News Release Details

AMETEK Announces Third Quarter 2015 Results

October 27, 2015 at 6:45 AM EDT
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-- Delivers Record Quarterly Diluted Earnings per Share --

BERWYN, Pa., Oct. 27, 2015 /PRNewswire/ -- AMETEK, Inc. (NYSE: AME) today announced its financial results for the three month period ended September 30, 2015.  

AMETEK reported third quarter 2015 sales of $1.0 billion, down 3% from last year's third quarter. Operating income increased 3% to $237.6 million, operating margins were up 130 basis points to 23.8%, and diluted earnings per share increased 5% to a record $0.65 per diluted share from the third quarter 2014 adjusted results.  

"I am very pleased with AMETEK's solid performance in the third quarter.  Although the global economic environment remains challenging, we continue to deliver strong improvements in our operating margins and diluted earnings per share through the execution of our Four Growth Strategies," noted Frank S. Hermance, AMETEK Chairman and Chief Executive Officer.

Third quarter 2014 results exclude $13.7 million, or $0.05 per diluted share, in Zygo integration costs.  A comparison of third quarter 2015 results to last year's reported GAAP and adjusted results is included with the financial tables accompanying the release.  All further references to 2014 results are on an adjusted basis.

Electronic Instruments Group (EIG)

In the third quarter of 2015, EIG sales were $598.5 million, down 5% versus $631.6 million in the previous year's comparable quarter.  Operating income was $162.5 million in the quarter, up slightly over last year's third quarter, and operating margins were 27.2%, up 160 basis points over the prior year.     

"EIG had a good third quarter in this difficult growth environment.  The lower sales were driven largely by currency headwinds.  Despite the lower sales, operating margins were very strong, increasing 160 basis points driven by our Operational Excellence initiatives," added Mr. Hermance.

Electromechanical Group (EMG)

For the third quarter of 2015, EMG sales were $400.0 million, essentially flat with the third quarter 2014.  Operating income increased 6% to $86.7 million and operating margins were 21.7%, up 120 basis points from 20.5% in last year's third quarter.  

"EMG also had a good quarter.  Strong core growth in our Aerospace businesses and the contribution from the Global Tubes acquisition were offset by foreign currency headwinds and weakness within our Engineered Materials, Interconnects and Packaging business.  Operating margins were very strong as a result of our Operational Excellence initiatives," notes Mr. Hermance.

2015 Outlook

"As a result of the increasingly sluggish global macro environment, we now expect 2015 sales to be down low single digits on a percentage basis versus 2014.  Earnings for the year, excluding the first quarter realignment costs, are anticipated to be approximately $2.55 per diluted share, up 5% from last year's adjusted diluted earnings per share," notes Mr. Hermance. 

"Fourth quarter sales are estimated to be down low single digits on a percentage basis from last year's fourth quarter.  We expect our diluted earnings per share to be approximately $0.63 in the fourth quarter," adds Mr. Hermance. 

"We remain confident in our ability to continue to deliver strong earnings due to our excellent portfolio of business, proven operational capabilities, on-going growth investments and a successful focus on strategic acquisitions," concluded Mr. Hermance.

Conference Call

The Company will webcast its Third Quarter 2015 investor conference call on Tuesday, October 27, 2015, 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 electro-mechanical 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 

 Nine Months Ended 

 September 30, 

 September 30, 

2015

2014

2015

2014

Net sales

$   998,527

$1,031,811

$2,986,312

$2,997,821

Operating expenses:






     Cost of sales, excluding depreciation

631,790

677,739

1,901,680

1,933,554

     Selling, general and administrative

112,116

119,205

335,702

345,146

     Depreciation

17,006

16,724

50,044

47,619

          Total operating expenses 

760,912

813,668

2,287,426

2,326,319








Operating income 

237,615

218,143

698,886

671,502

Other expenses:






     Interest expense

(23,684)

(19,543)

(69,048)

(57,362)

     Other, net

(2,325)

(8,639)

(6,298)

(16,842)

Income before income taxes

211,606

189,961

623,540

597,298

Provision for income taxes

55,208

48,150

169,522

164,838








Net income

$   156,398

$   141,811

$   454,018

$   432,460








Diluted earnings per share

$        0.65

$        0.57

$        1.87

$        1.75

Basic earnings per share

$        0.65

$        0.58

$        1.89

$        1.76








Weighted average common shares outstanding:






     Diluted shares

241,238

247,643

242,552

247,425

     Basic shares

239,959

245,439

240,801

245,184








Dividends per share

$        0.09

$        0.09

$        0.27

$        0.24

 

 

AMETEK, Inc.

