Delivers strong fourth quarter and full
year results; announces 2024 outlook with solid sales and earnings
growth with continued Service momentum
- 4Q Net sales up 5.3% and organic sales up 3.8%; GAAP EPS up
11.3% and adjusted EPS up 16.0%
- 4Q New Equipment orders up 3%; backlog up 2%
- 4Q Mod orders up 11%; backlog up 15%
- Maintenance portfolio units up 4.2%
- FY Net sales up 3.8% and organic sales up 5.6%; GAAP EPS up
14.5% and adjusted EPS up 11.7%
- FY GAAP cash flow from operations of $1.6 billion; free cash flow of $1.49 billion; adjusted free cash flow of
$1.53 billion
- Announcing 2024 outlook* with organic sales up 3 to 5%,
adjusted earnings per share of $3.80
to $3.90 and adjusted free cash flow
of approximately $1.6 billion
FARMINGTON, Conn., Jan. 31,
2024 /PRNewswire/ -- Otis Worldwide Corporation
(NYSE:OTIS) reported full year net sales of $14.2 billion with 5.6% organic growth. GAAP
earnings per share (EPS) increased 14.5% to $3.39 and adjusted EPS increased 11.7% to
$3.54.
"Otis delivered excellent fourth quarter results with mid-teens
adjusted EPS growth, the third consecutive quarter of high-single
digit Service organic sales growth, and a return to New Equipment
orders growth," said Chair, CEO & President Judy Marks. "Full year 2023 was marked by
mid-single digit organic sales growth, operating profit margin
expansion and low teens adjusted EPS growth. We expanded adjusted
Service operating profit margin by 50 basis points for the second
consecutive year, accelerated growth in our industry-leading
maintenance portfolio to 4.2%, grew both our New Equipment and
modernization backlogs and distributed approximately $1.35 billion to shareholders including
$800 million through share
repurchases. We carry positive momentum into 2024 as we continue to
execute on our long-term strategy to create value for our
customers, colleagues, and shareholders."
Key Figures
($ millions,
except per share amounts)
|
Quarter Ended
December 31,
|
|
Year Ended December
31,
|
2023
|
|
2022
|
|
Y/Y
|
|
Y/Y
(CFX)
|
|
2023
|
|
2022
|
|
Y/Y
|
|
Y/Y
(CFX)
|
Net sales
|
$
3,620
|
|
$
3,439
|
|
5.3 %
|
|
3.9 %
|
|
$ 14,209
|
|
$
13,685
|
|
3.8 %
|
|
5.0 %
|
Adjusted net
sales
|
$
3,620
|
|
$
3,439
|
|
5.3 %
|
|
3.9 %
|
|
$ 14,209
|
|
$
13,579
|
|
4.6 %
|
|
5.8 %
|
Organic sales
growth
|
|
|
|
|
|
|
3.8 %
|
|
|
|
|
|
|
|
5.6 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP
|
Operating
profit
|
$ 522
|
|
$ 491
|
|
$
31
|
|
|
|
$
2,186
|
|
$ 2,033
|
|
$ 153
|
|
|
Operating profit
margin
|
14.4 %
|
|
14.3 %
|
|
10 bps
|
|
|
|
15.4 %
|
|
14.9 %
|
|
50 bps
|
|
|
Net income
|
$ 323
|
|
$ 297
|
|
8.8 %
|
|
|
|
$
1,406
|
|
$ 1,253
|
|
12.2 %
|
|
|
Earnings per
share
|
$ 0.79
|
|
$ 0.71
|
|
11.3 %
|
|
|
|
$ 3.39
|
|
$
2.96
|
|
14.5 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted non-GAAP
comparison
|
Operating
profit
|
$ 566
|
|
$ 505
|
|
$
61
|
|
$
52
|
|
$
2,269
|
|
$ 2,126
|
|
$ 143
|
|
$ 166
|
Operating profit
margin
|
15.6 %
|
|
14.7 %
|
|
90 bps
|
|
|
|
16.0 %
|
|
15.7 %
|
|
30 bps
|
|
|
Net income
|
$ 356
|
|
$ 316
|
|
12.7 %
|
|
|
|
$
1,469
|
|
$ 1,343
|
|
9.4 %
|
|
|
Earnings per
share
|
$ 0.87
|
|
$ 0.75
|
|
16.0 %
|
|
|
|
$ 3.54
|
|
$
3.17
|
|
11.7 %
|
|
|
Fourth quarter net sales of $3.6
billion increased 5.3% versus the prior year, driven by a
3.8% increase in organic sales and a 1.4% benefit from foreign
exchange. New Equipment organic sales were roughly flat and Service
organic sales were up 6.8%.
Fourth quarter GAAP operating profit of $522 million increased $31
million and adjusted operating profit of $566 million increased $61
million. Excluding a $9
million benefit from foreign exchange, adjusted operating
profit at constant currency increased $52
million, driven by strong performance in both
segments. GAAP operating profit margin expanded 10 basis
points to 14.4% and adjusted operating profit margin expanded 90
bps to 15.6%, driven by favorable segment performance and mix.
GAAP EPS of $0.79 increased 11.3%
compared to the prior year and adjusted EPS increased 16.0% to
$0.87, as strong operational
performance, effective tax rate improvement, and a lower share
count contributed to 12 cents of
adjusted EPS growth.
Full year net sales increased 3.8%, driven by a 5.6% increase in
organic sales, partially offset by a 1.2% headwind from foreign
exchange. GAAP and adjusted operating profit increased $153 million and $143
million, respectively, as Service segment operating profit
growth was partially offset by foreign exchange
headwinds. GAAP operating profit margin expanded 50 basis
points and GAAP EPS increased 14.5%. Adjusted operating profit
margin expanded 30 basis points, as a result of strong Service
segment performance and favorable mix, partially offset by
headwinds in corporate. Adjusted EPS increased 11.7%, driven by
operating profit growth, a reduction in the effective tax rate,
lower noncontrolling interest and benefits from a lower share
count.
