08.02.17
Emerson announced net sales in the third quarter ended June 30, 2017 were $4.0 billion, up 10%, with underlying sales up 4% excluding unfavorable currency of 1% and an impact from acquisitions of 7%. The third quarter results reflected a return to growth for the company as both platforms delivered net and underlying sales growth and had high-single digit order rates in the quarter.
Automation Solutions net and underlying sales turned positive in the quarter, driven by favorable trends in energy related, hybrid and general industrial markets. Growth in Commercial & Residential Solutions was driven by strong demand in HVAC and refrigeration markets and favorable construction markets in North America, Asia and Europe.
Pretax margin of 15.4% and EBIT margin of 16.3% decreased 240 and 280 basis points, respectively, driven by dilution from the Valves & Controls acquisition. Excluding Valves & Controls, total segment margin increased 80 basis points to 20.9%. Earnings per share from continuing operations decreased 7% to $0.63. Earnings per share were $0.68, flat compared with the prior year. Operating cash flow from continuing operations increased 23% to $774 million.
“The third quarter continued the momentum we established in the first half of the year as sales held above anticipated levels and we generated strong cash flow from continuing operations, reflecting our disciplined approach to operating the business,” said David N. Farr, chairman and CEO. “Demand in the quarter was broad-based, driven by a mix of increasingly favorable global market conditions, and drove order rates and underlying sales growth across both platforms.”
Full-year net sales are expected to be up approximately 5%, with underlying sales up 1% excluding an impact from acquisitions of 4%. Automation Solutions net sales are expected to be up 4% to 5%, with underlying sales down 1 to 2% excluding an impact from acquisitions of 6%. Commercial & Residential Solutions net and underlying sales are expected to be up 5% to 6%.
Automation Solutions net and underlying sales turned positive in the quarter, driven by favorable trends in energy related, hybrid and general industrial markets. Growth in Commercial & Residential Solutions was driven by strong demand in HVAC and refrigeration markets and favorable construction markets in North America, Asia and Europe.
Pretax margin of 15.4% and EBIT margin of 16.3% decreased 240 and 280 basis points, respectively, driven by dilution from the Valves & Controls acquisition. Excluding Valves & Controls, total segment margin increased 80 basis points to 20.9%. Earnings per share from continuing operations decreased 7% to $0.63. Earnings per share were $0.68, flat compared with the prior year. Operating cash flow from continuing operations increased 23% to $774 million.
“The third quarter continued the momentum we established in the first half of the year as sales held above anticipated levels and we generated strong cash flow from continuing operations, reflecting our disciplined approach to operating the business,” said David N. Farr, chairman and CEO. “Demand in the quarter was broad-based, driven by a mix of increasingly favorable global market conditions, and drove order rates and underlying sales growth across both platforms.”
Full-year net sales are expected to be up approximately 5%, with underlying sales up 1% excluding an impact from acquisitions of 4%. Automation Solutions net sales are expected to be up 4% to 5%, with underlying sales down 1 to 2% excluding an impact from acquisitions of 6%. Commercial & Residential Solutions net and underlying sales are expected to be up 5% to 6%.