Emerson Reports Fourth Quarter and Full Year 2021 Results; Provides Initial 2022 Outlook

Emerson (NYSE: EMR) today reported results for the fourth quarter and fiscal year ended September 30, 2021.

“A rigorous focus on culture, our portfolio and operational execution is critical to our continued success, and I am incredibly proud of the initiative from our global team in these key areas," said Emerson President and CEO Lal Karsanbhai. "Our team has been working hard to mitigate the near-term impact of supply chain challenges which have created obstacles across the essential industries we serve. We don't expect the global supply chain landscape to hinder our success around long-term value creation, and we continue to progress toward our cost reset targets.

“This past quarter, we took action on our vision of a reimagined Emerson. We are advancing our culture across the organization through employee initiatives and a renewed focus on integrating environmental, social and governance (ESG) priorities. We also took an exceptional step toward expanding our software portfolio by announcing the strategic transaction with AspenTech. This transaction will create an industrial software leader by creating synergies and a differentiated vehicle for software acquisitions. This opportunity to deepen our industrial software capability is a meaningful step in a portfolio evolution that will ultimately drive higher growth and value creation. I'm energized as we enter a new fiscal year, and I know our team is ready to perform.”

September Trailing Three-Month Underlying Orders were up 16 percent, as demand continues to be strong in key hybrid and discrete automation as well as residential markets. Late-cycle process automation and commercial markets continue to improve and orders activity is increasing related to customer sustainability initiatives, notably decarbonization programs.

Fourth quarter Net Sales were up 9 percent and Underlying Sales were up 7 percent, excluding favorable currency of 1 percent and an impact of 1 percent from acquisitions. Revenue fell into the lower end of our guidance due to an estimated $175 million impact from supply chain, logistics and labor constraints. North America continued its strong recovery in the fourth quarter despite supply chain challenges, with the Americas up 16 percent, while Europe was down 2 percent. Asia, Middle East & Africa was down 3 percent, with China up 10 percent. For the full year, Net Sales were up 9 percent and Underlying Sales were up 5 percent. The Americas were up 6 percent and Europe and Asia, Middle East & Africa were both up 5 percent, with China up 15 percent.

Fourth quarter Pretax Margin of 16.7 percent was down 10 basis points and Adjusted EBIT Margin, which excludes restructuring and first year purchase accounting charges, was 19.0 percent, down 30 basis points. Adjusted EBIT margin was unfavorably impacted by price-cost headwinds in Commercial & Residential Solutions and lower volume due to supply chain constraints across the enterprise, together worth 200 basis points. For the full year, Pretax Margin of 16.0 percent was up 210 basis points while Adjusted EBIT Margin for the year was 18.0 percent, up 130 basis points and both in line with guidance.

Earnings Per Share were $1.11 for the quarter, down 8 percent, and Adjusted Earnings Per Share, which excludes restructuring and first year purchase accounting charges, were $1.21, up 10 percent. Earnings Per Share for the year were $3.82, up 18 percent, and Adjusted Earnings Per Share were $4.10, up 19 percent. Earnings for the year exceeded guidance and included $0.59 of operational improvements over the prior year.

Operating Cash Flow was $3.6 billion for the full year, up 16 percent, in line with guidance. Free Cash Flow was $3.0 billion for the year, up 18 percent, also in line with guidance, resulting in Free Cash Flow conversion of 129 percent. Full year cash flow results reflected higher earnings due to volume, operational execution across the two business platforms and favorable trade working capital.

Business Platform Results

Automation Solutions September trailing three-month underlying orders were up 20 percent driven by robust improvement in the Americas. The order backlog decreased by $100 million compared to the prior quarter to $5.4 billion, and was up 16 percent versus the prior year.

