- Net sales of $6.7 billion up 12%
versus second quarter 2023; organic sales up 2%
- GAAP EPS of $2.55 up
significantly and adjusted EPS of $0.87 up double-digits
- GAAP operating margin expanded significantly year over year;
adjusted operating margin expanded 200 bps
- Reaffirming full year 2024 adjusted EPS guidance range
- Closed two of four business exit transactions; remaining two
on-track
- Expect to repurchase about $1
billion worth of shares in the second half of 2024
PALM
BEACH GARDENS, Fla., July 25,
2024 /PRNewswire/ -- Carrier Global Corporation
(NYSE:CARR), global leader in intelligent climate and energy
solutions, today reported strong financial results for the second
quarter of 2024 and reaffirmed its full year earnings guidance.
"Carrier delivered another quarter of strong financial
performance, while making great progress with our portfolio
transformation," said Carrier Chairman & CEO David Gitlin. "We delivered solid sales and
roughly 30% orders growth as we continue to outperform in our
markets. Our strong operational execution drove 200 basis points of
adjusted operating margin expansion and double-digit adjusted
earnings growth. Year-to-date, we also closed on two of our four
business exits, and the remaining two continue to track well. The
proceeds from the exits, combined with our strong free cash flow
performance, have enabled us to reduce net debt by about
$5 billion in the quarter and we now
plan to repurchase about $1 billion
of shares in the second half of 2024."
Second Quarter 2024 Results
Carrier's second quarter sales of $6.7
billion were up 12% compared to the prior year including 2%
organic growth and approximately 12% contribution from the
acquisition of Viessmann Climate Solutions offset by about 2% from
divestitures. Foreign currency translation had a 1% negative impact
on sales. Organic sales in the HVAC segment were up 2%. HVAC sales
in the Americas were up mid-single digits driven by continued
strength in Commercial and Light Commercial businesses both of
which were up double-digits. North America Residential HVAC sales
were up about mid-single digits. HVAC organic sales in EMEA were up
low-single-digits with Commercial HVAC up mid-teens, offsetting a
decline in EMEA Residential and Light Commercial HVAC. These
organic figures exclude the contribution of Viessmann Climate
Solutions which was down almost 30% year-over-year in the quarter,
roughly one third of which was driven by lower solar PV
sales. HVAC sales in Asia
Pacific were down high-single-digits with declines driven by
residential light commercial in China, partially offset by Southeast Asia which was up
double-digits. Refrigeration sales were up 1% organically
driven by over 30% growth in container, mostly offset by
North America truck and trailer
and commercial refrigeration. Fire and Security showed broad-based
growth and sales were up 3% organically in the quarter. The
residential and commercial fire organic sales, the last of our four
business exits, were up mid-single digits.
GAAP operating profit in the quarter of $3.7 billion was up over 650% from last year
primarily due to the gain on the sale of Access Solutions and the
addition of Viessmann Climate Solutions. Adjusted operating profit
of $1.2 billion was up 26%, mostly
driven by the addition of Viessmann Climate Solutions.
Net income was $2.3 billion and
adjusted net income was $793 million.
GAAP EPS was $2.55 and adjusted EPS
was $0.87. Net cash flows generated
from operating activities were $660
million and capital expenditures were $111 million, resulting in free cash flow of
$549 million. During the
second-quarter, Carrier received $5.0
billion in cash proceeds from the sale of Access Solutions,
redeemed $1.0 billion of its
long-term notes, and repaid €2.3 billion of its term-loans.
Full-Year 2024 Guidance**
Carrier updated the following guidance for 2024, which now
includes Commercial Refrigeration for nine-months.
|
Current
Guidance
|
Prior
Guidance
|
|
|
|
|
Sales
|
~$25.5B
Organic* up
MSD
FX
(1%)
Acquisitions
+16%
Divestitures
(5%)
|
~$26B
Organic* up
MSD
FX
(0%)
Acquisitions
+18%
Divestitures
(6%)
|
|
Adjusted Operating
Margin*
|
~15.5%
|
~15.5%
|
|
Adjusted
EPS*
|
$2.80 -
$2.90
|
$2.80 -
$2.90
|
|
Free Cash
Flow*
|
~$0.4B
Includes ~$2B of
expected tax payments
on the gains from the announced
business exits, restructuring, and
transaction-related costs
|
~$0.4B
Includes ~$2B of
expected tax payments
on the gains from the announced
business exits, restructuring, and
transaction-related costs
|
|
*Note: When the
company provides expectations for organic sales, adjusted operating
profit, adjusted operating margin, adjusted EPS and free cash flow
on a forward-looking basis, a reconciliation of the differences
between the non-GAAP expectations and the corresponding GAAP
measures generally is not available without unreasonable effort.
See "Use and Definitions of Non-GAAP Financial Measures" below for
additional information.
|
|
**As of July 25,
2024
|
Conference Call
Carrier will host a webcast of its earnings conference call
today, Thursday, July 25, 2024, at
7:30 a.m. ET. To access the webcast,
visit the Events & Presentations section of the Carrier
Investor Relations site at
ir.carrier.com/news-and-events/events-and-presentations or to
listen to the earnings call by phone, participants must
pre-register at Carrier Earnings Call Registration. All
registrants will receive dial-in information and a PIN allowing
access to the live call.
