Parker Hannifin sales increase 3%
Parker Hannifin Corp., a global provider of motion and control technologies, reported record sales of $4.8 billion for its fiscal 2024 second quarter, a 3% increase compared with $4.7 billion in the second quarter of fiscal 2023.
Net income was $681.9 million compared with $395.2 million in the prior year quarter. Adjusted net income was $802.4 million, an increase of 30% compared with $618.9 million in the second quarter of fiscal 2023.
Earnings per share were $5.23 compared with $3.04 in the prior year quarter. Adjusted earnings per share increased 29% to $6.15 compared with $4.76 in the second quarter of fiscal 2023. Fiscal 2024 year-to-date cash flow from operations increased 26% to $1.4 billion, or 14.0% of sales, compared with $1.1 billion, or 12.1% of sales, in the prior year. A reconciliation of non-GAAP measures is included in the financial tables of this press release.
“We continue to produce exceptional results that reflect the strength of our portfolio and our ability to execute at a high level, underpinned by our business system, The Win Strategy,” said Chairman and Chief Executive Officer Jenny Parmentier. “Our adjusted operating margin increased by 300 basis points year-over-year, as we saw meaningful margin improvement in every segment. Strong aerospace and defense results, including synergies from the Meggitt acquisition, were a key driver of performance in the quarter. We continued to generate strong cash flow and direct it towards reducing debt. Our results are a testament to the dedication and persistence of our global teams.”
Segment Results
Diversified Industrial Segment: North American second quarter sales decreased 1% to $2.1 billion and operating income was $461.9 million compared with $419.9 million in the same period a year ago. On an adjusted basis, North American operating income was $510.4 million, or 24.2% of sales, a 240 basis point increase compared with the second quarter of fiscal 2023. International second quarter sales were flat at $1.4 billion and operating income was $290.5 million compared with $285.5 million in the same period a year ago. On an adjusted basis, International operating income was $323.4 million, or 23.0% of sales, a 110 basis point increase compared with the prior year quarter.
Aerospace Systems Segment: Second quarter sales increased 15% to $1.3 billion and operating income was $263.1 million compared with $8.8 million in the same period a year ago. On an adjusted basis, operating income was $346.9 million, or 26.5% of sales, a 590 basis point increase compared with the prior year quarter.
Orders
The company reported the following orders for the quarter ending December 31, 2023, compared with the same quarter a year ago:
- Orders increased 2% for total Parker
- Orders decreased 4% in the Diversified Industrial North America businesses
- Orders decreased 5% in the Diversified Industrial International businesses
- Orders increased 21% in the Aerospace Systems Segment on a rolling 12-month average basis.
Outlook
Parker's outlook for the fiscal year ending June 30, 2024 has been updated. The company expects total sales growth in fiscal 2024 to be in the range of 3% to 5%; total segment operating margin in the range of 20.7% to 21.1%, or 24.1% to 24.5% on an adjusted basis; and earnings per share in the range of $20.00 to $20.60, or $23.90 to $24.50 on an adjusted basis. Reconciliations of forecasted segment operating margin to adjusted forecasted segment operating margin and forecasted earnings per share to adjusted forecasted earnings per share are included in the financial tables of this press release.
Parmentier said, “We are increasing our outlook for fiscal 2024 and expect another year of record performance. We will continue to stay focused on executing the Win Strategy and leveraging the growth in aerospace markets. Our future looks very bright supported by favorable secular growth trends and further opportunities to improve our customer experience.”
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