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Parker Reports Fiscal 2014 First Quarter Sales, Net Income and Earnings per Share



 Parker Reports Fiscal 2014 First Quarter Sales, Net Income and Earnings per
                                    Share

- Fiscal 2014 first quarter diluted earnings per share reach $1.61 or $1.67
before restructuring

- Company increases fiscal 2014 full year guidance

PR Newswire

CLEVELAND, Oct. 18, 2013

CLEVELAND, Oct. 18, 2013 /PRNewswire/ -- Parker Hannifin Corporation (NYSE:
PH), the global leader in motion and control technologies, today reported
results for the fiscal 2014 first quarter ended September 30, 2013.  Fiscal
2014 first quarter sales were $3.23 billion compared with $3.21 billion in the
prior year quarter. Net income was $244.3 million compared with $239.9 million
in the first quarter of fiscal 2013.  Fiscal 2014 first quarter earnings per
diluted share were $1.61 compared with $1.57 in the prior year quarter and
included $0.06 per diluted share in expenses associated with its previously
announced restructuring initiatives. Cash flow from operations was $282.7
million or 8.8 percent of sales and was 11.1 percent of sales before a
discretionary pension contribution of $75 million.

(Logo:  http://photos.prnewswire.com/prnh/19990816/PHLOGO)

"I am pleased that we delivered strong first quarter segment operating profit,
earnings and cash flow performance in a mixed economic environment," said
Chairman, CEO and President, Don Washkewicz. "Our order growth this quarter
and near-term improvements in several key macroeconomic indicators support our
revised guidance."

Segment Results

Diversified Industrial Segment: North American first quarter sales decreased
2.6 percent to $1.39 billion, and operating income was $234.2 million compared
with $244.1 million in the same period a year ago.  International first
quarter sales increased 1.8 percent to $1.27 billion, and operating income was
$173.4 million compared with $156.6 million in the same period a year ago.

Aerospace Systems Segment: First quarter sales increased 4.9 percent to $567.5
million, and operating income was $57.3 million compared with $61.9 million in
the same period a year ago.

Orders

Parker reported an increase of 5 percent in orders for the quarter ending
September 30, 2013, compared with the same quarter a year ago.  The company
reported the following orders by business: 

  o Orders increased 3 percent in the Diversified Industrial North America
    businesses compared with the same quarter a year ago.
  o Orders increased 5 percent in the Diversified Industrial International
    businesses compared with the same quarter a year ago.
  o Orders increased 11 percent in the Aerospace Systems segment on a rolling
    12-month average basis.

Outlook

For the fiscal year ending June 30, 2014, the company has increased guidance
for earnings from continuing operations to the range of $7.78 to $8.38 per
diluted share.  Fiscal 2014 guidance includes expenses of $100 million or
$0.47 per diluted share associated with its previously announced restructuring
and an expected gain of $1.68 per diluted share associated with a joint
venture agreement between Parker Aerospace and GE Aviation to be recorded in
the quarter ending December 31, 2013.  A reconciliation of current guidance to
previous guidance is included in the first quarter earnings call presentation,
which has been posted to www.phstock.com.

Washkewicz added, "We are increasing our fiscal 2014 guidance to reflect
higher than anticipated earnings in the first quarter and a larger than
expected gain related to the GE Aviation joint venture, which will be recorded
in our second quarter.  We are also moving forward with our restructuring
activities having announced plant consolidations and other organizational
improvements. These actions are designed to strengthen our global
competitiveness."

NOTICE OF CONFERENCE CALL: Parker Hannifin's conference call and slide
presentation to discuss its fiscal 2014 first quarter results are available to
all interested parties via live webcast today at 11:00 a.m. ET, on the
company's investor information web site at www.phstock.com. To access the
call, click on the "Live Webcast" link. From this link, users also may
complete a pre-call system test and register for e-mail notification of future
events and information available from Parker.  A replay of the conference call
will also be available at www.phstock.com for one year after the call.

With annual sales of $13 billion in fiscal year 2013, Parker Hannifin is the
world's leading diversified manufacturer of motion and control technologies
and systems, providing precision-engineered solutions for a wide variety of
mobile, industrial and aerospace markets. The company employs approximately
58,000 people in 49 countries around the world. Parker has increased its
annual dividends paid to shareholders for 57 consecutive fiscal years, among
the top five longest-running dividend-increase records in the S&P 500 index.
For more information, visit the company's web site at www.parker.com, or its
investor information web site at www.phstock.com.

