10-QPeriod: Q1 FY2011

AMETEK INC/ Quarterly Report for Q1 Ended Mar 31, 2011

Filed May 5, 2011For Securities:AME

Summary

AMETEK INC. (AME) reported a strong first quarter for 2011, setting new records for orders, sales, operating income, net income, and diluted earnings per share compared to the prior year period. The company experienced robust internal growth across both its Electronic Instruments Group (EIG) and Electromechanical Group (EMG), complemented by successful contributions from recent acquisitions made in 2010. This broad-based performance indicates a positive trajectory for the company, with management expressing confidence in continued strength throughout the remainder of 2011. Consolidated net sales surged by 28.9% to $717.8 million, driven by a significant 18% internal sales growth and the impact of acquired businesses. New orders also saw a substantial increase of 37.2% to $798.7 million, leading to a record backlog of $909.7 million as of March 31, 2011. Profitability improved significantly, with operating income growing by 48.4% and net income rising by 56.1%, demonstrating effective cost management and operating leverage. International sales represented over 50% of total revenue, highlighting AMETEK's global reach.

Financial Highlights

49 data points
Beta

Revenue

$717.78M

Net Income

$90.44M

12.6% Net Margin

EPS (Diluted)

$0.37

Total Assets

$3.89B

Cash & Equivalents

$155.01M

Free Cash Flow

$93.27M

Financial Statements
Beta
Revenue$717.78M
SG&A Expenses$81.49M
Operating Expenses$565.76M
Operating Income$152.02M
Interest Expense$17.15M
Net Income$90.44M
EPS (Basic)$0.38
EPS (Diluted)$0.37
Shares Outstanding (Basic)239.59M
Shares Outstanding (Diluted)243.28M

Key Highlights

  • 1Record-breaking first quarter for orders, sales, operating income, net income, and diluted EPS.
  • 2Consolidated net sales increased by 28.9% to $717.8 million, with 18% driven by internal growth.
  • 3New orders grew by 37.2% to $798.7 million, resulting in a record backlog of $909.7 million.
  • 4Operating income increased by 48.4% to $152.0 million, with margins improving to 21.2% from 18.4%.
  • 5Net income rose by 56.1% to $90.4 million, translating to diluted EPS of $0.56, up from $0.36 in the prior year.
  • 6Both Electronic Instruments Group (EIG) and Electromechanical Group (EMG) reported strong sales and operating income growth, with improved margins.
  • 7International sales accounted for 50.3% of total revenue, underscoring the company's global market penetration.

Frequently Asked Questions

The significant increase in net sales was driven by a combination of strong internal growth of approximately 18% across both the Electronic Instruments Group (EIG) and Electromechanical Group (EMG), and the contributions from several acquisitions completed in 2010, including Technical Services for Electronics (TSE), Haydon Enterprises, and Atlas Material Testing Technology LLC.

AMETEK's profitability saw substantial improvement. Consolidated operating income increased by 48.4% to $152.0 million, with operating margins expanding to 21.2% from 18.4%. Net income grew by 56.1% to $90.4 million, and diluted earnings per share rose to $0.56 from $0.36 in the same period last year. This was attributed to sales leverage and operational excellence initiatives.

Based on the record orders and strong performance in the first quarter, AMETEK expects continued strength in operating results throughout the remainder of 2011 compared to 2010. The company's record backlog further supports this positive outlook.

International sales are a crucial part of AMETEK's business, representing 50.3% of consolidated net sales in the first quarter of 2011, totaling $361.4 million. This segment experienced a healthy increase of 26.4% compared to the prior year, indicating strong performance in global markets, particularly in Asia and Europe.