Summary
This Form 8-K filing by Emerson Electric Co. (EMR) on June 23, 2011, provides an update on the company's order trends for the trailing three months ending in May 2011. Overall, Emerson reported solid order growth, with total company orders increasing by 15% in May on a trailing three-month average basis compared to the prior year. This growth was primarily driven by the capital goods businesses, specifically Process Management and Industrial Automation, which both experienced order growth exceeding 20%. While the overall trend is positive, the filing notes that order growth is moderating from very high levels, and future comparisons will become more challenging. Currency exchange rates had a notable positive impact of approximately 7 percentage points on total Emerson orders. The company anticipates that order trends, excluding currency impacts, will remain in the 7-10% range for the remainder of the fiscal year. Investors should note the upcoming Q3 2011 earnings release and conference call scheduled for August 2, 2011.
Key Highlights
- 1Total Emerson trailing three-month orders showed solid growth, reaching 15% in May 2011 compared to the prior year.
- 2Process Management and Industrial Automation segments were key growth drivers, with orders exceeding 20% growth in the trailing three-month period.
- 3Order growth is moderating from very high levels, and future year-over-year comparisons are expected to become more challenging.
- 4Currency exchange rates had a positive impact of approximately 7 percentage points on overall Emerson orders.
- 5Emerson expects underlying order trends (excluding currency) to remain in the 7-10% range for the rest of the fiscal year.
- 6Network Power orders showed continued improvement, reaching a 5-10% growth range.
- 7The company announced its third quarter 2011 earnings release and investor conference call will be held on August 2, 2011.