Notes on Orders

Orders provide near-term perspective on the company's outlook, particularly
when viewed in the context of prior and future quarterly order rates. However,
orders are not in themselves an indication of future performance. All
comparisons are at constant currency exchange rates, with the prior year
restated to the current-year rates. All exclude acquisitions until they can be
reflected in both the numerator and denominator. Aerospace comparisons are
rolling 12-month average computations. The total Parker orders number is
derived from a weighted average of the year-over-year quarterly percent change
in orders for Diversified Industrial North America and Diversified Industrial
International, and the year-over-year 12-month rolling average of orders for
the Aerospace Systems segment.

Forward-Looking Statements

Forward-looking statements contained in this and other written and oral
reports are made based on known events and circumstances at the time of
release, and as such, are subject in the future to unforeseen uncertainties
and risks. All statements regarding future performance, earnings projections,
events or developments are forward-looking statements. It is possible that the
future performance and earnings projections of the company, including its
individual segments, may differ materially from current expectations,
depending on economic conditions within its mobile, industrial and aerospace
markets, and the company's ability to maintain and achieve anticipated
benefits associated with announced realignment activities, strategic
initiatives to improve operating margins, actions taken to combat the effects
of the current economic environment, and growth, innovation and global
diversification initiatives. A change in the economic conditions in individual
markets may have a particularly volatile effect on segment performance. Among
other factors which may affect future performance are: changes in business
relationships with and purchases by or from major customers, suppliers or
distributors, including delays or cancellations in shipments, disputes
regarding contract terms or significant changes in financial condition,
changes in contract cost and revenue estimates for new development programs
and changes in product mix; ability to identify acceptable strategic
acquisition targets; uncertainties surrounding timing, successful completion
or integration of acquisitions and similar transactions; the determination to
undertake business realignment activities and the expected costs thereof and,
if undertaken, the ability to complete such activities and realize the
anticipated cost savings from such activities; the ability to realize
anticipated benefits of the consolidation of the Climate and Industrial
Controls Group; threats associated with and efforts to combat terrorism;
uncertainties surrounding the ultimate resolution of outstanding legal
proceedings, including the outcome of any appeals; competitive market
conditions and resulting effects on sales and pricing; increases in raw
material costs that cannot be recovered in product pricing; the company's
ability to manage costs related to insurance and employee retirement and
health care benefits; and global economic factors, including manufacturing
activity, air travel trends, currency exchange rates, difficulties entering
new markets and general economic conditions such as inflation, deflation,
interest rates and credit availability. The company makes these statements as
of the date of this disclosure, and undertakes no obligation to update them
unless otherwise required by law.