New Equipment
|
|
Quarter Ended
December 31,
|
|
Year Ended December
31,
|
($
millions)
|
|
2023
|
|
2022
|
|
Y/Y
|
|
Y/Y
(CFX)
|
|
2023
|
|
2022
|
|
Y/Y
|
|
Y/Y
(CFX)
|
Net sales
|
|
$
1,466
|
|
$
1,461
|
|
0.3 %
|
|
(0.1) %
|
|
$
5,812
|
|
$
5,864
|
|
(0.9) %
|
|
1.2 %
|
Adjusted net
sales
|
|
$
1,466
|
|
$
1,461
|
|
0.3 %
|
|
(0.1) %
|
|
$
5,812
|
|
$
5,778
|
|
0.6 %
|
|
2.7 %
|
Organic sales
growth
|
|
|
|
|
|
|
|
(0.2) %
|
|
|
|
|
|
|
|
2.6 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP
|
Operating
profit
|
|
$ 81
|
|
$ 66
|
|
$ 15
|
|
|
|
$
358
|
|
$
358
|
|
$
0
|
|
|
Operating profit
margin
|
|
5.5 %
|
|
4.5 %
|
|
100 bps
|
|
|
|
6.2 %
|
|
6.1 %
|
|
10 bps
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted non-GAAP
comparison
|
Operating
profit
|
|
$ 89
|
|
$ 72
|
|
$ 17
|
|
$
20
|
|
$
381
|
|
$
381
|
|
$
0
|
|
$
26
|
Operating profit
margin
|
|
6.1 %
|
|
4.9 %
|
|
120 bps
|
|
|
|
6.6 %
|
|
6.6 %
|
|
0 bps
|
|
|
In the fourth quarter, net sales of $1.5
billion were roughly flat versus the prior year including a
modest benefit from foreign exchange. Organic sales were roughly
flat in the quarter as the decline in China was offset by growth in the Americas and
Asia Pacific.
GAAP operating profit increased $15
million to $81 million and
adjusted operating profit increased $17
million to $89 million due to
improved productivity, favorable pricing, and commodity tailwinds,
partially offset by unfavorable regional and product mix and higher
SG&A expense. GAAP operating profit margin expanded 100 basis
points and adjusted operating profit margin expanded 120 basis
points.
Fourth quarter New Equipment orders were up 3% at constant
currency driven by low teens growth in EMEA, mid single digit
growth in the Americas, and low single digit growth in Asia Pacific, partially offset by mid single
digit declines in China. Full year
New Equipment orders were down 4% with mid teens growth in
Asia Pacific and low single digit
growth in EMEA more than offset by mid single digit declines in
China and low teens declines in
the Americas. GAAP New Equipment backlog was up 2% at actual and
constant currency.
Full year net sales decreased 0.9% with a 2.6% increase in
organic sales partially offset by a 2.1% headwind from foreign
exchange. GAAP operating profit was flat and GAAP operating profit
margin expanded 10 basis points. Adjusted operating profit was flat
as higher volume, favorable price and productivity and commodity
tailwinds were offset by unfavorable regional and product mix,
higher SG&A expense and foreign exchange headwinds. Adjusted
operating profit margin was flat.
Service
|
|
Quarter Ended
December 31,
|
|
Year Ended December
31,
|
($
millions)
|
|
2023
|
|
2022
|
|
Y/Y
|
|
Y/Y
(CFX)
|
|
2023
|
|
2022
|
|
Y/Y
|
|
Y/Y
(CFX)
|
Net sales
|
|
$
2,154
|
|
$
1,978
|
|
8.9 %
|
|
7.0 %
|
|
$
8,397
|
|
$
7,821
|
|
7.4 %
|
|
7.8 %
|
Adjusted net
sales
|
|
$
2,154
|
|
$
1,978
|
|
8.9 %
|
|
7.0 %
|
|
$
8,397
|
|
$
7,801
|
|
7.6 %
|
|
8.1 %
|
Organic sales
growth
|
|
|
|
|
|
|
|
6.8 %
|
|
|
|
|
|
|
|
7.7 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP
|
Operating
profit
|
|
$ 497
|
|
$ 461
|
|
$
36
|
|
|
|
$
1,972
|
|
$
1,789
|
|
$ 183
|
|
|
Operating profit
margin
|
|
23.1 %
|
|
23.3 %
|
|
(20) bps
|
|
|
|
23.5 %
|
|
22.9 %
|
|
60 bps
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted non-GAAP
comparison
|
Operating
profit
|
|
$ 518
|
|
$ 472
|
|
$
46
|
|
$
33
|
|
$
2,014
|
|
$
1,832
|
|
$ 182
|
|
$
178
|
Operating profit
margin
|
|
24.0 %
|
|
23.9 %
|
|
10 bps
|
|
|
|
24.0 %
|
|
23.5 %
|
|
50 bps
|
|
|
In the fourth quarter, net sales of $2.2
billion increased 8.9%, driven by a 6.8% increase in organic
sales and a 1.9% benefit from foreign exchange. Organic maintenance
and repair sales increased 6.8% and organic modernization sales
increased 7.0%.
GAAP operating profit of $497
million increased $36 million
and adjusted operating profit of $518
million increased $33 million
at constant currency due to higher volume, favorable maintenance
pricing and productivity, partially offset by annual wage inflation
and higher material costs. GAAP operating profit margin contracted
20 basis points and adjusted operating profit margin expanded 10
basis points.
Full year net sales increased 7.4% driven by a 7.7% increase in
organic sales partially offset by a 0.4% headwind from foreign
exchange. GAAP operating profit increased $183 million and GAAP operating profit margin
expanded 60 basis points. Adjusted operating profit increased
$178 million at constant currency
driven by higher volume, favorable pricing and productivity,
partially offset by annual wage inflation and higher material
costs. Adjusted operating profit margin expanded 50 basis
points.
Cash flow
|
|
Quarter Ended
December 31,
|
|
Year Ended December
31,
|
($
millions)
|
|
2023
|
|
2022
|
|
Y/Y
|
|
2023
|
|
2022
|
|
Y/Y
|
Cash flow from
operations
|
|
$
597
|
|
$
464
|
|
$
133
|
|
$
1,627
|
|
$
1,560
|
|
$
67
|
Free cash
flow
|
|
$
555
|
|
$
430
|
|
$
125
|
|
$
1,489
|
|
$
1,445
|
|
$
44
|
Adjusted free cash
flow
|
|
$
573
|
|
$
430
|
|
$
143
|
|
$
1,534
|
|
$
1,463
|
|
$
71
|
Fourth quarter cash from operations of $597 million increased $133 million, free cash flow of $555 million increased $125 million and adjusted free cash flow of
$573 million increased $143 million versus prior year from higher net
income and favorable working capital.
Full year cash from operations of $1.6
billion increased $67 million,
free cash flow of $1.49 billion
increased $44 million and adjusted
free cash flow of $1.53 billion
increased $71 million driven by
higher net income from operations, partially offset by changes in
working capital.
2024 Outlook*
Otis is announcing its full year outlook:
- Net sales of $14.5 to
$14.8 billion, up 2 to 4%
- Organic sales up 3 to 5%
- Organic New Equipment sales approximately flat
- Organic Service sales up 6 to 7%
- Adjusted operating profit of $2.40 to $2.45
billion, up $150 to
$190 million at constant currency; up
$125 to $175
million at actual currency
- Adjusted EPS of $3.80 to
$3.90, up 7 to 10%; adjusted
effective tax rate of approximately 25.5%
- Adjusted free cash flow of approximately $1.6 billion
*Note: When we provide outlook for organic sales, adjusted
operating profit, adjusted EPS, adjusted effective tax rate and
adjusted free cash flow on a forward-looking basis, a
reconciliation of the differences between the non-GAAP expectations
and the corresponding GAAP measures generally is not available
without unreasonable effort. See "Use and Definitions of Non-GAAP
Financial Measures" below for additional information.
