Investment Rating - The report maintains a positive outlook for Chart Industries, reaffirming its revenue guidance for fiscal year 2025, with expected revenue between $4.65 billion and $4.85 billion [2][3]. Core Insights - Despite revenue and earnings falling short of consensus expectations for Q4 2024, the company reported strong backlog and new order performance, emphasizing optimism regarding liquefied natural gas contracts [1][2]. - The adjusted net income for Q4 2024 was $80 million, with revenue at $1.107 billion, reflecting a 9% year-over-year increase, although it was below the consensus estimate of $1.168 billion [2][5]. - The company reported a record backlog of $4.85 billion, up from $4.535 billion in Q3 2024, with total orders for the quarter reaching $1.55 billion, compared to $1.17 billion in the previous quarter [2][3]. Summary by Sections Financial Performance - Adjusted net income for Q4 2024 was $80 million, with revenue of $1.107 billion, and an adjusted EBITDA of $284 million, slightly below consensus estimates [2][5]. - Gross margin was approximately 34%, aligning with the company's mid-term guidance of 30% [2][5]. Guidance and Outlook - The company reaffirmed its fiscal year 2025 revenue guidance of $4.65 billion to $4.85 billion, with adjusted EBITDA expected to be between $1.175 billion and $1.225 billion [2][3]. - The expected earnings per share for 2025 is projected to be between $12 and $13, with free cash flow anticipated to be between $550 million and $600 million, an increase from $388 million in fiscal year 2024 [2][3]. Leverage and Financial Policy - The net leverage ratio stands at 2.80 times, down from 3.04 times in Q3 2024, with the company aiming to reach its target leverage ratio of 2.0 to 2.5 times this year [3]. - The company maintains its mid-term guidance of double-digit organic revenue growth, a gross margin midpoint of 30%, and a free cash flow conversion rate of 95% to 100% [3].

Group 1 - The article discusses the analysis of oil and gas companies, focusing on identifying undervalued names within the industry [1] - The author emphasizes the importance of understanding the balance sheet, competitive position, and development prospects of these companies [1] - The cyclical nature of the oil and gas industry is highlighted, indicating that it experiences boom and bust cycles, requiring patience and experience for successful investment [2] Group 2 - The author has a beneficial long position in shares of specific companies, indicating a personal investment interest in the sector [3] - The article is presented as an analysis rather than a recommendation for stock purchases or sales, urging investors to conduct their own research [4] - Seeking Alpha clarifies that past performance does not guarantee future results, and the views expressed may not represent the platform as a whole [5]

Sales and Customer Relationships - Sales to the top ten customers accounted for 26%, 25%, and 38% of consolidated sales in 2024, 2023, and 2022, respectively[45]. Employee and Labor Relations - As of January 31, 2025, the company had 11,928 employees, including 3,938 domestic and 7,990 international employees[49]. - The company is party to a five-year collective bargaining agreement with the IAM covering 387 employees, which expires on February 6, 2026[50]. - The company prioritizes employee safety and wellness, aiming for zero accidents through a dedicated Global Safety Council[54]. - The company invests in employee development programs, including the Emerging Leaders program and Engineering Fellows[56]. Financial Position and Debt - Total indebtedness as of December 31, 2024, was $3,757.5 million, with $277.5 million in letters of credit and bank guarantees outstanding[110]. - The company has a senior secured revolving credit facility with commitments of up to $1,250.0 million, of which $767.5 million was available for future borrowings as of December 31, 2024[112]. - The senior secured revolving credit facility due April 2029 requires compliance with certain financial ratios, and a breach could result in a default under debt agreements[116]. - If unable to repay or refinance the indebtedness, lenders could sell collateral securing the senior secured revolving credit facility, which includes substantially all