
(non-GAAP) |
$ |
2.18 |
|
|
$ |
1.04 |
|
|
$ |
1.34 |
|
|
$ |
3.52 |
|
Share Count |
|
47.25 |
|
|
|
46.45 |
|
|
|
46.73 |
|
|
|
46.99 |
|
_______________
(1) Includes the mark-to-market of our inorganic
investments in McPhy, Stabilis and certain of our minority
investments as well as losses from strategic equity method
investments.
- $2.4, $4.6, and
$4.3 for the three months ended June 30, 2024, June 30, 2023
and March 31, 2024, respectively, and $6.7 for the six months
ended June 30, 2024.
(2) Includes third party support fees, one time
costs due to acquisition and divestiture activities and other
integration related costs of $7.4, $7.4 and $14.3 for the three
months ended June 30, 2024, June 30, 2023 and March 31,
2024, respectively, and $21.7 for the six months ended June 30,
2024.
(3) Howden amortization includes amortization
expense related to acquired intangible assets of $46.9, $46.2 and
$46.6 for the three months ended June 30, 2024, June 30, 2023
and March 31, 2024, respectively, and $93.5 for the six months
ended June 30, 2024.
(4) Includes restructuring costs of $4.3, $5.4,
and $5.1 for the three months ended June 30, 2024, June 30,
2023 and March 31, 2024, respectively, and $9.4 for the six
months ended June 30, 2024. Restructuring charges in Q2 2024
primarily related to the restructuring of our Asia Pacific region
into our Middle East & Africa region (AIMA).
(5) Other one-time items include asset
impairments resulting from integrating Howden and Chart systems and
a one time adjustment related to a 2022 settlement of $2.0 for both
three and six months ended June 30, 2024.
_______________
Adjusted earnings per common share attributable
to Chart Industries, Inc. is not a measure of financial performance
under U.S. GAAP and should not be considered as an alternative to
earnings per share in accordance with U.S. GAAP. Management
believes that adjusted earnings per common share attributable to
Chart Industries, Inc. facilitate useful period-to-period
comparisons of our financial results and this information is used
by us in evaluating internal performance. Our calculation of these
non-GAAP measures may not be comparable to the calculations of
similarly titled measures reported by other companies. Prior to the
second quarter of 2024, the impacts of the mandatory convertible
preferred stock dividend were excluded from adjusted earnings per
common share attributable to Chart Industries, Inc. (non-GAAP). The
impacts are now included in adjusted earnings per common share
attributable to Chart Industries, Inc. (non-GAAP) and historical
periods have been restated to reflect the change in treatment.
RECONCILIATION OF NET CASH PROVIDED BY
(USED IN) OPERATING ACTIVITIES FROM CONTINUING OPERATIONS TO FREE
CASH FLOW FROM CONTINUING OPERATIONS AND RECONCILIATION OF NET CASH
USED IN OPERATING ACTIVITIES FROM DISCONTINUED OPERATIONS TO FREE
CASH FLOW FROM DISCONTINUED OPERATIONS
(UNAUDITED)(Dollars in millions) |
|
|
Three Months Ended |
|
Six Months Ended |
|
June 30,2024 |
|
June 30,2023 |
|
March 31,2024 |
|
June 30,2024 |
|
June 30,2023 |
Net cash provided by (used in) operating activities from continuing
operations |
$ |
116.1 |
|
|
$ |
96.8 |
|
|
$ |
(89.6 |
) |
|
$ |
26.5 |
|
|
$ |
135.4 |
|
Capital expenditures |
|
(28.1 |
) |
|
|
(20.9 |
) |
|
|
(46.1 |
) |
|
|
(74.2 |
) |
|
|
(52.3 |
) |
Free cash flow from
continuing operations (non-GAAP) |
$ |
88.0 |
|
|
$ |
75.9 |
|
|
$ |
(135.7 |
) |
|
$ |
(47.7 |
) |
|
$ |
83.1 |
|
|
Three Months Ended |
|
Six Months Ended |
|
June 30,2024 |
|
June 30,2023 |
|
March 31,2024 |
|
June 30,2024 |
|
June 30,2023 |
Net cash used in operating activities from discontinued
operations |
$ |
— |
|
$ |
(5.2 |
) |
|
$ |
(5.5 |
) |
|
$ |
(5.5 |
) |
|
$ |
(75.9 |
) |
Capital expenditures |
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(2.1 |
) |
Free cash flow from
discontinued operations (non-GAAP) |
$ |
— |
|
$ |
(5.2 |
) |
|
$ |
(5.5 |
) |
|
$ |
(5.5 |
) |
|
$ |
(78.0 |
) |
_______________
Free cash flow is not a measure of financial
performance under U.S. GAAP and should not be considered as an
alternative to net cash provided by (used in) operating activities
in accordance with U.S. GAAP. Management believes that free cash
flow facilitates useful period-to-period comparisons of our
financial results and this information is used by us in evaluating
internal performance. Our calculation of this non-GAAP measure may
not be comparable to the calculations of similarly titled measures
reported by other companies.