About Otis
Otis is the world's leading elevator and
escalator manufacturing, installation and service company. We move
2.3 billion people a day and maintain approximately 2.3 million
customer units worldwide, the industry's largest maintenance
portfolio. Headquartered in Connecticut,
USA, Otis is 71,000 people strong, including 42,000 field
professionals, all committed to meeting the diverse needs of our
customers and passengers in more than 200 countries and territories
worldwide. For more information, visit www.otis.com and follow us
on LinkedIn, Instagram and Facebook @OtisElevatorCo.
Use and Definitions of Non-GAAP Financial
Measures
Otis Worldwide Corporation ("Otis") reports its
financial results in accordance with accounting principles
generally accepted in the United
States ("GAAP"). We supplement the reporting of our
financial information determined under GAAP with certain non-GAAP
financial information. The non-GAAP information presented provides
investors with additional useful information, but should not be
considered in isolation or as substitutes for the related GAAP
measures. Moreover, other companies may define non-GAAP measures
differently, which limits the usefulness of these measures for
comparisons with such other companies. We encourage investors to
review our financial statements and publicly filed reports in their
entirety and not to rely on any single financial measure. A
reconciliation of the non-GAAP measures (referenced in this press
release) to the corresponding amounts prepared in accordance with
GAAP appears in the attached tables. These tables provide
additional information as to the items and amounts that have been
excluded from the adjusted measures.
Adjusted net sales, organic sales, adjusted selling, general and
administrative ("SG&A") expense, adjusted operating profit,
adjusted net interest expense, adjusted net income, adjusted
diluted earnings per share ("EPS"), adjusted effective tax rate,
constant currency, free cash flow and adjusted free cash flow
are non-GAAP financial measures.
Adjusted net sales represents net sales (a GAAP measure),
excluding significant items of a non-recurring and/or
nonoperational nature ("other significant items").
Organic sales represents consolidated net sales (a GAAP
measure), excluding the impact of foreign currency translation,
acquisitions and divestitures completed in the preceding twelve
months and other significant items. Management believes organic
sales is a useful measure in providing period-to-period comparisons
of the results of the Company's ongoing operational
performance.
Adjusted SG&A expense represents SG&A expense (a GAAP
measure), excluding restructuring costs and other significant
items.
Adjusted general corporate expenses and other represents general
corporate expenses and other (a GAAP measure), excluding
restructuring costs and other significant items.
Adjusted operating profit represents income from continuing
operations (a GAAP measure), excluding restructuring costs and
other significant items.
Adjusted net interest expense represents net interest expense (a
GAAP measure), adjusted for the impacts of non-recurring
acquisition related financing costs and related net interest
expense pending the completion of a transaction.
The adjusted effective tax rate represents the effective tax
rate (a GAAP measure) adjusted for other significant items and the
tax impact of restructuring costs and other significant items.
Adjusted net income represents net income attributable to Otis
Worldwide Corporation (a GAAP measure), excluding restructuring
costs and other significant items, including related tax effects.
Adjusted EPS represents diluted earnings per share attributable to
common shareholders (a GAAP measure), adjusted for the per share
impact of restructuring and other significant items, including
related tax effects.
Management believes that adjusted net sales, organic sales,
adjusted SG&A, adjusted general corporate expenses and other,
adjusted operating profit, adjusted net interest expense, adjusted
net income, adjusted EPS, the adjusted effective tax rate and
adjusted RPO are useful measures in providing period-to-period
comparisons of the results of the Company's ongoing operational
performance.
Additionally, GAAP financial results include the impact of
changes in foreign currency exchange rates ("AFX"). We use the
non-GAAP measure "at constant currency" or "CFX" to show changes in
our financial results without giving effect to period-to-period
currency fluctuations. Under U.S. GAAP, income statement results
are translated in U.S. dollars at the average exchange rate for the
period presented. Management believes that this non-GAAP measure is
useful in providing period-to-period comparisons of the results of
the Company's ongoing operational performance.
Free cash flow is a non-GAAP financial measure that represents
cash flow from operations (a GAAP measure) less capital
expenditures. Management believes free cash flow is a useful
measure of liquidity and an additional basis for assessing Otis'
ability to fund its activities, including the financing of
acquisitions, debt service, repurchases of common stock and
distribution of earnings to shareholders. Free cash flow should not
be considered an alternative to, or more meaningful than, net cash
flows provided by operating activities, or any other measure of
liquidity presented in accordance with GAAP.
Adjusted free cash flow is a non-GAAP financial measure that
represents cash flow from operations (a GAAP measure) less capital
expenditures, adjusted to exclude certain items management believes
affect the comparability of operating results. Management believes
adjusted free cash flow is a useful measure of liquidity that
provides investors additional information regarding the Company's
ability to fund its activities, including the financing of
acquisitions, debt service, repurchases of common stock and
distribution of earnings to shareholders. Adjusted free cash flow
should not be considered an alternative to, or more meaningful
than, net cash flows provided by operating activities, or any other
measure of liquidity presented in accordance with GAAP.
When we provide our expectations for adjusted net sales, organic
sales, adjusted operating profit, adjusted net interest expense,
adjusted net income, adjusted effective tax rate, adjusted EPS,
free cash flow and adjusted free cash flow on a forward-looking
basis, a reconciliation of the differences between the non-GAAP
expectations and the corresponding GAAP measures (expected diluted
EPS from continuing operations, operating profit, the effective tax
rate, net sales and expected cash flow from operations) generally
is not available without unreasonable effort due to potentially
high variability, complexity and low visibility as to the items
that would be excluded from the GAAP measure in the relevant future
period, such as unusual gains and losses, the ultimate outcome of
pending litigation, fluctuations in foreign currency exchange
rates, the impact and timing of potential acquisitions and
divestitures, and other structural changes or their probable
significance. The variability of the excluded items may have a
significant, and potentially unpredictable, impact on our future
GAAP results.
