SWORDS, Ireland--(BUSINESS WIRE)--Ingersoll-Rand plc (NYSE:IR), a world leader in creating comfortable, sustainable and efficient environments, has reported diluted earnings per share (EPS) from continuing operations of $1.13 for the second quarter of 2014.
The company reported net earnings of $306.0 million, or EPS of $1.12, for the second quarter of 2014. Second-quarter net earnings included $310.6 million, or EPS of $1.13, from continuing operations, as well as a net loss of $(4.6) million, or EPS of $(0.01) from discontinued operations. This compares with net earnings of $317.2 million, or EPS of $1.05, for the 2013 second quarter. Second-quarter 2013 net earnings included $269.2 million, or EPS of $0.89, from continuing operations, as well as net earnings of $48.0 million, or EPS of $0.16, from discontinued operations. The results for the second quarter of 2013 included $10.1 million of restructuring and other one-time costs equal to $(0.04) per share. Excluding restructuring and one-time costs from 2013 results, 2014 EPS from continuing operations increased by $0.20 per share, or 22 percent year-over-year (see attached tables for additional details).
“We are pleased to have delivered on our earnings, revenue and margin improvement commitments in the second quarter, particularly with our adjusted EPS at a 22 percent year-over-year increase,” said Michael W. Lamach, chairman and chief executive officer. “Our discipline and focus on growth, in coordination with ongoing productivity efforts, achieved adjusted operating leverage of 47 percent and strong revenue and order increases over last year. As we move into the second half of 2014, we are increasing our 2014 earnings forecast. We feel good about our positioning and our focus to deliver on our commitments to our customers and our shareholders.”
Additional Highlights from the 2014 Second Quarter
Revenues: The company’s reported revenues increased by 4.3 percent to $3,543 million, compared with revenues of $3,398 million for the 2013 second quarter. Total U.S. revenues were up 4 percent compared to 2013 and revenues from international operations increased by 5 percent (up 5 percent excluding currency). New equipment and aftermarket revenues were up 3 percent and 7 percent respectively, compared with the second quarter of 2013.
Operating Margin: The second-quarter operating margin was 13.1 percent compared with 11.4 percent in 2013. Adjusted for restructuring, the operating margin for the second quarter of 2013 was 11.6 percent. The year-over-year 1.5 percentage point adjusted margin improvement was due to higher volume, gains from productivity initiatives and pricing, partially offset by inflation and an increase in investment spending.
Interest Expense and Other Income/Expense: Interest expense of $53.0 million for the second quarter of 2014 declined by $8.9 million compared with the same period last year. Other income totaled $8.6 million for the second quarter of 2014, compared with $(2.4) million of other expense for the 2013 second quarter, primarily due to foreign exchange gains in 2014 compared with losses in 2013.
Taxes: The company had an effective tax rate of 24.8 percent in the second quarter of 2014. The effective rate for the second quarter of 2013 was 15.1 percent.