) reported revenues of $737.9 million for the second quarter of
2012, up 1.5% year over year. Excluding $20.8 million of
unfavorable foreign currency translation, organic revenues
increased 4.5%. Overall sales (net sales + financial services
revenue) were $777.8 million.
Net earnings of $76.4 million or $1.30 per diluted share
increased from $66.9 million, or $1.14 per diluted share a year
ago. This was 8.3% above the Zacks Consensus Estimate of $1.20.
Gross profit was $349.9 million and margin grew 320 basis points
(bps) to 47.4% of revenues, compared to 47.1% a year ago.
Operating expenses of $245.3 million in the quarter were greater
than $243.4 million largely due to higher volume related
Commercial and Industrial Group reported revenues of $283.4
million for the second quarter, which improved 1.3% from 2011
levels. The segment's organic revenue grew 5.1% excluding foreign
currency translation of $10.1 million.
Revenues in Snap-on Tools Group increased 8.7% year-over-year to
$325.0 million, largely due to continued higher sales in the United
States. On an organic basis (excluding $3.5 million unfavorable
currency impact), sales were up 10.0%.
Repair Systems & Information Group sales of $227.4 million
declined 3.0% year-over-year. Excluding currency translation,
organic sales increased 0.2%, reflecting higher sales to repair
shop owners and managers.
Financial Services operating earnings were $25.6 million in the
second quarter on revenue of $39.9 million compared to operating
earnings of $17.5 million on revenue of $30.3 million in the
prior-year period. The increase was driven by continued growth of
the on-book finance portfolio.
Balance Sheet and Cash Flow
Exiting the year, cash and cash equivalents declined to $173.6
million compared to $185.6 million in December 2011. Net cash
provided by operating activities was a positive $91.7 million
compared to a negative $13.7 million in year-ago period.
The company had long term debt of $191.7 million with a debt to
capitalization ratio of 10.4%.
Snap-on expects to continue with its planned strategic
investments to improve its mobile tool distribution network, expand
in the vehicle repair garage, extend to critical industries and
build in emerging markets. Therefore, as a result of these
investment initiatives, Snap-on now anticipates that capital
expenditures in 2012 will be in the range of $70 million to $80
million, of which $39.8 million was already spent in the first half
Snap-On currently holds a Zacks #4Rank, which implies a
short-term 'Sell' rating on the stock.
SNAP-ON INC (SNA): Free Stock Analysis Report
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