Summary
Emerson Electric Co. reported solid financial performance for the nine months ended June 30, 2010, showing a notable increase in net sales and net earnings compared to the same period in the prior year. This growth was driven by a combination of underlying sales improvements, strategic acquisitions, and effective cost-containment measures implemented across its business segments. The company demonstrated resilience in a recovering market, with positive sales growth in Climate Technologies, Appliance and Tools, and Network Power, while Industrial Automation and Process Management experienced slight declines but showed signs of recovery. The company's financial position remains strong, supported by substantial operating cash flow and a conservative capital structure, despite increased borrowings for strategic acquisitions.
Financial Highlights
52 data points| Revenue | $5.42B |
| Cost of Revenue | $3.25B |
| Gross Profit | $2.16B |
| SG&A Expenses | $1.17B |
| Operating Income | $581.00M |
| Net Income | $585.00M |
| EPS (Basic) | $0.78 |
| EPS (Diluted) | $0.77 |
| Shares Outstanding (Basic) | 751.10M |
| Shares Outstanding (Diluted) | 757.70M |
Key Highlights
- 1Net sales for the nine months ended June 30, 2010, increased by 1% to $15.8 billion from $15.6 billion in the prior year, driven by acquisitions and favorable foreign currency translation, despite a 5% decline in underlying sales.
- 2Net earnings attributable to Emerson increased by 16% to $1.415 billion for the nine months ended June 30, 2010, from $1.218 billion in the prior year, with diluted EPS rising to $1.86 from $1.60.
- 3Gross profit margin improved to 38.7% for the nine months of 2010 from 36.4% in 2009, attributed to cost reduction savings, materials cost containment, and acquisitions.
- 4The company completed several strategic acquisitions, including SSB Group GmbH and Avocent Corporation, significantly contributing to sales growth, particularly in the Network Power and Industrial Automation segments.
- 5Cash provided by operating activities increased by $288 million to $2.022 billion for the nine months ended June 30, 2010, supporting dividends, capital expenditures, and acquisitions.
- 6Emerson forecasts full fiscal year 2010 net sales between $21.7 billion and $21.9 billion and diluted earnings per share between $2.60 and $2.70.
- 7The company continues to actively manage its portfolio, considering the divestiture of certain businesses while pursuing strategic acquisitions like the proposed purchase of Chloride Group PLC.