Emerson Electric Company
) announced first-quarter 2013 results before the market opened
today, reporting earnings per share of 62 cents, in line with the
Zacks Consensus Estimate. Earnings per share surged up 24% year
The company delivered an impressive earnings performance
despite the prevailing uncertain economic environment.
Total revenue in the quarter increased by 5% year over year to
$5.6 billion. Divestiture and currency translations negatively
affected growth by 1%. Sales growth in the US sales increased by
6%, in Asia by 6% and declined by 2% in Europe.
sales were up by 24% during the quarter, led by a rise in
investment in the energy sector globally and
sales increased by 2%. This was the first time in six quarters
that the Climate Technologies segment witnessed an increase in
revenue, resulting from strong growth in Asia and improvement in
However, sales in all other three segments declined during the
sales declined 7%,
sales by 2% and
Commercial & Residential Solutions
sales by 1%.
Earnings before taxes for the quarter were $673 million
compared with $553 million in the prior-year quarter. Selling and
general expense was $1.39 billion compared with $1.35 billion in
the prior-year quarter.
Cash and Cash equivalents were $2.53 billion at the end of the
quarter with long-term debt of $3.54 billion and shareholders
equity of $10.17 billion compared with $2.08 billion, $4.04
billion and $10.36 billion, respectively.
Capital expenditure of the company amounted to $115 million,
down from the prior amount of $15 million. Free cash flow in the
quarter was $439 million, up 115% year over year.
Emerson expects its sales to increase by 2% to 5% in 2013
while earnings per share are expected to be in the range of $3.53
The company expects to see an improvement in the market
conditions as it moves ahead, especially in the emerging markets.
The market conditions have stabilized, which resulted in an
increase in order trends.
Emerson is well-positioned to benefit from the long-term
global trends of infrastructure spending and improved energy
efficiency. Many of Emerson's products are key components for
building the infrastructure such as data centers, manufacturing
plants and office buildings. Emerging markets account for nearly
one-third of the total sales and this trend is expected to be a
significant source of growth in the upcoming quarter.
However, substantial sales in the international market are
subject to economic risks. Results of operations are affected by
foreign currency fluctuations.
Emerson Electric Company is a diversified global manufacturing
and technology company. It offers a wide range of products and
services in the areas of process management, climate
technologies, network power, storage solutions, professional
tools, appliance solutions, motor technologies, and industrial
Emerson currently has a Zacks #3 Rank (Hold). Its close rivals
Clean Energy Fuels Inc.
) all have a Zacks Rank #2 (Buy).
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