Information by Business Segment

(In thousands)

(Unaudited)





 Three Months Ended 

 Nine Months Ended 

 September 30, 

 September 30, 

2015

2014

2015

2014

Net sales:






     Electronic Instruments

$   598,515

$   631,569

$1,788,777

$1,777,252

     Electromechanical

400,012

400,242

1,197,535

1,220,569

          Consolidated net sales

$   998,527

$1,031,811

$2,986,312

$2,997,821








Income:






Segment operating income:






     Electronic Instruments

$   162,530

$   148,313

$   477,740

$   450,131

     Electromechanical

86,671

82,001

257,929

258,014

          Total segment operating income

249,201

230,314

735,669

708,145

     Corporate administrative and other expenses

(11,586)

(12,171)

(36,783)

(36,643)

          Consolidated operating income

$   237,615

$   218,143

$   698,886

$   671,502

 

 

AMETEK, Inc.

Condensed Consolidated Balance Sheet

(In thousands)



 September 30, 

 December 31, 

2015

2014

 (Unaudited) 

ASSETS


Current assets:


     Cash and cash equivalents

$     328,034

$     377,615

     Receivables, net

610,019

585,462

     Inventories, net

541,994

495,896

     Other current assets

110,693

119,631

          Total current assets

1,590,740

1,578,604




Property, plant and equipment, net

483,029

448,446

Goodwill

2,722,871

2,614,030

Other intangibles, investments and other assets

1,847,384

1,779,883

          Total assets

$  6,644,024

$  6,420,963




LIABILITIES AND STOCKHOLDERS' EQUITY


Current liabilities:


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

$     295,259

$     286,201

     Accounts payable and accruals

630,218

649,943

          Total current liabilities

925,477

936,144




Long-term debt

1,621,812

1,427,825

Deferred income taxes and other long-term liabilities

781,466

817,433

Stockholders' equity

3,315,269

3,239,561

          Total liabilities and stockholders' equity

$  6,644,024

$  6,420,963

 

 

AMETEK, Inc.



Reconciliations of GAAP to Non-GAAP Financial Measures



(In thousands, except per share amounts)



(Unaudited)








Three Months Ended

Nine Months Ended



September 30,

September 30,



2015

2014

2015

2014











EIG Segment operating income (GAAP)

$   162,530

$   148,313

$   477,740

$   450,131

Realignment costs

-

-

9,251

-

Zygo integration costs

-

13,655

-

13,655

Adjusted EIG Segment operating income (Non-GAAP)

$   162,530

$   161,968

$   486,991

$   463,786











EMG Segment operating income (GAAP)

$     86,671

$     82,001

$   257,929

$   258,014

Realignment costs

-

-

6,534

-

Zygo integration costs

-

-

-

-

Adjusted EMG Segment operating income (Non-GAAP)

$     86,671

$     82,001

$   264,463

$   258,014











Operating income (GAAP)

$   237,615

$   218,143

$   698,886

$   671,502

Realignment costs

-

-

15,894

-

Zygo integration costs

-

13,655

-

13,655

Adjusted Operating income (Non-GAAP)

$   237,615

$   231,798

$   714,780

$   685,157











Net income (GAAP)

$   156,398

$   141,811

$   454,018

$   432,460

Realignment costs

-

-

10,808

(1)

-

Zygo integration costs

-

10,717

(2)

-

10,717

(2)

Adjusted Net income (Non-GAAP)

$   156,398

$   152,528

$   464,826

$   443,177











(1) Represents adjustments at 32.0% tax rate.








(2) Represents adjustments at 21.5% tax rate.



















Diluted earnings per share (GAAP)

$         0.65

$         0.57

$         1.87

$         1.75

Realignment costs

-

-

0.05

-

Zygo integration costs

-

0.05

-

0.04

Adjusted Diluted earnings per share (Non-GAAP)

$         0.65

$         0.62

$         1.92

$         1.79











EIG Segment operating margin (GAAP)

27.2%

23.5%

26.7%

25.3%

Realignment costs

-

-

0.5

-

Zygo integration costs

-

2.1

-

0.8

Adjusted EIG Segment operating margin (Non-GAAP)

27.2%

25.6%

27.2%

26.1%











EMG Segment operating margin (GAAP)

21.7%

20.5%

21.5%

21.1%

Realignment costs

-

-

0.6

-

Zygo integration costs

-

-

-

-

Adjusted EMG Segment operating margin (Non-GAAP)

21.7%

20.5%

22.1%

21.1%











Operating income margin (GAAP)

23.8%

21.1%

23.4%

22.4%

Realignment costs

-

-

0.5

-

Zygo integration costs

-

1.4

-

0.5%

Adjusted Operating income margin (Non-GAAP)

23.8%

22.5%

23.9%

22.9%











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, increased transparency and 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

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SOURCE AMETEK, Inc.