domestic wholly-owned subsidiaries' assets[117]. - The Senior Secured Notes due 2030 and Senior Unsecured Notes due 2031 have change in control features that may adversely affect financial condition, requiring repurchase at 101% of principal plus accrued interest upon certain triggers[118]. Pension and Benefit Obligations - The projected benefit obligation under the Chart defined benefit pension plan was $39.5 million, with assets valued at $43.1 million as of December 31, 2024[104]. - The aggregate projected benefit obligation for defined benefit plans outside the U.S. was $39.2 million, with assets valued at $42.4 million, resulting in an overfunded status of $3.2 million[105]. Environmental and Regulatory Compliance - The company has ongoing environmental compliance and monitoring activities and believes it is in substantial compliance with all known regulations[59]. - The company is subject to potential liabilities under environmental, health, and safety laws, which could increase costs and affect profitability[93]. - The company is subject to regulations governing the export of products, with compliance being critical to avoid penalties[99]. Strategic Acquisitions and Investments - The company has made several acquisitions in the past three years, including the Howden Acquisition, which complements existing LNG and gas technologies[83]. - The company has a strategy of no material cash acquisitions until net leverage is below 2.5 times[85]. Risks and Uncertainties - The company faces risks related to data privacy and security, which could impact business operations[90]. - The company is exposed to risks related to third-party insolvency, which could adversely affect financial position and liquidity[92]. - Future capital expenditures may be required due to operations in hurricane-susceptible areas, potentially impacting sales and profitability[97]. Taxation - The effective tax rate may be impacted by changes in tax laws, with the Tax Cuts and Jobs Act reducing the federal corporate income tax rate from 35% to 21%[101]. Stock and Dividend Information - The company has issued 8,050,000 depositary shares of Series B Mandatory Convertible Preferred Stock, with future dividends dependent on business conditions and financial health[107]. - Common stock ranks junior to Mandatory Convertible Preferred Stock regarding dividends and liquidation preferences, meaning no dividends may be declared on common stock until preferred dividends are paid[120]. - No distribution of assets to common stockholders can occur until the liquidation preference of $1,000 per share plus accumulated dividends for Mandatory Convertible Preferred Stock is paid[121]. - The conversion of 6.75% Series B Mandatory Convertible Preferred Stock could dilute existing stockholders, with automatic conversion occurring on or around December 15, 2025[119].

Fourth Quarter 2024 Performance - Orders increased by 29.4% to $1,553.1 million compared to Q4 2023[8, 9] - Sales increased by 10.1% to $1,106.8 million compared to Q4 2023, which includes a 0.7% foreign exchange headwind[8, 9] - Adjusted operating income margin increased by 90bps to 22.0% compared to Q4 2023[8, 9] - Adjusted EBITDA increased by 18.8% to $283.6 million with an adjusted EBITDA margin increase of 190bps to 25.6% compared to Q4 2023[8, 9] - Free cash flow was $261.0 million, resulting from $281.5 million in net cash from operating activities less $20.5 million in capital expenditures[8, 9] Full Year 2024 Performance - Sales increased 16.9% year-over-year[35] - Adjusted EBITDA increased 35.3% year-over-year[35] - Adjusted operating profit increased 43.9% year-over-year[35] 2025 Outlook - Revenue is projected to be between $4.65 billion and $4.85 billion[27] - Adjusted EBITDA is expected to be between $1.175 billion and $1.225 billion[27] - Adjusted diluted earnings per share are projected to be between $12.00 and $13.00, with an average diluted share count of approximately 45.5 million[27] - Free cash flow is anticipated to be between $550 million and $600 million, with capital expenditures of approximately $110 million[27]

