Emerson Electric Company · NYSE:EMR
Emerson Electric — Q4 2024 Earnings Presentation
23 slides from Emerson Electric's earnings presentation, Nov 5, 2024
Slide 1: Q4 & Full Year 2024 Earnings
Q4 & Full Year 2024 Earnings November 5, 2024 EMERSON | 1
Slide 2: Safe Harbor Statement
Safe Harbor Statement Statements in this presentation and our commentary and responses to questions that are not strictly historical may be “forward-looking” statements, which involve risks and uncertainties, and Emerson undertakes no obligation to update any such statements to reflect later develop
Slide 3: Outstanding Execution in 2024
November August 2024 Guidance Guidance Results Underlying Orders Growth1 LSD – MSD LSD 2% Outstanding Underlying Sales Growth2 4% – 6% ~6% 6% Execution in Operating Leverage2 Mid to High 40s Mid to High 40s 47% 2024 Adjusted EPS $5.15 – $5.35 $5.45 – $5.50 $5.49 Free Cash Flow $2.6B – $2.7B ~$2.8B $
Slide 4: 2024 Full Year Performance Summary
2024 Full Year Performance Summary Sales Adjusted Segment EBITA $17.5B 26.0% 30.0% 25.0% 20 $15.2B 25.0% Price-cost and cost reductions Process and hybrid businesses drove margin expansion grew HSD 15 20.0% Operating leverage2: 47% 10 6% Price contributed 2 pts 15.0% 100 Underlying bps Test & Measur
Slide 5: Updated Emerson Management System Has Driven Exceptional Operating Performance Since 2021
Updated Emerson Management System Has Driven Exceptional Operating Performance Since 2021 Sales Gross Profit Margins 20 $18.2B $17.5B 55.0% 50.8% $15.2B 49.0% 18 $13.8B 16 50.0% $12.9B 45.7% 44.3% 14 41.5% 12 45.0% 10 8 7% 10% 6% 40.0% 6 U/L YoY U/L YoY U/L YoY 4 35.0% 2 0 30.0% 2021 2021 2022 2023
Slide 6: 2025 Outlook and Guidance
2025 Outlook and Guidance EMERSON | 6
Slide 7: Emerson Serves Expansive and Diverse Customer Base Across Large Projects and MRO
Emerson Serves Expansive and Diverse Customer Base Across Large Projects and MRO LARGE PROJECT FUNNEL 2024 CUSTOMER DETAILS EV Battery Carbon Capture Sustainability & Decarbonization: $3.2B Energy Transition: $5.6B MRO represents 64% of sales Growth Platforms: $7.3B Clean Fuels Sustainability & Trad
Slide 8: 2025 End Market Outlook
Stable Process and Hybrid Demand Resilient demand driven by need for automation and investments in capacity expansions and facility modernizations Customers continue to invest in capital projects tied to secular trends Strong activity in Energy Transition, Power, Life Sciences and Metals & Mining Re
Slide 9: 2025 Guidance
2025 Guidance 2025 Q1 2025 Full Year Underlying Sales Growth 2% – 3% 3% – 5% GUIDANCE ASSUMPTIONS Safety & Productivity Growth flat Operating Leverage Mid 50s Mid 40s Dividend payments: ~$1.2B Adjusted EPS $1.25 – $1.30 $5.85 – $6.05 AspenTech1 ~57% Ownership Contribution $0.10 – $0.11 $0.44 – $0.46
Slide 10: Emerson Is Committed to Disciplined Capital Allocation and Plans to Increase Return of Capital
Emerson Is Committed to Disciplined Capital Allocation and Plans to Increase Return of Capital to Shareholders in 2025 % of FCF 140% Capital Returned to Shareholders Organic Growth Drive innovation and growth with ~8% of sales on RD&E Both Test & Measurement and AspenTech RD&E ~20% of sales 120% ~10
Slide 11: Appendix
Appendix E M E R S O N | 11
Slide 12: Corporate and Other Items
Corporate and Other Items (in millions) 2025 Q1 Expectations 2025 Expectations Stock Compensation – GAAP ~($57) ~($225) Integration-Related Stock Compensation Expense ~$2 ~$10 Adjusted Stock Compensation – Non-GAAP ~($55) ~($215) Pension ~$30 ~$110 Corporate & Other – GAAP ~($57) ~($220) Restructuri
Slide 13: 2024 Q4 Performance Summary
