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Crane boosts Q2 2021 sales and earnings, updates outlook

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July 27, 2021

Crane Co., a diversified manufacturer of engineered industrial products, including Crane Merchandising Systems and Crane Payment Innovations, reported strong second quarter 2021 financial results and updated its full-year 2021 outlook, according to an earnings release.

Second quarter sales rose 24% from $644.3 million in Q2 2020 to $796 million in the quarter ending June 30, 2021. The sales increase was comprised of a $120 million, or 19%, increase in core sales, and a $32 million, or 5%, benefit from favorable foreign exchange.

Net income attributable to common shareholders rose from $14.8 million to $138.3 million in the comparative quarters.

Second quarter 2021 GAAP earnings from continuing operations per diluted share of $1.87, compared to 23 cents in the second quarter of 2020.

Excluding special items, second quarter 2021 EPS from continuing operations was $1.83, compared to 60 cents in the second quarter of 2020.

For payment and merchandising technologies, sales rose 33% from $247.6 million in Q2 2020 to of $328.2 million in Q2 2021. This $81 million increase was driven by a 27% increase in core sales, and a 5%, benefit from favorable foreign exchange.

The $796.4 million in second quarter revenue beat analyst expectations by $53.05 million, while the GAAP EPS of $1.87 beat expectations by 43 cents and the non-GAAP EPS of $1.83 beat expectations by 44 cents, according to Seeking Alpha.

Shares traded today at $96.61 against a 52-week range of $47.74-$99.48.

"We delivered another quarter of exceptionally strong results with record adjusted operating margins of 17.6% and record adjusted EPS," Max Mitchell, president and CEO, said in the release. "All three of our strategic growth platforms continue to perform extremely well, and we continue to see strengthening underlying trends in our primary end markets as reflected in our core year-over-year order growth of 45% and core year-over-year backlog growth of 7%.

"Considering our strong performance in the second quarter and our outlook for the balance of the year, we are raising our adjusted EPS from continuing operations guidance by 30 cents to a range of $5.95-$6.15 reflecting an approximate 70% year-over-year increase," he said.

"We are also continuing our substantial investments in technology and strategic growth initiatives positioning us for continued outgrowth through the post-COVID recovery, and we expect strong operating leverage given our consistently solid execution," Mitchell said.

On May 24, 2021, Crane Co. announced it had signed an agreement to sell its engineered materials segment and that it would be presented as discontinued operations beginning with the second quarter of 2021. Consequently, all components of guidance, both GAAP and adjusted, are provided on a continuing operations basis and exclude all contribution from engineered materials, consistent with the most recent prior guidance issued on May 24, 2021.

The company raised its 2021 full year GAAP EPS from continuing operations guidance to a range of $6.05-$6.25, compared to the prior range of $5.75-$5.95.

Revised guidance now assumes core sales growth of 7% to 9%.

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