Q1 2025 Emerson Electric Co Earnings Call Transcript
Key Points
- Emerson Electric Co (EMR) reported strong Q1 performance with underlying sales growth of 2%, driven by robust demand in process and hybrid markets.
- The company achieved record gross profit margin of 53.5% and adjusted segment EBITDA margins of 28%, reflecting strong operational performance.
- Emerson Electric Co (EMR) completed approximately $1 billion in share repurchases during the quarter, demonstrating a commitment to returning value to shareholders.
- The company reiterated its full-year guidance for underlying sales, adjusted EPS, and free cash flow, indicating confidence in its operational outlook.
- Emerson Electric Co (EMR) continues to see significant opportunities in LNG and power sectors, with a strong project funnel and potential for over $1 billion in orders in the coming years.
- Discrete businesses, including safety and productivity, experienced a decline of approximately 4%, indicating challenges in certain market segments.
- The company faced foreign exchange headwinds, impacting GAAP net sales guidance and adjusted EPS by approximately $0.08.
- Demand in China remained muted, with weakness in chemical and discrete end markets offsetting strength in power.
- Factory automation and automotive markets remained depressed, particularly on the EV side, with no significant recovery expected in the near term.
- The impact of tariffs and geopolitical uncertainties, particularly related to Mexico, remains a concern, although Emerson Electric Co (EMR) has strategies in place to mitigate potential effects.
Good day, and welcome to the Emerson first quarter 2025 earnings conference call. (Operator Instructions) Please note this event is being recorded. I would now like to turn the conference over to Colleen Mettler, Vice President of Investor Relations. Please go ahead.
Good morning and thank you for joining us for Emerson's first quarter 2025 earnings conference call. This morning, I am joined by President and Chief Executive Officer, Lal Karsanbhai; Chief Financial Officer, Mike Baughman; and Chief Operating Officer, Ram Krishnan. As always, I encourage everyone to follow along with the slide presentation, which is available on our website.
Please join me on slide 2. This presentation may include forward-looking statements, which contain a degree of business risks and uncertainties. Please take time to read the safe harbor statement and note on non-GAAP measures. I will now pass the call over to Emerson's President and CEO, Lal Karsanbhai, for his opening remarks.
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