2024 Q4 Performance Summary Sales Adjusted Segment EBITA $4.6B 26.2% 30.0% 25.5% 5 $4.1B 25.0% 4 Price contributed 2 pts 20.0% Operating leverage2: 41% 4% 3 Test & Measurement $360M 15.0% 70 Underlying bps Test & Measurement 26.7% Adjusted Segment EBITA 2 10.0% 1 5.0% 0 0.0% 2023 2024 2023 2024 Adju
Slide 14: Reconciliation of Non-GAAP Measures: Underlying Sales Growth
Reconciliation of Non-GAAP Measures Underlying Sales Growth This information reconciles non-GAAP measures with the most directly comparable GAAP measure (dollars in millions, except per share amounts) 2025 Q1 2025 Underlying Sales Growth 2022 2023 2024 Q4 2024 Guidance Guidance Reported (GAAP) 7% 10
Slide 15: Reconciliation of Non-GAAP Measures: Adjusted Segment EBITA
Reconciliation of Non-GAAP Measures Adjusted Segment EBITA This information reconciles non-GAAP measures with the most directly comparable GAAP measure (dollars in millions, except per share amounts) Adjusted Segment EBITA 2023 Q4 2023 2024 Q4 2024 Net sales $4,090 $15,165 $4,619 $17,492 Pretax earn
Slide 16: Reconciliation of Non-GAAP Measures: Adjusted EPS
Reconciliation of Non-GAAP Measures Adjusted EPS This information reconciles non-GAAP measures with the most directly comparable GAAP measure (dollars in millions, except per share amounts) 2025 Q1 2025 2023 Q4 2023 2024 Q4 2024 Guidance Guidance Earnings per share (GAAP) $1.36 $3.96 $0.97 $2.82 $0.
Slide 17: Reconciliation of Non-GAAP Measures: Adjusted EPS
Reconciliation of Non-GAAP Measures Adjusted EPS This information reconciles non-GAAP measures with the most directly comparable GAAP measure (dollars in millions, except per share amounts) 2021 2021 2022 Before Continuing Continuing Transformation Operations Operations Earnings per share (GAAP) $3.
Slide 18: Reconciliation of Non-GAAP Measures: Free Cash Flow
Reconciliation of Non-GAAP Measures Free Cash Flow This information reconciles non-GAAP measures with the most directly comparable GAAP measure (dollars in millions, except per share amounts) $ in billions 2025 2023 Q4 2024 Q4 2023 2024 Guidance Net Sales $4,090 $4,619 $15,165 $17,492 Operating cash
Slide 19: Reconciliation of Non-GAAP Measures: Test & Measurement (T&M)
Reconciliation of Non-GAAP Measures Test & Measurement (T&M) This information reconciles non-GAAP measures with the most directly comparable GAAP measure (dollars in millions, except per share amounts) Earnings Per Share 2024 Q4 2024 Earnings per share (GAAP) - T&M contribution ($0.08) ($0.94) Amort
Slide 20: Reconciliation of Non-GAAP Measures: AspenTech
Reconciliation of Non-GAAP Measures AspenTech This information reconciles non-GAAP measures with the most directly comparable GAAP measure (dollars in millions, except per share amounts) 2025 Q1 2025 Earnings Per Share 2024 Q4 2024 Guidance Guidance Earnings per share (GAAP) - AspenTech contribution
Slide 21: Reconciliation of Non-GAAP Measures: Safety & Productivity
Reconciliation of Non-GAAP Measures Safety & Productivity This information reconciles non-GAAP measures with the most directly comparable GAAP measure (dollars in billions, except per share amounts) 2025 Underlying Sales Growth Guidance Reported (GAAP) – Safety & Productivity 0.5% (Favorable) / Unfa
Slide 22: Reconciliation of Non-GAAP Measures: Other
Reconciliation of Non-GAAP Measures Other This information reconciles non-GAAP measures with the most directly comparable GAAP measure (dollars in billions, except per share amounts) September 30, 2024 Backlog (GAAP) $8.45 AspenTech 1.29 Backlog excluding AspenTech (non-GAAP) $7.161 1 Rounded in sli
Slide 23: Endnotes
Endnotes Continuing Operations: All financial metrics in this presentation are on a continuing operations basis, unless otherwise noted. E M E R S O N | 23
Emerson Electric Company — Q4 2024 Earnings Presentation on 6ix