LII · Lennox International Q2 FY2026 earnings call record财报电话会记录

“Total segment profit increased 2% to $355 million, and adjusted earnings per share were flat at $7.72.”

“Elevated mortgage rates, inflationary pressures, and historically low consumer confidence are constraining underlying demand.”

“While we are reducing our earnings outlook, several key elements of our 2026 financial framework, such as revenue and free cash conversion, have not changed.”

“Compared to the prior year period, revenue declined 7%, driven primarily by a 12% decline in unit volumes.”

“Favorable mix and pricing contributed 3% growth, while acquisitions added another 2%, partially offsetting the volume decline.”

“Mix and price were favorable and mostly offset cost pressures, including ongoing inflation and approximately $10 million of factory absorption headwinds as we align inventory levels with market demand.”

“During Q2, we repurchased approximately $130 million of shares, and after quarter end, we completed the acquisition of the Comfort-Aire and Century brands using approximately $200 million of debt.”

“We are also refining our full-year capital expenditure outlook to approximately $225 million, down from $250 million.”

“We now expect approximately $60 million of productivity versus our prior expectation of $75 million, reflecting ongoing absorption headwinds from lower residential volumes and the delayed timing of some material cost reduction initiatives as resources were shifted to tariff mitigation.”

“Importantly, our free cash flow outlook remains unchanged at $750 million-$850 million, reflecting confidence in our inventory reduction plans and working capital execution.”

“Is that just the fixed cost absorption on the lower volumes, or is there anything else in there that's pressuring the margins?”

“Better margin performance in the second half as the volumes start to come back.”