Carrier Global (CARR) Q3 2024 earnings summary

Executive summary

• Q3 2024 net sales rose 21% year-over-year to $6.0B, driven by the Viessmann Climate Solutions (VCS) acquisition and organic HVAC growth; net income attributable to common shareowners increased 25% to $447M.

• Organic orders grew about 20% year-over-year, with a robust backlog positioning for continued growth into 2025.

• Portfolio transformation advanced with the VCS acquisition ($14.2B), divestitures of Access Solutions ($5.0B), Industrial Fire ($1.4B), and Commercial Refrigeration ($775M); Fire and Security divestiture expected by year-end.

• Settlements reached to resolve AFFF-related liabilities, with $565M–$650M in cash payments and insurance recoveries expected to offset payments.

• Viessmann Climate Solutions integration progressing, targeting $200M in cost and $200M in revenue synergies by 2026.

Financial highlights

• Q3 2024 reported sales were $6.0B, up 21% year-over-year; organic sales up 4%, with 17% growth from acquisitions.

• Adjusted operating profit exceeded $1.04B, up 19% year-over-year; GAAP operating profit was $763M, up 50% year-over-year.

• Adjusted EPS from continuing operations was $0.77, up 3% year-over-year; total adjusted EPS $0.83.

• Preliminary free cash flow for Q3 was an outflow of $370M, impacted by $1.1B in cash taxes and transaction costs.

• Net debt increased to $10.2B as of September 30, 2024.

Outlook and guidance

• Full-year 2024 reported sales expected at $22.5B, with organic growth of about 3% and 18% from acquisitions.

• Adjusted operating margin guidance at 15.5%, up 150 basis points year-over-year.

• Adjusted EPS for continuing operations guided at $2.50; double-digit adjusted EPS growth expected in 2025.

• Free cash flow outlook is $(0.2)B for 2024, including $2.6B in tax payments on business exits; capital expenditures expected at $500M.

• 2025 EPS growth to be driven by organic growth, cost elimination, lower interest, and share repurchases.