CHART INDUSTRIES, INC. AND
SUBSIDIARIESRECONCILIATIONS OF OPERATING INCOME
(LOSS) TO ADJUSTED OPERATING INCOME (LOSS)
(UNAUDITED)(Dollars in millions) |
|
|
Three Months Ended June 30, 2024 |
|
Cryo Tank Solutions |
|
Heat Transfer Systems |
|
Specialty Products |
|
Repair, Service & Leasing |
|
Intersegment Eliminations |
|
Corporate |
|
Consolidated |
Sales |
$ |
165.5 |
|
|
$ |
236.7 |
|
|
$ |
277.6 |
|
|
$ |
360.5 |
|
|
$ |
— |
|
$ |
— |
|
|
$ |
1,040.3 |
|
Operating income
(loss) as reported (U.S. GAAP) |
$ |
16.0 |
|
|
$ |
45.1 |
|
|
$ |
55.0 |
|
|
$ |
98.0 |
|
|
$ |
— |
|
$ |
(46.3 |
) |
|
|
167.8 |
|
Operating
margin |
|
9.7 |
% |
|
|
19.1 |
% |
|
|
19.8 |
% |
|
|
27.2 |
% |
|
|
|
|
|
|
16.1 |
% |
Restructuring, transaction-related and other one-time costs |
|
2.5 |
|
|
|
3.3 |
|
|
|
6.4 |
|
|
|
41.8 |
|
|
|
— |
|
|
3.9 |
|
|
|
57.9 |
|
Adjusted operating
income (loss) (non-GAAP) |
$ |
18.5 |
|
|
$ |
48.4 |
|
|
$ |
61.4 |
|
|
$ |
139.8 |
|
|
$ |
— |
|
$ |
(42.4 |
) |
|
$ |
225.7 |
|
Adjusted operating
margin (non-GAAP) |
|
11.2 |
% |
|
|
20.4 |
% |
|
|
22.1 |
% |
|
|
38.8 |
% |
|
|
|
|
|
|
21.7 |
% |
CHART INDUSTRIES, INC. AND
SUBSIDIARIESRECONCILIATIONS OF OPERATING INCOME
(LOSS) TO ADJUSTED OPERATING INCOME (LOSS)
(UNAUDITED)(Dollars in millions) |
|
|
Three Months Ended June 30, 2023 |
|
Cryo Tank Solutions |
|
Heat Transfer Systems |
|
Specialty Products |
|
Repair, Service & Leasing |
|
Intersegment Eliminations |
|
Corporate |
|
Consolidated |
Sales |
$ |
152.7 |
|
|
$ |
236.0 |
|
|
$ |
236.7 |
|
|
$ |
298.7 |
|
|
$ |
(16.0 |
) |
|
$ |
— |
|
|
$ |
908.1 |
|
Operating income
(loss) as reported (U.S. GAAP) |
$ |
10.5 |
|
|
$ |
49.8 |
|
|
$ |
29.1 |
|
|
$ |
45.6 |
|
|
$ |
— |
|
|
$ |
(39.3 |
) |
|
$ |
95.7 |
|
Operating
margin |
|
6.9 |
% |
|
|
21.1 |
% |
|
|
12.3 |
% |
|
|
15.3 |
% |
|
|
|
|
|
|
10.5 |
% |
Restructuring related, deal-related, integration and other one time
costs |
|
2.7 |
|
|
|
0.8 |
|
|
|
3.4 |
|
|
|
44.5 |
|
|
|
— |
|
|
