Name: Trane Technologies plc (NYSE:TT) | Statement of Comprehensive Income
Creator: Stock Analysis on Net

Statement of Comprehensive Income

Comprehensive income is the change in equity (net assets) of a business enterprise during a period from transactions and other events and circumstances from non-owners sources. It includes all changes in equity during a period except those resulting from investments by owners and distributions to owners.

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Trane Technologies plc, consolidated statement of comprehensive income

US$ in thousands

12 months ended:	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018
Net earnings	1,774,700)	1,436,600)	870,000)	1,428,500)	1,357,500)
Currency translation	(202,700)	(122,700)	261,500)	(37,100)	(230,600)
Unrealized net gains (losses) arising during period	(24,300)	1,600)	3,300)	(2,700)	1,200)
Net (gains) losses reclassified into earnings	10,200)	(6,400)	1,900)	700)	900)
Tax (expense) benefit	2,500)	1,100)	—)	900)	(100)
Cash flow hedges, net of tax	(11,600)	(3,700)	5,200)	(1,100)	2,000)
Prior service costs for the period	(3,300)	300)	(1,900)	(5,700)	(16,000)
Net actuarial gains (losses) for the period	54,200)	111,400)	(52,500)	(41,900)	12,800)
Amortization reclassified into earnings	21,600)	38,600)	43,400)	48,100)	50,700)
Net curtailment and settlement (gains) losses reclassified to earnings	15,000)	8,000)	(1,800)	2,200)	2,500)
Currency translation and other	12,700)	5,200)	(10,400)	(1,400)	7,500)
Tax (expense) benefit	(16,100)	(43,700)	(700)	(4,700)	(17,200)
Pension and OPEB adjustments, net of tax	84,100)	119,800)	(23,900)	(3,400)	40,300)
Other comprehensive income (loss), net of tax	(130,200)	(6,600)	242,800)	(41,600)	(188,300)
Comprehensive income, net of tax	1,644,500)	1,430,000)	1,112,800)	1,386,900)	1,169,200)
Comprehensive income attributable to noncontrolling interests	(16,600)	(12,700)	(17,800)	(18,500)	(16,900)
Comprehensive income attributable to Trane Technologies plc	1,627,900)	1,417,300)	1,095,000)	1,368,400)	1,152,300)

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).

An analysis of the financial performance from 2018 to 2022 reveals a general upward trajectory in profitability, interrupted by a significant contraction in 2020. Net earnings exhibited volatility, declining from $1.43 billion in 2019 to $870 million in 2020, before recovering strongly to reach a five-year peak of $1.77 billion by the end of 2022. Comprehensive income followed a similar pattern, reflecting the underlying strength of net earnings while being influenced by fluctuating items of other comprehensive income.

Earnings and Comprehensive Income Trends: Net earnings demonstrated a compound growth trend over the period, with the 2020 dip representing a temporary deviation. The recovery in 2021 and 2022 indicates a robust return to growth, with 2022 net earnings exceeding 2018 levels by approximately 31%. Comprehensive income attributable to Trane Technologies plc mirrored this growth, rising from $1.15 billion in 2018 to $1.63 billion in 2022.
Volatility in Other Comprehensive Income (OCI): Other comprehensive income, net of tax, showed extreme variance, alternating between significant losses and gains. A notable peak occurred in 2020 with a gain of $242.8 million, contrasting with losses of $188.3 million in 2018 and $130.2 million in 2022. This volatility is primarily driven by currency translation adjustments, which fluctuated from a loss of $230.6 million in 2018 to a gain of $261.5 million in 2020, and back to a loss of $202.7 million in 2022.
Pension and OPEB Adjustments: Pension and Other Post-Employment Benefits (OPEB) adjustments transitioned from a period of instability to a consistent positive contribution in the later years. After recording losses in 2019 and 2020, the company saw substantial positive adjustments in 2021 ($119.8 million) and 2022 ($84.1 million). This shift was supported by net actuarial gains, which peaked at $111.4 million in 2021.
Noncontrolling Interests and Attributable Income: The impact of noncontrolling interests on comprehensive income remained relatively stable and marginal throughout the period, ranging from a loss of $18.5 million in 2019 to a loss of $12.7 million in 2021. Consequently, the vast majority of total comprehensive income was consistently attributable to the parent company, Trane Technologies plc.

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