Common-Size Income Statement
Quarterly Data
Hubbell Inc., common-size consolidated income statement (quarterly data)
Based on: 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
- Gross Profit and Cost of Goods Sold
- The gross profit margin has shown a generally stable to improving trend over the periods, ranging between approximately 26.35% and 36.33% of net sales. The early periods show gross profit margins mostly in the high twenties to low thirties, fluctuating slightly but maintaining a consistent level. From early 2022 onward, there is a notable increase in gross profit margin, peaking around 36.33% in mid-2023. Correspondingly, the cost of goods sold as a percentage of net sales has declined in the recent periods, dropping from levels around 70% in earlier years to approximately 63.67% to 65.12% in 2023. This improvement suggests increased efficiency in production or cost controls.
- Selling and Administrative Expenses
- Selling and administrative expenses relative to net sales have exhibited a general downward trend over the years. Starting near 18.49% in early 2018, the ratio fluctuated but moved mostly downward, reaching near 14.14% by late 2021. Post-2021, these expenses stabilized in the 15% range, between 15.26% to 15.97%. This indicates some cost control efforts tempered by periodic increases, possibly due to strategic investments or inflationary pressures.
- Operating Income
- Operating income as a percentage of net sales demonstrates an improving trend. It started near 10.05% in early 2018, showing fluctuations but generally increasing over time. Peaks are evident in mid-2018 and mid-2019 at above 13%, with some softening toward the end of 2019 and 2020. From 2021 onward, operating income steadily improved, surging above 20% by mid-2023. The strong improvement in operating income aligns with the observed increase in gross profit margin and controlled operating expenses.
- Interest Expense
- Net interest expense as a percentage of sales has consistently declined throughout the timeline, starting at about -1.75% in early 2018 and falling steadily to approximately -0.57% by the third quarter of 2023. This suggests a reduction in interest-bearing liabilities, refinancing at lower interest rates, or improved financial management.
- Other Income and Expenses
- Other income (expense), net, shows some variability but predominantly low percentages relative to net sales, generally close to zero with occasional minor gains or losses. Other expense lines such as "Other expense" have fluctuated between approximately -0.41% and -3.62%, with no clear trend but some reduction in magnitude in recent years. Pension charges and gains or losses related to business disposition are sporadically present and affect some quarters, but their impact is limited overall.
- Income Before Taxes and Provision for Income Taxes
- Income from continuing operations before income taxes generally improved from 7.65% in early 2018, reaching above 19% in mid-2023. The provision for income taxes has fluctuated between about -1.6% and -4.8%, trending toward a higher effective tax rate in recent years, especially post-2022. This reflects either increased taxable income or changes in tax strategy or tax regulations affecting the company's tax expense.
- Net Income
- Net income from continuing operations mirrored the operating income trend, improving significantly from about 6.03% in early 2018 to highs exceeding 15% in 2023. Total net income, including discontinued operations where applicable, fluctuated more but follows a positive upward trajectory with notable spikes in early 2022 and again in 2023. Such results reflect increasing profitability, stronger operational control, and favorable market or business conditions.
- Attributable Net Income
- Net income attributable to Hubbell Incorporated shows a trend consistent with overall net income, rising from 5.88% in early 2018 to about 14.54% by the third quarter of 2023. This confirms that the majority of earnings are attributable to the company’s shareholders with relatively low and stable noncontrolling interest impacts ranging generally between -0.15% and -0.06% of net sales.
- Summary
- Overall, the financial data reflect a company with improving profitability driven by higher gross margins and effective cost management. Operating income and net income show steady growth over the analyzed periods. The company also benefits from lower interest expenses and controlled selling and administrative expenses. While tax expenses have increased relative to income, net profitability remains strong, exhibiting robust financial health and operational efficiency. Occasional gains or losses from business activities and restructuring are present but do not significantly alter underlying positive trends.