On July 24, 2024, Westinghouse Air Brake Technologies Corp (WAB, Financial) released its 8-K filing for the second quarter of 2024, showcasing robust financial performance that surpassed analyst expectations.
Westinghouse Air Brake Technologies Corp is a provider of value-added, technology-based products and services for the freight rail and passenger transit industries, and the mining, marine, and industrial markets. It operates through two main business segments: Freight and Transit, with the Freight segment generating the majority of the company's revenue.
Q2 2024 Financial Highlights
Westinghouse Air Brake Technologies Corp reported net sales of $2.64 billion for Q2 2024, a 9.8% increase from $2.41 billion in Q2 2023. The company's GAAP diluted earnings per share (EPS) rose to $1.64, up 54.7% from $1.06 in the same quarter last year. Adjusted diluted EPS was $1.96, a 39.0% increase from $1.41 in Q2 2023.
| Metric | Q2 2024 | Q2 2023 | Change |
|---|---|---|---|
| Net Sales | $2.64 billion | $2.41 billion | +9.8% |
| GAAP Gross Margin | 33.0% | 30.1% | +2.9 pts |
| Adjusted Gross Margin | 33.3% | 30.4% | +2.9 pts |
| GAAP Operating Margin | 16.3% | 12.9% | +3.4 pts |
| Adjusted Operating Margin | 19.3% | 16.4% | +2.9 pts |
| GAAP Diluted EPS | $1.64 | $1.06 | +54.7% |
| Adjusted Diluted EPS | $1.96 | $1.41 | +39.0% |
| Cash Flow from Operations | $235 million | $115 million | +104.3% |
Segment Performance
The Freight segment saw a significant sales increase of 13.1%, driven primarily by Equipment and Components, which were up 36.4% and 17.5%, respectively. The Transit segment also experienced a modest sales increase of 2.0%, attributed to higher aftermarket sales.
Operational Efficiency and Shareholder Returns
Westinghouse Air Brake Technologies Corp's GAAP operating margin improved to 16.3%, up from 12.9% in the previous year, while the adjusted operating margin rose to 19.3% from 16.4%. The company returned $235 million to shareholders through share repurchases and dividends during the quarter.
"The Wabtec team delivered another strong quarter, evidenced by robust sales and earnings per share growth," said Rafael Santana, Wabtec's President and CEO. "With the first half behind us, we are focused on executing against our second half deliverables. Demand on our end markets continues to be strong and we have significant opportunities for further growth given the quality of our products and the productivity and reliability that we provide for our customers."
Financial Position and Liquidity
As of June 30, 2024, the company had cash, cash equivalents, and restricted cash of $595 million and total debt of $4.00 billion. The total available liquidity stood at $2.09 billion, including $1.50 billion available under current credit facilities.
Guidance and Outlook
Westinghouse Air Brake Technologies Corp raised and tightened its 2024 adjusted EPS guidance to a range of $7.20 to $7.50, reflecting a 24.2% increase from 2023 at the midpoint. The revenue guidance range remains unchanged at $10.25 billion to $10.55 billion. The company expects operating cash flow conversion to exceed 90% for the full year 2024.
For more detailed information, please refer to the full 8-K filing.
Explore the complete 8-K earnings release (here) from Westinghouse Air Brake Technologies Corp for further details.
