Earnings Roundup: Snap-on, Kennametal, SKF, Eaton, Ingersoll-Rand

We're in the midst of another quarterly earnings reporting period, with publicly-traded companies sharing their latest fiscal performance numbers. A handful of prominent industrial manufacturers reported their figures over the past couple days. Here's the key numbers for Snap-on, Kennametal, SKF, Eaton and Ingersoll-Rand.

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We're in the midst of another quarterly earnings reporting period, with publicly-traded companies sharing their latest fiscal performance numbers.

A handful of prominent industrial manufacturers reported their figures over the past couple days. Here's the key numbers for Snap-on, Kennametal, SKF, Eaton and Ingersoll-Rand:

Snap-on

Kenosha, WI-based toolmaker Snap-on reported its Q4 and full year 2016 fiscals on Thursday. The company posted Q4 sales of $890 million, up 4.5 percent year-over-year. The increase included a 3.6 percent gain in organic sales, along with $23.3 million in acquisition-related sales, partially offset by a negative $15.2 million impact in currency headwinds.

Q4 total profit of $146.3 million was up from $131.4 million a year earlier. Operating profit of $176.1 million was up from $162.3 million a year earlier.

Full year 2016 sales of $3.4 billion were up 2.3 percent from 2015, including a 2.9 percent organic sales gain and $32.9 million in sales from acquisitions, partially offset by $51.5 million in currency headwinds. Total 2016 profit of $546.4 million was up from 2015's $478.7 million.

"We also concluded two coherent acquisitions in the quarter, Car-O-Liner and Sturtevant Richmont, both of which further enhance and expand Snap-on’s capabilities in serving serious professionals performing critical tasks in workplaces of consequence around the world," said Snap-on chairman and CEO Nick Pinchuk. "In 2017, we expect to make continued progress through our Snap-on Value Creation Processes and, at the same time, advance further along each of our strategic runways for growth: enhance the franchise network, expand with repair shop owners and managers, extend in critical  industries and build in emerging markets."

Kennametal

Latrobe, PA-based metalworking and metal cutting tool manufacturer Kennametal reported its 2017 Q2 fiscals on Wednesday. The company posted Q4 sales of $488 million, down 6.9 percent year-over-year despite 2 percent organic growth. It was the company's first quarterly consolidated organic growth in over two years. Of the overall decline, six percentage points were due to divestiture and two points were due to fewer business days and a 1 point negative impact from currency headwinds.

Total Q4 profit of $7.2 million compared with a loss of $169.2 million a year ago, with Q4 2015 including $112.2 million in restructuring costs, compared to only $8.5 million this year. Q4 operating profit was $24 million.

  • Kennametal's Industrial segment had Q4 sales of $267 million, essentially flat compared to $269 million a year earlier, while organic sales grew 4 percent. Organic sales grew 6 percent in general engineering and grew 4 percent in aerospace and defense, while energy sales declined 5 percent and transportation sales declined 2 percent. Industrial segment operating profit of $18 million increased from $12 million a year earlier.
  • Kennametal's Infrastructure segment had Q4 sales of $177 million, down 17 percent year-over-year. Of that decline, 14 percentage points were due to divestiture and, 2 points were due to fewer businesses days, and one point was due to currency headwinds. Operating profit was $10 million.
  • The company's Widia segment had Q4 sales of $43 million, up 1 percent year-over-year, with organic growth of 5 percent. Operating loss of $3 million compared with a loss of $5 million a year earlier.

For the full first half of 2017, total sales of $965 million were down 11 percent from 2016. Of that decline, 8 percentage points were due to divestiture, 1 point was due to currency headwinds, 1 point was due to fewer businesses days and 1 point was due to organic sales decline. First half operating profit was $15 million.

"The second quarter results reflect positive performance from our growth and cost reduction initiatives," commented Ron De Feo, Kennametal President and CEO ... "We are pleased to see these improvements during a quarter where end markets were still relatively quiet. There is much work to do however as we strive to simplify, modernize and energize this company. The progress we are making in lowering employment costs is generally on track and evident now in our run rates. We are at the beginning stages of product line simplification, and the End-to-End initiatives by product line are accelerating as we examine all our value streams for simplification and efficiency."

De Foe continued, commenting on the company's ongoing restructuring: "Factory modernization is underway. This is a multi-year program that will likely take time to manifest in the quarterly numbers. In addition, we may accelerate some capital expenditures, which will put pressure on short-term free cash flow. But these are all very positive decisions, as we believe that they will result in excellent project returns."