Cautionary Statement
This communication contains statements which, to the extent they
are not statements of historical or present fact, constitute
"forward-looking statements" under the securities laws. From time
to time, oral or written forward-looking statements may also be
included in other information released to the public. These
forward-looking statements are intended to provide management's
current expectations or plans for Otis' future operating and
financial performance, based on assumptions currently believed to
be valid. Forward-looking statements can be identified by the use
of words such as "believe," "expect," "expectations," "plans,"
"strategy," "prospects," "estimate," "project," "target,"
"anticipate," "will," "should," "see," "guidance," "outlook,"
"medium-term," "near-term," "confident," "goals" and other words of
similar meaning in connection with a discussion of future operating
or financial performance. Forward-looking statements may include,
among other things, statements relating to future sales, earnings,
cash flow, results of operations, uses of cash, dividends, share
repurchases, tax rates, research & development spend,
restructuring actions (including UpLift), credit ratings, net
indebtedness and other measures of financial performance or
potential future plans, strategies or transactions, or statements
that relate to climate change and our intent to achieve certain
environmental, social and governance targets or goals, including
operational impacts and costs associated therewith, and other
statements that are not historical facts. All forward-looking
statements involve risks, uncertainties and other factors that may
cause actual results to differ materially from those expressed or
implied in the forward-looking statements. For those statements,
Otis claims the protection of the safe harbor for forward-looking
statements contained in the U.S. Private Securities Litigation
Reform Act of 1995. Such risks, uncertainties and other factors
include, without limitation: (1) the effect of economic conditions
in the industries and markets in which Otis and its businesses
operate and any changes therein, including financial market
conditions, fluctuations in commodity prices and other inflationary
pressures, interest rates and foreign currency exchange rates,
levels of end market demand in construction, pandemic health issues
(including COVID-19 and variants thereof ), natural disasters,
whether as a result of climate change or otherwise, and the
financial condition of Otis' customers and suppliers; (2) the
effect of changes in political conditions in the U.S., including in
connection with the results of the 2024 elections or otherwise, and
other countries in which Otis and its businesses operate, including
the effects of the ongoing conflict between Russia and Ukraine, the war between Israel and Hamas, and tensions between the
U.S. and China, on general market
conditions, commodity costs, global trade policies and related
sanctions and export controls, and currency exchange rates in the
near term and beyond; (3) challenges in the development,
production, delivery, support, performance and realization of the
anticipated benefits of advanced technologies and new products and
services; (4) future levels of indebtedness, capital spending and
research and development spending; (5) future availability of
credit and factors that may affect such availability or costs
thereof, including credit market conditions and Otis' capital
structure; (6) the timing and scope of future repurchases of Otis'
common stock, which may be suspended at any time due to various
factors, including market conditions and the level of other
investing activities and uses of cash; (7) fluctuations in prices
and delays and disruption in delivery of materials and services
from suppliers, whether as a result of changes in general economic
conditions, geopolitical conflicts or otherwise; (8) cost reduction
or containment actions, restructuring costs and related savings and
other consequences thereof, including with respect to UpLift; (9)
new business and investment opportunities; (10) the outcome of
legal proceedings, investigations and other contingencies; (11)
pension plan assumptions and future contributions; (12) the impact
of the negotiation of collective bargaining agreements and labor
disputes and labor inflation in the markets in which Otis and its
businesses operate globally; (13) the effect of changes in tax,
environmental, regulatory (including among other things
import/export) and other laws and regulations in the U.S. and other
countries in which Otis and its businesses operate; (14) the
ability of Otis to retain and hire key personnel; (15) the scope,
nature, impact or timing of acquisition and divestiture activity,
the integration of acquired businesses into existing businesses and
realization of synergies and opportunities for growth and
innovation and incurrence of related costs; (16) the determination
by the Internal Revenue Service and other tax authorities that the
distribution or certain related transactions should be treated as
