Regal Rexnord reports Q4 adjusted EPS $2.34, consensus $2.47

Reports Q4 revenue $1.46B, consensus $1.49B. CEO Louis Pinkham commented, “In Q4, our team continued to make good progress on our many growth, margin, and debt reduction initiatives, despite weaker-than-expected end markets…During the quarter, we also surpassed our annual $90M synergy target by $11M, helping us achieve a Q4 adjusted gross margin of 37.1%, up 60 basis points versus prior year. What disappointed us in the quarter was a weaker top line and to a lesser extent softer mix, which also caused us to fall short of our margin targets. Most notably, general industrial and machinery/off-highway markets were weaker than expected, particularly in December when we experienced sizable, last minute customer push-outs. Encouragingly, the enterprise is showing further signs of inflection. Q4 daily order growth improved to 4.4% compared to the prior year period, with all segments contributing, and our AMC segment orders were up almost 9%, which makes us more optimistic about our growth prospects in 2025, particularly in the back half….We are starting the year managing a number of uncertainties, with some of our key markets still under pressure, headwinds around currency, and unknowns related to potential tariffs and other regulatory changes. However, the combination of improving orders, green shoots in some key end markets, plus our significant self-help opportunities on growth, margins, free cash flow, and debt reduction, including ample remaining cost and sales synergies, makes us cautiously optimistic about 2025.”