ITT Inc. (NYSE:ITT) Q1 2023 Results Conference Call May 4, 2023 8:30 AM ET
Company Participants
Mark Macaluso - Vice President, Investor Relations and Global Communications
Luca Savi - Chief Executive Officer and President
Emmanuel Caprais - Chief Financial Officer
Conference Call Participants
Jeff Hammond - KeyBanc Capital Markets
Scott Davis - Melius Research
Vlad Bystricky - Citigroup
Mike Halloran - Baird
Damian Karas - UBS
Joe Ritchie - Goldman Sachs
Matt Summerville - D.A. Davidson
Bryan Blair - Oppenheimer
Michael Anastasiou - TD Cowen
Operator
Welcome to the ITT's 2023 First Quarter Conference Call. Today is Thursday, May 4, 2023. Today's call is being recorded and will be available for a replay beginning at 12 p.m. ET [Operator Instructions].
It's now my pleasure to turn the floor over to Mark Macaluso, Vice President, Investor Relations and Global Communications. You may begin.
Mark Macaluso
Thank you, Elliot, and good morning. Joining me here this morning are Luca Savi, ITT's Chief Executive Officer and President; and Emmanuel Caprais, Chief Financial Officer. Today's call will cover ITT's financial results for the three month period ending April 1, 2023, which we announced this morning. Before we begin, please refer to Slide 2 of today's presentation where we note that today's comments will include forward-looking statements that are based on our current expectations. Actual results may differ materially due to several risks and uncertainties, including those described in our 2022 annual report on Form 10-K and other recent SEC filings. Except or otherwise noted, the first quarter results we present this morning will be compared to the first quarter of 2022 and include non-GAAP financial measures. The reconciliation of such measures to the most comparable GAAP figures are detailed in our press release and in the appendix of our presentation, both of which are available on our website.
It is now my pleasure to turn the call over to Luca, who will begin on Slide 3.
Luca Savi
Thank you, Mark, and good morning. As always, I would like to begin by thanking our shareholders and our customers for their continued support and investment in ITT. And again, I also want to recognize our employees around the world. It is thanks to your efforts that we were able to deliver such a strong first quarter. If there is one thing about ITT's Q1 results, I would like you to remember, is our performance on both growth and execution. We delivered solid start to 2023 on all accounts, 10% organic revenue growth, leading to ITT's highest quarterly revenue ever, 7% organic orders growth, 150 basis points of segment margin expansion, 21% EPS growth, and a more than $60 million improvement in free cash flow. We also signed a strategic aftermarket agreement in Friction with our partner Continental, repurchased $30 million of ITT shares and deployed $80 million towards the acquisition of Micro-Mode in May. Now let's get into the details. On growth, Industrial Process orders grew 22% as a result of continued share gains. We generated significant commercial momentum in the green energy space with large project awards and market share gains related to decarbonization. Project orders in IP grew an outstanding 54%, while on the short cycle, orders for aftermarket baseline pumps and valves grew 13%. The orders momentum drove IP's revenue growth above 25% this quarter and added to an already large and most importantly, profitable backlog entering Q2. In Motion Technologies, we won 41 electrified vehicle platforms awards with leading OEMs, including BYD in China and Ford and [Chrysler] in North America. Continuing with electrification, orders in our EV connector business grew over 15% and with sales growth eclipsing 20% as electrification investments continue.