Cautionary Statement
This communication contains
statements which, to the extent they are not statements of
historical or present fact, constitute "forward-looking statements"
under the securities laws. These forward-looking statements are
intended to provide management's current expectations or plans for
Carrier's future operating and financial performance, based on
assumptions currently believed to be valid. Forward-looking
statements can be identified by the use of words such as "believe,"
"expect," "expectations," "plans," "strategy," "prospects,"
"estimate," "project," "target," "anticipate," "will," "should,"
"see," "guidance," "outlook," "confident," "scenario" and other
words of similar meaning in connection with a discussion of future
operating or financial performance. Forward-looking statements may
include, among other things, statements relating to future sales,
earnings, cash flow, results of operations, uses of cash, share
repurchases, tax rates and other measures of financial performance
or potential future plans, strategies or transactions of Carrier,
our portfolio transformation and the use of the anticipated
proceeds thereof, potential future investments, Carrier's plans
with respect to its indebtedness and other statements that are not
historical facts. All forward-looking statements involve risks,
uncertainties and other factors that may cause actual results to
differ materially from those expressed or implied in the
forward-looking statements. For additional information on
identifying factors that may cause actual results to vary
materially from those stated in forward-looking statements, see
Carrier's reports on Forms 10-K, 10-Q and 8-K filed with or
furnished to the U.S. Securities and Exchange Commission from time
to time. Any forward-looking statement speaks only as of the date
on which it is made, and Carrier assumes no obligation to update or
revise such statement, whether as a result of new information,
future events or otherwise, except as required by applicable
law.
About Carrier
Carrier Global Corporation, global
leader in intelligent climate and energy solutions, is committed to
creating solutions that matter for people and our planet for
generations to come. From the beginning, we've led in inventing new
technologies and entirely new industries. Today, we continue to
lead because we have a world-class, diverse workforce that puts the
customer at the center of everything we do. For more information,
visit corporate.carrier.com or follow Carrier on social media at
@Carrier.
CARR-IR
|
Contact:
|
|
|
Investor
Relations
|
|
Sam
Pearlstein
|
|
561-365-2251
|
|
Sam.Pearlstein@Carrier.com
|
|
|
|
Media
Inquiries
|
|
Rob Six
|
|
561-281-2362
|
|
Rob.Six@Carrier.com
|
SELECTED FINANCIAL DATA, NON-GAAP MEASURES AND
DEFINITIONS
Following are tables that present selected financial data of
Carrier Global Corporation ("Carrier"). Also included are
reconciliations of non-GAAP measures to their most comparable GAAP
measures.
Use and Definitions of Non-GAAP Financial
Measures
Carrier Global Corporation ("Carrier") reports its
financial results in accordance with accounting principles
generally accepted in the United
States ("GAAP"). We supplement the reporting of our
financial information determined under GAAP with certain non-GAAP
financial information. The non-GAAP information presented provides
investors with additional useful information, but should not be
considered in isolation or as substitutes for the related GAAP
measures. Moreover, other companies may define non-GAAP measures
differently, which limits the usefulness of these measures for
comparisons with such other companies. We encourage investors to
review our financial statements and publicly filed reports in their
entirety and not to rely on any single financial measure. A
reconciliation of the non-GAAP measures to the corresponding
amounts prepared in accordance with GAAP appears in the tables in
this Appendix. The tables provide additional information as to the
items and amounts that have been excluded from the adjusted
measures.
Organic sales, adjusted operating profit, adjusted operating
margin, incremental margins / earnings conversion, earnings before
interest, taxes and depreciation and amortization ("EBITDA"),
adjusted EBITDA, adjusted net income, adjusted earnings per share
("EPS"), adjusted interest expense, net, adjusted effective tax
rate and net debt are non-GAAP financial measures.
Organic sales represents consolidated net sales (a GAAP
measure), excluding the impact of foreign currency translation,
acquisitions and divestitures completed in the preceding twelve
months and other significant items of a nonoperational nature
(hereinafter referred to as "other significant items"). Adjusted
operating profit represents operating profit (a GAAP measure),
excluding restructuring costs, amortization of acquired intangibles
and other significant items. Adjusted operating margin represents
adjusted operating profit as a percentage of net sales (a GAAP
measure). Incremental margins / earnings conversion represents the
year-over-year change in adjusted operating profit divided by the
year-over-year change in net sales. EBITDA represents net income
attributable to common shareholders (a GAAP measure), adjusted for
interest income and expense, income tax expense, and depreciation
and amortization. Adjusted EBITDA represents EBITDA, as calculated
above, excluding non-service pension benefit, non-controlling
interest in subsidiaries' earnings from operations, restructuring
costs and other significant items. Adjusted net income represents
net income attributable to common shareowners (a GAAP measure),
excluding restructuring costs, amortization of acquired intangibles
and other significant items. Adjusted EPS represents diluted
earnings per share (a GAAP measure), excluding restructuring costs,
amortization of acquired intangibles and other significant items.
Adjusted interest expense, net represents interest expense (a GAAP
measure) and interest income (a GAAP measure), net excluding other
significant items. The adjusted effective tax rate represents the
effective tax rate (a GAAP measure), excluding restructuring costs,
amortization of acquired intangibles and other significant items.
Net debt represents long-term debt (a GAAP measure) less cash and
cash equivalents (a GAAP measure). For the business segments, when
applicable, adjustments of operating profit and operating margins
represent operating profit, excluding restructuring, amortization
of acquired intangibles and other significant items.
Free cash flow is a non-GAAP financial measure that represents
net cash flows provided by operating activities (a GAAP measure)
less capital expenditures. Management believes free cash flow is a
useful measure of liquidity and an additional basis for assessing
Carrier's ability to fund its activities, including the financing
of acquisitions, debt service, repurchases of Carrier's common
stock and distribution of earnings to shareowners.
Orders are contractual commitments with customers to provide
specified goods or services for an agreed upon price and may not be
subject to penalty if cancelled.