Net Sales increased 6 percent in the quarter, with Underlying Sales up 3 percent. Results for the quarter reflected strong recovery in the Americas, ongoing strength across discrete and hybrid markets and continued improvement in longer-cycle process automation markets. Sales were unfavorably impacted by an estimated $125 million due to supply chain and logistics constraints in the quarter. Full year Net Sales were up 4 percent and Underlying Sales were flat versus prior year. Europe and Asia, Middle East & Africa saw low single-digit growth while the Americas were down slightly versus the prior year due to recovery timing. China was up mid teens.

Segment EBIT margin in the quarter was 18.7 percent, up 170 basis points. Adjusted Segment EBIT margin in the quarter, which excludes restructuring and related costs, increased 170 basis points to 20.4 percent driven by savings from cost actions and volume leverage. Total restructuring and related actions in the quarter totaled $52 million. Full year Segment EBIT margin was 16.8 percent up 320 basis points. Full year Adjusted Segment EBIT margin of 18.1 percent was up 230 basis points.

Commercial & Residential Solutions September trailing three-month underlying orders were up 9 percent driven by strong growth in all world areas and business groups. Backlog ended the quarter at $1.1 billion, flat compared to the prior quarter.

Net Sales increased 14 percent in the quarter and Underlying Sales were up 13 percent, with all business groups and geographies showing strong underlying growth driven by continued residential demand in the Americas, heat pump and professional tools demand in Europe and cold chain and heating technologies demand in Asia, Middle East & Africa. Full year Net Sales were up 18 percent and Underlying Sales were up 16 percent. Sales in the Americas, Europe and Asia, Middle East & Africa saw growth in the mid teens for the full year. China was up mid teens as well.

Fourth quarter Segment EBIT margin declined 260 basis points to 18.1 percent. Fourth quarter Adjusted Segment EBIT margin, which excludes restructuring and related costs, declined 340 basis points to 18.7 percent mainly due to price-cost headwinds, partially offset by leverage and cost reduction actions. Total restructuring and related actions in the quarter were $11 million. Full year Segment EBIT margin increased 70 basis points to 20.5 percent and full year Adjusted Segment EBIT margin increased 20 basis points to 20.9 percent.

2022 Outlook

We expect that 2022 will be characterized by strong underlying demand. Strength in discrete and hybrid automation markets, further recovery in process markets and expanding opportunities in sustainability projects is expected to drive Automation Solutions full year net sales and underlying sales growth to mid-to-high single digits. For Commercial & Residential Solutions, residential demand is expected to moderate while the commercial and industrial environment is expected to further improve, driving net sales and underlying sales growth to mid-to-high single digits. We also expect operational challenges to continue through the first half of the year. Price-cost will turn to a tailwind during the second half and is expected to be approximately $100 million favorable for the year.

Starting in fiscal 2022, Emerson will revise Adjusted EBIT and Adjusted EPS to exclude intangibles amortization expense in addition to previously excluded restructuring expense and first year purchase accounting related items. The revised metric for Adjusted EBIT will be referred to as Adjusted EBITA. Adjusted EPS guidance in the tables below is presented using the new definition.

Under the new definitions, fiscal 2021 Adjusted EBITA margin was 19.8 percent and Adjusted EPS was $4.51. For the first quarter 2021, Adjusted EBITA margin was 18.2 percent and Adjusted EPS was $0.93.

The following table summarizes the fiscal year 2022 and first quarter 2022 guidance framework and does not include the impact of the AspenTech transaction, which is expected to close in fiscal 2022.

