MILWAUKEE - Badger Meter, Inc. (NYSE: NYSE:BMI) announced a robust start to the year with record-breaking financial results for the first quarter ended March 31, 2024. The company reported a significant 23% increase in sales, reaching $196.3 million, compared to $159.1 million in the same quarter last year. This performance surpassed the analyst consensus estimate of $182.25 million.
The company's adjusted EPS soared to $0.99, a 50% increase from the $0.66 reported in the prior year's quarter, and notably higher than the analyst estimate of $0.82. The impressive earnings growth was attributed to strong customer demand and operational execution, particularly in the smart water solutions segment.
Kenneth C. Bockhorst, Chairman, President, and CEO, highlighted the success of the quarter, "The continued strength in both customer demand and operating execution drove exceptional performance in our first quarter, with record quarterly revenue, operating profit, and EPS results."
He credited the company's innovative smart water solutions and favorable industry fundamentals for the robust customer demand.
Utility water sales saw a 29% year-over-year increase, driven by the adoption of the company's cellular AMI offering, which includes ORION® Cellular endpoints and BEACON® Software as a Service (SaaS) revenues, as well as increased water meter volumes, including E-Series® Ultrasonic meters. Despite a 3% decline in flow instrumentation product sales compared to the previous year, the company experienced solid order demand from water-focused end markets.
Operating profit margins expanded to a record 18.6%, up 290 basis points from 15.7% in the previous year, benefiting from higher volumes and solid operating execution. Gross margin dollars increased by $14.4 million year-over-year, with a stable gross margin percentage of 39.3%, reflecting a positive sales mix and higher volumes amidst inflationary cost pressures.
SEA expenses rose modestly to $40.6 million, up from $37.7 million in the prior year, mainly due to growth investments, including higher personnel-related costs. The tax rate for the quarter was slightly lower at 23.5%, compared to 24.3% in the previous year.
Looking ahead, Bockhorst expressed confidence in the company's ability to continue capitalizing on the resilient macro trends within the water industry. He stated, "We have confidence in the durability of our end markets, the appeal of our innovative offerings, and the strength of our execution to drive sales and earnings growth."
Badger Meter's commitment to sustainability and employee engagement was also recognized, with the company being named to Barron's 2024 list of 100 Most Sustainable Companies and being named a 2024 USA Top Workplace.
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