Financial Data and Key Metrics Changes - In Q4 2024, the company generated $281.5 million of net cash from operating activities, with free cash flow of $261 million after $20.5 million of CapEx spend, contributing to full-year 2024 free cash flow of $388 million [8] - Orders in Q4 2024 were $1.55 billion, a 29.4% increase compared to Q4 2023, leading to full-year 2024 orders of $5 billion, a 13% increase year-over-year [9] - Q4 2024 sales were $1.11 billion, a 10.8% increase excluding foreign exchange effects, contributing to full-year organic sales growth of 16.9% [9][24] - Adjusted operating income for Q4 2024 was $243.4 million, reflecting a 22% adjusted operating margin, while full-year adjusted operating margin was 21.1%, an increase of 400 basis points [10][11][24] Business Line Data and Key Metrics Changes - Cryo Tank Solutions (CTS) orders in Q4 2024 were $138.5 million, a decrease of 11.9% year-over-year, with sales of $150 million down 26.4% [30][31] - Heat Transfer Systems (HTS) orders in Q4 2024 were $536 million, an increase of over 66% year-over-year, with sales of $288.8 million growing 14.2% [32] - Specialty Products orders in Q4 2024 were $509 million, a 27.7% increase, with sales of $317 million up 47.7% compared to Q4 2023 [33][34] - Repair Service and Leasing (RSL) orders were $369 million, a 14.2% increase, with sales of $351 million growing 4% [35][36] Market Data and Key Metrics Changes - The company has approximately $24 billion in its commercial pipeline of opportunities not yet in backlog, with $2 billion of customer commitments also not yet in backlog [19] - The LNG end market ended 2024 strong, with expectations for continued growth in 2025, particularly in regions like India, the Philippines, and Japan [19][20] Company Strategy and Development Direction - The company anticipates growth across all four segments in 2025 compared to 2024, with a focus on LNG and traditional energy applications driving HTS growth [50][52] - The company is positioned to benefit from increasing global interest in small-scale LNG and carbon capture solutions [22][15] - The management emphasizes a flexible manufacturing and supply chain strategy to mitigate potential impacts from tariffs and supply chain disruptions [43][44] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving the target net leverage ratio of 2 to 2.5% by 2025, with no share repurchases or material cash acquisitions until then [26] - The first quarter of 2025 is expected to be the lowest quarter of the year, with a focus on backlog conversion and cash management [41] - Management noted that the commercial pipeline for LNG opportunities has expanded recently, driven by growing global demand [106] Other Important Information - The company has executed a Master Goods and Services Agreement with ExxonMobil, enhancing its position in the LNG market [21] - The company is the only manufacturer of brazed aluminum heat exchangers in the U.S., which strengthens its competitive position [44] Q&A Session Summary Question: 2025 guidance and segment performance - Management expects growth in RSL, HTS, CTS, and Specialty segments in 2025, with RSL projected to grow high single-digit to 10% [48][52] Question: LNG backlog conversion - Revenue from large LNG projects typically starts six to eight months after orders are received, with expectations for strong backlog conversion in 2025 [56][58] Question: CTS performance and China exposure - CTS orders and sales are expected to improve in 2025, with management monitoring global market conditions closely, including China [64][66] Question: NRU business size - The NRU business could range from $20 million to $75 million per unit, with expectations for significant growth in customer interest [69] Question: Aftermarket growth outlook - Management is confident in the growth outlook for the aftermarket segment, with strong visibility to service agreements and repair projects [75][78] Question: Data center market discussions - Discussions with data center providers are consistent, with increasing demand for energy solutions and heat rejection technologies [90][92] Question: Customer commitments and backlog conversion - Approximately $2 billion in customer commitments not yet in backlog includes several large LNG projects and carbon capture applications [124][126]