|
7.3 |
|
|
|
58.7 |
|
Adjusted operating
income (loss) (non-GAAP) |
$ |
13.2 |
|
|
$ |
50.6 |
|
|
$ |
32.5 |
|
|
$ |
90.1 |
|
|
$ |
— |
|
|
$ |
(32.0 |
) |
|
$ |
154.4 |
|
Adjusted operating
margin (non-GAAP) |
|
8.6 |
% |
|
|
21.4 |
% |
|
|
13.7 |
% |
|
|
30.2 |
% |
|
|
|
|
|
|
17.0 |
% |
CHART INDUSTRIES, INC. AND
SUBSIDIARIESRECONCILIATIONS OF
OPERATING INCOME (LOSS) TO ADJUSTED OPERATING INCOME (LOSS)
(UNAUDITED)(Dollars in millions) |
|
|
Three Months Ended March 31, 2024 |
|
Cryo Tank Solutions |
|
Heat Transfer Systems |
|
Specialty Products |
|
Repair, Service & Leasing |
|
Intersegment Eliminations |
|
Corporate |
|
Consolidated |
Sales |
$ |
159.7 |
|
|
$ |
253.6 |
|
|
$ |
236.5 |
|
|
$ |
301.0 |
|
|
$ |
(0.1 |
) |
|
$ |
— |
|
|
$ |
950.7 |
|
Operating income
(loss) as reported (U.S. GAAP) |
$ |
14.0 |
|
|
$ |
51.2 |
|
|
$ |
25.1 |
|
|
$ |
65.1 |
|
|
$ |
— |
|
|
$ |
(42.5 |
) |
|
|
112.9 |
|
Operating
margin |
|
8.8 |
% |
|
|
20.2 |
% |
|
|
10.6 |
% |
|
|
21.6 |
% |
|
|
|
|
|
|
11.9 |
% |
Restructuring, transaction-related and other one-time costs |
|
2.8 |
|
|
|
1.7 |
|
|
|
6.3 |
|
|
|
40.6 |
|
|
|
— |
|
|
|
7.0 |
|
|
|
58.4 |
|
Adjusted operating
income (loss) (non-GAAP) |
$ |
16.8 |
|
|
$ |
52.9 |
|
|
$ |
31.4 |
|
|
$ |
105.7 |
|
|
$ |
— |
|
|
$ |
(35.5 |
) |
|
$ |
171.3 |
|
Adjusted operating
margin (non-GAAP) |
|
10.5 |
% |
|
|
20.9 |
% |
|
|
13.3 |
% |
|
|
35.1 |
% |
|
|
|
|
|
|
18.0 |
% |
_______________
Adjusted operating income (loss) is not a
measure of financial performance under U.S. GAAP and should not be
considered as an alternative to operating income (loss) in
accordance with U.S. GAAP. Management believes that adjusted
operating income (loss) facilitates useful period-to-period
comparisons of our financial results and this information is used
by us in evaluating internal performance. Our calculation of these
non-GAAP measures may not be comparable to the calculations of
similarly titled measures reported by other companies.