2022 Guidance

Net Sales Growth

5% to 7%

 

Operating Cash Flow

~$3.8B

Automation Solutions

5% to 7%

 

Capital Spend

~$650M

Commercial & Residential Solutions

6% to 9%

 

Free Cash Flow

~$3.1B

 

Dividend

~$1.2B

Underlying Sales Growth

6% to 8%

 

Share Repurchase

$250M to $500M

Automation Solutions

6% to 8%

 

Commercial & Residential Solutions

6% to 9%

 

Tax Rate

~22%

 

Restructuring Actions

~$150M

GAAP EPS

$4.21 to $4.36

 

Price-Cost

~$100M

Adjusted EPS

$4.82 to $4.97

 

Quarter 1, 2022 Guidance

Net Sales Growth

7% to 9%

Automation Solutions

6% to 8%

Commercial & Residential Solutions

9% to 12%

Underlying Sales Growth

7% to 9%

Automation Solutions

6% to 8%

Commercial & Residential Solutions

9% to 12%

GAAP EPS

$0.85 to $0.89

Adjusted EPS

$0.98 to $1.02

Upcoming Investor Events

Today, beginning at 8:00 a.m. Central Time / 9:00 a.m. Eastern Time, Emerson management will discuss the fourth quarter and fiscal year end results during an investor conference call. Participants can access a live webcast available at www.emerson.com/financial at the time of the call. A replay of the call will be available for 90 days. Conference call slides will be posted in advance of the call on the company website.

Forward-Looking and Cautionary Statements

Statements in this press release that are not strictly historical may be “forward-looking” statements, which involve risks and uncertainties, and Emerson undertakes no obligation to update any such statements to reflect later developments. These risks and uncertainties include the Company's ability to successfully complete on the terms and conditions contemplated, and the financial impact of, the proposed AspenTech transaction, the scope, duration and ultimate impact of the COVID-19 pandemic as well as economic and currency conditions, market demand, including related to the pandemic and oil and gas price declines and volatility, pricing, protection of intellectual property, cybersecurity, tariffs, competitive and technological factors, among others, as set forth in the Company's most recent Annual Report on Form 10-K and subsequent reports filed with the SEC. The outlook contained herein represents the Company's expectations for its consolidated results, excluding the expected AspenTech transaction.

Table 1

EMERSON AND SUBSIDIARIES

CONSOLIDATED OPERATING RESULTS

(AMOUNTS IN MILLIONS EXCEPT PER SHARE, UNAUDITED)

 

Quarter Ended Sept 30

Percent

2020

2021

Change

Net sales

$4,558

$4,947

9

%

Costs and expenses:

Cost of sales

2,676

2,951

SG&A expenses

946

1,054

Other deductions, net

131

75

Interest expense, net

40

39

Earnings before income taxes

765

828

8

%

Income taxes

35

154

Net earnings

730

674

Less: Noncontrolling interests in earnings of subsidiaries

7

4

Net earnings common stockholders

$723

$670

(7

)%

Diluted avg. shares outstanding

601.1

600.5

Diluted earnings per share common share

$1.20

$1.11

(8

)%

Quarter Ended Sept 30

2020

2021

Other deductions, net

Amortization of intangibles

$61

$77

Restructuring costs

68

39

Other

2

(41

)

Total

$131

$75

Table 2

EMERSON AND SUBSIDIARIES

CONSOLIDATED OPERATING RESULTS

(AMOUNTS IN MILLIONS EXCEPT PER SHARE, UNAUDITED)

 

Year Ended Sept 30

Percent

2020

2021

Change

Net sales

$16,785

$18,236

9

%

Costs and expenses:

Cost of sales

9,776

10,673

SG&A expenses

3,986

4,179

Other deductions, net

532

318

Interest expense, net

156

154

Earnings before income taxes

2,335

2,912

25

%

Income taxes

345

585

Net earnings

1,990

2,327

Less: Noncontrolling interests in earnings of subsidiaries

25

24

Net earnings common stockholders

$1,965

$2,303

17

%

Diluted avg. shares outstanding

606.6

601.8

Diluted earnings per share common share

$3.24

$3.82

18

%

Year Ended Sept 30

2020

2021

Other deductions, net

Amortization of intangibles

$239

$300

Restructuring costs

284

150

Other

9

(132

)

Total

$532

$318

Table 3

EMERSON AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(DOLLARS IN MILLIONS, UNAUDITED)

 