Financial Data and Key Metrics Changes - In Q4 2024, the company generated $281.5 million of net cash from operating activities, with free cash flow of $261 million after $20.5 million of CapEx spend, contributing to full-year 2024 free cash flow of $388 million [8] - Full-year 2024 sales reached $4.16 billion, representing a year-over-year organic increase of 17.5% [24] - Adjusted operating margin for full-year 2024 was 21.1%, an increase of 400 basis points compared to the previous year [11][24] - Adjusted EBITDA for Q4 2024 was $283.6 million, contributing to full-year adjusted EBITDA of $1.014 billion, with an EBITDA margin of 24.4%, a year-over-year increase of 330 basis points [11][25] Business Line Data and Key Metrics Changes - Cryo Tank Solutions (CTS) orders in Q4 2024 were $138.5 million, a decrease of 11.9% compared to Q4 2023, with sales of $150 million down 26.4% [30][31] - Heat Transfer Systems (HTS) orders in Q4 2024 were $536 million, an increase of over 66% compared to Q4 2023, with sales of $288.8 million growing 14.2% [32] - Specialty Products orders in Q4 2024 were $509 million, an increase of 27.7% compared to Q4 2023, with sales of $317 million up 47.7% [33] - Repair Service and Leasing (RSL) orders were $369 million, an increase of 14.2% compared to Q4 2023, with sales of $351 million up 4% [35][36] Market Data and Key Metrics Changes - The company has approximately $24 billion in its commercial pipeline of opportunities not yet in backlog, with $2 billion of customer commitments not yet in backlog [19] - The global nitrogen rejection unit (NRU) market is expected to grow at a 6.3% CAGR from 2025 to 2033, indicating a growing opportunity for the company [15] - The LNG end market ended 2024 strong, with expectations for expanded commercial pipeline opportunities in regions like India, the Philippines, and Japan [19] Company Strategy and Development Direction - The company aims to achieve a net leverage ratio target of 2 to 2.5% by 2025, with no share repurchases or material cash acquisitions until that target is met [26] - The company is focusing on expanding its service arrangements and partnerships, such as with ExxonMobil and Cheniere, to enhance its market position [21] - The company is committed to optimizing its capital structure and has taken steps to mitigate impacts from tariffs and supply chain disruptions [42][43] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving growth across all four segments in 2025 compared to 2024, with specific expectations for RSL, HTS, CTS, and specialty segments [52] - The company anticipates that the first quarter of 2025 will be its lowest quarter of the year, typical for the company, with expectations for sequential growth in the second half of 2025 [41] - Management highlighted the importance of backlog conversion and the potential impact of foreign exchange on sales, estimating a 2% negative impact if current rates hold [39] Other Important Information - The company has seen strong demand in the data center market, with plans to hire a dedicated team member to focus on this sector [92] - The company reported record orders in the hydrogen market in Europe for 2024, indicating strong growth potential in this area [18] Q&A Session Summary Question: 2025 guidance and segment performance - Management reiterated that RSL is expected to grow high single-digit to 10%, with HTS and LNG also anticipated to contribute positively to growth in 2025 [49][50] Question: CTS performance and China exposure - Management noted a good start to 2025 for CTS, despite previous declines, and emphasized a diversified supply chain that is not heavily reliant on China [64][66] Question: Aftermarket growth outlook - Management expressed confidence in the growth outlook for the aftermarket segment, with strong visibility to service and repair projects for 2025 [78] Question: Data center market discussions - Management indicated consistent discussions with data center providers regarding their increasing energy needs and the company's plans to capitalize on this opportunity [90][92] Question: LNG orders and commitments - Management estimated that LNG orders constituted approximately 20 to 25% of total orders in 2024, with expectations for similar levels in 2025 [102] Question: Impact of inefficiencies on margins - Management clarified that inefficiencies related to the Teddy 2 facility impacted margins in 2024, but these costs are not expected to recur [110][111]