taxable transactions in connection with the separation (the
"Separation") of Otis and Carrier Global Corporation
("Carrier") from United Technologies Corporation (now known
as RTX Corporation ("RTX"); and (17) our obligations and disputes
that have or may hereafter arise under the agreements we entered
into with RTX and Carrier in connection with the Separation.
The above list of factors is not exhaustive or necessarily in order
of importance. For additional information on identifying factors
that may cause actual results to vary from those stated in
forward-looking statements, see Otis' registration statement on
Form 10 and the reports of Otis on Forms 10-K, 10-Q and 8-K filed
with or furnished to the SEC from time to time. Any forward-looking
statement speaks only as of the date on which it is made, and Otis
assumes no obligation to update or revise such statement, whether
as a result of new information, future events or otherwise, except
as required by applicable law.
|
Otis Worldwide
Corporation
Condensed
Consolidated Statements of Operations
|
|
|
|
|
|
Quarter
Ended
December
31,
|
|
Year
Ended
December
31,
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
(amounts in
millions, except per share amounts)
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Net Sales
|
|
$
3,620
|
|
$
3,439
|
|
$
14,209
|
|
$
13,685
|
Costs and
Expenses:
|
|
|
|
|
|
|
|
|
|
Cost of products and
services sold
|
|
2,552
|
|
2,479
|
|
10,016
|
|
9,765
|
|
Research and
development
|
|
37
|
|
38
|
|
144
|
|
150
|
|
Selling, general and
administrative
|
|
498
|
|
448
|
|
1,884
|
|
1,763
|
|
Total Costs and
Expenses
|
|
3,087
|
|
2,965
|
|
12,044
|
|
11,678
|
Other income (expense),
net
|
|
(11)
|
|
17
|
|
21
|
|
26
|
Operating
profit
|
|
522
|
|
491
|
|
2,186
|
|
2,033
|
|
Non-service pension
cost (benefit)
|
|
4
|
|
—
|
|
5
|
|
2
|
|
Interest expense
(income), net
|
|
41
|
|
36
|
|
150
|
|
143
|
Net income before
income taxes
|
|
477
|
|
455
|
|
2,031
|
|
1,888
|
|
Income tax
expense
|
|
133
|
|
137
|
|
533
|
|
519
|
Net income
|
|
344
|
|
318
|
|
1,498
|
|
1,369
|
|
Less: Noncontrolling
interest in subsidiaries' earnings
|
|
21
|
|
21
|
|
92
|
|
116
|
Net income attributable
to Otis Worldwide Corporation
|
|
$
323
|
|
$
297
|
|
$
1,406
|
|
$
1,253
|
|
|
|
|
|
|
|
|
|
|
Earnings Per Share of
Common Stock:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
0.79
|
|
$
0.71
|
|
$
3.42
|
|
$
2.98
|
|
Diluted
|
|
$
0.79
|
|
$
0.71
|
|
$
3.39
|
|
$
2.96
|
Weighted Average Number
of Shares Outstanding:
|
|
|
|
|
|
|
|
|
|
Basic shares
|
|
408.0
|
|
415.8
|
|
411.4
|
|
420.0
|
|
Diluted
Shares
|
|
410.9
|
|
418.7
|
|
414.6
|
|
423.0
|
Otis Worldwide
Corporation
Segment Net Sales
and Operating Profit
|
|
|
|
Quarter
Ended
December
31,
|
|
Quarter
Ended
December
31,
|
|
|
(Unaudited)
|
|
(Unaudited)
|
(dollars in
millions)
|
|
2023
|
|
2022
|
|
|
Reported
|
|
Adjusted
|
|
Reported
|
|
Adjusted
|
Net
Sales
|
|
|
|
|
|
|
|
|
New
Equipment
|
|
$
1,466
|
|
$
1,466
|
|
$
1,461
|
|
$
1,461
|
Service
|
|
2,154
|
|
2,154
|
|
1,978
|
|
1,978
|
Consolidated Net
Sales
|
|
$
3,620
|
|
$
3,620
|
|
$
3,439
|
|
$
3,439
|
|
|
|
|
|
|
|
|
|
Operating
Profit
|
|
|
|
|
|
|
|
|
New
Equipment
|
|
$
81
|
|
$
89
|
|
$
66
|
|
$
72
|
Service
|
|
497
|
|
518
|
|
461
|
|
472
|
Segment Operating
Profit
|
|
578
|
|
607
|
|
527
|
|
544
|
General corporate
expenses and other
|
|
(56)
|
|
(41)
|
|
(36)
|
|
(39)
|
Consolidated
Operating Profit
|
|
$
522
|
|
$
566
|
|
$
491
|
|
$
505
|
|
|
|
|
|
|
|
|
|
Segment Operating
Profit Margin
|
|
|
|
|
|
|
|
|
New
Equipment
|
|
5.5 %
|
|
6.1 %
|
|
4.5 %
|
|
4.9 %
|
Service
|
|
23.1 %
|
|
24.0 %
|
|
23.3 %
|
|
23.9 %
|
Total Operating Profit
Margin
|
|
14.4 %
|
|
15.6 %
|
|
14.3 %
|
|
14.7 %
|
|
|
Year
Ended
December
31,
|
|
Year
Ended
December
31,
|
|
|
(Unaudited)
|
|
(Unaudited)
|
(dollars in
millions)
|
|
2023
|
|
2022
|
|
|
Reported
|
|
Adjusted
|
|
Reported
|
|
Adjusted
|
Net
Sales
|
|
|
|
|
|
|
|
|
New
Equipment
|
|
$
5,812
|
|
$
5,812
|
|
$
5,864
|
|
$
5,778
|
Service
|
|
8,397
|
|
8,397
|
|
7,821
|
|
7,801
|
Consolidated Net
Sales
|
|
$ 14,209
|
|
$ 14,209
|
|
$ 13,685
|
|
$ 13,579
|
|
|
|
|
|
|
|
|
|
Operating
Profit
|
|
|
|
|
|
|
|
|
New
Equipment
|
|
$
358
|
|
$
381
|
|
$
358
|
|
$
381
|
Service
|
|
1,972
|
|
2,014
|
|
1,789
|
|
1,832
|
Segment Operating
Profit
|
|
2,330
|
|
2,395
|
|
2,147
|
|
2,213
|
General corporate
expenses and other
|
|
(144)
|
|
(126)
|
|
(114)
|
|
(87)
|
Consolidated
Operating Profit
|
|
$
2,186
|
|
$
2,269
|
|
$
2,033
|
|
$
2,126
|
|
|
|
|
|
|
|
|
|
Segment Operating
Profit Margin
|
|
|
|
|
|
|
|
|
New
Equipment
|
|
6.2 %
|
|
6.6 %
|
|
6.1 %
|
|
6.6 %
|
Service
|
|
23.5 %
|
|
24.0 %
|
|
22.9 %
|
|
23.5 %
|
Total Operating Profit
Margin
|
|
15.4 %
|
|
16.0 %
|
|
14.9 %
|
|
15.7 %
|
Otis Worldwide
Corporation
Reconciliation of
Reported (GAAP) to Adjusted Operating Profit & Operating Profit
Margin
|
|
|
|
Quarter Ended
December 31,
|
|
Year Ended December
31,
|
|
|
(Unaudited)
|
|
(Unaudited)
|
(dollars in
millions)
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
New
Equipment
|
|
|
|
|
|
|
|
|
GAAP Net
sales
|
|
$
1,466
|
|
$
1,461
|
|
$
5,812
|
|
$
5,864
|