CHART INDUSTRIES, INC. AND
SUBSIDIARIESRECONCILIATION OF OPERATING SEGMENT
ORDERS TO PRO FORMA ORDERS, SALES TO PRO FORMA SALES AND GROSS
PROFIT TO PRO FORMA GROSS PROFIT(Dollars in
millions) |
|
|
Three Months Ended June 30, 2023 |
|
Cryo Tank Solutions |
|
Heat Transfer Systems |
|
Specialty Products |
|
Repair, Service & Leasing |
|
Intersegment Eliminations |
|
Corporate |
|
Consolidated |
Orders |
$ |
155.0 |
|
|
$ |
302.2 |
|
|
$ |
293.2 |
|
|
$ |
319.7 |
|
|
$ |
(7.0 |
) |
|
$ |
— |
|
$ |
1,063.1 |
|
Less: Orders from American
Fan, Cofimco and Cryo Diffusion (divested in fourth quarter
2023) |
|
2.9 |
|
|
|
4.7 |
|
|
|
7.6 |
|
|
|
8.7 |
|
|
|
— |
|
|
|
— |
|
|
23.9 |
|
Pro forma orders
(non-GAAP) |
$ |
152.1 |
|
|
$ |
297.5 |
|
|
$ |
285.6 |
|
|
$ |
311.0 |
|
|
$ |
(7.0 |
) |
|
$ |
— |
|
$ |
1,039.2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales |
$ |
152.7 |
|
|
$ |
236.0 |
|
|
$ |
236.7 |
|
|
$ |
298.7 |
|
|
$ |
(16.0 |
) |
|
$ |
— |
|
$ |
908.1 |
|
Less: Sales from American Fan,
Cofimco and Cryo Diffusion (divested in fourth quarter 2023) |
|
5.5 |
|
|
|
7.0 |
|
|
|
6.9 |
|
|
|
13.1 |
|
|
|
— |
|
|
|
— |
|
|
32.5 |
|
Pro forma sales
(non-GAAP) |
$ |
147.2 |
|
|
$ |
229.0 |
|
|
$ |
229.8 |
|
|
$ |
285.6 |
|
|
$ |
(16.0 |
) |
|
$ |
— |
|
$ |
875.6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
Profit |
$ |
28.8 |
|
|
$ |
67.3 |
|
|
$ |
61.0 |
|
|
$ |
123.5 |
|
|
$ |
— |
|
|
$ |
— |
|
$ |
280.6 |
|
Less: Gross Profit from
American Fan, Cofimco and Cryo Diffusion (divested in fourth
quarter 2023) |
|
1.6 |
|
|
|
2.1 |
|
|
|
3.9 |
|
|
|
3.9 |
|
|
|
— |
|
|
|
— |
|
|
11.5 |
|
Pro forma gross profit
(non-GAAP) |
$ |
27.2 |
|
|
$ |
65.2 |
|
|
$ |
57.1 |
|
|
$ |
119.6 |
|
|
$ |
— |
|
|
$ |
— |
|
$ |
269.1 |
|
Pro forma gross profit
margin (non-GAAP) |
|
18.5 |
% |
|
|
28.5 |
% |
|
|
24.8 |
% |
|
|
41.9 |
% |
|
|
— |
% |
|
|
|
|
30.7 |
% |
_______________
Pro forma orders, pro forma sales, pro forma
gross profit and pro forma gross profit margin are not measures of
financial performance under U.S. GAAP and should not be considered
as an alternative to orders, sales, gross profit and gross profit
margin in accordance with U.S. GAAP. Management believes that pro
forma orders, pro forma sales, pro forma gross profit and pro forma
gross profit margin facilitate useful period-to-period comparisons
of our financial results and this information is used by us in
evaluating internal performance. Our calculation of these non-GAAP
measures may not be comparable to the calculations of similarly
titled measures reported by other companies.