Years Ended Sept 30

2020

2021

Assets

Cash and equivalents

$3,315

$2,354

Receivables, net

2,802

2,971

Inventories

1,928

2,050

Other current assets

761

1,057

Total current assets

8,806

8,432

Property, plant & equipment, net

3,688

3,738

Goodwill

6,734

7,723

Other intangible assets

2,468

2,877

Other

1,186

1,945

Total assets

$22,882

$24,715

Liabilities and equity

Short-term borrowings and current

maturities of long-term debt

$1,160

$872

Accounts payable

1,715

2,108

Accrued expenses

2,910

3,266

Total current liabilities

5,785

6,246

Long-term debt

6,326

5,793

Other liabilities

2,324

2,753

Total equity

8,447

9,923

Total liabilities and equity

$22,882

$24,715

Table 4

EMERSON AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(DOLLARS IN MILLIONS, UNAUDITED)

 

Year Ended Sept 30

2020

2021

Operating activities

Net earnings

$1,990

$2,327

Adjustments to reconcile net earnings to net cash provided by operating activities:

Depreciation and amortization

854

969

Stock compensation

110

224

Pension expense

67

28

Pension funding

(66

)

(41

)

Changes in operating working capital

148

203

Other, net

(20

)

(135

)

Cash provided by operating activities

3,083

3,575

Investing activities

Capital expenditures

(538

)

(581

)

Purchases of businesses, net of cash and equivalents acquired

(126

)

(1,611

)

Divestitures of businesses

34

Other, net

(76

)

38

Cash used in investing activities

(740

)

(2,120

)

Financing activities

Net increase in short-term borrowings

(90

)

(504

)

Proceeds from short-term borrowings greater than three months

1,043

71

Payments of short-term borrowings greater than three months

(1,043

)

(71

)

Proceeds from long-term debt

2,233

Payments of long-term debt

(503

)

(308

)

Dividends paid

(1,209

)

(1,210

)

Purchases of common stock

(942

)

(500

)

Other, net

2

100

Cash used in financing activities

(509

)

(2,422

)

Effect of exchange rate changes on cash and equivalents

(13

)

6

Increase (Decrease) in cash and equivalents

1,821

(961

)

Beginning cash and equivalents

1,494

3,315

Ending cash and equivalents

$3,315

$2,354

Table 5

EMERSON AND SUBSIDIARIES

SEGMENT SALES AND EARNINGS

(DOLLARS IN MILLIONS, UNAUDITED)

 

Quarter Ended Sept 30

2020

2021

Sales

Measurement & Analytical Instrumentation

$828

$860

Valves, Actuators & Regulators

980

961

Industrial Solutions

542

610

Systems & Software

655

747

Automation Solutions

3,005

3,178

Climate Technologies

1,111

1,289

Tools & Home Products

444

486

Commercial & Residential Solutions

1,555

1,775

Eliminations

(2

)

(6

)

Net sales

$4,558

$4,947

Earnings

Automation Solutions

$511

$595

Climate Technologies

238

234

Tools & Home Products

84

88

Commercial & Residential Solutions

322

322

Stock compensation

(41

)

(33

)

Unallocated pension and postretirement costs

16

23

Corporate and other

(3

)

(40

)

Interest expense, net

(40

)

(39

)

Earnings before income taxes

$765

$828

Restructuring costs

Automation Solutions

$50

$29

Climate Technologies

9

7

Tools & Home Products

9

3

Commercial & Residential Solutions

18

10

Corporate

Total

$68

$39

The table above does not include $5 and $27 of costs related to restructuring actions that
were reported in cost of sales and selling, general and administrative expenses for the
three months ended September 30, 2020 and 2021, respectively.

