The following is a summary of the Otis Worldwide Corporation (OTIS) Q1 2024 Earnings Call Transcript:
Financial Performance:
Otis Worldwide Corporation's Q1 net sales were $3.4 billion with an organic sales growth of 3.8%.
The company reported an operating profit of $71 million for New Equipment and $523 million for Service at constant currency.
Otis undertook a share repurchase of $300 million in Q1, and announced a 14.7% increase in its quarterly dividend.
The company adjusted their projected EPS for 2024 to a range of $3.83 to $3.90, marking an increase of 8% to 10%.
The company repatriated $300 million cash and increased share repurchase from $800 million to $1 billion.
Business Progress:
The Service business saw mid-single digit growth. Maintenance portfolio growth was above 4% ensuring service organic sales growth of 6.5%.
Modernization orders experienced an increase of 12.9% in Q1 with growth seen across all regions.
The company secured new business in multiple countries including China, Canada, Japan, and the United Kingdom.
The company is acquiring the remaining minority interest in Nippon Otis in Japan for approximately $70 million.
Despite pressurized pricing in China, Otis showed growth in Service revenue with service now constituting 25% of the revenue in China and growing.
The company expects further savings from commodities amounting to $15 million to $20 million this year.
The company's supply chain has been effectively managed and optimized without impacting delivery, and it plans to further strengthen its supply chain by focusing on dual sourcing and resilience.
More details: Otis Worldwide IR
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