Russia sales
|
|
—
|
|
—
|
|
—
|
|
(86)
|
Adjusted New
Equipment Sales
|
|
$
1,466
|
|
$
1,461
|
|
$
5,812
|
|
$
5,778
|
|
|
|
|
|
|
|
|
|
GAAP Operating
profit
|
|
$
81
|
|
$
66
|
|
$
358
|
|
$
358
|
UpLift
restructuring
|
|
7
|
|
—
|
|
7
|
|
—
|
Other
restructuring
|
|
1
|
|
5
|
|
16
|
|
23
|
Russia
operations
|
|
—
|
|
—
|
|
—
|
|
(3)
|
Russia conflict-related
charges
|
|
—
|
|
1
|
|
—
|
|
3
|
Adjusted New
Equipment Operating Profit
|
|
$
89
|
|
$
72
|
|
$
381
|
|
$
381
|
Reported New Equipment
Operating Profit Margin
|
|
5.5 %
|
|
4.5 %
|
|
6.2 %
|
|
6.1 %
|
Adjusted Operating
Profit Margin
|
|
6.1 %
|
|
4.9 %
|
|
6.6 %
|
|
6.6 %
|
|
|
|
|
|
|
|
|
|
Service
|
|
|
|
|
|
|
|
|
GAAP Net
sales
|
|
$
2,154
|
|
$
1,978
|
|
$
8,397
|
|
$
7,821
|
Russia sales
|
|
—
|
|
—
|
|
—
|
|
(20)
|
Adjusted Service
Sales
|
|
$
2,154
|
|
$
1,978
|
|
$
8,397
|
|
$
7,801
|
|
|
|
|
|
|
|
|
|
GAAP Operating
profit
|
|
$
497
|
|
$
461
|
|
$
1,972
|
|
$
1,789
|
UpLift
restructuring
|
|
16
|
|
—
|
|
16
|
|
—
|
Other
restructuring
|
|
5
|
|
10
|
|
26
|
|
37
|
Russia
operations
|
|
—
|
|
—
|
|
—
|
|
4
|
Russia conflict-related
charges
|
|
—
|
|
1
|
|
—
|
|
2
|
Adjusted Service
Operating Profit
|
|
$
518
|
|
$
472
|
|
$
2,014
|
|
$
1,832
|
Reported Service
Operating Profit Margin
|
|
23.1 %
|
|
23.3 %
|
|
23.5 %
|
|
22.9 %
|
Adjusted Operating
Profit Margin
|
|
24.0 %
|
|
23.9 %
|
|
24.0 %
|
|
23.5 %
|
|
|
|
|
|
|
|
|
|
General Corporate
Expenses and Other
|
|
|
|
|
|
|
|
|
GAAP General corporate
expenses and other
|
|
$
(56)
|
|
$
(36)
|
|
$
(144)
|
|
$
(114)
|
UpLift
restructuring
|
|
2
|
|
—
|
|
2
|
|
—
|
UpLift transformation
costs
|
|
12
|
|
—
|
|
16
|
|
—
|
Russia other expense
(income)
|
|
—
|
|
—
|
|
—
|
|
4
|
Russia sale and
conflict-related charges
|
|
—
|
|
(2)
|
|
—
|
|
23
|
One-time separation
costs, net and other
|
|
1
|
|
(1)
|
|
—
|
|
—
|
Adjusted General
Corporate Expenses and Other
|
|
$
(41)
|
|
$
(39)
|
|
$
(126)
|
|
$
(87)
|
|
|
|
|
|
|
|
|
|
Total
Otis
|
|
|
|
|
|
|
|
|
GAAP Operating
profit
|
|
$
522
|
|
$
491
|
|
$
2,186
|
|
$
2,033
|
UpLift
restructuring
|
|
25
|
|
—
|
|
25
|
|
—
|
Other
restructuring
|
|
6
|
|
15
|
|
42
|
|
60
|
UpLift transformation
costs
|
|
12
|
|
—
|
|
16
|
|
—
|
Russia
operations
|
|
—
|
|
—
|
|
—
|
|
5
|
Russia sale and
conflict-related charges
|
|
—
|
|
—
|
|
—
|
|
28
|
One-time separation
costs, net and other
|
|
1
|
|
(1)
|
|
—
|
|
—
|
Adjusted Total
Operating Profit
|
|
$
566
|
|
$
505
|
|
$
2,269
|
|
$
2,126
|
Reported Total
Operating Profit Margin
|
|
14.4 %
|
|
14.3 %
|
|
15.4 %
|
|
14.9 %
|
Adjusted Total
Operating Profit Margin
|
|
15.6 %
|
|
14.7 %
|
|
16.0 %
|
|
15.7 %
|
Otis Worldwide
Corporation
Reconciliation of
Reported (GAAP) to Adjusted (Non-GAAP) Net Income, Earnings Per
Share, and Effective Tax Rate
|
|
|
|
Quarter
Ended
December
31,
|
|
Year
Ended
December
31,
|
|
|
(Unaudited)
|
|
(Unaudited)
|
(dollars in
millions, except per share amounts)
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Adjusted Operating
Profit
|
|
$
566
|
|
$
505
|
|
$
2,269
|
|
$
2,126
|
Non-service pension
cost (benefit)
|
|
4
|
|
—
|
|
5
|
|
2
|
Net interest expense
1
|
|
41
|
|
36
|
|
150
|
|
139
|
Adjusted income from
operations before income taxes
|
|
521
|
|
469
|
|
2,114
|
|
1,985
|
Income tax
expense
|
|
133
|
|
137
|
|
533
|
|
519
|
Tax impact on
restructuring and non-recurring items
|
|
11
|
|
(5)
|
|
20
|
|
5
|
Non-recurring tax
items
|
|
—
|
|
—
|
|
—
|
|
2
|
Adjusted net income
from operations
|
|
377
|
|
337
|
|
1,561
|
|
1,459
|
Noncontrolling
interest
|
|
21
|
|
21
|
|
92
|
|
116
|
Adjusted net income
attributable to common shareholders
|
|
$
356
|
|
$
316
|
|
$
1,469
|
|
$
1,343
|
|
|
|
|
|
|
|
|
|
GAAP income
attributable to common shareholders
|
|
$
323
|
|
$
297
|
|
$
1,406
|
|
$
1,253
|
UpLift
restructuring
|
|
25
|
|
—
|
|
25
|
|
—
|
Other
restructuring
|
|
6
|
|
15
|
|
42
|
|
60
|
UpLift transformation
costs
|
|
12
|
|
—
|
|
16
|
|
—
|
Zardoya Otis Tender
Offer finance costs 1
|
|
—
|
|
—
|
|
—
|
|
5
|
Russia
operations
|
|
—
|
|
—
|
|
—
|
|
4
|
Russia sale and
conflict-related charges
|
|
—
|
|
—
|
|
—
|
|
28
|
One-time separation
costs, net and other
|
|
1
|
|
(1)
|
|
—
|
|
—
|
Tax effects of
restructuring, non-recurring items and other adjustments
|
|
(11)
|
|
5
|
|
(20)
|
|
(5)
|
Non-recurring tax
items
|
|
—
|
|
—
|
|
—
|
|
(2)
|
Adjusted net income
attributable to common shareholders
|
|
$
356
|
|
$
316
|
|
$
1,469
|
|
$
1,343
|
|
|
|
|
|
|
|
|
|
Diluted Earnings Per
Share
|
|
$
0.79
|
|
$
0.71
|
|
$
3.39
|
|
$
2.96
|
Impact to
diluted earnings per share
|
|
0.08
|
|
0.04
|
|
0.15
|
|
0.21
|
Adjusted Diluted
Earnings Per Share
|
|
$
0.87
|
|
$
0.75
|
|
$
3.54
|
|
$
3.17
|
|
|
|
|
|
|
|
|
|
Effective Tax
Rate
|
|
27.9 %
|
|
30.1 %
|
|
26.2 %
|
|
27.5 %
|
Impact of
adjustments on effective tax rate
|
|
(0.3) %
|
|
(2.0) %
|
|
(0.1) %
|
|
(1.0) %
|
Adjusted Effective
Tax Rate
|
|
27.6 %
|
|
28.1 %
|
|
26.1 %
|
|
26.5 %
|
|
1 Otis incurred interest costs
associated with financing the Zardoya Otis Tender Offer. Net
interest expense for the year ended December 31, 2022 is reflected
as adjusted without those costs.