Depreciation and Amortization

Automation Solutions

$143

$168

Climate Technologies

51

47

Tools & Home Products

19

17

Commercial & Residential Solutions

70

64

Corporate and other

10

17

Total

$223

$249

 

Table 6

EMERSON AND SUBSIDIARIES

SEGMENT SALES AND EARNINGS

(DOLLARS IN MILLIONS, UNAUDITED)

 

Year Ended Sept 30

2020

2021

Sales

Measurement & Analytical Instrumentation

$3,108

$3,071

Valves, Actuators & Regulators

3,589

3,483

Industrial Solutions

2,012

2,266

Systems & Software

2,446

2,790

Automation Solutions

11,155

11,610

Climate Technologies

3,980

4,748

Tools & Home Products

1,663

1,905

Commercial & Residential Solutions

5,643

6,653

Eliminations

(13

)

(27

)

Net sales

$16,785

$18,236

Earnings

Automation Solutions

$1,523

$1,948

Climate Technologies

801

965

Tools & Home Products

317

399

Commercial & Residential Solutions

1,118

1,364

Stock compensation

(110

)

(224

)

Unallocated pension and postretirement costs

53

94

Corporate and other

(93

)

(116

)

Interest expense, net

(156

)

(154

)

Earnings before income taxes

$2,335

$2,912

Restructuring costs

Automation Solutions

$232

$123

Climate Technologies

23

15

Tools & Home Products

21

7

Commercial & Residential Solutions

44

22

Corporate

8

5

Total

$284

$150

The table above does not include $20 and $38 of costs related to restructuring actions
that were reported in cost of sales and selling, general and administrative expenses for
the twelve months ended September 30, 2020 and 2021, respectively.

Depreciation and Amortization

$557

$632

Automation Solutions

Climate Technologies

184

191

Tools & Home Products

77

76

Commercial & Residential Solutions

261

267

Corporate and other

36

70

Total

$854

$969

Table 7

EMERSON AND SUBSIDIARIES

ADJUSTED EBITA & EPS

(DOLLARS IN MILLIONS EXCEPT PER SHARE, UNAUDITED)

 

As discussed herein, starting in fiscal 2022, Emerson will revise Adjusted EBIT and Adjusted EPS
to exclude intangibles amortization expense, in addition to previously excluded restructuring expense and
first year purchase accounting related items. To facilitate investor understanding and comparison, the
Company is providing historical Adjusted EBITA and Adjusted EPS on this new basis.

 

2021

Q1

Q2

Q3

Q4

FY

Pretax earnings (GAAP)

$

563

737

784

828

2,912

Interest expense, net

40

38

37

39

154

Earnings before interest and taxes*

$

603

775

821

867

3,066

Restructuring

69

21

32

66

188

Gain on acquisition of full ownership of equity investment

(17

)

(17

)

OSI purchase accounting items

21

10

10

9

50

Prior adjusted earnings before interest and taxes*

$

676

806

863

942

3,287

Amortization of intangibles

81

82

79

85

327

Adjusted EBITA*

$

757

888

942

1,027

3,614

2020

Q1

Q2

Q3

Q4

FY

Pretax earnings (GAAP)

$

423

689

458

765

2,335

Interest expense, net

35

36

45

40

156

Earnings before interest and taxes*

$

458

725

503

805

2,491

Restructuring and advisory fees

110

40

94

73

317

Prior adjusted earnings before interest and taxes*

$

568

765

597

878

2,808

Amortization of intangibles

63

63

65

65

256

Adjusted EBITA*

$

631

828

662

943

3,064

 

2021

Q1

Q2

Q3

Q4

FY

GAAP earnings per share

$

0.74

0.93

1.04

1.11

3.82

Restructuring and advisory fees

0.09

0.03

0.04

0.08

0.24

Gain on acquisition of full ownership of equity investment

(0.03

)

(0.03

)