When we provide our expectations for organic sales, adjusted
operating profit, adjusted operating margin, adjusted interest
expense, net, adjusted effective tax rate, incremental
margins/earnings conversion, EBITDA, adjusted EBITDA, adjusted EPS
and free cash flow on a forward-looking basis, a reconciliation of
the differences between the non-GAAP expectations and the
corresponding GAAP measures (expected net sales, operating profit,
operating margin, interest expense, effective tax rate, incremental
operating margin, net income attributable to common shareowners,
diluted EPS and net cash flows provided by operating activities)
generally is not available without unreasonable effort due to
potentially high variability, complexity and low visibility as to
the items that would be excluded from the GAAP measure in the
relevant future period, such as unusual gains and losses, the
ultimate outcome of pending litigation, fluctuations in foreign
currency exchange rates, the impact and timing of potential
acquisitions and divestitures, future restructuring costs, and
other structural changes or their probable significance. The
variability of the excluded items may have a significant, and
potentially unpredictable, impact on our future GAAP results.
|
Carrier Global
Corporation
Condensed
Consolidated Statement of Operations
|
|
|
|
|
|
(Unaudited)
|
|
|
Three Months
Ended
June 30,
|
|
Six Months
Ended
June 30,
|
|
(In millions,
except per share amounts)
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
Net
sales
|
|
|
|
|
|
|
|
|
|
Product
sales
|
|
$
6,004
|
|
$
5,355
|
|
$
11,546
|
|
$
10,041
|
|
Service
sales
|
|
685
|
|
637
|
|
1,325
|
|
1,224
|
|
Total Net
sales
|
|
6,689
|
|
5,992
|
|
12,871
|
|
11,265
|
|
Costs and
expenses
|
|
|
|
|
|
|
|
|
|
Cost of products
sold
|
|
(4,296)
|
|
(3,769)
|
|
(8,294)
|
|
(7,227)
|
|
Cost of services
sold
|
|
(515)
|
|
(468)
|
|
(994)
|
|
(905)
|
|
Research and
development
|
|
(187)
|
|
(151)
|
|
(411)
|
|
(290)
|
|
Selling, general and
administrative
|
|
(975)
|
|
(784)
|
|
(1,960)
|
|
(1,505)
|
|
Total Costs and
expenses
|
|
(5,973)
|
|
(5,172)
|
|
(11,659)
|
|
(9,927)
|
|
Equity method
investment net earnings
|
|
90
|
|
52
|
|
121
|
|
96
|
|
Other income
(expense), net
|
|
2,885
|
|
(383)
|
|
2,858
|
|
(390)
|
|
Operating
profit
|
|
3,691
|
|
489
|
|
4,191
|
|
1,044
|
|
Non-service pension
(expense) benefit
|
|
(1)
|
|
—
|
|
(1)
|
|
—
|
|
Interest (expense)
income, net
|
|
(166)
|
|
(67)
|
|
(331)
|
|
(113)
|
|
Income from
operations before income taxes
|
|
3,524
|
|
422
|
|
3,859
|
|
931
|
|
Income tax (expense)
benefit
|
|
(1,155)
|
|
(189)
|
|
(1,201)
|
|
(311)
|
|
Net income from
operations
|
|
2,369
|
|
233
|
|
2,658
|
|
620
|
|
Less: Non-controlling
interest in subsidiaries' earnings from operations
|
|
32
|
|
34
|
|
52
|
|
48
|
|
Net income
attributable to common shareowners
|
|
$
2,337
|
|
$
199
|
|
$
2,606
|
|
$
572
|
|
|
|
|
|
|
|
|
|
|
Earnings per
share
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
2.59
|
|
$
0.24
|
|
$
2.90
|
|
$
0.68
|
|
Diluted
|
|
$
2.55
|
|
$
0.23
|
|
$
2.85
|
|
$
0.67
|
|
Weighted-average
number of shares outstanding
|
|
|
|
|
|
|
|
|
|
Basic
|
|
902.4
|
|
836.0
|
|
900.2
|
|
835.5
|
|
Diluted
|
|
915.3
|
|
850.9
|
|
913.6
|
|
851.5
|
|
Carrier Global
Corporation
Condensed
Consolidated Balance Sheet
|
|
|
|
|
|
(Unaudited)
|
|
(In
millions)
|
|
June 30,
2024
|
|
December 31,
2023
|
|
Assets
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
2,919
|
|
$
10,015
|
|
Accounts receivable,
net
|
|
3,187
|
|
2,481
|
|
Contract
assets
|
|
333
|
|
306
|
|
Inventories,
net
|
|
3,045
|
|
2,217
|
|
Assets held for
sale
|
|
1,601
|
|
3,314
|
|
Other current
assets
|
|
488
|
|
447
|
|
Total current
assets
|
|
11,573
|
|
18,780
|
|
Future income tax
benefits
|
|
939
|
|
739
|
|
Fixed assets,
net
|
|
3,117
|
|
2,293
|
|
Operating lease
right-of-use assets
|
|
635
|
|
491
|
|
Intangible assets,
net
|
|
7,048
|
|
1,028
|
|
Goodwill
|
|
15,245
|
|
7,989
|
|
Pension and
post-retirement assets
|
|
81
|
|
32
|
|
Equity method
investments
|
|
1,221
|
|
1,140
|
|
Other assets
|
|
565
|
|
330
|
|
Total
Assets
|
|
$
40,424
|
|
$
32,822
|
|
|
|
|
|
|
Liabilities and
Equity
|
|
|
|
|
|
Accounts
payable
|
|
$
3,181
|
|
$
2,742
|
|
Accrued
liabilities
|
|
4,262
|
|
2,811
|
|
Contract
liabilities
|
|
493
|
|
425
|
|
Liabilities held for
sale
|
|
687
|
|
862
|
|
