Parker Hannifin, one of the world’s largest manufacturers of motion and control technologies, reported that its its company wide sales dropped 4.4 percent in Q1 while its North American industrial business fell 9 percent.
"Quarterly order rates turned positive for the first time since the December 2014 quarter, reinforcing our previous view that we are progressing towards stabilization in many of our key end markets," CEO Tom Williams said. The company reported an 8 percent increase in profit.
Parker reaffirmed its FY 2017 guidance, seeing EPS of $6.40-$7.10.
For the fiscal 2017 first quarter ended September 30, sales were $2.74 billion, compared with $2.87 billion in the prior year quarter. Net income increased 8 percent to $210.2 million compared with $195.0 million in the first quarter of fiscal 2016.
Parker’s orders increased 2 percent company-wide, while its aerospace segment orders soared 14 percent, and international business rose 3 percent. Orders for the company's North American industrial business slipped 4 percent.
Parker’s Diversified Industrial Segment for North America saw sales fall 9 percent to $1.2 billion, and operating income was $200.6 million compared with $212.7 million in the same period a year ago. International sales decreased 2 percent to $1.0 billion.
Lee Banks, president and chief operating officer, said sales in its North Americn industrial segment were in line with expectations.
In an earnings call with financial analysts, Banks says he is encouraged by the feedback he recently received from some 400 distributors at a recent channel meeting. After spending two days with those distributors, Banks said he was mildly enouraged about prospects in the future.
The Great Lakes region continue to do well while distributors in the oil patch were “still suffering” but not at an accelerating rate of decline. Banks said distributors told him there were some positive trends as projects may be moving forward.