) reported fiscal second-quarter 2014 (ended Jan 31, 2014) pro
forma earnings of 82 cents a share, 2.5% above the Zacks
Consensus Estimate of 80 cents. Earnings for the quarter also
beat the prior-year quarter's earnings of 73 cents a share by
12%. The reported earnings per share (EPS) include a 4 cents
negative impact of foreign currency translation.
Despite economic headwinds in some of Pall's industrial end
markets, the company reported profits attributable primarily to
improved operational execution and favorable impact of structural
Total revenue in the quarter increased 2.2% year over year to
$677.0 million, primarily attributable to the modest Life
Sciences sales and an improvement in the Industrial business.
However, it marginally fell short of the Zacks Consensus Estimate
of $678 million.
Life Sciences segment
revenues climbed 8% in local currency to $353 million in the
reported quarter. This increase was driven by a 9% rise in
Biopharmaceuticals, which in turn was aided by developments in
the single-use systems business and a 7% improvement in Medical,
driven by strong sales to original equipment manufacturers (OEM),
especially in its Medistad division which was acquired recently.
Also, the demand for the company's water solutions for hospitals
remained strong in the quarter. Sales in the Food & Beverage
division remained flat year over year.
Revenues for the quarter in the
remained flat year over year in local currency at $324 million.
The revenues were impacted by lower sales in one of its three
sub-divisions. Aerospace sales were down 12% in local currency
due to unfavorable comparisons in the last year.
However, this decline was partially offset by a 19% increase
in the Microelectronics division driven by new business awards
and strong performance across regions. The company's Process
Technologies business remained flat at local currency.
Gross margin in the quarter contracted 70 basis points to
50.9% of sales. However, the operating margin increased to 18.2%
in the quarter from 17.0% in the prior-year quarter. Increase in
operating margin was attributable to lower selling, general and
Cash Flow and Balance Sheet
Exiting the quarter, cash and cash equivalents were $951.8
million down from $970.2 million at the end of Jan 31, 2013.
Net cash from operating activities for the 6 months period
ended on Jan 31, 2014 was $205.6 million, up significantly by
130% from $89.4 million as on Jan 31, 2013. The increase
primarily reflects benefits from the company's efficient working
capital management in the quarter and one-time tax payments in
the prior year.
Capital expenditure for the 6 months period was $34.7 million,
while the company paid $58.4 million in dividends.
Pall's free cash flow for the six months period stood at
$170.9 million compared to $47.0 million on Jan 31, 2013.
Pall narrowed its guidance for fiscal 2014 to include the
acquisition cost of ATMI LifeSciences and the negative impact of
foreign currency translation. It now expects the pro forma EPS to
lie in the range of $3.35 and $3.45. Earlier, the company
had expected fiscal 2014 EPS to grow about 9%-15% over $3.04 EPS
reported for fiscal 2013.
Pall has a Zacks Rank #3 (Hold).
Performance of some other stocks in the Pollution
Donaldson Company, Inc.
) reported fiscal second-quarter 2014 (ended Jan 31, 2013)
earnings of 39 cents per share, beating the Zacks Consensus
Estimate of 36 cents.
Calgon Carbon Corporation
) reported fourth-quarter 2013 earnings of 20 cents per share
compared with 16 cents per share in the year-ago quarter. The
quarterly results beat the Zacks Consensus Estimate by a
Tetra Tech Inc
) reported fiscal first-quarter 2014 (ended Dec 29, 2013)
earnings of 42 cents per share, beating the Zacks Consensus
Estimate of 38 cents.
CALGON CARBON (CCC): Free Stock Analysis
DONALDSON CO (DCI): Free Stock Analysis
PALL CORP (PLL): Free Stock Analysis Report
TETRA TECH NEW (TTEK): Free Stock Analysis
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