NORTH CANTON, Ohio - The Timken Company (NYSE: NYSE:TKR), a global leader in engineered bearings and industrial motion products, reported a solid first-quarter performance with adjusted earnings per share (EPS) surpassing analyst expectations. The stock was up 3.78% in premarket trading Tuesday.
Despite a 5.7% decline in sales compared to the previous year, the company's adjusted EPS of $1.77 outperformed the consensus estimate of $1.51. First-quarter sales reached $1.19 billion, exceeding the $1.15 billion analyst forecast.
Timken's net income for the quarter was $103.5 million, translating to $1.46 per diluted share, a decrease from $122.3 million, or $1.67 per diluted share, in the same quarter last year. The company's net income margin also saw a slight dip from 9.7% to 8.7% YoY. Adjusted EBITDA margin remained robust at 20.7%, albeit slightly down from 21% YoY.
Richard G. Kyle, Timken president and CEO, acknowledged the strength and resilience of the company's diverse portfolio and differentiated business model in dynamic economic conditions. "While below last year's record level, revenue in the quarter modestly exceeded our expectations," said Kyle. He also credited strong margin performance and favorable price-cost dynamics for mitigating the impact of lower YoY organic revenue.
Looking ahead, Timken has raised its full-year 2024 outlook, now forecasting an adjusted EPS range of $6.00 to $6.30, which brackets the consensus estimate of $6.06. The company anticipates a total revenue decrease of 2 to 4 percent from 2023. Kyle expressed confidence in Timken's ability to deliver solid results in 2024 and remain focused on driving shareholder value.
The company's financial health remains strong, with a net debt-to-adjusted EBITDA ratio of 2.1 times. Timken also continued its shareholder-friendly practices by paying out its 407th consecutive quarterly dividend, amounting to $24.5 million in the first quarter.
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