Dover Reports 4Q 2018 Organic Revenue Growth of 6.2%

Dover announced its financial results for the fourth quarter and full year ended Dec. 31, 2018.
 
Fourth Quarter 2018 Financial Results:
 
For the fourth quarter ended Dec. 31, 2018, Dover’s revenue was $1.8 billion, which represents organic growth of 6.2%. Net earnings on a GAAP basis for the fourth quarter ended Dec. 31, 2018, were $141.6 million, compared to net earnings of $296.4 million in the prior year period, including the results of discontinued operations.
 
Earnings from continuing operations were $158 million, a decrease of 45% as compared to $289.6 million for the prior year period, largely driven by a $110 million net benefit from a disposition (net of disposition costs) and a $54.9 million net benefit from the Tax Cuts and Jobs Act, both realized in the fourth quarter of 2017. Diluted earnings per share from continuing operations (EPS) on a GAAP basis for the fourth quarter ended Dec. 31, 2018, was $1.07, compared to $1.83 for the fourth quarter in the prior year.
 
Full Year 2018 Financial Results:
 
For the full year ended Dec. 31, 2018, Dover’s revenue was $7 billion, driven by organic growth of 3.7%. Net earnings on a GAAP basis for the full year ended Dec. 31, 2018, were $570.3 million, compared to net earnings of $811.7 million in the prior year.
 
Earnings from continuing operations were $591.1 million, a decrease of 21% compared to $746.7 million for the prior year, largely driven by net benefits from dispositions and a net benefit from the Tax Reform Act realized in 2017. Diluted EPS on a GAAP basis for the full year ended Dec. 31, 2018, was $3.89, compared to $4.73 in the prior year.
 
Free cash flow for the year was $618.2 million, representing 8.8% cash conversion of revenue. Excluding $52 million of cash costs from restructuring initiatives, cash conversion was 9.6% of revenue.
 
Full Year 2019 Guidance:
 
In 2019, Dover expects to generate adjusted EPS in the range of $5.65 to $5.85. This guidance is based on full-year revenue growth of 2% to 3%, comprised of 2% to 4% organic growth and a 1% impact from completed acquisitions, partially offset by an estimated 2% unfavorable impact from foreign currency exchange.
 
“Dover’s solid results for the quarter and the year reflect broad-based demand strength in Engineered Systems and Fluids, which posted 2018 annual organic growth of 5.8% and 8.7%, respectively, and more than offset weak demand in Refrigeration & Food Equipment,” Richard J. Tobin, Dover’s president and CEO, said. “Our $7 billion of revenue for the year reflects an organic growth rate of 3.7%, while adjusted net earnings and adjusted EPS improved 15% and 20%, respectively.
 
“Dover enters 2019 with solid momentum as represented by our Q4 organic growth rate, solid order backlogs across most of our portfolio, and margin expansion being driven by volume and cost initiatives,” Tobin added.