Integer (ITGR) Q4 2023 earnings summary

Executive summary

• FY23 sales rose 16% to $1.597B; adjusted operating income increased 26% to $241M and adjusted EBITDA rose 21% to $309M.

• Strategy targets growth 200 bps above market and long-term adjusted operating income growth at 2x sales growth.

Financial highlights

• 4Q23 sales increased 11% to $413M; organic sales growth was 9%.

• 4Q23 adjusted EBITDA was $86M, adjusted operating income $68M, adjusted net income $47M and adjusted EPS $1.39; increases were 18%, 18%, 28% and 25%, respectively.

• FY23 adjusted EBITDA was $309M, adjusted operating income $241M, adjusted net income $158M and adjusted EPS $4.67.

• FY23 GAAP income from continuing operations rose 39% to $91M; GAAP operating income increased 38% to $167M and diluted EPS rose 37% to $2.69.

Outlook and guidance

• FY24 sales guidance is $1,735M–$1,770M, up 9%–11% reported and 6%–8% organic; includes estimated Pulse Technologies impact.

• FY24 adjusted EBITDA is projected at $355M–$375M, adjusted operating income at $272M–$290M, adjusted net income at $171M–$185M and adjusted EPS at $5.01–$5.43.

• Adjusted operating income growth is projected at 13%–20%; margin is expected to expand 91 bps at the midpoint.

• FY24 operating cash flow is forecast at $185M–$205M, capex at $90M–$110M and free cash flow at $85M–$105M; year-end leverage target is 2.5x–3.5x.

• 1Q24 sales growth is expected in the high single digits, accelerating in 2Q–4Q with product launches and emerging PMA customers.