Summary
Emerson Electric Co. (EMR) filed an 8-K on February 27, 2006, providing an update on its underlying orders for the three-month period ending January 2006. The report indicates robust order growth across the company, with a trailing three-month average increase of 10% to 15% compared to the prior year. This positive trend is driven by strong performance in key segments like Network Power and Process Management, which experienced double-digit growth. The company highlighted that unfavorable currency exchange rates impacted order growth by approximately 3 percentage points, suggesting underlying business momentum is even stronger.
Key Highlights
- 1Emerson Electric Co. reported a positive underlying orders trend, with a trailing three-month average growth of 10% to 15% for the period ending January 2006.
- 2Three of Emerson's five business segments achieved double-digit order growth in the three months ending January 2006.
- 3Unfavorable currency exchange rates reduced reported order growth by approximately 3 percentage points.
- 4Process Management segment orders strengthened due to success in large projects and growth in valve, measurement, and systems businesses.
- 5Industrial Automation orders benefited from continued capital spending and industrial demand in North America, particularly from the power generating alternator business.
- 6Network Power orders remained high, driven by strong growth in power systems and embedded power businesses, with significant demand from the United States and Asia.
- 7Climate Technologies orders remained strong, partly due to the transition to 13 SEER for residential air-conditioning units.
Frequently Asked Questions
Emerson Electric Co. reported a strong positive trend in its underlying orders, with a trailing three-month average growth of 10% to 15% compared to the prior year for the period ending January 2006.
Yes, unfavorable currency exchange rates negatively impacted the reported order growth by approximately 3 percentage points, indicating that the underlying business performance was even stronger than the reported figures.
Key growth drivers included the Network Power segment (driven by power systems and embedded power, particularly in the US and Asia) and the Process Management segment (benefiting from large projects and growth in valve, measurement, and systems). Industrial Automation also showed strength due to capital spending in North America.
For the Climate Technologies segment, the transition of residential air-conditioning units from 10 SEER to 13 SEER, which finalized on January 23rd, contributed to strong order performance.