Rockwell Automation Reports First Quarter 2013 Results
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- Sales up 1 percent; organic sales up 1.5 percent
- Adjusted EPS of $1.23; Diluted EPS of $1.14
- Company reaffirms Adjusted EPS guidance for fiscal 2013 of $5.35 - $5.75
Rockwell Automation, Inc. (NYSE: ROK) today reported fiscal 2013 first quarter sales of $1,489.2 million, up 1 percent from $1,473.9 million in the first quarter of fiscal 2012. Organic sales increased 1.5 percent and currency translation reduced sales by less than 1 percentage point.
Rockwell Automation, whose controls make factories run more efficiently, posted a 1 percent sales increase. (Photo: Business Wire)
Adjusted EPS was $1.23 in the first quarter of fiscal 2013 compared to Adjusted EPS of $1.31 in the first quarter of fiscal 2012. Diluted EPS was $1.14 in the first quarter of fiscal 2013 compared to $1.27 last year. Total segment operating earnings were $276.0 million in the first quarter of fiscal 2013 compared to $291.9 million in the same period of 2012. Total segment operating margin was 18.5 percent compared to an unusually strong margin of 19.8 percent a year ago.
In order to provide transparency into the operating results of its business, effective with this first quarter of fiscal 2013, the Company is providing non-GAAP measures (Adjusted Income, Adjusted EPS and Adjusted Effective Tax Rate) that exclude non-operating pension costs and their related tax effects. The Company defines non-operating pension costs as defined benefit plan interest cost, expected return on plan assets, amortization of actuarial gains and losses and the impacts of any plan curtailments or settlements. In addition, the Company has redefined segment operating earnings to exclude non-operating pension costs. Prior year results are provided on a comparable basis.
Commenting on the results, Keith D. Nosbusch, chairman and chief executive officer, said, “Total company sales were in line with our expectations for the quarter, but results by region were mixed. Strong growth in Latin America and the U.S. was mostly offset by declines in the other regions, consistent with underlying market conditions. Solutions order rates picked up in the quarter and we rebuilt backlog. Operating margin and free cash flow were both very good. Overall, I am pleased with the good start to the fiscal year."
Commenting on the outlook, Nosbusch added, “Given first quarter results and our current assessment of market conditions, we are reaffirming our outlook for fiscal 2013. We expect sales to be in the range of $6.35 to $6.65 billion, with corresponding Adjusted EPS of $5.35 to $5.75. Stabilization of macroeconomic indicators and forecasts, coupled with our rebuilt backlog, reinforce our expectations of stronger growth in the second half of the year compared to the first half. We will continue to monitor business conditions closely and pace our investments accordingly."
Following is a discussion of first quarter results for both segments.
Architecture & Software
Architecture & Software fiscal 2013 first quarter sales were $657.5 million, an increase of 1 percent from $650.5 million last year. Organic sales increased 2 percent and currency translation reduced sales by 1 percentage point. Segment operating earnings were $183.2 million in the first quarter of fiscal 2013 compared to $189.2 million in 2012. Segment operating margin was 27.9 percent in the first quarter of fiscal 2013 compared to 29.1 percent a year ago.
Control Products & Solutions
Control Products & Solutions fiscal 2013 first quarter sales were $831.7 million, an increase of 1 percent from $823.4 million last year. Acquisitions and currency translation had a minimal impact. Segment operating earnings were $92.8 million in the first quarter of fiscal 2013 compared to $102.7 million in 2012. Segment operating margin was 11.2 percent in the first quarter of fiscal 2013 compared to 12.5 percent a year ago.
Free cash flow was $156.3 million in the first quarter of fiscal 2013.
Fiscal 2013 first quarter general corporate net expense decreased to $18.5 million from $20.2 million in 2012.
The Adjusted Effective Tax Rate for the first quarter of fiscal 2013 was 26.6 percent compared to 24.9 percent a year ago. The Company now expects the full-year Adjusted Effective Tax Rate for fiscal 2013 to be in the range of 25 to 26 percent, which includes the impact of the extension of the research and development credit for years 2012 and 2013 under the American Taxpayer Relief Act of 2012.
During the first quarter of fiscal 2013, the Company repurchased 1.2 million shares of its common stock at a cost of $87.8 million. At December 31, 2012, $848.9 million remained available under the $1.0 billion share repurchase authorization.
Organic sales, total segment operating earnings, total segment operating margin, Adjusted Income, Adjusted EPS, Adjusted Effective Tax Rate, free cash flow and return on invested capital are non-GAAP measures that are reconciled to GAAP measures in the attachments to this release.
A conference call to discuss our financial results will take place at 8:30 A.M. Eastern Time on January 30, 2013. The call and related financial charts will be webcast and accessible via the Rockwell Automation website (http://www.rockwellautomation.com/...).