Franklin Electric's 2024 Performance: Resilient Financial Results
Financial Overview of Franklin Electric’s 2024 Results
Fourth Quarter 2024 Key Insights
In the fourth quarter of 2024, Franklin Electric Co., Inc. achieved consolidated net sales of $485.7 million, marking a 3% increase from the same period a year prior. The company experienced notable growth in its Energy Systems and Distribution segments, which reported sales increases of 5% and 6% respectively. However, the Water Systems segment remained stable without any change in sales. Operating income during this quarter stood at $43.0 million, resulting in an operating margin of 8.9%.
Annual Performance Review for 2024
For the full year 2024, Franklin Electric reported consolidated net sales of $2.0 billion, which represented a slight decrease of 2% compared to the previous year. The Distribution segment saw a modest sales increase of 2%, whereas both the Water Systems and Energy Systems segments faced declines of 2% and 8% respectively. The operating income for the entire year totaled $243.6 million, achieving a 12.1% operating margin. The earnings per share (EPS) calculated under Generally Accepted Accounting Principles (GAAP) were $3.86, showing a decline from $4.11 in the previous year.
Insights from the CEO
Joe Ruzynski, the CEO of Franklin Electric, commented on the results, stating, "The fourth quarter marked a solid finish to a challenging year for us. This outcome was largely driven by strong performance within our newly established Energy Systems segment. While we have addressed the elevated post-COVID backlogs, demand remains healthy. We continuously strive to enhance our productivity initiatives to align our operations with the evolving market conditions." He further emphasized the company's resilience, citing its diverse global portfolio as a strategic asset that will allow it to navigate macroeconomic pressures and capitalize on upcoming opportunities in the year ahead.
Segment Performance Highlights
Water Systems: The Water Systems segment reported fourth-quarter net sales of $279.6 million, which remained flat compared to the same quarter in the previous year. This performance was balanced by increases in groundwater and water treatment products, offset by declines in large dewatering pump sales, which had performed exceptionally the prior year. The operating income for this segment was $35.6 million.
Distribution: The Distribution segment achieved net sales of $157.2 million, reflecting a $9.2 million or 6% growth from the fourth quarter of 2023. The increase was propelled by higher volumes and contributions from a recent acquisition, leading to an operating income of $0.5 million for the quarter.
Energy Systems: The newly renamed Energy Systems segment generated $68.8 million in net sales for the fourth quarter, reflecting a 5% increase compared to the previous year’s fourth quarter. The sales were driven by both higher volumes and successful price adjustments, contributing to a record operating income of $24.7 million for the segment.
Financial Flexibility and Future Outlook
At the end of 2024, Franklin Electric maintained a robust cash balance of $220.5 million, which marked a significant increase of $135.5 million compared to the end of the previous year. Operating cash flows totaled $261.4 million in 2024, down from $315.7 million in 2023, indicating the positive effects of improved working capital management throughout the year.
Looking forward, the company anticipates its total sales for 2025, inclusive of the impact from recent acquisitions, to be in the range of $2.09 billion to $2.15 billion. EPS for 2025 is projected between $4.05 and $4.25, aiming for an expansion in both revenue and margins.
Upcoming Earnings Conference Call
Franklin Electric plans to hold a conference call to discuss its earnings and business developments, which will commence at 9:00 AM ET. This call will be accessible via a live webcast, providing participants a chance to engage in a question-and-answer session following the presentation. It is highly encouraged for attendees to join 10 minutes early for optimal connectivity.
Company Spotlight
Franklin Electric is recognized globally for its expertise in the production of systems and components related to water and energy management. The company serves a wide range of customers across various sectors, including residential, commercial, agricultural, industrial, municipal, and fueling applications. Recently, it has earned accolades such as inclusion in Newsweek’s lists of America’s Most Responsible Companies and Most Trustworthy Companies for 2024, as well as recognition as America’s Climate Leaders 2024.
Contact Information
For inquiries regarding financial performance or investor relations, please reach out to:
Jeffery L. Taylor
Franklin Electric Co., Inc.
Email: InvestorRelations@fele.com
Frequently Asked Questions
What were Franklin Electric's fourth quarter sales for 2024?
Franklin Electric recorded consolidated net sales of $485.7 million for the fourth quarter of 2024.
How did the Water Systems segment perform in Q4 2024?
The Water Systems segment generated sales of $279.6 million in Q4 2024, remaining flat compared to the same period in 2023.
What is the outlook for Franklin Electric in 2025?
For 2025, Franklin Electric expects total sales between $2.09 billion to $2.15 billion and EPS of $4.05 to $4.25.
Who is the CEO of Franklin Electric?
The CEO of Franklin Electric is Joe Ruzynski, who highlighted the company's aim for growth and innovation in the upcoming year.
How can investors contact Franklin Electric for inquiries?
Investors can reach out via email to InvestorRelations@fele.com for any questions or concerns.
About The Author
Contact Owen Jenkins privately here. Or send an email with ATTN: Owen Jenkins as the subject to contact@investorshangout.com.
About Investors Hangout
Investors Hangout is a leading online stock forum for financial discussion and learning, offering a wide range of free tools and resources. It draws in traders of all levels, who exchange market knowledge, investigate trading tactics, and keep an eye on industry developments in real time. Featuring financial articles, stock message boards, quotes, charts, company profiles, and live news updates. Through cooperative learning and a wealth of informational resources, it helps users from novices creating their first portfolios to experts honing their techniques. Join Investors Hangout today: https://investorshangout.com/
The content of this article is based on factual, publicly available information and does not represent legal, financial, or investment advice. Investors Hangout does not offer financial advice, and the author is not a licensed financial advisor. Consult a qualified advisor before making any financial or investment decisions based on this article. This article should not be considered advice to purchase, sell, or hold any securities or other investments. If any of the material provided here is inaccurate, please contact us for corrections.
