Chart(GTLS) Haitong Securities International·2025-05-02 08:20Investment Rating - The report maintains an "Outperform" rating for Chart Industries, expecting a relative return exceeding 10% over the next 12-18 months [12]. Core Insights - Chart Industries reported slightly better-than-expected earnings for Q1 2025, driven by strong performance in specialty products and a solid backlog of orders, which reached a record high of $5.14 billion [2][3]. - The company reaffirmed its guidance for FY 2025, projecting revenues between $4.65 billion and $4.85 billion, with adjusted EBITDA expected to be between $1.175 billion and $1.225 billion [3]. - The company emphasized that the impact of tariffs is limited and can be offset by cost reductions, maintaining a positive outlook on liquefied natural gas contracts [2][3]. Summary by Sections Financial Performance - Adjusted net income for Q1 2025 was $84 million, slightly above the consensus estimate of $79 million, with revenues of $1.002 billion, close to the expected $1.01 billion [2]. - The adjusted EBITDA was $231 million, exceeding the consensus of $228 million, with a gross margin of 33.9%, aligning with the mid-point of the company's guidance [2][5]. Order Backlog - The backlog of orders reached a historic high of $5.14 billion, up from $4.85 billion in Q4 2024, with total orders for the quarter amounting to $1.32 billion [2][3]. Guidance Reaffirmation - The company reiterated its FY 2025 guidance, expecting adjusted earnings per share between $12 and $13, and free cash flow between $550 million and $600 million, compared to $388 million in FY 2024 [3]. - The net leverage ratio increased to 2.91 times, but the company remains confident in achieving its target leverage ratio of 2.0 to 2.5 times [3]. Mid-term Outlook - Chart Industries expects organic revenue growth to remain in the mid-teens, with gross margins maintaining in the mid-30% range and free cash flow conversion rates of 95%-100% [3].