Current portion of
long-term debt
|
|
2,080
|
|
51
|
|
Total current
liabilities
|
|
10,703
|
|
6,891
|
|
Long-term
debt
|
|
11,242
|
|
14,242
|
|
Future pension and
post-retirement obligations
|
|
247
|
|
155
|
|
Future income tax
obligations
|
|
2,184
|
|
535
|
|
Operating lease
liabilities
|
|
501
|
|
391
|
|
Other long-term
liabilities
|
|
1,468
|
|
1,603
|
|
Total
Liabilities
|
|
26,345
|
|
23,817
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
Common
stock
|
|
9
|
|
9
|
|
Treasury
stock
|
|
(1,972)
|
|
(1,972)
|
|
Additional paid-in
capital
|
|
8,563
|
|
5,535
|
|
Retained
earnings
|
|
8,854
|
|
6,591
|
|
Accumulated other
comprehensive loss
|
|
(1,686)
|
|
(1,486)
|
|
Non-controlling
interest
|
|
311
|
|
328
|
|
Total
Equity
|
|
14,079
|
|
9,005
|
|
Total Liabilities
and Equity
|
|
$
40,424
|
|
$
32,822
|
|
Carrier Global
Corporation
Condensed
Consolidated Statement of Cash Flows
|
|
|
|
Six Months
Ended
June 30,
|
|
(In
millions)
|
|
2024
|
|
2023
|
|
Operating
Activities
|
|
|
|
|
|
Net income from
operations
|
|
$
2,658
|
|
$
620
|
|
Adjustments to
reconcile net income to net cash flows from operating
activities:
|
|
|
|
|
|
Depreciation and
amortization
|
|
625
|
|
273
|
|
Deferred income tax
provision
|
|
(338)
|
|
(110)
|
|
Stock-based
compensation costs
|
|
48
|
|
40
|
|
Equity method
investment net earnings
|
|
(121)
|
|
(96)
|
|
(Gain) loss on sale of
investments / deconsolidation
|
|
(2,881)
|
|
276
|
|
Changes in operating
assets and liabilities
|
|
|
|
|
|
Accounts receivable,
net
|
|
(286)
|
|
(406)
|
|
Contract
assets
|
|
(62)
|
|
(40)
|
|
Inventories,
net
|
|
(2)
|
|
(59)
|
|
Other current
assets
|
|
(52)
|
|
(105)
|
|
Accounts payable and
accrued liabilities
|
|
1,118
|
|
120
|
|
Contract
liabilities
|
|
(19)
|
|
37
|
|
Distributions from
equity method investments
|
|
12
|
|
10
|
|
Other operating
activities, net
|
|
—
|
|
(56)
|
|
Net cash flows
provided by (used in) operating activities
|
|
700
|
|
504
|
|
|
|
|
|
|
Investing
Activities
|
|
|
|
|
|
Capital
expenditures
|
|
(215)
|
|
(144)
|
|
Investment in
businesses, net of cash acquired
|
|
(10,779)
|
|
(56)
|
|
Dispositions of
businesses
|
|
4,877
|
|
36
|
|
Settlement of
derivative contracts, net
|
|
(185)
|
|
(14)
|
|
Kidde-Fenwal, Inc.
deconsolidation
|
|
—
|
|
(134)
|
|
Other investing
activities, net
|
|
29
|
|
16
|
|
Net cash flows
provided by (used in) investing activities
|
|
(6,273)
|
|
(296)
|
|
|
|
|
|
|
Financing
Activities
|
|
|
|
|
|
Increase (decrease) in
short-term borrowings, net
|
|
—
|
|
(19)
|
|
Issuance of long-term
debt
|
|
2,555
|
|
6
|
|
Repayment of long-term
debt
|
|
(3,542)
|
|
(12)
|
|
Repurchases of common
stock
|
|
—
|
|
(62)
|
|
Dividends paid on
common stock
|
|
(330)
|
|
(309)
|
|
Dividends paid to
non-controlling interest
|
|
(67)
|
|
(41)
|
|
Other financing
activities, net
|
|
(22)
|
|
(69)
|
|
Net cash flows
provided by (used in) financing activities
|
|
(1,406)
|
|
(506)
|
|
Effect of foreign
exchange rate changes on cash and cash equivalents
|
|
(82)
|
|
(13)
|
|
Net increase
(decrease) in cash and cash equivalents and restricted cash,
including cash classified
in current assets held for sale
|
|
(7,061)
|
|
(311)
|
|
Less: Change in cash
balances classified as assets held for sale
|
|
34
|
|
—
|
|
Net increase (decrease)
in cash and cash equivalents and restricted cash
|
|
(7,095)
|
|
(311)
|
|
Cash, cash equivalents
and restricted cash, beginning of period
|
|
10,017
|
|
3,527
|
|
Cash, cash equivalents
and restricted cash, end of period
|
|
2,922
|
|
3,216
|
|
Less: restricted
cash
|
|
3
|
|
7
|
|
Cash and cash
equivalents, end of period
|
|
$
2,919
|
|
$
3,209
|
|
Carrier Global
Corporation
Segment Net Sales
and Operating Profit
|
|
|
|
(Unaudited)
|
|
Three Months
Ended June 30,
|
|
Six Months Ended
June 30,
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
(In
millions)
|
Reported
|
|
Adjusted
|
|
Reported
|
|
Adjusted
|
|
Reported
|
|
Adjusted
|
|
Reported
|
|
Adjusted
|
|
Net
sales
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
HVAC
|
$
4,970
|
|
$
4,970
|
|
$
4,216
|
|
$
4,216
|
|
$
9,511
|
|
$
9,511
|
|
$
7,838
|
|
$
7,838
|
|
Refrigeration
|
973
|
|
973
|
|
972
|
|
972
|
|
1,857
|
|
1,857
|
|
1,870
|
|
1,870
|
|
Fire &
Security
|
871
|
|
871
|
|
932
|
|
932
|
|
1,758
|
|
1,758
|
|
1,801
|
|
1,801
|
|
Segment
sales
|
6,814
|
|
6,814
|
|
6,120
|
|
6,120
|
|
13,126
|
|
13,126
|
|
