MSA Safety Q3 profit rises 8% as Autronica acquisition closes
Adjusted EPS of $2.09 was in line with the $2.11 consensus estimate compiled by Finnhub, and net sales rose 15% to $536.4 million.
Key takeaways
- MSA Safety (MSA) said on Nov. 2 that third-quarter adjusted earnings rose 8% to $2.09 per diluted share, from $1.94 a year earlier. Net sales rose 15% to $536.4 million. The company also completed its $563 million acquisition of Autronica Fire and Security.
MSA Safety (MSA) said on Nov. 2 that adjusted earnings rose 8% to $2.09 per diluted share in the third quarter, from $1.94 a year earlier. Net sales rose 15% to $536.4 million.
The adjusted figure was in line with the consensus estimate. Revenue was also in line with the $534.28 million estimate.
GAAP net income fell 16% to $58.4 million, or $1.51 per diluted share, as acquisition-related costs tied to Autronica weighed on results. The company said organic sales rose 6%, excluding currency effects and acquisitions.
The company completed its acquisition of Autronica Fire and Security for $563 million, net of cash acquired, a regulatory filing showed.
Here's how the company did:
- Net sales: $536.4 million vs. $468.4 million a year earlier
- GAAP net income: $58.4 million vs. $69.6 million a year earlier
- Adjusted diluted EPS: $2.09 vs. $1.94 a year earlier
- Free cash flow: $68.2 million vs. $100.5 million a year earlier
Segment results
Americas net sales rose 8% to $338.2 million, and adjusted operating income rose 9% to $96.7 million.
International net sales rose 28% to $198.2 million, and adjusted operating income rose 28% to $31.8 million. The segment's adjusted operating margin was 16.1%.
Steve Blanco, President and Chief Executive Officer, said the company delivered "15% sales growth" while closing the Autronica acquisition and launching the G1 City Edition SCBA. He added that an ALTAIR io 6 order "marked our largest MSA+ order to date."
Guidance
The company is maintaining its full-year sales outlook of low-double-digit reported growth, the same range it gave on July 30.
Julie Beck, Chief Financial Officer, said cash generation and capital allocation enabled the Autronica purchase and shareholder returns through dividends and share repurchases.
Costs and cash
GAAP operating income fell 6% to $88.2 million. Transaction and digital transformation costs were $15.0 million, up from $1.9 million a year earlier.
Free cash flow fell 32% to $68.2 million, and free cash flow conversion was 117%. The company paid $20.8 million in cash dividends and bought back $12.7 million of stock in the quarter.