Message #11 From:
Stock News Bot Date: October 19, 2006 04:00:00 AM
AME News AMETEK Achieves Record Quarterly Results
PAOLI, Pa.--(BUSINESS WIRE)--AMETEK, Inc. (NYSE:AME) today announced third quarter results that
established quarterly records for sales, operating income, net income
and diluted earnings per share.
AMETEK’s third quarter 2006 sales of $464.2
million were up 35% from the $344.5 million recorded in the third
quarter of 2005. Operating income for the third quarter of 2006 was
$79.8 million, up 39% from the third quarter of 2005. Net income in the
third quarter of 2006 increased 38% to $47.4 million, or $.67 per
diluted share, from the third quarter 2005 level of $34.4 million, or
$.49 per diluted share.
“AMETEK had an outstanding quarter which
exceeded our expectations,” noted Frank S.
Hermance, AMETEK Chairman and Chief Executive Officer. “Strong
internal growth of 13%, combined with the contributions from acquired
businesses drove the top-line growth. Excellent performance in our
long-cycle aerospace and power businesses and continued strong results
in our process and analytical instrument business drove the internal
growth. Earnings were up sharply as well, with net income increasing 38%
and operating income margins increasing 60 basis points,”
he commented.
Operating cash flow continues to be very strong, totaling $59 million
for the third quarter of 2006, up 26% from the third quarter of 2005.
For the first nine months of 2006, operating cash flow of $161 million
is up 46% over the same period of 2005.
For the first nine months of 2006, AMETEK sales increased 30% to $1.34
billion from $1.03 billion in the same period of 2005. Operating income
totaled $229.7 million, a 35% increase from $170.1 million earned in the
first nine months of last year. Net income for the first nine months of
2006 was $134.1 million, up 35% from $99.5 million in the same period of
2005. Diluted earnings per share were $1.89 for the first nine months of
2006, up 33% from $1.42 per diluted share in the first nine months of
2005.
Electronic Instruments Group (EIG)
EIG’s third quarter 2006 sales were $262.3
million, up 28% from last year’s level of
$205.5 million. Third quarter group operating income was up 22% to $52.0
million, versus $42.6 million in the same period of 2005. Group
operating margins were 19.8%, as compared with 20.7% in the third
quarter of 2005. Last year’s third quarter
operating income included a gain on the sale of a facility of
approximately $4 million. Without this gain, last year’s
third quarter operating income margin would have been 18.6%.
“EIG had an excellent quarter,”
noted Mr. Hermance. “Revenue for the Group
was up 28% driven by strength in our aerospace, power and process
businesses as well as the contribution from the acquisitions of
Solartron, Land Instruments and Pulsar. Operating income improved
significantly and was driven by the top-line strength and our
operational excellence initiatives.”
Electromechanical Group (EMG)
EMG’s sales of $201.9 million were up 45%
from $139.0 million in the third quarter of 2005. Third quarter group
operating income of $36.2 million was up 66%, versus $21.8 million
reported for the same period of 2005. EMG’s
operating income margin in the third quarter of 2006 was 17.9%, up
sharply from the third quarter of 2005 level of 15.7%.
“EMG had a tremendous quarter. Sales were up
sharply, driven by solid core growth and the contribution from the
acquisitions of HCC Industries and PennEngineering Motion Technologies.
Profitability was strong as a result of the increased sales volume and
broad-based operating improvements,”
commented Mr. Hermance.
2006 Outlook
“We expect 2006 revenue to grow by
approximately 25%,” commented Mr. Hermance. “Given
our strong year to date results and the expectation of continued
strength in our markets, we anticipate our full year 2006 earnings to be
in the range of $2.52 to $2.54 per diluted share, an increase of 30% to
31% over the 2005 level of $1.94 per diluted share and in-line with the
revised guidance we issued on October 12, 2006.”
“Our fourth quarter 2006 sales are expected
to be up approximately 15% from last year’s
fourth quarter. We expect fourth quarter earnings will be approximately
$.63 to $.65 per diluted share, an increase of 21% to 25% over last year’s
fourth quarter,” concluded Mr. Hermance.
Accounting for Stock Options
The above operating results reflect the adoption of FAS 123R, effective
January 1, 2006, for expensing stock options under the modified
retrospective method. Results for 2005 have been adjusted on this basis.
