The Middleby Corporation (MIDD) Q4 2021 earnings summary

Executive summary

• FY2021 net sales rose 29.3% to $3.251B; net earnings were $488.5M and diluted EPS was $8.62. Growth reflected higher volumes, recovering demand, acquisitions and FX.

• Operating income rose to $630.0M, including a $110.0M Welbilt termination fee; operating cash flow was $423.4M.

Financial highlights

• Revenue was $3,250.8M, up 29.3% YoY; excluding FX, acquisitions and a disposition, sales increased 23.7%.

• Gross profit rose to $1,194.9M from $882.0M; gross margin improved to 36.8% from 35.1%, or 37.0% excluding acquisitions and FX.

• Operating income was $630.0M versus $324.4M; net earnings were $488.5M versus $207.3M.

• Diluted EPS was $8.62 versus $3.76; FY2021 included 1.449M dilutive equivalents, mainly from the convertible notes.

• Cash from operations was $423.4M versus $524.8M; cash and equivalents ended at $180.4M, while debt was $2.414B.

Outlook and guidance

• Commercial Foodservice backlog was $881.9M, with most expected to ship in 2022; Residential Kitchen backlog was $443.4M, all expected in 2022.

• Food Processing backlog was $187.5M, expected to be filled by the end of FY2023; management viewed existing capital resources as sufficient for foreseeable needs.

• Backlog growth reflected pandemic-related market conditions and supply-chain challenges and was not necessarily indicative of expected annual business levels.