CHART INDUSTRIES, INC. AND
SUBSIDIARIESRECONCILIATION OF NET INCOME (LOSS)
FROM CONTINUING OPERATIONS TO EBITDA PLUS ACQUISITION FINANCE FEES
& LOSS ON EXTINGUISHMENT OF DEBT AND ADJUSTED EBITDA PLUS
ACQUISITION FINANCE FEES & LOSS ON EXTINGUISHMENT OF DEBT
(UNAUDITED)(Dollars in millions) |
|
|
Three Months Ended |
|
Six Months Ended |
|
June 30,2024 |
|
June 30,2023 |
|
March 31,2024 |
|
June 30,2024 |
|
June 30,2023 |
Net income (loss) from continuing operations |
$ |
63.1 |
|
$ |
9.6 |
|
$ |
16.8 |
|
$ |
79.9 |
|
$ |
(5.6 |
) |
Income tax expense (benefit) |
|
15.5 |
|
|
2.4 |
|
|
8.8 |
|
|
24.3 |
|
|
(4.3 |
) |
Interest expense, net |
|
84.3 |
|
|
83.9 |
|
|
83.8 |
|
|
168.1 |
|
|
112.2 |
|
Acquisition related finance fees |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
26.1 |
|
Loss on extinguishment of debt |
|
0.7 |
|
|
— |
|
|
— |
|
|
0.7 |
|
|
— |
|
Depreciation and amortization |
|
66.0 |
|
|
62.9 |
|
|
65.9 |
|
|
131.9 |
|
|
96.2 |
|
EBITDA
(non-GAAP) |
|
229.6 |
|
|
158.8 |
|
|
175.3 |
|
|
404.9 |
|
|
224.6 |
|
Non-recurring costs (1) |
|
21.2 |
|
|
29.3 |
|
|
26.6 |
|
|
47.8 |
|
|
55.3 |
|
Employee share-based compensation expense |
|
4.1 |
|
|
2.6 |
|
|
6.0 |
|
|
10.1 |
|
|
6.6 |
|
Unrealized loss on investments in equity securities and loss from
strategic equity method investments (2) |
|
2.4 |
|
|
4.6 |
|
|
4.3 |
|
|
6.7 |
|
|
6.6 |
|
Howden FX Hedge |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
2.8 |
|
Adjusted EBITDA
(non-GAAP) |
$ |
257.3 |
|
$ |
195.3 |
|
$ |
212.2 |
|
$ |
469.5 |
|
$ |
295.9 |
|
_______________
(1) Includes $7.4, $11.3, and $6.5 deal &
integration costs, $0.0, $0.0, and $7.8 of divestment working
capital charges related to fourth quarter 2023 divestitures, $4.3,
$5.4, and $5.1 of restructuring costs, $7.5, $10.9, and $7.1 of
step-up value amortization of inventory from the Howden
acquisition, and $2.0, $1.7, and $0.1 of impairments and a one-time
adjustment related to a 2022 settlement for the three months ended
June 30, 2024, June 30, 2023 and March 31, 2024,
respectively. Includes $13.9 and $33.5 of deal & integration
costs, $7.8 and $0.0 of divestment working capital settlement
charges related to businesses divested in the fourth quarter of
2023, $9.4 and $7.0 of restructuring costs, $14.6 and $10.9 of
step-up value amortization of inventory from the Howden
acquisition, and $2.0 and $3.9 of impairments and a one time
adjustment related to a 2022 settlement for the six months ended
June 30, 2024 and June 30, 2023, respectively.
(2) Includes the mark-to-market of our inorganic
investments in McPhy, Stabilis and certain of our minority
investments as well as losses from strategic equity method
investments.
- $2.4, $4.6, and
$4.3 for the three months ended June 30, 2024, June 30, 2023
and March 31, 2024, respectively, and $6.7 and $6.6 for the
six months ended June 30, 2024 and June 30, 2023,
respectively.
_______________
EBITDA and Adjusted EBITDA are not measures of
financial performance under U.S. GAAP and should not be considered
as an alternative to net income (loss) from continuing operations
in accordance with U.S. GAAP. Management believes that EBITDA and
Adjusted EBITDA facilitate useful period-to-period comparisons of
our financial results and this information is used by us in
evaluating internal performance. Our calculation of these non-GAAP
measures may not be comparable to the calculations of similarly
titled measures reported by other companies.
