The Timken Company (NYSE:TKR) Q2 2019 Earnings Conference Call - Final Transcript

Jul 31, 2019 • 11:00 am ET


The Timken Company (NYSE:TKR) Q2 2019 Earnings Conference Call - Final Transcript


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Good morning. My name is Brian, and I will be your conference operator today. As a reminder, this call is being recorded. At this time, I'd like to welcome everyone to Timken's Second Quarter Earnings Release Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. [Operator Instructions].

Thank you. It's now my pleasure to hand it over to Mr. Jason Hershiser. You may begin.

Jason Hershiser

Thanks, Brian, and welcome everyone to our second quarter 2019 earnings conference call. This is Jason Hershiser, Manager of Investor Relations for the Timken Company. We appreciate you joining us today. If after our call you should have further questions, please feel free to contact me directly at 234-262-7101.

Before we begin our remarks this morning, I want to point out that we have posted on the Company's website presentation materials that we will reference as part of today's review of the quarterly results. You can also access this material through the download feature on the earnings call webcast link.

With me today are the Timken Company's President and CEO, Rich Kyle; and Phil Fracassa, our Chief Financial Officer. We will have opening comments this morning from both Rich and Phil before we open up the call for your questions. During the Q&A, I would ask that you please limit your questions to one question and one follow-up at a time to allow everyone an opportunity to participate.

During today's call, you may hear forward-looking statements related to our future financial results, plans, and business operations. Our actual results may differ materially from those projected or implied due to a variety of factors, which we described in greater detail in today's press release and in our reports filed with the SEC, which are available on the website. We have included reconciliations between non-GAAP financial information and its GAAP equivalent in the press release and presentation materials. Today's call is copyrighted by the Timken Company. Without expressed written consent we prohibit any use, recording or transmission of any portion of the call.

With that I would like to thank you for your interest in the Timken Company, and I will now turn the call over to Rich.

Richard G. Kyle

Thanks, Jason. Good morning, everyone, and thank you for joining us today. Second quarter was another record quarter for Timken, and I will start with some of the highlights before I talk about the revised outlook.

We achieved $1 billion in revenue in the quarter, up over 10% from the prior year, despite the negative impact of currency. We had strong organic growth in Process Industries of 6% and slightly negative organic growth in Mobile Industries. Wind, solar, aerospace, industrial distribution, marine and heavy industries all delivered solid year-on-year organic growth. We delivered record second quarter earnings per share of $1.27, up 14% from 2018. We achieved 15.5% EBIT margins in the quarter up 110 basis points from last year. And our trailing return on