11,509
|
|
11,509
|
|
Eliminations and
other
|
(125)
|
|
(125)
|
|
(128)
|
|
(128)
|
|
(255)
|
|
(255)
|
|
(244)
|
|
(244)
|
|
Net
sales
|
$
6,689
|
|
$
6,689
|
|
$
5,992
|
|
$
5,992
|
|
$
12,871
|
|
$
12,871
|
|
$
11,265
|
|
$
11,265
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
profit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
HVAC
|
$ 687
|
|
$ 991
|
|
$ 742
|
|
$ 791
|
|
$
1,116
|
|
$
1,711
|
|
$
1,177
|
|
$
1,281
|
|
Refrigeration
|
113
|
|
118
|
|
112
|
|
119
|
|
210
|
|
217
|
|
220
|
|
230
|
|
Fire &
Security
|
3,001
|
|
155
|
|
(157)
|
|
137
|
|
3,154
|
|
319
|
|
(64)
|
|
245
|
|
Segment operating
profit
|
3,801
|
|
1,264
|
|
697
|
|
1,047
|
|
4,480
|
|
2,247
|
|
1,333
|
|
1,756
|
|
Eliminations and
other
|
(23)
|
|
(20)
|
|
(146)
|
|
(35)
|
|
(98)
|
|
(54)
|
|
(184)
|
|
(71)
|
|
General corporate
expenses
|
(87)
|
|
(31)
|
|
(62)
|
|
(48)
|
|
(191)
|
|
(53)
|
|
(105)
|
|
(79)
|
|
Operating
profit
|
$
3,691
|
|
$
1,213
|
|
$
489
|
|
$
964
|
|
$
4,191
|
|
$
2,140
|
|
$
1,044
|
|
$
1,606
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
margin
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
HVAC
|
13.8 %
|
|
19.9 %
|
|
17.6 %
|
|
18.8 %
|
|
11.7 %
|
|
18.0 %
|
|
15.0 %
|
|
16.3 %
|
|
Refrigeration
|
11.6 %
|
|
12.1 %
|
|
11.5 %
|
|
12.2 %
|
|
11.3 %
|
|
11.7 %
|
|
11.8 %
|
|
12.3 %
|
|
Fire &
Security
|
344.5 %
|
|
17.8 %
|
|
(16.8) %
|
|
14.7 %
|
|
179.4 %
|
|
18.1 %
|
|
(3.6) %
|
|
13.6 %
|
|
Total
Carrier
|
55.2 %
|
|
18.1 %
|
|
8.2 %
|
|
16.1 %
|
|
32.6 %
|
|
16.6 %
|
|
9.3 %
|
|
14.3 %
|
|
Carrier Global
Corporation
Reconciliation of
Reported (GAAP) to Adjusted (Non-GAAP)
Operating
Profit
|
|
|
(Unaudited)
|
|
Three Months Ended
June 30, 2024
|
|
(In
millions)
|
HVAC
|
|
Refrigeration
|
|
Fire &
Security
|
|
Eliminations
and Other
|
|
General
Corporate
Expenses
|
|
Carrier
|
|
Net
sales
|
$
4,970
|
|
$
973
|
|
$
871
|
|
$
(125)
|
|
$
—
|
|
$
6,689
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment operating
profit
|
$
687
|
|
$
113
|
|
$
3,001
|
|
$
(23)
|
|
$
(87)
|
|
$
3,691
|
|
Reported operating
margin
|
13.8 %
|
|
11.6 %
|
|
344.5 %
|
|
|
|
|
|
55.2 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments to segment
operating profit:
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring
costs
|
$
25
|
|
$
1
|
|
$
3
|
|
$
3
|
|
$
—
|
|
$
32
|
|
Amortization of
acquired intangibles
|
170
|
|
—
|
|
—
|
|
—
|
|
—
|
|
170
|
|
Acquisition step-up
amortization (1)
|
109
|
|
—
|
|
—
|
|
—
|
|
—
|
|
109
|
|
Acquisition/divestiture-related costs
|
—
|
|
4
|
|
32
|
|
—
|
|
56
|
|
92
|
|
Access Solutions
gain
|
—
|
|
—
|
|
(2,881)
|
|
—
|
|
—
|
|
(2,881)
|
|
Total adjustments to
operating profit
|
$
304
|
|
$
5
|
|
$
(2,846)
|
|
$
3
|
|
$
56
|
|
$
(2,478)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted operating
profit
|
$
991
|
|
$
118
|
|
$
155
|
|
$
(20)
|
|
$
(31)
|
|
$
1,213
|
|
Adjusted operating
margin
|
19.9 %
|
|
12.1 %
|
|
17.8 %
|
|
|
|
|
|
18.1 %
|
|
|
(Unaudited)
|
|
Three Months Ended
June 30, 2023
|
|
(In
millions)
|
HVAC
|
|
Refrigeration
|
|
Fire &
Security
|
|
Eliminations
and Other
|
|
General
Corporate
Expenses
|
|
Carrier
|
|
Net
sales
|
$
4,216
|
|
$
972
|
|
$
932
|
|
$
(128)
|
|
$
—
|
|
$
5,992
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment operating
profit
|
$
742
|
|
$
112
|
|
$
(157)
|
|
$
(146)
|
|
$
(62)
|
|
$
489
|
|
Reported operating
margin
|
17.6 %
|
|
11.5 %
|
|
(16.8) %
|
|
|
|
|
|
8.2 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments to segment
operating profit:
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring
costs
|
$
3
|
|
$
7
|
|
$
(1)
|
|
$
—
|
|
$
—
|
|
$
9
|
|
Amortization of
acquired intangibles
|
36
|
|
—
|
|
2
|
|
—
|
|
—
|
|
38
|
|
Acquisition step-up
amortization (1)
|
10
|
|
—
|
|
—
|
|
—
|
|
—
|
|
10
|
|
Acquisition/divestiture-related costs
|
—
|
|
—
|
|
—
|
|
—
|
|
14
|
|
14
|
|
Viessmann-related
hedges
|
—
|
|
—
|
|
—
|
|
111
|
|
—
|
|
111
|
|
KFI
deconsolidation
|
—
|
|
—
|
|
293
|
|
—
|
|
—
|
|
293
|
|
Total adjustments to
operating profit
|
$
49
|
|
$
7
|
|
$
294
|
|
$
111
|
|
$
14
|
|
$
475
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted operating
profit
|
$
791
|
|
$
119
|
|
$
137
|
|
$
(35)
|
|
$
(48)
|
|
$
964
|
|
Adjusted operating
margin
|
18.8 %
|
|
12.2 %
|
|
14.7 %
|
|
|
|
|
|
16.1 %
|
|
(1) Amortization of the step-up to
fair value of acquired inventory and backlog.