|
Otis Worldwide
Corporation
Components of
Changes in Net Sales
|
|
Quarter Ended
December 31, 2023 Compared with Quarter Ended December 31,
2022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Factors Contributing
to Total % Change in Net Sales
|
|
|
Organic
|
|
FX
Translation
|
|
Acquisitions
/
Divestitures,
net
|
|
Total
|
New
Equipment
|
|
(0.2) %
|
|
0.4 %
|
|
0.1 %
|
|
0.3 %
|
Service
|
|
6.8 %
|
|
1.9 %
|
|
0.2 %
|
|
8.9 %
|
Maintenance and
Repair
|
|
6.8 %
|
|
2.0 %
|
|
0.2 %
|
|
9.0 %
|
Modernization
|
|
7.0 %
|
|
1.4 %
|
|
— %
|
|
8.4 %
|
Total Net
Sales
|
|
3.8 %
|
|
1.4 %
|
|
0.1 %
|
|
5.3 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended
December 31, 2023 Compared with Year Ended December 31,
2022
|
|
|
|
|
|
|
|
|
|
Factors Contributing
to Total % Change in Net Sales
|
|
|
Organic
|
|
FX
Translation
|
|
Acquisitions
/
Divestitures,
net
|
|
Total
|
New
Equipment
|
|
2.6 %
|
|
(2.1) %
|
|
(1.4) %
|
|
(0.9) %
|
Service
|
|
7.7 %
|
|
(0.4) %
|
|
0.1 %
|
|
7.4 %
|
Maintenance and
Repair
|
|
7.8 %
|
|
(0.3) %
|
|
— %
|
|
7.5 %
|
Modernization
|
|
7.3 %
|
|
(0.8) %
|
|
0.4 %
|
|
6.9 %
|
Total Net
Sales
|
|
5.6 %
|
|
(1.2) %
|
|
(0.6) %
|
|
3.8 %
|
|
|
|
|
|
|
|
|
|
Components of New
Equipment Backlog
|
|
|
|
December 31,
2023
|
|
|
Y/Y Growth
%
|
New Equipment Backlog
increase at actual currency
|
|
2 %
|
Foreign exchange impact
to New Equipment Backlog
|
|
— %
|
New Equipment Backlog
increase at constant currency
|
|
2 %
|
Components of
Modernization Backlog
|
|
|
|
December 31,
2023
|
|
|
Y/Y Growth
%
|
Modernization Backlog
increase at actual currency
|
|
15 %
|
Foreign exchange impact
to Modernization Backlog
|
|
— %
|
Modernization Backlog
increase at constant currency
|
|
15 %
|
Otis Worldwide
Corporation
Reconciliation of
Adjusted Operating Profit at Constant Currency
|
|
Quarter Ended
December 31, 2023 Compared with Quarter Ended December 31,
2022
|
|
|
|
|
|
|
|
|
|
(dollars in
millions)
|
|
2023
|
|
2022
|
|
Y/Y
|
|
|
|
|
|
|
|
New
Equipment
|
|
|
|
|
|
|
Adjusted Operating
Profit
|
|
$
89
|
|
$
72
|
|
$
17
|
Impact of foreign
exchange
|
|
3
|
|
—
|
|
3
|
Adjusted Operating
Profit at constant currency
|
|
$
92
|
|
$
72
|
|
$
20
|
|
|
|
|
|
|
|
Service
|
|
|
|
|
|
|
Adjusted Operating
Profit
|
|
$
518
|
|
$
472
|
|
$
46
|
Impact of foreign
exchange
|
|
(13)
|
|
—
|
|
(13)
|
Adjusted Operating
Profit at constant currency
|
|
$
505
|
|
$
472
|
|
$
33
|
|
|
|
|
|
|
|
Otis
Consolidated
|
|
|
|
|
|
|
Adjusted Operating
Profit
|
|
$
566
|
|
$
505
|
|
$
61
|
Impact of foreign
exchange
|
|
(9)
|
|
—
|
|
(9)
|
Adjusted Operating
Profit at constant currency
|
|
$
557
|
|
$
505
|
|
$
52
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended
December 31, 2023 Compared with Year Ended December 31,
2022
|
|
|
|
|
|
|
|
|
|
(dollars in
millions)
|
|
2023
|
|
2022
|
|
Y/Y
|
|
|
|
|
|
|
|
New
Equipment
|
|
|
|
|
|
|
Adjusted Operating
Profit
|
|
$
381
|
|
$
381
|
|
$
—
|
Impact of foreign
exchange
|
|
26
|
|
—
|
|
26
|
Adjusted Operating
Profit at constant currency
|
|
$
407
|
|
$
381
|
|
$
26
|
|
|
|
|
|
|
|
Service
|
|
|
|
|
|
|
Adjusted Operating
Profit
|
|
$
2,014
|
|
$
1,832
|
|
$
182
|
Impact of foreign
exchange
|
|
(4)
|
|
—
|
|
(4)
|
Adjusted Operating
Profit at constant currency
|
|
$
2,010
|
|
$
1,832
|
|
$
178
|
|
|
|
|
|
|
|
Otis
Consolidated
|
|
|
|
|
|
|
Adjusted Operating
Profit
|
|
$
2,269
|
|
$
2,126
|
|
$
143
|
Impact of foreign
exchange
|
|
23
|
|
—
|
|
23
|
Adjusted Operating
Profit at constant currency
|
|
$
2,292
|
|
$
2,126
|
|
$
166
|
Otis Worldwide
Corporation
Consolidated Balance
Sheet
|
|
|
|
December 31,
2023
|
|
December 31,
2022
|
(dollars in
millions)
|
|
(Unaudited)
|
|
|
Assets
|
|
|
|
|
Cash and cash
equivalents
|
|
$
1,274
|
|
$
1,189
|
Accounts receivable,
net
|
|
3,538
|
|
3,357
|
Contract
assets
|
|
717
|
|
664
|
Inventories
|
|
612
|
|
617
|
Other current
assets
|
|
259
|
|
316
|
Total Current
Assets
|
|
6,400
|
|
6,143
|
Future income tax
benefits
|
|
323
|
|
285
|
Fixed assets,
net
|
|
727
|
|
719
|
Operating lease
right-of-use assets
|
|
416
|
|
449
|
Intangible assets,
net
|
|
335
|
|
369
|
Goodwill
|
|
1,588
|
|
1,567
|
Other assets
|
|
328
|
|
287
|
Total
Assets
|
|
$
10,117
|
|
$
9,819
|
|
|
|
|
|
Liabilities and
(Deficit) Equity
|
|
|
|
|
Short-term borrowings
and current portion of long-term debt
|
|
$
32
|
|
$
670
|
Accounts
payable
|
|
1,878
|
|
1,717
|
Accrued
liabilities
|
|
1,873
|
|
1,794
|
Contract
liabilities
|
|
2,696
|
|
2,662
|
Total Current
Liabilities
|
|
6,479
|
|
6,843
|
Long-term
debt
|
|
6,866
|
|
6,098
|
Future pension and
postretirement benefit obligations
|
|
462
|
|
392
|
Operating lease
liabilities
|
|
292
|
|
315
|
Future income tax
obligations
|
|
245
|
|
279
|
Other long-term
liabilities
|
|
493
|
|
556
|
Total
Liabilities
|
|
14,837
|
|
14,483
|
|
|
|
|
|
Redeemable
noncontrolling interest
|
|
135
|
|
135
|
Shareholders' Equity
(Deficit):
|
|
|
|
|
Common Stock and
additional paid-in-capital
|
|
213
|
|
162
|
Treasury
Stock
|
|
(2,382)
|
|
(1,575)
|
Accumulated
deficit
|
|
(2,005)
|
|
(2,865)
|
Accumulated other
