10-KPeriod: FY2019

EMERSON ELECTRIC CO Annual Report, Year Ended Sep 30, 2019

Filed November 18, 2019For Securities:EMR

Summary

Emerson Electric Co. (EMR) reported total net sales of $18.4 billion for the fiscal year ended September 29, 2019, representing a 6% increase over the prior year, driven significantly by acquisitions which contributed 5% to the growth. Underlying sales, excluding the impact of acquisitions and foreign currency fluctuations, increased by 3%. Net earnings attributable to common stockholders rose by 5% to $2.3 billion, translating to diluted earnings per share of $3.71, a 7% increase. The company generated robust operating cash flow of $3.0 billion. Emerson operates through two primary segments: Automation Solutions and Commercial & Residential Solutions. The Automation Solutions segment, comprising over two-thirds of total sales, showed strong growth with a 7% increase in sales, driven by acquisitions and underlying volume increases. The Commercial & Residential Solutions segment saw a more modest 3% sales increase, with mixed performance between its Climate Technologies and Tools & Home Products sub-segments, impacted by acquisition contributions and differing market conditions. The company continued its strategic portfolio management through acquisitions, particularly in the Automation Solutions segment, aiming to enhance its technology offerings and market position.

Financial Highlights

56 data points
Beta

Revenue

$18.37B

42.5% Gross Margin

Net Income

$2.31B

12.6% Net Margin

EPS (Diluted)

$3.71

Total Assets

$20.50B

Cash & Equivalents

$1.49B

Free Cash Flow

$2.41B

Financial Statements
Beta
Revenue$18.37B
Cost of Revenue$10.56B
Gross Profit$7.82B
R&D Expenses$454.00M
SG&A Expenses$4.46B
Operating Income$2.31B
Net Income$2.31B
EPS (Basic)$3.74
EPS (Diluted)$3.71
Shares Outstanding (Basic)616.20M
Shares Outstanding (Diluted)620.60M

Key Highlights

  • 1Emerson reported net sales of $18.4 billion in fiscal year 2019, up 6% from the prior year, with acquisitions contributing 5% growth.
  • 2Net earnings attributable to common stockholders increased by 5% to $2.3 billion, and diluted EPS grew 7% to $3.71.
  • 3Operating cash flow remained strong at $3.0 billion.
  • 4The Automation Solutions segment showed robust growth, with sales up 7% to $12.2 billion, supported by acquisitions and underlying demand.
  • 5Commercial & Residential Solutions segment sales grew 3% to $6.2 billion, with contributions from acquisitions offsetting some market softness.
  • 6The company made strategic acquisitions primarily within the Automation Solutions segment, totaling $469 million in 2019.
  • 7Emerson continues to return value to shareholders through dividends, with an announced 2% increase in the quarterly cash dividend.

Frequently Asked Questions

Emerson Electric Co. reported net sales of $18.4 billion for the fiscal year ended September 29, 2019, an increase of 6% compared to the prior year. This growth was driven by acquisitions (contributing 5%) and a 3% increase in underlying sales, partially offset by a 2% unfavorable impact from foreign currency translation.

Net earnings attributable to common stockholders increased by 5% to $2.3 billion in fiscal year 2019. Diluted earnings per share (EPS) grew by 7% to $3.71, up from $3.46 in the prior year, attributed to modest sales growth and lower corporate expenses.

Emerson operates two main segments: Automation Solutions and Commercial & Residential Solutions. The Automation Solutions segment reported a 7% sales increase to $12.2 billion, driven by acquisitions and underlying demand. The Commercial & Residential Solutions segment saw a 3% sales increase to $6.2 billion, with acquisitions contributing significantly to growth, though Climate Technologies experienced a slight decline.

Emerson continues to engage in strategic portfolio repositioning. In 2019, the company acquired eight businesses, all within the Automation Solutions segment, for $469 million. This aligns with their strategy to enhance technology offerings and market position, particularly in industrial automation and solutions.