|
|
Carrier Global
Corporation
Reconciliation of
Reported (GAAP) to Adjusted (Non-GAAP)
Operating
Profit
|
|
|
(Unaudited)
|
|
Six Months Ended
June 30, 2024
|
|
(In
millions)
|
HVAC
|
|
Refrigeration
|
|
Fire &
Security
|
|
Eliminations
and Other
|
|
General
Corporate
Expenses
|
|
Carrier
|
|
Net
sales
|
$
9,511
|
|
$
1,857
|
|
$
1,758
|
|
$
(255)
|
|
$
—
|
|
$
12,871
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment operating
profit
|
$
1,116
|
|
$
210
|
|
$
3,154
|
|
$
(98)
|
|
$
(191)
|
|
$
4,191
|
|
Reported operating
margin
|
11.7 %
|
|
11.3 %
|
|
179.4 %
|
|
|
|
|
|
32.6 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments to segment
operating profit:
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring
costs
|
$
32
|
|
$
1
|
|
$
10
|
|
$
4
|
|
$
—
|
|
$
47
|
|
Amortization of
acquired intangibles
|
342
|
|
—
|
|
—
|
|
—
|
|
—
|
|
342
|
|
Acquisition step-up
amortization (1)
|
220
|
|
—
|
|
—
|
|
—
|
|
—
|
|
220
|
|
Acquisition/divestiture-related costs
|
1
|
|
6
|
|
36
|
|
—
|
|
138
|
|
181
|
|
Viessmann-related
hedges
|
—
|
|
—
|
|
—
|
|
86
|
|
—
|
|
86
|
|
Gain on liability
adjustment (2)
|
—
|
|
—
|
|
—
|
|
(46)
|
|
—
|
|
(46)
|
|
Access Solutions
gain
|
—
|
|
—
|
|
(2,881)
|
|
—
|
|
—
|
|
(2,881)
|
|
Total adjustments to
operating profit
|
$
595
|
|
$
7
|
|
$
(2,835)
|
|
$
44
|
|
$
138
|
|
$
(2,051)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted operating
profit
|
$
1,711
|
|
$
217
|
|
$
319
|
|
$
(54)
|
|
$
(53)
|
|
$
2,140
|
|
Adjusted operating
margin
|
18.0 %
|
|
11.7 %
|
|
18.1 %
|
|
|
|
|
|
16.6 %
|
|
|
(Unaudited)
|
|
Six Months Ended
June 30, 2023
|
|
(In
millions)
|
HVAC
|
|
Refrigeration
|
|
Fire &
Security
|
|
Eliminations
and Other
|
|
General
Corporate
Expenses
|
|
Carrier
|
|
Net
sales
|
$
7,838
|
|
$
1,870
|
|
$
1,801
|
|
$
(244)
|
|
$
—
|
|
$ 11,265
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment operating
profit
|
$
1,177
|
|
$
220
|
|
$
(64)
|
|
$
(184)
|
|
$
(105)
|
|
$
1,044
|
|
Reported operating
margin
|
15.0 %
|
|
11.8 %
|
|
(3.6) %
|
|
|
|
|
|
9.3 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments to segment
operating profit:
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring
costs
|
$
2
|
|
$
10
|
|
$
12
|
|
$
2
|
|
$
—
|
|
$
26
|
|
Amortization of
acquired intangibles
|
73
|
|
—
|
|
4
|
|
—
|
|
—
|
|
77
|
|
Acquisition step-up
amortization (1)
|
21
|
|
—
|
|
—
|
|
—
|
|
—
|
|
21
|
|
Acquisition/divestiture-related costs
|
—
|
|
—
|
|
—
|
|
—
|
|
26
|
|
26
|
|
Viessmann-related
hedges
|
—
|
|
—
|
|
—
|
|
111
|
|
—
|
|
111
|
|
TCC
acquisition-related gain (3)
|
8
|
|
—
|
|
—
|
|
—
|
|
—
|
|
8
|
|
KFI
deconsolidation
|
—
|
|
—
|
|
293
|
|
—
|
|
—
|
|
293
|
|
Total adjustments to
operating profit
|
$
104
|
|
$
10
|
|
$
309
|
|
$
113
|
|
$
26
|
|
$
562
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted operating
profit
|
$
1,281
|
|
$
230
|
|
$
245
|
|
$
(71)
|
|
$
(79)
|
|
$
1,606
|
|
Adjusted operating
margin
|
16.3 %
|
|
12.3 %
|
|
13.6 %
|
|
|
|
|
|
14.3 %
|
|
(1) Amortization of the step-up to
fair value of acquired inventory and backlog.
