OAK BROOK, Ill. - Federal Signal Corporation (NYSE:FSS), a leading provider of environmental and safety solutions, reported a robust fourth quarter, surpassing analyst expectations for both earnings and revenue.
The company announced an adjusted EPS of $0.74, which was $0.08 higher than the analyst estimate of $0.66. Revenue also exceeded forecasts, coming in at $448 million against the consensus estimate of $428.53 million, marking a significant 15% increase from the same quarter last year.
The company's financial performance has prompted a mixed investor response, with the stock price trimming its initial 7% gain following the announcement. This uptick is attributed to the earnings and revenue beat, coupled with an upbeat guidance for the fiscal year 2024.
Federal Signal's President and CEO, Jennifer L. Sherman, attributed the strong quarter to increased sales volumes, contributions from recent acquisitions, and robust price realization. She noted that the Environmental Solutions Group saw a 15% YoY net sales increase, while the Safety and Security Systems Group also achieved double-digit top-line growth.
Looking ahead, Federal Signal provided an optimistic guidance for the fiscal year 2024, projecting an adjusted EPS range of $2.85 to $3.05, which is above the consensus estimate of $2.91. The company also anticipates revenue between $1.85 billion and $1.9 billion, surpassing the consensus forecast of $1.829 billion. Capital expenditures are expected to be between $35 million and $40 million.
Federal Signal's financial position was further strengthened by a 162% increase in operating cash flow for the quarter, amounting to $103 million. This has enabled the company to pay down approximately $70 million of debt. The full-year operating cash flow also saw a substantial rise of 171%, totaling $194 million.
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