- Trane Technologies PLC (NYSE:TT) reported Q1 2023 revenue growth of 9% Y/Y on a reported and organic basis to $3.67 billion, beating the consensus of $3.64 billion.
- Bookings declined by 1% Y/Y (both reported and organically) to $4.31 billion.
- Adjusted continuing EPS of $1.41 (+26% Y/Y), beating the consensus of $1.34.
- Adjusted operating margin expanded by 140 bps to 12.9%, and the adjusted EBITDA margin expanded by 100 bps to 14.8%.
- Americas net revenue was $2.86 billion (+9% Y/Y), Bookings of $3.32 billion (-4% Y/Y), Adjusted operating margin 14.0% (up 90 bps Y/Y), and Adjusted EBITDA margin 15.9% (up 50 bps Y/Y).
- EMEA net revenues $510.5 million (+16% Y/Y); Bookings $591.7 million (+10% Y/Y), Adjusted operating margin 17.0% (up 540 bps Y/Y) and Adjusted EBITDA margin 18.5% (up 510 bps).
- Asia Pacific net revenue $294.3 million (+5% Y/Y), Bookings $390.1 million (+11% Y/Y); and adjusted operating margin 17.2% (up 340 bps Y/Y), and adjusted EBITDA margin 19.4% (up 390 bps Y/Y).
- The company exited Q1 2023 with a backlog of $7.3 billion.
- Trane Technologies generated cash from operating activities of $17 million, compared to cash used in operating activities of $(4) million a year ago. Free cash outflow was $(52) million.
- The company held $692.9 million in cash and equivalents as of March 31, 2023.
- Dividend Increased: In Q1, the company raised its annual dividend per share by 12% to $3.00 annualized.
- Year-to-date through May, the company returned $170 million in dividends and $300 million in share repurchases to shareholders.
- 2023 Outlook Revised: Trane Technologies expects adjusted EPS of $8.30-$8.50 vs. consensus of $8.40 and prior guidance of $8.20-$8.50.
- TT projects 2023 reported revenue growth of around 9% to 10% (up 7% to 9% earlier) and organic revenue growth of 7% to 8% (up 6% to 8% previously).
- Price Action: TT shares are trading lower by 4.83% at $179.45 on the last check Wednesday.
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