Conference Call
AMETEK, Inc. will Web cast its Third Quarter 2006 investor conference
call on Thursday, October 19, 2006, beginning at 8:30 AM ET. The live
audio Web cast will be available at www.ametek.com
and at www.streetevents.com.
To access the Web cast from ametek.com,
click on “Investors”
and a link will be provided to access the Web cast. The call will also
be archived at www.ametek.com/investors.
Corporate Profile
AMETEK is a leading global manufacturer of electronic instruments and
electromechanical devices with annualized sales of approximately $1.8
billion. AMETEK’s Corporate Growth Plan is
based on Four Key Strategies: Operational Excellence, Strategic
Acquisitions & Alliances, 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 MidCap 400 Index and the Russell 1000 Index.
Forward-looking Information
Statements in this news release that are not historical are considered “forward-looking
statements” and are subject to change based
on various factors and uncertainties that may cause actual results to
differ significantly from expectations. Those factors are contained in
AMETEK’s Securities and Exchange Commission
filings.
(Financial Information Follows)
AMETEK, Inc.
CONSOLIDATED STATEMENT OF INCOME (Unaudited)
(In thousands, except per share amounts)
Three months ended
Nine months ended
September 30,
September 30,
2006
2005 (a)
2006
2005 (a)
Net sales
$ 464,164
$ 344,529
$ 1,338,616
$ 1,030,676
Expenses:
Cost of sales, excluding depreciation
318,275
234,007
919,351
711,090
Selling, general and administrative
56,197
44,834
160,324
124,101
Depreciation
9,862
8,446
29,211
25,363
Total expenses
384,334
287,287
1,108,886
860,554
Operating income
79,830
57,242
229,730
170,122
Other (expenses) income:
Interest expense
(11,162)
(7,628)
(31,551)
(22,962)
Other, net
17
(1,446)
(1,309)
(1,648)
Income before income taxes
68,685
48,168
196,870
145,512
Provision for income taxes
21,314
13,799
62,773
46,054
Net income
$ 47,371
$ 34,369
$ 134,097
$ 99,458
Diluted earnings per share
$0.67
$0.49
$1.89
$1.42
Basic earnings per share
$0.68
$0.50
$1.92
$1.44
Average common shares outstanding:
Diluted shares
70,888
70,518
71,081
70,245
Basic shares
69,778
69,242
69,918
69,007
Dividends per share
$0.06
$0.06
$0.18
$0.18
(a) Results for 2005 have been adjusted to reflect the retrospective
application of FAS 123R to expense stock options, which was adopted
effective January 1, 2006. The retrospective application reduced
2005 net income by $1.1 million, or $0.01 per diluted share, for the
quarter ended September 30, 2005, and by $3.2 million, or $0.03 per
diluted share, for the nine months ended September 30, 2005.
AMETEK, Inc.
INFORMATION BY BUSINESS SEGMENT (Unaudited)
(In thousands)
Three months ended
Nine months ended
September 30,
September 30,
2006
2005 (a)
2006
2005 (a)
Net sales
Electronic Instruments
$262,250
$205,500
$742,720
$577,777
Electromechanical
201,914
139,029
595,896
452,899
Total Consolidated
$464,164
$344,529
$1,338,616
$1,030,676
Operating income
Electronic Instruments
$52,000
$42,594
$150,111
$118,541
Electromechanical
36,239
21,782
104,943
73,511
Total segments
88,239
64,376
255,054
192,052
Corporate and other
(8,409)
(7,134)
(25,324)
(21,930)
Total Consolidated
$79,830
$57,242
$229,730
$170,122
(a) Operating income for 2005 has been adjusted to reflect the
retrospective application of FAS 123R to expense stock options,
which was adopted effective January 1, 2006. The retrospective
application reduced 2005 operating income by $1.5 million for the
quarter ended September 30, 2005, and by $4.4 million for the nine
months ended September 30, 2005.
AMETEK, Inc.
CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED)
(In thousands)
September 30,
December 31,
2006
2005
ASSETS
Current assets:
Cash, cash equivalents and marketable securities
$58,505
$43,788
Receivables, net
317,679
269,395
Inventories
229,937
193,099
Other current assets
53,334
50,025
Total current assets
659,455
556,307
Property, plant and equipment, net
240,045
228,450
Goodwill
860,047
785,185
Other intangibles, investments and other assets
280,689
210,658
Total assets
$2,040,236
$1,780,600
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Short-term borrowings and current portion of long-term debt