(2) Gain associated with an
adjustment to our tax-related liability owed to UTC.
(3)
The carrying value of our previously held TCC equity
investments were recognized at fair value and subsequently
adjusted.
|
|
Carrier Global
Corporation
Reconciliation of
Reported (GAAP) to Adjusted (Non-GAAP) Results
Net Income, Earnings
Per Share and Effective Tax Rate
|
|
|
(Unaudited)
|
|
Three Months Ended
June 30, 2024
|
|
Six Months Ended
June 30, 2024
|
|
(In millions,
except per share amounts)
|
Reported
|
|
Adjustments
|
|
Adjusted
|
|
Reported
|
|
Adjustments
|
|
Adjusted
|
|
Net sales
|
$
6,689
|
|
$
—
|
|
$
6,689
|
|
$
12,871
|
|
$
—
|
|
$
12,871
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
profit
|
$
3,691
|
|
(2,478)
|
a
|
$
1,213
|
|
$
4,191
|
|
(2,051)
|
a
|
$
2,140
|
|
Operating
margin
|
55.2 %
|
|
|
|
18.1 %
|
|
32.6 %
|
|
|
|
16.6 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from operations
before income
taxes
|
$
3,524
|
|
(2,466)
|
a,b
|
$
1,058
|
|
$
3,859
|
|
(2,039)
|
a,b
|
$
1,820
|
|
Income tax
expense
|
$ (1,155)
|
|
922
|
c
|
$
(233)
|
|
$
(1,201)
|
|
791
|
c
|
$
(410)
|
|
Effective tax
rate
|
32.8 %
|
|
|
|
22.0 %
|
|
31.1 %
|
|
|
|
22.5 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
attributable to common
shareowners
|
$
2,337
|
|
$
(1,544)
|
|
$
793
|
|
$
2,606
|
|
$
(1,248)
|
|
$
1,358
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Summary of
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring
costs
|
|
|
$
32
|
a
|
|
|
|
|
$
47
|
a
|
|
|
Amortization of
acquired intangibles
|
|
|
170
|
a
|
|
|
|
|
342
|
a
|
|
|
Acquisition step-up
amortization (1)
|
|
|
109
|
a
|
|
|
|
|
220
|
a
|
|
|
Acquisition/divestiture-related costs
|
|
|
92
|
a
|
|
|
|
|
181
|
a
|
|
|
Access Solutions
gain
|
|
|
(2,881)
|
a
|
|
|
|
|
(2,881)
|
a
|
|
|
Viessmann-related
hedges
|
|
|
—
|
a
|
|
|
|
|
86
|
a
|
|
|
Gain on liability
adjustment (2)
|
|
|
—
|
a
|
|
|
|
|
(46)
|
a
|
|
|
Debt prepayment
costs
|
|
|
12
|
b
|
|
|
|
|
12
|
b
|
|
|
Total
adjustments
|
|
|
$
(2,466)
|
|
|
|
|
|
$
(2,039)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax effect on
adjustments above
|
|
|
$
976
|
|
|
|
|
|
$
880
|
|
|
|
Tax specific
adjustments
|
|
|
(54)
|
|
|
|
|
|
(89)
|
|
|
|
Total tax
adjustments
|
|
|
$
922
|
c
|
|
|
|
|
$
791
|
c
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares outstanding -
Diluted
|
915.3
|
|
|
|
915.3
|
|
913.6
|
|
|
|
913.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share -
Diluted
|
$
2.55
|
|
|
|
$
0.87
|
|
$
2.85
|
|
|
|
$ 1.49
|
|
|
(1) Amortization of the step-up to
fair value of acquired inventory and backlog.
(2) Gain
associated with an adjustment to our tax-related liability owed to
UTC.
|
|
Carrier Global
Corporation
Reconciliation of
Reported (GAAP) to Adjusted (Non-GAAP) Results
Net Income, Earnings
Per Share and Effective Tax Rate
|
|
|
(Unaudited)
|
|
Three Months Ended
June 30, 2023
|
|
Six Months Ended
June 30, 2023
|
|
(In millions,
except per share amounts)
|
Reported
|
|
Adjustments
|
|
Adjusted
|
|
Reported
|
|
Adjustments
|
|
Adjusted
|
|
Net sales
|
$
5,992
|
|
$
—
|
|
$
5,992
|
|
$
11,265
|
|
$
—
|
|
$
11,265
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
profit
|
$ 489
|
|
475
|
a
|
$
964
|
|
$
1,044
|
|
562
|
a
|
$ 1,606
|
|
Operating
margin
|
8.2 %
|
|
|
|
16.1 %
|
|
9.3 %
|
|
|
|
14.3 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from operations
before income
taxes
|
$ 422
|
|
496
|
a,b
|
$
918
|
|
$ 931
|
|
583
|
a,b
|
$ 1,514
|
|
Income tax
expense
|
$ (189)
|
|
(25)
|
c
|
$
(214)
|
|
$ (311)
|
|
(43)
|
c
|
$ (354)
|
|
Effective tax
rate
|
44.8 %
|
|
|
|
23.3 %
|
|
33.4 %
|
|
|
|
23.4 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
attributable to common
shareowners
|
$
199
|
|
$
471
|
|
$
670
|
|
$
572
|
|
$
540
|
|
$ 1,112
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Summary of
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring
costs
|
|
|
$
9
|
a
|
|
|
|
|
$
26
|
a
|
|
|
Amortization of
acquired intangibles
|
|
|
38
|
a
|
|
|
|
|
77
|
a
|
|
|
Acquisition step-up
amortization (1)
|
|
|
10
|
a
|
|
|
|
|
21
|
a
|
|
|
Acquisition/divestiture-related costs
|
|
|
14
|
a
|
|
|
|
|
26
|
a
|
|
|
Viessmann-related
hedges
|
|
|
111
|
a
|
|
|
|
|
111
|
a
|
|
|
TCC acquisition-related
gain (2)
|
|
|
—
|
a
|
|
|
|
|
8
|
a
|
|
|
KFI
deconsolidation
|
|
|
293
|
a
|
|
|
|
|
293
|
a
|
|
|
Bridge loan financing
costs
|
|
|
21
|
b
|
|
|
|
|
21
|
b
|
|
|
Total
adjustments
|
|
|
$
496
|
|
|
|
|
|
$
583
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax effect on
adjustments above
|
|
|
$
(25)
|
|
|
|
|
|
$
(43)
|
|
|
|
Total tax
adjustments
|
|
|
$
(25)
|
c
|
|
|
|
|
$
(43)
|
c
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares outstanding -
Diluted
|
850.9
|
|
|
|
850.9
|
|
851.5
|
|
|
|
851.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share -
Diluted
|
$
0.23
|
|
|
|
$
0.79
|
|
$
0.67
|
|
|
|
$
1.31
|
|
(1) Amortization of the step-up to
fair value of acquired inventory and backlog.