CHART INDUSTRIES, INC. AND
SUBSIDIARIESRECONCILIATION OF ORDERS TO PRO FORMA
ORDERS, SALES TO PRO FORMA SALES, GROSS PROFIT TO PRO FORMA GROSS
PROFIT, ADJUSTED EBITDA TO PRO FORMA ADJUSTED EBITDA, AND OPERATING
INCOME TO PRO FORMA ADJUSTED OPERATING INCOME
(UNAUDITED)(Dollars in millions) |
|
|
Three Months Ended June 30, 2023 |
Orders |
$ |
1,063.1 |
|
Less: Orders from American Fan (divested in fourth quarter
2023) |
|
14.3 |
|
Less: Orders from Cofimco (divested in fourth quarter 2023) |
|
8.6 |
|
Less: Orders from Cryo Diffusion (divested fourth quarter
2023) |
|
1.0 |
|
Pro forma orders
(non-GAAP) |
$ |
1,039.2 |
|
|
|
Sales |
$ |
908.1 |
|
Less: Sales from American Fan (divested in fourth quarter
2023) |
|
19.5 |
|
Less: Sales from Cofimco (divested in fourth quarter 2023) |
|
10.9 |
|
Less: Sales from Cryo Diffusion (divested fourth quarter 2023) |
|
2.1 |
|
Pro forma sales (non-GAAP) |
$ |
875.6 |
|
|
|
Gross
profit |
$ |
280.6 |
|
Less: Gross profit from American Fan (divested in fourth quarter
2023) |
|
6.2 |
|
Less: Gross profit from Cofimco (divested in fourth quarter
2023) |
|
5.1 |
|
Less: Gross profit from Cryo Diffusion (divested fourth quarter
2023) |
|
0.2 |
|
Pro forma gross profit
(non-GAAP) |
$ |
269.1 |
|
Pro forma gross profit
margin (non-GAAP) |
|
30.7 |
% |
|
|
Adjusted EBITDA
(non-GAAP) |
$ |
195.3 |
|
Less: EBITDA from American Fan (divested in fourth quarter
2023) |
|
4.4 |
|
Less: EBITDA from Cofimco (divested in fourth quarter 2023) |
|
4.0 |
|
Less: EBITDA from Cryo Diffusion (divested fourth quarter
2023) |
|
(0.6 |
) |
Pro forma adjusted
EBITDA (non-GAAP) |
$ |
187.5 |
|
Pro forma adjusted
EBITDA margin (non-GAAP) |
|
21.4 |
% |
|
|
Operating
income |
$ |
95.7 |
|
Less: Operating income from American Fan (divested in fourth
quarter 2023) |
|
4.3 |
|
Less: Operating income from Cofimco (divested in fourth quarter
2023) |
|
3.4 |
|
Less: Operating loss from Cryo Diffusion (divested fourth quarter
2023) |
|
(0.7 |
) |
Pro forma operating
income (non-GAAP) |
$ |
88.7 |
|
Pro forma operating
income margin (non-GAAP) |
|
10.1 |
% |
Restructuring related, deal-related, integration and other one time
costs |
|
58.7 |
|
Pro forma adjusted
operating income (non-GAAP) |
$ |
147.4 |
|
Pro forma adjusted
operating income margin (non-GAAP) |
|
16.8 |
% |
_______________
Pro forma orders, pro forma sales, pro forma
gross profit, adjusted EBITDA, pro forma adjusted EBITDA, pro forma
operating income and pro forma adjusted operating income are not
measures of financial performance under U.S. GAAP and should not be
considered as an alternative to sales and net income (loss) from
continuing operations in accordance with U.S. GAAP. Management
believes that pro forma orders, pro forma sales, pro forma gross
profit, adjusted EBITDA, pro forma adjusted EBITDA, pro forma
operating income and pro forma adjusted operating income facilitate
useful period-to-period comparisons of our financial results and
this information is used by us in evaluating internal performance.
Our calculation of these non-GAAP measures may not be comparable to
the calculations of similarly titled measures reported by other
companies.
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