Carrier Global (CARR) Q4 2021 earnings summary

Executive summary

• 2021 net sales grew 18% to $20.6B, including 15% organic growth; adjusted diluted EPS rose 36% to $2.26 amid supply-chain constraints and inflation.

• Growth initiatives centered on healthy buildings, connected cold-chain solutions, electrification and recurring aftermarket and digital revenue.

Financial highlights

• Net sales were $20.613B versus $17.456B in 2020; organic growth was 15%, with foreign currency adding 2% and acquisitions and divestitures net adding 1%.

• Adjusted operating profit was $2.804B versus $2.232B; adjusted operating margin was 13.6% versus 12.8%.

• GAAP net income attributable to common shareowners was $1.664B versus $1.982B; diluted EPS was $1.87 versus $2.25.

• Operating cash flow was $2.237B and free cash flow was $1.893B, up from $1.692B and $1.380B, respectively.

Outlook and guidance

• Strong demand was expected to continue; healthy-building demand was anticipated to accelerate as building owners prioritized occupant health and safety.

• Supply-chain and logistics challenges were expected to affect results for the foreseeable future; mitigation efforts included supplier coordination, automation, dual sourcing and localized manufacturing.

• 2030 goals include carbon-neutral operations, reducing customers’ carbon footprint by more than 1 gigaton and investing over $2B in sustainable building and cold-chain solutions.

• The Toshiba Carrier majority-stake acquisition, agreed in February 2022 for approximately $900M, was expected to close before the end of Q3 2022, subject to customary conditions.