Crane (CR) Q3 Earnings call transcript Oct 29, 2024

Crane Company's third quarter 2024 earnings call highlighted the company's resilience and adaptability in the face of various challenges, including hurricanes, power outages, and the Boeing strike. Despite these adversities, Crane's management expressed confidence in the company's performance, outlook, and strategic initiatives.

Outperforming Expectations

The call started with a positive note, with Crane's management sharing that the company had outperformed expectations in the third quarter, driven by a 6% core sales growth across both Aerospace & Electronics and Process Flow Technologies. This growth was reflected in an impressive 6% increase in core orders and a 10% increase in core backlog, indicating a solid foundation for future growth.

Strategic Initiatives and Flexibility

Crane's management highlighted the company's strategic initiatives, including the flexibility and speed to react to issues outside of its control. This was evident in the company's response to hurricanes and other challenges, demonstrating its ability to navigate through adversity and maintain a strong financial position.

Aerospace & Electronics and Process Flow Technologies

In the Aerospace & Electronics segment, Crane's management shared that demand remains strong, with sales up 15% and core growth of 10%. Despite the Boeing strike, Crane is taking proactive measures to support its customer and protect its volumes, expressing optimism about the future of the aerospace industry.

In the Process Flow Technologies segment, Crane's management reported a 16% increase in sales, driven by strong core sales growth of 7%. Despite the impact of hurricanes, Crane is confident in its ability to recover and is actively pursuing growth opportunities, including new acquisitions and strategic initiatives.

Financial Performance and Guidance

Crane's financial performance was impressive, with adjusted operating profit increasing by 35% and adjusted free cash flow of $75 million. The company also raised its full-year earnings outlook, expecting adjusted earnings per share to be in the range of $5.05 to $5.20, reflecting a 19% year-over-year growth at the midpoint.

Strategic Acquisitions and M&A

Crane's management highlighted its active M&A pipeline, with a focus on strategic acquisitions that will support the company's growth and scale up its businesses. The company is confident in its ability to execute on these deals and is well-positioned for continued growth in 2025 and beyond.

Conclusion

Crane Company's third quarter 2024 earnings call underscored the company's strength and resilience in the face of various challenges. With a solid financial position, strategic initiatives, and a proactive approach to growth, Crane is well-positioned for continued success in the coming quarters and years. The company's commitment to delivering on its expectations and supporting its customers and employees through challenging times is a testament to its leadership and adaptability. As Crane looks ahead to 2025 and beyond, its focus on strategic acquisitions, operational excellence, and customer satisfaction is a promising sign for investors and stakeholders alike.