Payments

Crane boosts Q4 2020 earnings on declining sales

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February 3, 2021

Crane Co., parent company of Crane Merchandising Systems and Crane Payment Innovations, reported net sales fell 13.3% from $837.5 million in the fourth quarter of 2019 to $726.4 million in the quarter ending Dec. 31, 2020, according to an earnings report.

Net income attributable to common shareholders jumped 141.6% from a $112.6 million loss in 2019 to a $46.8 million gain in 2020. This translated to a 142.3% per share gain from a $1.89 loss in 2019 to an 80-cent gain in 2020.

While revenues were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 7.7% to hit $3.08 per share, according to Yahoo Finance.

Sales for the payment and merchandising technologies, the company's largest revenue segment, decreased $32 million, or 10% from $325 million in the 2019 fourth quarter to $283 million for the 2020 fourth quarter, driven by an $80 million, or 25%, decline in core sales, partially offset by a $41 million, or 13%, benefit from an acquisition, and $7 million, or 2%, of favorable foreign exchange.

Operating profit margin declined to 11.2%, from 16.7% last year primarily reflecting the impact of lower volumes, partially offset by productivity, benefits from cost saving measures and favorable product mix

Payment and merchandising technologies order backlog was $348 million on Dec. 31, 2020, compared to $311 million at Dec. 31, 2019. Excluding the impact of foreign exchange, fourth quarter backlog increased 4% driven by strength in the Crane Payment Innovations business.

"We are introducing 2021 adjusted EPS guidance in a range of $4.90-$5.10, with the midpoint reflecting 30% adjusted earnings growth compared to last year," Max Mitchell, Crane Co. president and chief executive officer, said in the earnings release. "This growth is supported by recent trends, including markets that strengthened towards the end of 2020 and order rates that accelerated throughout the fourth quarter."

Mitchell said December orders improved "substantially" at Crane Payment Innovations.

"Although these trends improve our confidence in a strong 2021 recovery, we are still managing through sporadic and isolated ongoing COVID-19 related logistics and supply chain disruptions due to the recent global spike in infection rates that resulted in some shipment delays at the end of the fourth quarter," he said.

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