Engineered bearings and power transmission products maker Timken reported its 2019 fourth quarter and full-year fiscal results on Wednesday, showing a modest decline in year-over-year sales during the October-December period.
The North Canton, OH-based company posted total Q4 sales of $896 million, down 1.5 percent year-over-year (YoY), driven mostly by lower demand in its Mobile Industries segment. Timken posted Q4 total profit of $113.5 billion, almost double the $60 million from a year earlier, though adjusted net profit of $64.3 million was down compared to $77.4 million of a year earlier. Q4 operating profit of $93.5 million compared with $104.4 million of a year earlier.
By business segment in Q4:
- Mobile Industries sales of $445 million decreased 3.6 percent YoY, driven by lower shipments in the off-highway and heavy truck sectors, partially offset by the benefit of acquisitions and growth in the rail and aerospace sectors. Q4 EBITDA of $57.5 million compared with $61.1 million of a year earlier.
- Process Industries sales of $451 million increased 0.6 percent YoY, driven by the favorable impact of acquisitions and strong growth in renewable energy, offset by lower revenue in the industrial and marine sectors. Q4 EBITDA of $96.8 million compared with $101.2 million of year earlier.
"Fourth quarter revenue was in line with our expectations and cash flow finished the year strong,” said Richard Kyle, Timken president and CEO. “While profitability fell short, a significant portion of this related to some higher than normal operating expenses in the quarter that are not expected to persist.”
During Q4, Timken completed its $165 million acquisition of BEKA Lubrication, a global supplier of automatic lubrication systems.
For the full year, Timken posted total 2019 sales of $3.79 billion, up 20.9 percent from 2018. Operating profit of $516.4 million increased 13.6 percent, while total profit of $347.7 million increased 22.7 percent.
Timken expects 2020 full-year revenue to be in the range of down 2 percent to up 2 percent compared to 2019. This includes the benefit of acquisitions made in 2019, offset by expected organic declines in Mobile Industries and currency impacts.
"We plan to deliver another strong year of cash generation and solid earnings performance in 2020 against a soft industrial economic backdrop," Kyle said. "We expect profitability to improve meaningfully from fourth-quarter levels, and we remain focused on driving outgrowth, integrating recent acquisitions and advancing our operational excellence initiatives.”