MSA Safety rporated(US:MSA)2022-10-27 19:03Financial Performance - Net sales for the third quarter of 2022 were $381.7 million, an increase of $41.5 million, or 12.2%, compared to $340.2 million in the same period last year [115]. - Net sales in the Americas segment increased to $276.1 million, up $47.0 million or 20.5%, while the International segment saw a decrease to $105.6 million, down $5.5 million or 5.0% [116][118]. - Net sales for the nine months ended September 30, 2022, were $1,084.7 million, an increase of $94.8 million, or 9.6%, compared to $989.9 million in the same period last year [143]. - Net sales for the nine months ended September 30, 2022, were $1,084.7 million, an increase from $989.9 million in the same period in 2021, representing a growth of approximately 9.6% [162]. Profitability - Gross profit for the third quarter of 2022 was $169.4 million, an increase of $20.0 million or 13.4%, with a gross profit margin of 44.4% compared to 43.9% in the same quarter last year [122]. - Gross profit for the nine months ended September 30, 2022, was $476.6 million, an increase of $39.4 million or 9.0%, with a gross profit margin of 43.9% [149]. - Consolidated operating income for the third quarter of 2022 was $64.3 million, compared to $32.4 million in the same period last year, driven by increased sales and lower expenses [130]. - Adjusted operating income for the Americas segment was $184.7 million, an increase of $42.5 million, or 29.9%, compared to $142.2 million in the prior year [158]. - Adjusted operating income for the International segment was $34.7 million, a decrease of $7.3 million, or 17.4%, compared to $42.0 million in the prior year [159]. - Adjusted operating income for the nine months ended September 30, 2022, was $194.6 million, compared to $160.6 million for the same period in 2021, reflecting an increase of about 21.1% [162]. - Adjusted EBITDA for the three months ended September 30, 2022, was $86,643, with an adjusted EBITDA margin of 30.4% [135]. - Adjusted EBITDA for the nine months ended September 30, 2022, was $229.5 million, up from $194.3 million in the same period in 2021, indicating a growth of approximately 18.1% [162]. Expenses - Selling, general and administrative expenses decreased by $4.7 million or 5.4% to $82.8 million, representing 21.7% of net sales compared to 25.7% in the prior year [124]. - Research and development expenses were $14.4 million, a decrease of $0.5 million compared to $14.9 million in the same period last year, representing 3.8% of net sales [126]. - SG&A expenses were $247.4 million during the nine months ended September 30, 2022, an increase of $1.1 million or 0.4%, representing 22.8% of net sales [150]. - Research and development expense was $43.0 million during the nine months ended September 30, 2022, an increase of $0.9 million compared to the same period last year [152]. Income and Tax - Net income attributable to MSA Safety Incorporated was $44.9 million for the third quarter of 2022, or $1.14 per diluted share, compared to $21.2 million, or $0.54 per diluted share, for the same period last year [141]. - Net income attributable to MSA Safety Incorporated for the nine months ended September 30, 2022, was $128.1 million, or $3.25 per diluted share, compared to $82.8 million, or $2.10 per diluted share, for the same period last year, marking a significant increase of 54.8% in net income [167]. - The reported effective tax rate for the third quarter of 2022 was 26.0%, down from 31.5% for the same quarter in 2021 [139]. - The effective tax rate for the nine months ended September 30, 2022, was 24.4%, a decrease from 26.0% in the same period in 2021, due to various tax benefits and changes in nondeductible expenses [165]. Cash Flow and Investments - Cash and cash equivalents totaled $159.6 million at September 30, 2022, with an increase of $19.8 million during the nine months, compared to a decrease of $43.2 million in the same period in 2021 [172]. - Operating activities provided cash of $103.9 million during the nine months ended September 30, 2022, down from $130.1 million in the same period in 2021, primarily due to increased working capital requirements [173]. - Investing activities used cash of $4.4 million during the nine months ended September 30, 2022, significantly lower than $402.6 million used in the same period in 2021, mainly due to the absence of acquisitions [175]. - Financing activities used cash of $56.2 million during the nine months ended September 30, 2022, compared to cash provided of $233.4 million in the same period in 2021, reflecting a shift in capital allocation strategies [176]. Currency Impact - Currency exchange losses were $3.0 million in the third quarter of 2022, compared to losses of $0.1 million in the same period last year [128]. - Currency exchange losses were $4.8 million during the nine months ended September 30, 2022, compared to gains of $0.4 million in the same period of 2021 [154]. - A hypothetical 10% strengthening of the U.S. dollar would decrease reported sales by approximately $14.6 million or 3.8% for the three months ended September 30, 2022 [185]. Future Outlook - The company expects fourth quarter revenue to increase in the low to mid single-digit range compared to the fourth quarter of 2021 [119]. - The company has implemented additional price increases in response to inflation in electronic components and other inputs [123].