Core Insights - Chart Industries reported strong growth in order volumes but fell short of earnings and revenue expectations for Q4 2024 [2][9] - Adjusted EPS was $2.66, missing the estimate of $3.10, while revenue reached $1.11 billion against an anticipated $1.16 billion [2][3] Financial Performance - Adjusted EPS increased by 32.3% year-over-year from $2.01 in Q4 2023 [3] - Revenue grew by 10.8% compared to Q4 2023, which was $1.01 billion [3] - Free Cash Flow surged by 140.5% to $261 million from $108.5 million in Q4 2023 [3] - Adjusted Operating Margin improved by 1 percentage point to 22% [3][8] Business Overview - Chart Industries focuses on solutions for the clean energy transition, including LNG, hydrogen, and carbon capture technologies [4] - The company aims to enhance market penetration and technological innovation to meet sustainable practices demands [4] Recent Initiatives - The company is expanding operations to meet surging demand in clean energy sectors and has acquired Howden to enhance capacity and innovation [5] - Strategic partnerships with companies like ExxonMobil and Bloom Energy are part of its clean energy solutions engagement [8] Quarterly Highlights - Order volume increased by 29.4% year-over-year to $1.55 billion, driven by major LNG projects [6] - Sales rose by 10.8%, excluding foreign exchange impacts, with strong performances in Specialty Products and Heat Transfer Systems [6] Segment Performance - The Heat Transfer Systems sector saw orders increase by 66.3% and sales growth of 14.2% [7] - Specialty Products experienced a sales surge of 47.7%, driven by growth in carbon capture and space exploration sectors [7] - Cryo Tank Solutions faced a 26.4% sales drop due to declining demand in EMEA [7] Future Outlook - Management projects 2025 sales between $4.65 billion and $4.85 billion, with adjusted EPS forecasted between $12.00 and $13.00 [10] - The company emphasizes operational improvements as a foundation for continued growth [10]

Core Insights - Chart Industries reported $1.11 billion in revenue for Q4 2024, a 9% year-over-year increase, but fell short of the Zacks Consensus Estimate by 5.58% [1] - The EPS for the quarter was $2.66, compared to $2.25 a year ago, but also missed the consensus estimate of $3.19 by 16.61% [1] Financial Performance - Revenue and EPS figures indicate a mixed performance against Wall Street expectations, which is critical for investor decision-making [2] - The stock has returned -13.8% over the past month, underperforming the Zacks S&P 500 composite's -2.4% change [3] Backlog and Orders - Total backlog reached $4.85 billion, exceeding the average estimate of $4.51 billion [4] - Backlog for Heat Transfer Systems was $2.10 billion, above the estimated $1.88 billion [4] - Orders for Heat Transfer Systems were $536.10 million, significantly higher than the average estimate of $305.30 million [4] Sales Performance - Sales for Heat Transfer Systems were $288.80 million, slightly below the average estimate of $304.83 million, but showed a year-over-year increase of 13.2% [4] - Sales for Specialty Products were $316.90 million, compared to an average estimate of $327.82 million, reflecting a substantial year-over-year increase of 46% [4] - Sales for Cryo Tank Solutions were $150.20 million, missing the estimate of $169.81 million, marking a 27% decline year-over-year [4]

分组1 - Chart Industries reported quarterly earnings of $2.66 per share, missing the Zacks Consensus Estimate of $3.19 per share, representing an earnings surprise of -16.61% [1] - The company posted revenues of $1.11 billion for the quarter ended December 2024, missing the Zacks Consensus Estimate by 5.58%, compared to year-ago revenues of $1.02 billion [2] - Chart Industries has not surpassed consensus EPS estimates over the last four quarters, indicating a trend of underperformance [2] 分组2 - The stock has lost about 4.5% since the beginning of the year, while the S&P 500 has declined by -0.3% [3] - The current consensus EPS estimate for the coming quarter is $2.23 on revenues of $1.04 billion, and for the current fiscal year, it is $12.57 on revenues of $4.69 billion [7] - The Zacks Industry Rank for Manufacturing - General Industrial is currently in the bottom 40% of over 250 Zacks industries, which may impact stock performance [8]

