The Timken Company has reported financial results for the 2018 fourth quarter, with sales up by 17 percent to $910.1 million compared to the fourth quarter of 2017. The increase was primarily due to continued growth across most end markets, as well as the favorable impact of acquisitions and pricing, partially offset by unfavorable currency.
The company reported a net income of $60 million or $0.77 per diluted share compared to the prior year’s fourth quarter results of a net income of $29.2 million or $0.37 per diluted share.
"We generated strong growth and financial performance again in the fourth quarter," said Timken President and CEO Richard G. Kyle. "In 2018, Timken delivered record adjusted earnings per share, significant year-over-year revenue gains and higher operating margins.”
“Our relentless focus on winning with customers with innovative problem solving and industry-leading customer service helped us deliver market outgrowth across multiple sectors during the year,” added Kyle. “The execution of our strategy, along with our consistent and deliberate approach to capital allocation has positioned us to deliver even higher levels of performance going forward."
For the 2018 full year, sales increased 19.2 percent to $3.6 billion. The increase was driven by broad organic growth across most end-market sectors, as well as the favorable impact of acquisitions and pricing.
Net income was $302.8 million or a record $3.86 per diluted share, compared to the 2017 year net income of $203.4 million or $2.58 per diluted share. The year-over-year increase was driven by higher volume, favorable price/mix and the benefit of acquisitions, partially offset by higher operating costs including tariffs as well as higher interest expense and the impact of a higher tax rate driven by net discrete benefits in the prior year.
Timken expects 2019 revenue to be up approximately 8 to10 percent in total. This includes expected organic growth of 4 to 6 percent plus the benefit of acquisitions made during 2018, partially offset by unfavorable currency.
"In 2019, we plan to deliver another record year of EPS with strong revenue growth and further margin expansion," stated Kyle. “We will continue to balance our pursuit of growth with our drive for margins, returns and cash flow. The fundamentals underlying our markets remain positive and, combined with our market penetration and inorganic actions, we are planning for a third consecutive year of double-digit revenue growth in 2019. We are confident that our strategy and track record of strong execution will enable us to continue to drive profitable growth and create shareholder value in 2019 and beyond."