Summary
Emerson Electric Co. (EMR) filed an 8-K on May 4, 2004, primarily to report its second quarter fiscal year 2004 earnings and provide an update on its underlying order trends. The company highlighted consistent positive growth in underlying orders across its business segments for the trailing three months ending March 2004, with total Emerson orders showing a 10-15% increase year-over-year for January, February, and March. This indicates a healthy demand environment for Emerson's diverse product offerings. Key takeaways include strong performance in Process Control, driven by oil and gas markets and growth in Asia/Middle East, and continued strength in Electronics and Telecommunications, particularly in OEM and systems businesses, also boosted by Asian markets. While Industrial Automation orders showed positive trends, the company noted a slight softening in Europe due to currency headwinds and a slower growth rate. Management also cautioned that the positive impact of favorable currency exchange rates on reported orders would likely diminish in the future as comparisons shift to periods with already weaker dollar rates.
Key Highlights
- 1Consistent positive year-over-year growth in underlying orders across all segments for the three months ending March 2004.
- 2Total Emerson underlying orders showed a 10-15% increase for January, February, and March 2004.
- 3Process Control segment saw strong growth, especially in oil and gas markets and continued expansion in Asia and the Middle East.
- 4Electronics and Telecommunications segment experienced robust demand, driven by OEM, systems businesses, and Asian market growth.
- 5Industrial Automation orders were positive but experienced a slight slowdown in Europe due to currency factors and moderating growth rates.
- 6Company expects the positive currency exchange rate impact on reported orders to lessen in upcoming periods.
- 7The report includes a press release (Exhibit 99.1) detailing second quarter fiscal 2004 results and non-GAAP financial measures.