Emerson reported results for the third fiscal quarter ended June 30, 2020, and announced updated guidance for the full year.
GAAP net sales of $3.9 billion were down 16%; underlying sales were down 15% as demand declined due to COVID-19. GAAP EPS was $0.67, down 31% from $0.97 in the year prior.
The company delivered strong free cash flow of $738 million in the quarter and $1.53 billion year-to-date, up $118 million or 8% year-to-date
Revenue declines were in-line with management expectations, as COVID-19 negatively affected nearly all end markets and geographies throughout the quarter.
Third quarter gross profit margin of 41.3% was down 140 basis points from 42.7% due to manufacturing plant deleverage. Adjusted EBIT margin, which excludes restructuring and related charges, was 15.3% for the quarter, down 240 basis points.
“Like many organizations, Emerson has been forced to rapidly adapt to the COVID-19 reality during the quarter, and I'm extremely proud of how the team rose to the challenge," said David N. Farr, Emerson chairman and CEO.
“While sales results were in-line with expectations, profitability for the third quarter came in well above expectations, primarily driven by our ongoing aggressive cost actions and as Emerson remained at work around the world,” added Farr. “Overall orders and revenue declines were in-line with management expectations, as most end markets were heavily impacted by COVID-19.”
