Hubbell Inc. (NYSE:HUBB)

The financial data reveals several notable trends in key profitability and expense categories over the five-year period examined.

Gross Profit and Cost of Goods Sold

Gross profit as a percentage of net sales fluctuated slightly but displayed an overall improvement, rising from 29.02% in 2018 to 29.74% in 2022. This corresponds with some variability in the cost of goods sold, which ranged from a low of -70.26% in 2022 to a high of -72.54% in 2021. The decrease in cost of goods sold in 2022 contributed to the strengthened gross margin that year.

Selling & Administrative Expenses

These expenses gradually decreased as a percentage of net sales, from -16.59% in 2018 to -15.41% in 2022, reaching a low of -14.76% in 2021. The trend points to improved operational efficiency or cost control within selling and administrative functions during this period.

Operating Income

Operating income improved consistently, starting at 12.43% in 2018 and increasing to 14.33% in 2022. The steady rise reflects the combined impact of improved gross margins and reduced operating expenses relative to sales.

Other Income and Expenses

There were fluctuating other income and expense items. Notably, loss on extinguishment of debt appeared only in 2021 at -0.4%, and gains/losses on disposition of business were observed sporadically. Interest expense steadily declined from -1.62% in 2018 to -1.00% in 2022, indicating potentially lower debt costs or reduced leverage. Other net expense items also diminished over time, improving overall earnings quality.

Income Before Taxes, Taxes, and Net Income

Income from continuing operations before income taxes increased from 10.42% in 2018 to 13.28% in 2022, demonstrating stronger earnings performance. Provision for income taxes showed some variability but generally remained between -2.10% and -2.83%. Net income from continuing operations mirrored pre-tax income trends, rising from 8.17% in 2018 to 10.44% in 2022.

Discontinued Operations and Net Income

Discontinued operations contributed positively in 2021 and 2022, accounting for about 0.7% to 0.82% of net sales, thus enhancing total net income in those years. Overall net income increased from 8.17% of net sales in 2018 to 11.14% in 2022, reflecting the cumulative effect of improving margins, reduced expenses, and additional gains from discontinued operations.

Net Income Attributable to Noncontrolling Interests and Parent

The share of net income attributable to noncontrolling interest remained consistently low, around -0.11% to -0.15%, with minimal fluctuation. Consequently, net income attributable to the parent company increased in line with total net income, rising from 8.04% in 2018 to 11.03% in 2022.