comprehensive income (loss)
|
|
(750)
|
|
(592)
|
Total Shareholders'
Equity (Deficit)
|
|
(4,924)
|
|
(4,870)
|
Noncontrolling
interest
|
|
69
|
|
71
|
Total Equity
(Deficit)
|
|
(4,855)
|
|
(4,799)
|
Total Liabilities
and Equity (Deficit)
|
|
$
10,117
|
|
$
9,819
|
Otis Worldwide
Corporation
Condensed
Consolidated Statement of Cash Flows
|
|
|
|
Quarter Ended
December 31,
|
|
Year Ended December
31,
|
|
|
(Unaudited)
|
|
(Unaudited)
|
(dollars in
millions)
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Operating
Activities:
|
|
|
|
|
|
|
|
|
Net income from
operations
|
|
$
344
|
|
$
318
|
|
$
1,498
|
|
$
1,369
|
Adjustments to
reconcile net income to net cash flows provided by operating
activities:
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
48
|
|
46
|
|
193
|
|
191
|
Deferred income tax
expense (benefit)
|
|
(27)
|
|
(22)
|
|
(61)
|
|
(16)
|
Stock compensation
cost
|
|
15
|
|
26
|
|
64
|
|
67
|
Change in:
|
|
|
|
|
|
|
|
|
Accounts receivable,
net
|
|
(25)
|
|
(138)
|
|
(239)
|
|
(309)
|
Contract assets and
liabilities, current
|
|
(98)
|
|
(105)
|
|
(30)
|
|
38
|
Inventories
|
|
23
|
|
15
|
|
15
|
|
(65)
|
Other current
assets
|
|
42
|
|
66
|
|
38
|
|
52
|
Accounts
payable
|
|
187
|
|
135
|
|
152
|
|
272
|
Accrued
liabilities
|
|
99
|
|
82
|
|
33
|
|
(84)
|
Pension
contributions
|
|
(16)
|
|
(6)
|
|
(48)
|
|
(34)
|
Other operating
activities, net
|
|
5
|
|
47
|
|
12
|
|
79
|
Net cash flows
provided by (used in) operating activities
|
|
597
|
|
464
|
|
1,627
|
|
1,560
|
Investing
Activities:
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
|
(42)
|
|
(34)
|
|
(138)
|
|
(115)
|
Acquisitions of
businesses and intangible assets, net of cash
|
|
(9)
|
|
(8)
|
|
(36)
|
|
(46)
|
Dispositions of
businesses, net of cash
|
|
—
|
|
—
|
|
—
|
|
61
|
Proceeds from sale of
(investments in) equity securities, net
|
|
6
|
|
—
|
|
4
|
|
(7)
|
Other investing
activities, net
|
|
(6)
|
|
(53)
|
|
(13)
|
|
74
|
Net cash flows
provided by (used in) investing activities
|
|
(51)
|
|
(95)
|
|
(183)
|
|
(33)
|
Financing
Activities:
|
|
|
|
|
|
|
|
|
Increase (decrease) in
short-term borrowings, net
|
|
(23)
|
|
33
|
|
(113)
|
|
113
|
Proceeds from the
issuance of long-term debt
|
|
—
|
|
—
|
|
747
|
|
—
|
Payment of debt
issuance costs
|
|
—
|
|
—
|
|
(6)
|
|
—
|
Repayment of long-term
debt
|
|
(534)
|
|
—
|
|
(534)
|
|
(500)
|
Dividends paid on
Common Stock
|
|
(139)
|
|
(120)
|
|
(539)
|
|
(465)
|
Repurchases of Common
Stock
|
|
(225)
|
|
(150)
|
|
(800)
|
|
(850)
|
Dividends paid to
noncontrolling interest
|
|
(9)
|
|
(11)
|
|
(85)
|
|
(118)
|
Acquisition of Zardoya
Otis shares
|
|
—
|
|
—
|
|
—
|
|
(1,802)
|
Other financing
activities, net
|
|
(2)
|
|
(2)
|
|
(20)
|
|
(30)
|
Net cash flows
provided by (used in) financing activities
|
|
(932)
|
|
(250)
|
|
(1,350)
|
|
(3,652)
|
Summary of
Activity:
|
|
|
|
|
|
|
|
|
Net cash provided by
(used in) operating activities
|
|
597
|
|
464
|
|
1,627
|
|
1,560
|
Net cash provided by
(used in) investing activities
|
|
(51)
|
|
(95)
|
|
(183)
|
|
(33)
|
Net cash provided by
(used in) financing activities
|
|
(932)
|
|
(250)
|
|
(1,350)
|
|
(3,652)
|
Effect of foreign
exchange rate changes on cash and cash equivalents
|
|
25
|
|
34
|
|
(9)
|
|
(157)
|
Net increase
(decrease) in cash, cash equivalents and restricted cash
|
|
(361)
|
|
153
|
|
85
|
|
(2,282)
|
Cash, cash equivalents
and restricted cash, beginning of period
|
|
1,641
|
|
1,042
|
|
1,195
|
|
3,477
|
Cash, cash equivalents
and restricted cash, end of period
|
|
1,280
|
|
1,195
|
|
1,280
|
|
1,195
|
Less: Restricted
cash
|
|
6
|
|
6
|
|
6
|
|
6
|
Cash and cash
equivalents, end of period
|
|
$
1,274
|
|
$
1,189
|
|
$
1,274
|
|
$
1,189
|
Otis Worldwide
Corporation
Reconciliation of
Net Cash Provided by Operating Activities (GAAP) to Adjusted Free
Cash Flow (Non-GAAP)
|
|
|
|
Quarter Ended
December 31,
|
|
Year Ended December
31,
|
|
|
(Unaudited)
|
|
(Unaudited)
|
(dollars in
millions)
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Net cash flows provided
by operating activities (GAAP)
|
|
$
597
|
|
$
464
|
|
$
1,627
|
|
$ 1,560
|
Capital
expenditures
|
|
(42)
|
|
(34)
|
|
(138)
|
|
(115)
|
Free Cash Flow
(Non-GAAP)
|
|
555
|
|
430
|
|
1,489
|
|
1,445
|
Adjustments
for:
|
|
|
|
|
|
|
|
|
UpLift restructuring
payments
|
|
12
|
|
—
|
|
12
|
|
—
|
UpLift transformation
payments
|
|
6
|
|
—
|
|
8
|
|
—
|
Separation-related
payments 1
|
|
—
|
|
—
|
|
25
|
|
18
|
Adjusted Free Cash Flow
(Non-GAAP)
|
|
$
573
|
|
$
430
|
|
$
1,534
|
|
$ 1,463
|
|
1 In
April of 2022 and 2023, we made payments to RTX Corporation (our
former parent) in accordance with the Separation tax agreement.
These annual payments are anticipated to conclude in
2026.
|
Media
Contact:
|
|
|
Investor Relations
Contact:
|
Ray Hernandez
|
|
|
Michael
Rednor
|
Ray.Hernandez@otis.com
|
|
|
investorrelations@otis.com
|
+1
860-212-9167
|
|
|
+1-860-676-6011
|
View original
content:https://www.prnewswire.com/news-releases/otis-reports-fourth-quarter-and-full-year-2023-results-302049175.html
SOURCE Otis Worldwide Corporation