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AMETEK Announces First Quarter 2016 Results

BERWYN, Pa., April 28, 2016 /PRNewswire/ -- AMETEK, Inc. (NYSE: AME) today announced its financial results for the three month period ended March 31, 2016. 

AMETEK's first quarter 2016 sales of $944.4 million were down 4% over the same period of 2015. Operating income was down 12% to $208.5 million and diluted earnings per share of $0.57 were down 10% from the first quarter 2015 adjusted results. Operating margins were 22.1% in the quarter.      

"As expected, demand remained weak in the quarter," said Chairman and Chief Executive Officer Frank S. Hermance. "Ongoing softness in oil and gas, metals and global industrial markets continues to drive meaningful headwinds. Despite these challenges, we were able to deliver solid first quarter earnings in-line with our expectations." 

First quarter 2015 results exclude realignment costs of $15.9 million, or approximately $0.04 per diluted share. A comparison of first quarter 2016 results to last year's reported GAAP and adjusted results is included with the financial tables accompanying the release. All further references to 2015 results are on an adjusted basis.   

Electronic Instruments Group (EIG)
For the first quarter of 2016, EIG sales decreased 4% to $569.0 million.  Operating income was $141.8 million, down 12% versus the first quarter 2015, and operating margins were 24.9% in the quarter.

"Overall sales in our Power & Industrial businesses were up approximately 10% driven by the contributions from the acquisitions of Brookfield Engineering Laboratories and ESP/SurgeX during the quarter. However, this strong growth was more than offset by lower sales in our Process business driven by weakness in our oil and gas businesses," adds Mr. Hermance.

Electromechanical Group (EMG)
In the first quarter, EMG sales decreased 4% to $375.4 million. Operating income in the quarter was $79.4 million, down 10% from last year's first quarter, and operating margins were 21.2% in the quarter. 

"The lower sales versus last year were largely driven by the impacts from commodity price deflation across our Engineered Materials, Interconnects and Packaging businesses. We expect these end market conditions to sequentially improve during 2016 with a stronger second half than first half," notes Mr. Hermance.

2016 Outlook
"We have an excellent portfolio of differentiated businesses. We are confident in our ability to successfully execute on our growth strategies in order to capitalize on the tremendous opportunity we have to grow and expand these businesses. However, we are faced with the reality of a number of challenging end markets, which will continue to impact us in 2016," notes Mr. Hermance.  

"We expect 2016 sales to be roughly flat versus last year with earnings expected to be in the range of $2.42 to $2.52 per diluted share, down 1% to 5% versus 2015 adjusted results," adds Mr. Hermance.

"Second quarter 2016 sales are expected to be down low single digits compared to last year's second quarter. We estimate our earnings in the second quarter to be approximately $0.58 to $0.59 per diluted share, down 8% to 9% over last year's second quarter," concludes Mr. Hermance.  

Conference Call
The Company will webcast its First Quarter 2016 investor conference call on Thursday, April 28, 2016 beginning at 8:30 AM ET. The live audio webcast will be available at the Investors section of www.ametek.com and at www.streetevents.com. The call will also be archived at the Investors section of www.ametek.com.

Corporate Profile
AMETEK is a leading global manufacturer of electronic instruments and electromechanical devices with annual sales of $4.0 billion. AMETEK's Corporate Growth Plan is based on Four Key Strategies: Operational Excellence, Strategic Acquisitions, Global & Market Expansion and New Products. AMETEK's objective is double-digit percentage growth in earnings per share over the business cycle and a superior return on total capital. The common stock of AMETEK is a component of the S&P 500 Index.

Forward-looking Information
Statements in this news release relating to future events, such as AMETEK's expected business and financial performance are "forward-looking statements." Forward-looking statements are subject to various factors and uncertainties that may cause actual results to differ significantly from expectations.  These factors and uncertainties include our ability to consummate and successfully integrate future acquisitions; risks associated with international sales and operations; our ability to successfully develop new products, open new facilities or transfer product lines; the price and availability of raw materials; compliance with government regulations, including environmental regulations; changes in the competitive environment or the effects of competition in our markets; the ability to maintain adequate liquidity and financing sources; and general economic conditions affecting the industries we serve. A detailed discussion of these and other factors that may affect our future results is contained in AMETEK's filings with the U.S. Securities and Exchange Commission, including its most recent reports on Form 10-K, 10-Q and 8-K. AMETEK disclaims any intention or obligation to update or revise any forward-looking statements.

(Financial Information Follows)

 

 

AMETEK, Inc.

Consolidated Statement of Income

(In thousands, except per share amounts)

(Unaudited)




 Three Months Ended 



 March 31, 



2016


2015

Net sales


$   944,398


$   984,059

Operating expenses:





     Cost of sales, excluding depreciation


605,356


635,965

     Selling, general and administrative


112,194


110,884

     Depreciation


18,325


16,258

          Total operating expenses 


735,875


763,107






Operating income 


208,523


220,952

Other expenses:





     Interest expense


(23,401)


(22,686)

     Other, net


(2,080)


(1,480)

Income before income taxes


183,042


196,786

Provision for income taxes


48,872


54,679






Net income


$   134,170


$   142,107






Diluted earnings per share


$        0.57


$        0.59

Basic earnings per share


$        0.57


$        0.59






Weighted average common shares outstanding:





     Diluted shares


236,216


242,797

     Basic shares


234,983


240,947






Dividends per share


$        0.09


$        0.09

 

 

AMETEK, Inc.

