05.04.17
Emerson announced net sales in the second quarter ended March 31, 2017 were flat on both a net and underlying basis. The second quarter results reflected a continued improvement in served markets across both platforms. Five percent growth in the Commercial & Residential Solutions platform was driven by favorable HVAC, refrigeration and construction related markets. The Automation Solutions platform was down low-single digits. However, MRO activity in energy related markets continues to strengthen, particularly in North America, and power and life sciences markets remained favorable.
All profitability measures increased in the second quarter. Gross profit margin of 43.6% improved 50 basis points versus the prior year primarily due to savings from restructuring activities in 2016. Pretax margin of 15.8% and EBIT margin of 17.0% increased 40 and 30 basis points respectively. Earnings per share from continuing operations of $0.58 increased 2%. Earnings per share were $0.45, down 21%, including a ($0.13) impact from discontinued operations related to the completed sales of the Network Power, Leroy-Somer and Control Techniques businesses.
“Following our solid first quarter, the second quarter results again exceeded our expectations delivering continued profitability improvement over the prior year,” said chairman and CEO David N. Farr. “During the quarter we saw improving demand across both of our platform businesses, positioning us for a stronger second half of the year. Considering our solid performance in the first half of the fiscal year and current order trends, we are raising our full year sales and EPS guidance. We now expect earnings per share from continuing operations to be $2.55 to $2.65, versus our prior guidance of $2.47 to $2.62. This EPS guidance assumes full year sales are approximately flat with underlying sales up approximately 1% excluding unfavorable currency translation.”
Full-year net sales are now expected to be approximately flat, with underlying sales up approximately 1% excluding unfavorable currency translation of approximately 1%. Earnings per share from continuing operations guidance is being raised to $2.55 to $2.65. Automation Solutions net sales are expected to be down 3% to 4. Commercial & Residential Solutions net and underlying sales are expected to be up 5% to 6%.
“Thanks to the success of our multi-year restructuring actions and with the momentum established by our two platform businesses, we’re well positioned for what we expect to be a stronger second half of the year,” said Farr.
All profitability measures increased in the second quarter. Gross profit margin of 43.6% improved 50 basis points versus the prior year primarily due to savings from restructuring activities in 2016. Pretax margin of 15.8% and EBIT margin of 17.0% increased 40 and 30 basis points respectively. Earnings per share from continuing operations of $0.58 increased 2%. Earnings per share were $0.45, down 21%, including a ($0.13) impact from discontinued operations related to the completed sales of the Network Power, Leroy-Somer and Control Techniques businesses.
“Following our solid first quarter, the second quarter results again exceeded our expectations delivering continued profitability improvement over the prior year,” said chairman and CEO David N. Farr. “During the quarter we saw improving demand across both of our platform businesses, positioning us for a stronger second half of the year. Considering our solid performance in the first half of the fiscal year and current order trends, we are raising our full year sales and EPS guidance. We now expect earnings per share from continuing operations to be $2.55 to $2.65, versus our prior guidance of $2.47 to $2.62. This EPS guidance assumes full year sales are approximately flat with underlying sales up approximately 1% excluding unfavorable currency translation.”
Full-year net sales are now expected to be approximately flat, with underlying sales up approximately 1% excluding unfavorable currency translation of approximately 1%. Earnings per share from continuing operations guidance is being raised to $2.55 to $2.65. Automation Solutions net sales are expected to be down 3% to 4. Commercial & Residential Solutions net and underlying sales are expected to be up 5% to 6%.
“Thanks to the success of our multi-year restructuring actions and with the momentum established by our two platform businesses, we’re well positioned for what we expect to be a stronger second half of the year,” said Farr.
