- Timken Co (NYSE:TKR) reported first-quarter FY22 sales growth of 9.7% year-over-year to $1.124 billion, beating the consensus of $1.11 billion.
- The increase was driven by growth across most end-market sectors led by industrial distribution and off-highway, and the impact of higher pricing, partially offset by unfavorable currency.
- Sales by segment: Process Industries $584.2 million (+12.2% Y/Y) and Mobile Industries $540.54 million (+7.1% Y/Y).
- Timken returned $123.5 million to shareholders during the quarter with the repurchase of 1.5 million shares and quarterly dividend payment.
- The gross margin was down slightly by 7 bps at 29.1%.
- The operating income increased by 14.3% Y/Y to $172.3 million, and the margin expanded by 62 bps to 15.3%.
- Adjusted EPS improved to $1.61 compared to $1.38 in 1Q21, beating the consensus of $1.16.
- Timken's net cash used from operating activities for the quarter was $1.2 million, compared to cash generated of $31.7 million a year ago.
- FY22 Outlook: Timken maintained its EPS outlook of $4.85 - $5.25 on a GAAP basis and adjusted EPS of $5.00 - $5.40.
- The company modestly adjusted the revenue outlook now expects it to be up ~8% Y/Y at the midpoint in total vs. prior expectations of up ~10%.
- Price Action: TKR shares are trading higher by 3.33% at $59.56 on Monday's last check.