(2) The
carrying value of our previously held TCC equity investments were
recognized at fair value at the TCC acquisition date.
|
|
Carrier Global
Corporation
Reconciliation of
Reported (GAAP) to Adjusted (Non-GAAP) Results
|
|
|
Components of
Changes in Net Sales
|
|
|
Three Months Ended
June 30, 2024 Compared with Three Months
Ended June 30, 2023
|
|
(Unaudited)
|
|
Factors Contributing
to Total % change in Net Sales
|
|
Organic
|
|
FX
Translation
|
|
Acquisitions /
Divestitures, net
|
|
Other
|
|
Total
|
|
HVAC
|
2 %
|
|
(1) %
|
|
17 %
|
|
— %
|
|
18 %
|
|
Refrigeration
|
1 %
|
|
(1) %
|
|
— %
|
|
— %
|
|
— %
|
|
Fire &
Security
|
3 %
|
|
— %
|
|
(10) %
|
|
— %
|
|
(7) %
|
|
Consolidated
|
2 %
|
|
(1) %
|
|
11 %
|
|
— %
|
|
12 %
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended
June 30, 2024 Compared with Six Months Ended June 30,
2023
|
|
|
(Unaudited)
|
|
Factors Contributing
to Total % change in Net Sales
|
|
Organic
|
|
FX
Translation
|
|
Acquisitions /
Divestitures, net
|
|
Other
|
|
Total
|
|
HVAC
|
2 %
|
|
(1) %
|
|
20 %
|
|
— %
|
|
21 %
|
|
Refrigeration
|
(1) %
|
|
— %
|
|
— %
|
|
— %
|
|
(1) %
|
|
Fire &
Security
|
5 %
|
|
— %
|
|
(7) %
|
|
— %
|
|
(2) %
|
|
Consolidated
|
2 %
|
|
(1) %
|
|
13 %
|
|
— %
|
|
14 %
|
|
Historical Amounts
of Amortization of Acquired Intangibles
|
|
|
|
|
|
(Unaudited)
|
|
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4
|
|
FY
|
|
Q1
|
|
Q2
|
|
(In
millions)
|
|
2023
|
|
2023
|
|
2023
|
|
2023
|
|
2023
|
|
2024
|
|
2024
|
|
HVAC
|
|
$
37
|
|
$
36
|
|
$
35
|
|
$
35
|
|
$
143
|
|
$
172
|
|
$
170
|
|
Fire &
Security
|
|
2
|
|
2
|
|
2
|
|
—
|
|
6
|
|
—
|
|
—
|
|
Total
Carrier
|
|
39
|
|
38
|
|
37
|
|
35
|
|
149
|
|
172
|
|
170
|
|
Associated tax
effect
|
|
(12)
|
|
(11)
|
|
(11)
|
|
(11)
|
|
(45)
|
|
(46)
|
|
(42)
|
|
Net impact to
adjusted results
|
|
$
27
|
|
$
27
|
|
$
26
|
|
$
24
|
|
$
104
|
|
$
126
|
|
$
128
|
|
Free Cash Flow
Reconciliation
|
|
|
|
(Unaudited)
|
|
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4
|
|
FY
|
|
Q1
|
|
Q2
|
|
(In
millions)
|
|
2023
|
|
2023
|
|
2023
|
|
2023
|
|
2023
|
|
2024
|
|
2024
|
|
Net cash flows provided
by (used in)
operating activities
|
|
$
120
|
|
$
384
|
|
$ 1,041
|
|
$ 1,062
|
|
$ 2,607
|
|
$
40
|
|
$
660
|
|
Less: Capital
expenditures
|
|
70
|
|
74
|
|
92
|
|
233
|
|
469
|
|
104
|
|
111
|
|
Free cash
flow
|
|
$
50
|
|
$
310
|
|
$
949
|
|
$
829
|
|
$
2,138
|
|
$
(64)
|
|
$
549
|
|
Net Debt
Reconciliation
|
|
|
|
|
|
(Unaudited)
|
|
(In
millions)
|
|
June 30,
2024
|
|
December 31,
2023
|
|
Long-term
debt
|
|
$
11,270
|
|
$
14,242
|
|
Current portion of
long-term debt
|
|
2,052
|
|
51
|
|
Less: Cash and cash
equivalents
|
|
2,919
|
|
10,015
|
|
Net
debt
|
|
$
10,403
|
|
$
4,278
|
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SOURCE Carrier Global Corporation