Financial Performance - Full year 2024 sales totaled $4.16 billion, reflecting a 17.5% organic growth, excluding foreign exchange impacts[9] - Adjusted operating income for full year 2024 was $876.3 million, resulting in a 21.1% adjusted operating income margin, an increase of 400 basis points compared to 2023[10] - Fourth quarter 2024 EBITDA was $283.6 million, representing a 25.6% margin, an increase of 190 basis points[4] - Q4 2024 sales reached $1,106.8 million, a 9% increase from $1,015.0 million in Q4 2023[37] - Full year 2024 sales totaled $4,160.3 million, up 24% from $3,352.5 million in 2023[37] - Gross profit for Q4 2024 was $372.3 million, compared to $334.3 million in Q4 2023, reflecting an increase of 11%[37] - Operating income for Q4 2024 was $188.3 million, a 20% increase from $156.0 million in Q4 2023[37] - Net income attributable to Chart Industries, Inc. for Q4 2024 was $79.6 million, up 60% from $49.8 million in Q4 2023[38] - Diluted earnings per share for Q4 2024 was $1.58, compared to $0.92 in Q4 2023, representing a 72% increase[38] - Adjusted earnings attributable to Chart Industries, Inc. for 2024 are projected to be $8.36 per share, reflecting strong operational performance[54] Orders and Backlog - Fourth quarter 2024 orders reached $1.55 billion, a 29.4% increase, contributing to a backlog of $4.85 billion[4] - Specialty Products orders in fourth quarter 2024 increased by 27.7% to $509.3 million, driven by significant growth in carbon capture and space exploration[21] - Heat Transfer Systems (HTS) orders in fourth quarter 2024 increased 66.3% to $536.1 million, marking a record for the segment[18] - Orders for consolidated products totaled $1,553.1 million in Q4 2024, a 28.5% increase from $1,209.1 million in Q4 2023[50] - The backlog as of December 31, 2024, was $4,845.1 million, up from $4,535.3 million as of September 30, 2024[50] Cash Flow and Assets - Full year 2024 free cash flow was $387.9 million, contributing to a net leverage ratio of 2.80 as of December 31, 2024[15] - Net cash provided by continuing operating activities reached $281.5 million in Q4 2024, compared to $128.7 million in Q4 2023, marking a 118.3% increase[41] - Cash and cash equivalents at the end of the period were $310.5 million, up from $201.1 million in 2023, a 54.4% increase[42] - Total current assets rose to $2,465.4 million as of December 31, 2024, compared to $2,214.4 million in 2023, reflecting an increase of 11.3%[46] - Inventories decreased to $490.5 million in 2024 from $576.3 million in 2023, a reduction of 14.9%[46] Debt and Investments - Long-term debt increased to $3,640.7 million in 2024 from $3,576.4 million in 2023, an increase of 1.8%[46] - The company reported a net cash used in investing activities of $(19.7) million in Q4 2024, compared to a net cash provided of $164.8 million in Q4 2023[41] - Capital expenditures for the year ended December 31, 2024, were $120.8 million, down from $135.6 million in 2023[59] Strategic Focus and Outlook - The company anticipates 2025 sales in the range of $4.65 billion to $4.85 billion, with adjusted EBITDA between $1.175 billion and $1.225 billion[25] - The company has over $2.0 billion in customer commitments not yet booked into backlog, supporting a strong demand outlook for 2025[12] - The company is focused on integrating the Howden acquisition to achieve anticipated revenue and earnings benefits[29] - Future growth may be impacted by supply chain challenges and geopolitical risks, including conflicts in the Middle East and Ukraine[29] - The company plans to discuss its Q4 2024 financial results in a conference call scheduled for February 28, 2025[33] Operational Efficiency - Full year 2024 gross margin improved to 33.4%, reflecting the positive impact of Chart Business Excellence initiatives[9] - Gross profit margin improved to 33.6% in Q4 2024, compared to 32.9% in Q4 2023[48] - Adjusted operating income (non-GAAP) for Q4 2024 was $243.4 million, compared to $213.4 million in Q4 2023, reflecting a 14.1% increase[64] - The operating income margin for Q4 2024 was 17.0%, up from 15.4% in Q4 2023[61] - Corporate operating loss decreased to $(45.0) million in Q4 2024 from $(39.3) million in Q4 2023, indicating improved cost management[48]