) reported first-quarter 2013 earnings per share of 53 cents
beating the Zacks Consensus Estimate of 51 cents per share.
The company reported revenues of $882.9 million, up 6.7% year
over year and lower than the management's guidance of an
approximately 10% increase. The increase was due to strong demand
in the Electronic as well as Electro mechanical segments.
During the quarter, orders were $878 million, up 2% from the
year-ago quarter. The book-to-bill ratio was 1.
Revenues by Business Segments
Electronic Instruments comprised 54.9% of Ametek's sales in the
quarter, up 3.3% from the year-ago quarter to $484.5 million. The
first quarter was strong due to strength in Aerospace and oil and
gas businesses, combined with the contribution from the
Ametek's Electro mechanical segment generated 45.1% of its sales,
up 11.2% from the year-ago quarter to $398.4 million. Management
stated that the strong core growth in third party Aerospace MRO
business and the Dunkermotoren acquisition drove the top-line
Reported gross margin for the quarter was 35.0%, down 20 basis
points (bps) year over year due to unfavorable mix.
Operating expenses (SG&A and Depreciation) of $111.5 million
were up 3.1% from $108.1 million in the year-ago quarter. The
reported operating margin was 22.3%, up 20 bps from the year-ago
quarter margin of 22.1%. Selling, general and administrative
(SG&A) expenses decreased as a percentage of sales, while
depreciation expenses remained the same.
The quarter's GAAP net income was $125.1 million or earnings per
share of 51 cents compared with $110.2 million or 45 cents in the
comparable quarter last year. Excluding special items but
including stock-based compensation expenses, adjusted net income
was $13.0 million or earnings per share of 53 cents compared with
$11.4 million or 47 cents a share in the year-ago quarter.
The company ended the first quarter with cash and short-term
investments balance of $177.3 million, up from $158.0 million in
the prior quarter. Trade receivables were $529.2 million, up from
$507.9 million in the prior quarter.
Cash flow from operations was $157 million, up 11.0% year over
year. Free cash flow was $146 million in the quarter.
For the second quarter of 2013, Ametek expects total revenue to
be up mid-to- high single digits over the year-ago quarter
revenues. Earnings per share are expected to be in the range of
51 to 52 cents, up 9% to 11% year over year.
For 2013, management expects revenues to be up high single digits
on a year- over-year basis. Earnings are expected to be in
the range of $2.08 to $2.12 per share, up 11% to 13% year over
Ametek manufactures and sells electronic instruments and
electromechanical devices. The company reported a decent first
quarter with both earnings and revenues increasing year over
We remain encouraged by the improving order rates in the quarter.
Management also gave a modest second quarter guidance, which
indicates improving demand visibility and an overall improving
Additionally, we believe that the company's new products and
global market expansion will continue to drive Ametek's growth.
We also remain optimistic about Ametek's long-term prospects and
contend that its restructuring activities will reduce operating
expenses. The company stated that it expects $95 million of cost
savings in 2013.
Currently, Ametek has a Zacks Rank #3 (Hold). Investors should
look out for some other stocks with a positive Zacks Rank and
Expected Surprise Prediction or ESP (Read: Zacks Earnings ESP: A
Applied Materials, Inc.
), Earnings ESP of +7.69% and Zacks Rank #2 (Buy)
), with an ESP of +3.03% and a Zacks Rank #2 (Buy)
), with an ESP of +14.3% and a Zacks Rank #3 (Hold)
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