Shares of cryogenic gas-processing equipment manufacturer and service provider Chart Industries, Inc. (NASDAQ:GTLS) are up 11.7% at 12:14 p.m. EDT on July 19, following the company's pre-market second-quarter earnings release. Chart reported $320 million in revenue, good for 34% growth year over year and 14% higher than in the first quarter.
Earnings came in at $0.38 per share, more than four times last year's $0.09-per-share result. Adjusted for a number of nonrecurring items related to the company's nearly completed restructuring efforts, the departure of its former CEO last quarter, and some expense related to a product recall that has since been corrected, Chart's earnings would have been $0.55 per share, more than double the year-ago Q2 adjusted earnings of $0.21 per share.
Chart's improved results are a product of multiple actions over the past couple of years, including a substantial restructuring and consolidation of its manufacturing, distribution, and corporate headquarters locations; the integration of several acquisitions that have expanded its capabilities and service offerings; and the positive benefit of the lowered corporate income tax rate at the beginning of the year.
As I recently wrote, today's Chart is built for bigger sales and profits than in the past, and all of its restructuring efforts correspond to a surge in demand for its products.
This marks six consecutive quarters of sequential sales growth for Chart, and it's not just a product of sales from acquired companies; the company said its organic sales increased 14% year over year, as overall demand from energy and biotech customers continues to strengthen.
The recovery in the energy sector is particularly positive for Chart today, and it's looking like the good times could continue for the foreseeable future. Chart reported order growth of 43% year over year, or 12% on a sequential basis. Its backlog has increased sharply over the past year, up 44% to $527 million, with the bulk of that growth coming from its energy and chemicals (E&C) segment. The backlog increased 8% sequentially as well, with the E&C and distribution and storage segments providing the bulk.
It's been a great run for Chart investors over the past few years, as management has poured substantial resources into strengthening the business with acquisitions, while also investing in making it more efficient and lean in advance of the recovery in energy spending. And with improving demand, Chart should continue delivering earnings growth in the quarters ahead.