SKF

Sweden-based bearings maker SKF reported its Q4 and full year fiscal results on Thursday. The company posted Q4 total sales of $2.2 billion, up 3.1 percent year-over-year, while organic sales improved 1.2 percent. Operating profit of $182,000 was up slightly from $119,000 a year earlier.

The overall sales increase follows declines of 2.5 percent in Q3, 8 percent in Q2 and 8.9 percent in Q1, and organic declines of 0.6 percent in Q3, 4.4 percent in Q2 and 6.1 percent in Q1.

"In 2016 we have seen market conditions gradually improve and SKF is now growing again," said company president and CEO alrik Danielson. "We saw a gradual strengthening in demand during the quarter and less of the seasonal pre-buying which is otherwise associated with that time of year.

"We saw higher demand in Asia, especially in industrial distribution, but also in industrial drives. Total demand in Europe was relatively unchanged but we saw growth in our distribution business as well as in the rail and industrial general industries. In North America, market conditions continue to be challenging, but the development in the market is stabilizing."

Eaton 

Dublin, Ireland-based power management and component manufacturing company Eaton shared its Q4 and full year 2016 fiscals on Thursday. The company had Q4 total sales of $4.9 billion, down 4 percent year-over-year, including a 3 percent decline in organic sales. Total profit of $504 million was down from $534 million a year earlier.

  • Q4 Hydraulic segment sales of $520 million were down 6 percent year-over-year, with organic sales down 5 percent. Operating profit sunk 40 percent.
  • Q4 Electrical Products segment sales of $1.73 billion were flat year-over-year, with organic sales up 1 percent. Operating profit increased 4 percent.
  • Q4 Electrical Services segment sales of $1.46 billion were down 3 percent year-over-year, with organic sales down 2 percent. Operating profit declined 15 percent.
  • Q4 Aerospace segment sales of $425 million were down 3 percent year-over-year, with organic sales flat. Operating profit declined 9 percent.
  • Q4 Vehicle segment sales of $741 million were down 12 percent year-over-year, with organic sales down 12 percent. Operating profit sunk 37 percent.

"The shortfall in sales resulted solely from higher negative currency translation due to the rise in the U.S. dollar following the U.S. election," said Eaton chairman and CEO Craig Arnold. "Our organic sales for the quarter came in slightly better than expected, and some segments showed modestly improved order trends."

For the full year, total 2016 sales of $19.7 billion were down from 2015's $20.8 billion, while total profit fell from $1.9 billion in 2015 to $1.2 billion in 2016.

Q4 restructuring costs of $90 million dwarfed their original expected costs of $24 million. Total 2016 restructuring costs were $211 million, with the biggest chunk of it — $67 million — coming from its Hydraulics segment.

Ingersoll-Rand

Swords, Ireland-based compressed air systems, tools and pumps manufacturer Ingersoll-Rand reported its Q4 and full year 2016 results on Wednesday. The company posted Q4 sales of $3.24 billion, up 6 percent year-over-year overall and up 2 percent organically. Bookings increased 7 percent organically. Q4 operating profit of $347 million decreased 3 percent.

The company's Industrial segment had Q4 sales of $800 million, down 4 percent year-over-year and down 3 percent organically. Operating income decreased 21 percent. Ingersoll-Rand said Industrial Products organic sales were down in the high-single digits, driven by a continued sharp decline in material handling. Organic bookings were down in the low-single digits, with positive growth in the short cycle Power Tools and Fluid Management businesses.

For the full year, total company 2016 sales of $13.51 billion were up 2 percent overall and up 3 percent organically. Operating profit of $1.57 billion increased 8 percent. Full year Industrial segment sales of $2.96 billion were down 3.6 percent from 2015, while operating profit sunk 20.8 percent.

 

Here are upcoming dates of when some prominent industrial distributor/manufacturers will report their latest fiscal performance

  • 2/9: Timken Bearings
  • 2/15: NOW Inc./DistributionNOW
  • 2/16: MRC Global

Check out our earnings roundup from 1/31 to see the latest fiscal numbers for Honeywell, Atlas Copco and Air Products & Chemicals. See our earnings roundup from 1/26 to see the latest fiscal numbers for Stanley Black & Decker, Praxair, Rockwell Automation and Avnet.

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