OSI purchase accounting items

0.03

0.01

0.01

0.02

0.07

Prior adjusted earnings per share

$

0.83

0.97

1.09

1.21

4.10

Amortization of intangibles

0.10

0.10

0.10

0.11

0.41

Adjusted earnings per share*

$

0.93

1.07

1.19

1.32

4.51

2020

Q1

Q2

Q3

Q4

FY

GAAP earnings per share

$

0.53

0.84

0.67

1.20

3.24

Restructuring and advisory fees

0.14

0.05

0.13

0.10

0.42

Discrete tax items

(0.20

)

(0.20

)

Prior adjusted earnings per share

$

0.67

0.89

0.80

1.10

3.46

Amortization of intangibles

0.08

0.08

0.08

0.08

0.32

Adjusted earnings per share*

$

0.75

0.97

0.88

1.18

3.78

Reconciliations of Non-GAAP Financial Measures & Other

Table 8

 

 

 

Reconciliations of Non-GAAP measures (denoted by *) with the most directly comparable GAAP measure (dollars in millions, except per share amounts):

 

 

 

Q4 2021 Underlying Sales Change

Auto Solns

Comm & Res
Solns

Emerson

Reported (GAAP)

6

%

14

%

9

%

(Favorable) / Unfavorable FX

(1

)%

(1

)%

(1

)%

Acquisitions / Divestitures

(2

)%

-

%

(1

)%

Underlying*

3

%

13

%

7

%

 

 

 

2021 Underlying Sales Change

Auto Solns

Comm & Res
Solns

Emerson

Reported (GAAP)

4

%

18

%

9

%

(Favorable) / Unfavorable FX

(2

)%

(2

)%

(3

)%

Acquisitions / Divestitures

(2

)%

-

%

(1

)%

Underlying*

-

%

16

%

5

%

 

 

 

FY 2022E Underlying Sales Change

Auto Solns

Comm & Res
Solns

Emerson

Reported (GAAP)

5% - 7

%

6% - 9

%

5% - 7

%

(Favorable) / Unfavorable FX

1

%

-

%

1

%

Acquisitions / Divestitures

-

%

-

%

-

%

Underlying*

6% - 8

%

6% - 9

%

6% - 8

%

 

 

 

Q1 2022E Underlying Sales Change

Auto Solns

Comm & Res
Solns

Emerson

Reported (GAAP)

6% - 8

%

9% - 12

%

7% - 9

%

(Favorable) / Unfavorable FX

-

%

-

%

-

%

Acquisitions / Divestitures

-

%

-

%

-

%

Underlying*

6% - 8

%

9% - 12

%

7% - 9

%

 

 

 

Q4 Earnings Per Share

Q4 FY20

Q4 FY21

Change

Earnings per share (GAAP)

$

1.20

$

1.11

(8

)%

Restructuring and related charges

0.10

0.08

(2

)%

Certain tax benefits

(0.20

18

%

OSI purchase accounting items

0.02

2

%

Adjusted earnings per share*

$

1.10

$

1.21

10

%

 

 

 

Earnings Per Share

FY20

FY21

Change

Q1 FY21

Earnings per share (GAAP)

$

3.24

$

3.82

18

%

$

0.74

Restructuring and related charges

0.42

0.24

(7

)%

0.09

Certain tax benefits

(0.20

7

%

OSI purchase accounting and fees

0.07

2

%

0.03

Gain on acquisition of full ownership of equity investment

(0.03

(1

)%

(0.03

Adjusted earnings per share*

$

3.46

4.10

19

%

0.83

Amortization of intangibles

 

0.41

 

0.10

Adjusted earnings per share*

 

$

4.51

 

$

0.93

 

 

 

 

 

 

 

 

 

Earnings Per Share

FY2021E
Aug.
Guidance

FY2022E

Q1
FY2022E

Earnings per share (GAAP)

$3.78 - $3.80

 

$4.21 - $4.36

 

$0.85 - $0.89

Restructuring

0.24

0.19

0.03

OSI purchase accounting items & fees

0.07

Gain on acquisition of full ownership of equity investment

(0.03

Amortization of intangibles

0.42

0.10

Adjusted earnings per share*

$4.06 - $4.08

 

