Emerson (EMR) Q1 Earnings Beat Estimates, Revenues Rise Y/Y

Financial Performance - Emerson Electric Co reported Q1 fiscal 2024 adjusted earnings of $1 22 per share beating the Zacks Consensus Estimate of $1 04 and showing a 56 4% increase from the year-ago quarter [1] - Net sales for Q1 fiscal 2024 were $4 1 billion surpassing the consensus estimate of $3 9 billion and marking a 22 1% year-over-year increase with underlying sales up 10% [1] Segmental Performance - The Intelligent Devices segment reported net sales of $2 8 billion an 11% year-over-year increase with Final Control revenues at $940 million Measurement & Analytical at $947 million Discrete Automation at $613 million and Safety & Productivity at $322 million [2] - The Software and Control Automation Solutions segment generated net sales of $1 31 billion a 3% year-over-year increase with Control Systems & Software revenues at $675 million AspenTech at $257 million and Test & Measurement at $382 million [3] Margins and Expenses - Cost of sales increased 25 6% year over year to $2 2 billion while the pre-tax earnings margin was 3 4% compared to 12 5% in the year-ago quarter Adjusted EBITA margin improved to 23 4% from 19 7% [4] - Selling general and administrative expenses rose 24% to $1 3 billion [4] Balance Sheet and Cash Flow - Cash and cash equivalents stood at $2 1 billion at the end of Q1 fiscal 2024 down from $8 1 billion at the end of fiscal 2023 Long-term debt was $7 63 billion [5] - Net cash from operating activities was $415 million a 0 7% decrease from the year-ago period Capital expenditure increased to $77 million from $59 million [5] - The company paid dividends of $300 million and repurchased common stocks worth $175 million [5] Outlook - For Q2 fiscal 2024 Emerson anticipates net sales growth of 12 5-14 5% and underlying sales growth of 3 5-5 5% with earnings per share expected to be 68-72 cents and adjusted earnings per share of $1 22-$1 26 [6][7] - For fiscal 2024 the company raised its net sales growth outlook to 14 5-17% and underlying sales growth to 4 5-6 5% Adjusted earnings per share are estimated at $5 30-$5 45 with operating cash flow expected to be $3 0-$3 1 billion and free cash flow at $2 6-$2 7 billion [8] Industry Performance - Tetra Tech Inc reported Q1 fiscal 2024 adjusted earnings of $1 40 per share surpassing the Zacks Consensus Estimate of $1 35 with adjusted revenues of $1 2 billion a 37 3% year-over-year increase [9] - A O Smith Corporation reported Q4 2023 adjusted earnings of 97 cents per share beating the Zacks Consensus Estimate of 96 cents with net sales of $988 1 million a 5 6% year-over-year increase [10] - Illinois Tool Works Inc reported Q4 2023 adjusted earnings of $2 42 per share surpassing the Zacks Consensus Estimate of $2 40 with revenues of $3 98 billion a 0 3% year-over-year increase [10]