PARKER HANNIFIN CORPORATION -
SEPTEMBER 30, 2013
CONSOLIDATED STATEMENT OF
INCOME
(Unaudited)                      Three Months Ended September 30,
(Dollars in thousands except     2013              2012
per share amounts)
Net sales                        $                 $            
                                  3,226,144        3,214,935
Cost of sales                    2,476,409         2,477,447
Gross profit                     749,735           737,488
Selling, general and             406,930           381,122
administrative expenses
Interest expense                 20,958            23,509
Other (income), net              (2,243)           (3,201)
Income before income taxes       324,090           336,058
Income taxes                     79,770            96,110
Net income                       244,320           239,948
Less:  Noncontrolling            4                 207
interests
Net income attributable to       $                 $              
common shareholders              244,316            239,741
Earnings per share attributable
to common shareholders:
   Basic earnings per share      $                 $              
                                   1.64                   1.61
   Diluted earnings per share    $                 $              
                                   1.61                   1.57
Average shares outstanding       149,237,306       149,285,849
during period - Basic
Average shares outstanding       151,860,261       152,617,110
during period - Diluted
Cash dividends per common        $                 $              
share                                .45                    .41
BUSINESS SEGMENT INFORMATION BY
INDUSTRY
(Unaudited)                      Three Months Ended September 30,
(Dollars in thousands)           2013              2012
Net sales
    Diversified Industrial:
       North America             $                 $            
                                  1,387,875        1,425,279
       International             1,270,795         1,248,573
    Aerospace Systems            567,474           541,083
Total                            $                 $            
                                  3,226,144        3,214,935
Segment operating income
    Diversified Industrial:
       North America             $                 $              
                                 234,198            244,075
       International             173,410           156,598
    Aerospace Systems            57,298            61,898
Total segment operating income   464,906           462,571
Corporate general and            47,210            39,767
administrative expenses
Income before interest           417,696           422,804
and other expense
Interest expense                 20,958            23,509
Other expense                    72,648            63,237
Income before income taxes       $                 $              
                                 324,090            336,058
CONSOLIDATED BALANCE SHEET
(Unaudited)                       September 30,    June, 30         September,
                                                                    30 
(Dollars in thousands)           2013              2013             2012
Assets
Current assets:
Cash and cash equivalents        $                 $                $        
                                  1,945,623        1,781,412         436,131
Accounts receivable, net         1,968,490         2,062,745        1,982,590
Inventories                      1,465,431         1,377,405        1,489,748
Prepaid expenses                 176,245           182,669          161,123
Deferred income taxes            123,390           126,955          130,490
Total current assets             5,679,179         5,531,186        4,200,082
Plant and equipment, net         1,833,748         1,808,240        1,803,412
Goodwill                         3,285,228         3,223,515        3,076,134
Intangible assets, net           1,280,431         1,290,499        1,193,815
Other assets                     709,778           687,458          861,135
Total assets                     $                 $                $    
                                  12,788,364       12,540,898       11,134,578
Liabilities and equity
Current liabilities:
Notes payable                    $                 $                $        
                                  1,335,339        1,333,826         264,582
Accounts payable                 1,130,676         1,156,002        1,162,797
Accrued liabilities              808,218           894,296          830,034
Accrued domestic and foreign     180,776           136,079          109,052
taxes
Total current liabilities        3,455,009         3,520,203        2,366,465
Long-term debt                   1,506,744         1,495,960        1,511,799
Pensions and other               1,309,981         1,372,437        1,704,291
postretirement benefits
Deferred income taxes            107,000           102,920          112,532
Other liabilities                319,859           307,897          287,477
Shareholders' equity             6,086,861         5,738,426        5,141,124
Noncontrolling interests         2,910             3,055            10,890
Total liabilities and equity     $                 $                $    
                                  12,788,364       12,540,898       11,134,578
CONSOLIDATED STATEMENT OF CASH
FLOWS
(Unaudited)                      Three Months Ended September 30, 
(Dollars in thousands)           2013              2012
Cash flows from operating
activities:
Net income                       $                 $              
                                 244,320            239,948
Depreciation and amortization    85,580            81,172
Stock incentive plan             48,998            31,261
compensation
Net change in receivables,       16,213            (23,536)
inventories, and trade payables
Net change in other assets and   (106,293)         (389,688)
liabilities
Other, net                       (6,127)           53,872
Net cash provided by (used in)   282,691           (6,971)
operating activities
Cash flows from investing
activities:
Acquisitions (net of cash of     1,491             (194,548)
$20,329 in 2012) 
Capital expenditures             (56,651)          (76,685)
Proceeds from sale of plant and  2,915             8,645
equipment
Other, net                       49                168
Net cash (used in) investing     (52,196)          (262,420)
activities
Cash flows from financing
activities:
Net payments for common stock    (44,905)          (72,530)
activity
Net proceeds from (payments      1,269             (37,773)
for) debt
Dividends                        (67,388)          (61,365)
Net cash (used in) financing     (111,024)         (171,668)
activities
Effect of exchange rate changes  44,740            38,873
on cash
Net increase (decrease) in cash  164,211           (402,186)
and cash equivalents
Cash and cash equivalents at     1,781,412         838,317
beginning of period
Cash and cash equivalents at     $                 $              
end of period                     1,945,623         436,131

 

SOURCE Parker Hannifin Corporation

Website: http://www.phstock.com
Contact: Media - Aidan Gormley, Director, Corporate Communications,
216/896-3258, aidan.gormley@parker.com; Financial Analysts - Pamela Huggins,
Vice President - Treasurer, 216/896-2240, phuggins@parker.com
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