$4.82 - $4.97

 

$0.98 - $1.02

 

 

 

 

Q4 EBIT Margin

Q4 FY20

Q4 FY21

Change

Pretax margin (GAAP)

16.8

 %

16.7

%

(10)

bps

Interest expense, net

0.9

 %

0.8

%

(10)

bps

EBIT margin*

17.7

17.5

%

(20)

bps

Restructuring

1.6

%

1.2

%

(40)

bps

OSI purchase accounting items

-

%

0.3

%

30

bps

Adjusted EBIT margin*

19.3

%

19.0

%

(30)

bps

 

 

 

EBIT Margin

FY20

FY21

Change

Q1 FY21

Pretax margin (GAAP)

13.9

%

16.0

%

210

bps

13.5

%

Interest expense, net

0.9

%

0.8

%

(10)

bps

1.0

%

Earnings before interest and taxes margin*

14.8

%

16.8

%

200

bps

14.5

%

Restructuring

1.9

%

1.0

%

(90)

bps

1.7

%

OSI purchase accounting items

-

%

0.3

%

30

bps

0.5

%

Gain on acquisition of full ownership of equity investment

-

%

(0.1

)% 

(10)

bps

(0.4

)%

Adjusted earnings before interest and taxes margin*

16.7

%

18.0

%

130

bps

16.3

%

Amortization of intangibles

 

1.8

%

 

1.9

%

Adjusted EBITA margin*

 

19.8

%

 

18.2

%

 

 

 

Q4 Automation Solutions Segment EBIT Margin

Q4 FY20

Q4 FY21

Change

Automation Solutions Segment EBIT margin (GAAP)

17.0

%

18.7

%

170

bps

Restructuring and related charges impact

1.7

%

1.7

%

-

bps

Automation Solutions Adjusted Segment EBIT margin*

18.7

%

20.4

%

170

bps

   

Q4 Commercial & Residential EBIT Margin

Q4 FY20

Q4 FY21

Change

Commercial & Residential EBIT margin (GAAP)

20.7

%

18.1

%

(260)

bps

Restructuring and related charges impact

1.4

%

0.6

%

(80)

bps

Commercial & Residential Adjusted Segment EBIT margin*

22.1

%

18.7

%

(340)

bps

 

 

 

Automation Solutions Segment EBIT Margin

FY20

FY21

Change

Automation Solutions Segment EBIT margin (GAAP)

13.6

%

16.8

%

320

bps

Restructuring and related charges impact

2.2

%

1.3

%

(90)

bps

Automation Solutions Adjusted Segment EBIT margin*

15.8

%

18.1

%

230

bps

 

 

 

 

 

 

Commercial & Residential EBIT Margin

FY20

FY21

Change

Commercial & Residential EBIT margin (GAAP)

19.8

%

20.5

%

70

bps

Restructuring and related charges impact

0.9

%

0.4

%

(50)

bps

Commercial & Residential Adjusted Segment EBIT margin*

20.7

%

20.9

%

20

bps

   

Year-To-Date Cash Flow

FY20

FY21

% Change

FY2022E

Operating cash flow (GAAP)

$

3,083

$

3,575

16

%

~$ 3.8B

Capital expenditures

(538

)

(581

2

%

(0.650

)

Free cash flow*

$

2,545

$

2,994

18

%

~$ 3.1B

 

 

 

Net Earnings to Cash Flow Conversion

FY21

 

 

Operating cash flow conversion (GAAP)

154

%

 

 

Capital expenditures

(25

)%

 

 

Free cash flow to conversion*

129

%

 

 

 

 

 

Note 1: Underlying sales exclude the impact of acquisitions, divestitures and currency translation.

Note 2: All fiscal year 2022E figures are approximate, except where range is given.

Contacts:

For Emerson
Investor Contact: Colleen Mettler (314) 553-2197
Media Contact: Casey Murphy (314) 982-6220

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