EnerSys (NYSE:ENS) Q3 2019 Earnings Conference Call Transcript

Feb 07, 2019 • 09:00 am ET

Previous

EnerSys (NYSE:ENS) Q3 2019 Earnings Conference Call Transcript

Share
Close

Loading Event

Loading Transcript

Presentation
Operator
Operator

Good day, ladies and gentlemen, and welcome to the Q3 2019 EnerSys Earnings Conference Call. At this time all participants are in a listen-only mode. Later, we will conduct a question-and-answer session, and instructions will be given at that time. (Operator Instructions) As a reminder, today's conference is being recorded.

I would now like to turn the call over to David Shaffer, President and CEO. Sir, please begin.

Executive
David M. Shaffer

Thanks, Mark. Good morning, and thank you for joining us. On the call with me this morning is Mike Schmidtlein, our CFO. Last evening, we posted slides on our website that we will be referencing during the call this morning. If you didn't get a chance to see this information, you can go to the webcast tab in the Investor section of our website at www.enersys.com.

I'm going to ask Mike Schmidtlein to cover information regarding forward-looking statements.

Executive
Michael J. Schmidtlein

Thank you, Dave, and good morning to everyone. As a reminder, we will be presenting certain forward-looking statements on this call that are based on management's current expectations and views regarding future events and operating performance and are subject to uncertainties and changes in circumstances.

Our actual results may differ materially from the forward-looking statements for a number of reasons. Our forward-looking statements are applicable only as of the date of this presentation. For a list of factors which could affect our future results, including our earnings estimates, see forward-looking statements included in Item 2, Management's Discussion and Analysis of Financial Condition and Results of Operations set forth in our quarterly report on Form 10-Q for the fiscal quarter ended December 30th, 2018, which was filed with the U.S. Securities and Exchange Commission.

In addition, we will also be presenting certain non-GAAP financial measures. For an explanation of the differences between the comparable GAAP financial information and the non-GAAP information, please see our company's Form 8-K, which includes our press release dated February 6, 2019, which is located on our website at www.enersys.com.

Now let me turn it back to you, Dave.

Executive
David M. Shaffer

Thanks, Mike. I will begin on slide three. Excluding the effects of the Alpha acquisition that closed on December 7th EnerSys reported third quarter fiscal 2019 adjusted earnings of $1.21 per diluted share, which fell slightly below our prior guidance range of $1.23 to $1.27.

The short fall is primarily due to one, lower calendar year-end volume from US telecom customers who are going through recent, but well publicized restructuring activities during the transition from between prior 4G deployment and upcoming 5G deployment causing a temporary slow down in orders and second, higher than anticipated freight costs.

Please turn to slide four. On the positive front, our motive power business continues to do well, and we are beginning to see a pick up in US telecom activity with carriers forecasting substantial purchasing increases for calendar year 2019. We again saw mixed results in reserve power. In the Americas, reserve power was solid, consistent with the trends we've seen in prior quarter despite the