Bearings and power transmission manufacturer Timken reported its 2020 first quarter financial results on Friday, showing that total sales fell 5.7 percent from a year earlier driven by lower demand in most end markets.
The North Canton, OH-based company posted total Q1 sales of $923 million, with organic sales down 9 percent. Q1 total profit of $81 million was down from $92 million of a year earlier.
By business segment in Q1:
- Mobile Industries sales of $467 million decreased 6.7 percent year-over-year, with organic sales down 7.5 percent, driven primarily by lower shipments in the off-highway, automotive and heavy truck sectors.
- Process Industries sales of $457 million decreased 4.8 percent year-over-year, with organic sales down 10.4 percent, driven primarily by lower revenue in the industrial distribution and general and heavy sectors.
Timken said sales declined throughout March and accelerated downward in April, and it expects year-over-year sales to be down significantly in Q2.
Timken has taken cost-savings actions in response to COVID-19’s business impacts, which include furloughs and salary reductions across the company while focusing on managing working capital and reducing capital expenditures.
The company said it withdrew $350 million from its revolving credit facility on April 3 as a precautionary measure to boost its financial flexibility.
"First quarter revenue and profitability improved meaningfully from the fourth quarter of 2019 as we expected, despite the impact from the COVID-19 pandemic," said Richard Kyle, Timken president and CEO. "The Timken team responded quickly to the pandemic, prioritizing the health and safety of our global associates and stakeholders. We have also taken significant short-term cost-reduction actions across the enterprise to mitigate the impact of COVID-19 on our second-quarter performance. We are confident in our ability to successfully manage through the challenges that lie ahead."