Information by Business Segment

(In thousands)

(Unaudited)




 Three Months Ended 



 March 31, 



2016


2015

Net sales:





     Electronic Instruments


$   568,956


$   593,798

     Electromechanical


375,442


390,261

          Consolidated net sales


$   944,398


$   984,059






Income:





Segment operating income:





     Electronic Instruments


$   141,832


$   151,217

     Electromechanical


79,426


81,964

          Total segment operating income


221,258


233,181

     Corporate administrative and other expenses


(12,735)


(12,229)

          Consolidated operating income


$   208,523


$   220,952

 

 

 

AMETEK, Inc.

Condensed Consolidated Balance Sheet

(In thousands)



 March 31, 


 December 31, 


2016


2015


 (Unaudited) 



ASSETS




Current assets:




     Cash and cash equivalents

$     386,940


$     381,005

     Receivables, net

606,888


603,295

     Inventories, net

548,777


514,451

     Other current assets

119,985


120,076

          Total current assets

1,662,590


1,618,827





Property, plant and equipment, net

488,331


484,548

Goodwill

2,857,999


2,706,633

Other intangibles, investments and other assets

1,985,782


1,850,442

          Total assets

$  6,994,702


$  6,660,450





LIABILITIES AND STOCKHOLDERS' EQUITY




Current liabilities:




     Short-term borrowings and current portion of long-term debt, net

$     665,686


$     384,924

     Accounts payable and accruals

624,868


639,097

          Total current liabilities

1,290,554


1,024,021





Long-term debt, net

1,552,674


1,553,116

Deferred income taxes and other long-term liabilities

854,788


828,687

Stockholders' equity

3,296,686


3,254,626

          Total liabilities and stockholders' equity

$  6,994,702


$  6,660,450

 

 

AMETEK, Inc.

Reconciliations of GAAP to Non-GAAP Financial Measures

(In thousands, except per share amounts)

(Unaudited)







Three Months Ended




March 31,




2016


2015








EIG Segment operating income (GAAP)


$   141,832


$  151,217


        Realignment costs


-


9,251


Adjusted EIG Segment operating income (Non-GAAP)


$   141,832


$  160,468








EMG Segment operating income (GAAP)


$     79,426


$    81,964


        Realignment costs


-


6,534


Adjusted EMG Segment operating income (Non-GAAP)


$     79,426


$    88,498








Operating income (GAAP)


$   208,523


$  220,952


        Realignment costs


-


15,894


Adjusted Operating income (Non-GAAP)


$   208,523


$  236,846








Net income (GAAP)


$   134,170


$  142,107


        Realignment costs


-


10,808

(1)

Adjusted Net income (Non-GAAP)


$   134,170


$  152,915








(1) Represents adjustments at 32.0% tax rate.












Diluted earnings per share (GAAP)


$        0.57


$        0.59


         Realignment costs


-


0.04


Adjusted Diluted earnings per share (Non-GAAP)


$        0.57


$        0.63








EIG Segment operating margin (GAAP)


24.9%


25.5%


        Realignment costs


-


1.5


Adjusted EIG Segment operating margin (Non-GAAP)


24.9%


27.0%








EMG Segment operating margin (GAAP)


21.2%


21.0%


         Realignment costs


-


1.7


Adjusted EMG Segment operating margin (Non-GAAP)


21.2%


22.7%








Operating income margin (GAAP)


22.1%


22.5%


        Realignment costs


-


1.6


Adjusted Operating income margin (Non-GAAP)


22.1%


24.1%


Use of Non-GAAP Financial Information
 
The Company supplements its consolidated financial statements presented on a U.S. generally accepted accounting principles ("GAAP") basis with certain non‑GAAP financial information to provide investors with greater insight and increased transparency, and to allow for a more comprehensive understanding of the information used by management in its financial and operational decision-making. Reconciliation of non‑GAAP measures to their most directly comparable GAAP measures are included in the accompanying financial tables. These non‑GAAP financial measures should be considered in addition to, and not as a replacement for, or superior to, the comparable GAAP measure, and may not be comparable to similarly titled measures reported by other companies.
 
The Company believes that these measures provide useful information to investors by reflecting additional ways of viewing AMETEK's operations that, when reconciled to the comparable GAAP measure, helps our investors to better understand the long-term profitability trends of our business, and facilitates easier comparisons of our profitability to prior and future periods and to our peers. The items described above have been excluded from this measure because items of this nature and/or size occur with inconsistent frequency, occur for reasons that may be unrelated to AMETEK's commercial performance during the period and/or we believe are not indicative of AMETEK's ongoing operating costs or gains in a given period, which we believe may obscure underlying business trends and make comparisons of long-term performance difficult.

 

 

Contact: Kevin Coleman +1 610-889-5247

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/ametek-announces-first-quarter-2016-results-300258950.html

SOURCE AMETEK, Inc.