Federal Signal Reports Record Orders and Backlog in Strong First Quarter

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Oak Brook, Illinois, May 4, 2021 — Federal Signal Corporation (NYSE:FSS) (the “Company”), a leader in environmental and safety solutions, today reported results for the first quarter ended March 31, 2021.

First Quarter Highlights

  • Record orders of $384 million, up $80 million, or 26%, from last year and up $108 million, or 39%, compared to the fourth quarter of 2020
  • Record backlog of $410 million, up $106 million, or 35%, from the end of last year
  • GAAP EPS of $0.36
  • Adjusted EPS of $0.38
  • Completed acquisition of OSW Equipment and Repair, LLC (“OSW”), a leading manufacturer of dump truck bodies and custom upfitter of truck equipment and trailers

Consolidated net sales for the first quarter were $279 million, compared to $286 million in the same quarter a year ago. Net income for the first quarter was $22.2 million, equal to $0.36 per diluted share, compared to $23.4 million, equal to $0.38 per share, in the prior-year quarter.

The Company also reported adjusted net income for the first quarter of $23.2 million, equal to $0.38 per diluted share, compared to $24.1 million, or $0.39 per diluted share, in the first quarter of last year. The Company is reporting adjusted results to facilitate comparisons of underlying performance on a year-over-year basis. A reconciliation of these and other non-GAAP measures is provided at the conclusion of this news release.

Strong Operational Performance Despite Ongoing Disruption; Demand Continues to Improve with Record Quarterly Orders

“We delivered another strong quarter, with operating results exceeding our expectations despite ongoing pandemic-related disruption and the effects of unusually adverse weather which impacted production at our facilities in Texas, Mississippi and Alabama,” commented Jennifer L. Sherman, President and Chief Executive Officer. “As in the last two quarters, we again saw improved demand for our products, with our first quarter order intake setting a new record for the Company, surpassing the previous high by over $50 million.”

In the Environmental Solutions Group, net sales for the first quarter were $228 million, compared to $233 million in the prior-year quarter. In the Safety and Security Systems Group, net sales were $51 million, compared to $53 million last year.

Consolidated operating income for the first quarter was $27.8 million, compared to $32.3 million in the prior-year quarter. Consolidated operating margin was 10.0%, compared to 11.3% in the prior-year quarter.

Consolidated adjusted earnings before interest, tax, depreciation and amortization (“adjusted EBITDA”) for the first quarter was $41.2 million, compared to $43.9 million in the prior-year quarter, and consolidated adjusted EBITDA margin was 14.8%, compared to 15.3% last year.

Adjusted EBITDA in the Environmental Solutions Group was $39.3 million, compared to $40.0 million in the prior-year quarter, and its adjusted EBITDA margin was 17.2%, consistent with the prior year. In the Safety and Security Systems Group, adjusted EBITDA was $8.2 million, compared to $8.2 million in the prior-year quarter, and its adjusted EBITDA margin was 16.2%, compared to 15.4% last year.

Consolidated orders for the first quarter were $384 million, the highest quarterly orders on record, representing an increase of $80 million, or 26%, compared to the prior-year quarter. Consolidated backlog at March 31, 2021 was $410 million, a new record for the Company, and up $106 million, or 35%, from the end of last year.

Financial Position Remains Strong, Providing Flexibility to Invest in Organic Growth, Fund M&A and Return Cash to Stockholders

Net cash of $26.0 million was provided by operating activities during the first quarter, an improvement of $20.8 million, compared to the prior-year period.

During the first quarter, the Company completed the acquisition of OSW for initial cash consideration of $53.5 million.

At March 31, 2021, consolidated debt was $223 million, total cash and cash equivalents were $55 million and the Company had $270 million of availability for borrowings under its revolving credit facility. 

“Our financial position continues to be very strong,” said Sherman. “It provides us with flexibility to pursue strategic

acquisitions, like OSW, invest in organic growth initiatives, and return cash to stockholders through dividends and opportunistic share repurchases.”

The Company also funded dividends of $5.5 million during the first quarter, reflecting an increased dividend of $0.09 per share, and the Board of Directors recently declared a similar dividend that will be payable in the second quarter.


“Orders thus far this year have exceeded our expectations, fueled by a combination of new product launches, ongoing execution against strategic initiatives and strong recovery in end markets,” noted Sherman. “With certain chassis manufacturers temporarily impacted by the global semiconductor shortage, we are currently encountering some short-term production challenges at our largest facility. Our teams are working diligently to navigate through the disruption, as they have in the past when faced with similar situations. After factoring in the impact expected over the next couple of months, at this time we are maintaining our adjusted EPS* outlook for the year of $1.73 to $1.85. With our recently-completed capacity expansions at several facilities, we are well positioned once the current chassis uncertainty eases. Demand for our products is at an all-time high, with the recent federal stimulus and the possibility of infrastructure investment offering potential for further momentum, which we have not factored into our current outlook.”


Federal Signal will host its first quarter conference call on Tuesday, May 4, 2021 at 10:00 a.m. Eastern Time. The call will last approximately one hour. The call may be accessed over the internet through Federal Signal’s website at www.federalsignal.com or by dialing phone number 1-877-705-6003 and entering the pin number 13719079. A replay will be available on Federal Signal’s website shortly after the call.

About Federal Signal

Federal Signal Corporation (NYSE: FSS) builds and delivers equipment of unmatched quality that moves material, cleans infrastructure, and protects the communities where we work and live. Founded in 1901, Federal Signal is a leading global designer, manufacturer and supplier of products and total solutions that serve municipal, governmental, industrial and commercial customers. Headquartered in Oak Brook, Ill., with manufacturing facilities worldwide, the Company operates two groups: Environmental Solutions and Safety and Security Systems. For more information on Federal Signal, visit: www.federalsignal.com.

“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995

This release contains unaudited financial information and various forward-looking statements as of the date hereof and we undertake no obligation to update these forward-looking statements regardless of new developments or otherwise. Statements in this release that are not historical are forward-looking statements. Such statements are subject to various risks and uncertainties that could cause actual results to vary materially from those stated. Such risks and uncertainties include but are not limited to: direct and indirect impacts of the coronavirus pandemic and the associated government response, economic conditions in various regions, product and price competition, supply chain disruptions, work stoppages, availability and pricing of raw materials, risks associated with acquisitions such as integration of operations and achieving anticipated revenue and cost benefits, foreign currency exchange rate changes, interest rate changes, increased legal expenses and litigation results, legal and regulatory developments and other risks and uncertainties described in filings with the Securities and Exchange Commission.

Contact: Ian Hudson, Chief Financial Officer, +1-630-954-2000, ihudson@federalsignal.com

* Adjusted earnings per share (“EPS”) is a non-GAAP measure, which includes certain adjustments to reported GAAP net income and diluted EPS. When reporting adjusted EPS in 2021, we have made, and would expect to continue to make, certain adjustments to exclude the impact of acquisition and integration-related expenses, coronavirus-related expenses and purchase accounting effects, where applicable. In prior years, we have also made adjustments to GAAP net income and diluted EPS for pension-related charges, restructuring activity, hearing loss settlement charges and special tax items. Should any similar items occur in 2021, we would also expect to exclude them from the determination of adjusted EPS. However, because of the underlying uncertainty in quantifying amounts which may not yet be known, a reconciliation of our Adjusted EPS outlook to the most applicable GAAP measure is excluded based on the unreasonable efforts exception in Item 10(e)(1)(i)(B).

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