Ecolab Chief Executive Christophe Beck speaks five languages, which came in handy in August and September, when he went on a tour of 11 countries.
Ecolab CEO says he has ‘rarely felt better’ about the St. Paul-based company
Christophe Beck spoke after the company released third-quarter earnings that skyrocketed 80% above the same quarter a year ago.
The Minnesota Star Tribune
October 29, 2024 at 8:29PM
Beck, who is a native of Switzerland, met with 29 companies and eight governments during the tour.
“It’s the first time in 17 years in the company where I really got the loud message that water is becoming an issue for most countries and most industries, and especially driven by digital and AI,” Beck said Tuesday during a phone interview.
Water products are a core strength for St. Paul-based Ecolab. The company not only provides cleaning and hygiene products but also helps clients meet sustainability goals, especially around water conservation.
Beck said he has “rarely felt better” about how the company is doing and where it is heading.
That confidence, he said, “is important in the world that we’re living in, and I still believe that the best is in front of us.”
Beck spoke after Ecolab reported third-quarter financial results. While its $4 billion in sales gained just 1% from the year-ago quarter, earnings increased 80% to $736.5 million, or $2.58 a share.
Ecolab closed on the $950 million sale of its surgical business to Medline in August and accounting for the sale and other items, adjusted earnings per share (EPS) for the quarter was $1.83 a share, above analyst expectations.
In September, Ecolab released its second Watermark Study that show the public’s concern about water stewardship around the world. The study shows that concerns about the availability of clean and safe drinking water worldwide with people in Latin American, China and the U.S. showing the most concern.
The expansion of data centers and need to power and cool more fast-running artificial intelligence chips has raised the awareness of issues around water scarcity. The Electric Power Research Institute estimates that data centers consumed 4% of U.S. energy production in 2023 and that it could increase to more than 9% by 2030.
These industrial applications are a growth opportunity for Ecolab.
“Water-treatment products will continue to be important with increasing regulations, the needs for industrial process efficiency, and the desire to reuse the natural resource,” wrote Faisal Hersi, an analyst with Edward Jones who covers Ecolab.
After the second quarter, Beck and other company officials said the company would institute a “One Ecolab” plan to boost sales. Under the new plan, the company will expand use of its current digital technologies and add solutions using AI and other tools. It also was reorganizing its sales force to drive 5% to 7% organic sales growth and progress toward 20% operating margins.
The organic sales growth in the third quarter was 4%. The strong earnings results were across business segments and geographies, Beck said.
Ecolab increased its earnings guidance for the remainder of the year. It now expects to report adjusted EPS of $6.60 to $6.70 a share up from the range of $6.50 to $6.70 a share given after the second quarter.
Shares of Ecolab closed Tuesday at $253.76, down about 1%. Over the last 52 weeks shares have ranged between $159.15 and $262.61 a share.
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