UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): May 2, 2018
AMETEK, Inc.
(Exact name of registrant as specified in its charter)
| Delaware | 1-12981 | 14-1682544 | ||
| (State or other jurisdiction of incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) | ||
| 1100 Cassatt Road, Berwyn, Pennsylvania |
19312 | |||
| (Address of principal executive offices) | (Zip Code) | |||
Registrant’s telephone number, including area code: (610) 647-2121
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2. below):
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition.
On May 2, 2018, AMETEK, Inc. (the “Company”) issued a press release announcing its financial results for the three months ended March 31, 2018. A copy of the release is furnished as Exhibit 99.1 and incorporated by reference herein. This Current Report on Form 8-K and the press release attached hereto are being furnished pursuant to Item 2.02 of Form 8-K.
The information shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities under that Section and shall not be deemed to be incorporated by reference into any filing by the Company under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
Item 8.01 Other Events.
On May 2, 2018, the Company issued a press release announcing it has acquired SoundCom Systems. A copy of the release is furnished as Exhibit 99.2 to this Current Report on Form 8-K.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| AMETEK, Inc. | ||||||
| May 2, 2018 | By: |
/s/ THOMAS M. MONTGOMERY | ||||
| Name: Thomas M. Montgomery | ||||||
| Title: Senior Vice President – Comptroller | ||||||
Exhibit 99.1
AMETEK ANNOUNCES RECORD FIRST QUARTER RESULTS
AND RAISES 2018 GUIDANCE
-- Reports first quarter sales up 16% over prior year --
-- Delivers diluted earnings per share of $0.78, up 30% over prior year --
-- Increases 2018 earnings guidance to $3.06 - $3.12 per diluted share --
BERWYN, PA, MAY 2, 2018 – AMETEK, Inc. (NYSE: AME) today announced its financial results for the three month period ended March 31, 2018.
AMETEK’s first quarter 2018 sales were a record $1.17 billion, up 16% compared to the first quarter of 2017, with organic sales growth of 8%. Orders were a record $1.34 billion, up 20% over the prior year. Operating income in the quarter increased 19% to a record $258.2 million and operating margins of 22.0% were up 40 basis points over the prior year. First quarter diluted earnings per share of $0.78 were up 30% versus the same quarter in 2017.
“AMETEK delivered outstanding results to start the year,” said David A. Zapico, AMETEK Chairman and Chief Executive Officer. “Excellent organic sales growth, contributions from recently completed acquisitions and exceptional operating performance allowed AMETEK to deliver 30% earnings growth in the quarter. Record backlog, continued strong order momentum and positive market trends provides us with an optimistic outlook for the remainder of the year, prompting us to raise our full year guidance for 2018.”
Electronic Instruments Group (EIG)
In the first quarter of 2018, EIG sales were $716.4 million, up 16% over the same quarter of 2017. EIG operating income for the quarter was $183.4 million, an increase of 18% over the same period last year, and operating margins expanded 50 basis points to 25.6%.
“EIG delivered excellent results in the quarter, with the robust sales growth driven by strong organic sales growth and contributions from the recent acquisitions of Rauland, MOCON and Arizona Instrument,” commented Mr. Zapico. “The higher sales combined with our operational excellence initiatives drove outstanding operating margin expansion in the quarter.”
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Electromechanical Group (EMG)
EMG sales in the first quarter were a record $456.2 million, an 18% increase compared to the first quarter last year. EMG operating income in the quarter was $91.0 million, an increase of 16% over the prior year. Operating margins were a very strong 19.9% in the quarter.
“EMG also had an excellent start to the year with outstanding sales growth and strong operating performance. Sales increased sharply on low-double digit organic sales growth and contributions from the acquisition of FMH Aerospace. EMG also delivered solid operating performance in the quarter through the execution of our operational excellence efforts,” noted Mr. Zapico.
2018 Outlook
“The first quarter’s results were excellent and firmly position AMETEK for strong sales and earnings growth in 2018. Our businesses continue to deliver exceptional performance, generating excellent sales growth, margin expansion and cash flows through the execution of our Four Growth Strategies. We remain focused on strategically investing in our businesses to accelerate growth both organically and through value enhancing strategic acquisitions,” commented Mr. Zapico.
“We now expect overall sales in 2018 to increase low-double digits on a percentage basis, with organic sales up mid-single digits. We are increasing our 2018 earnings guidance range to $3.06 to $3.12 per diluted share, up 17% to 20% over 2017’s adjusted diluted earnings per share. This is an increase from our initial guidance range of $2.95 to $3.05 per diluted share,” he added.
“Overall sales in the second quarter of 2018 are expected to be up approximately 10% compared to the same quarter in 2017. We expect second quarter earnings per diluted share to be in the range of $0.76 to $0.78, up 17% to 20% over the same quarter last year,” concluded Mr. Zapico.
Conference Call
AMETEK will webcast its first quarter 2018 investor conference call on Wednesday, May 2, 2018, beginning at 8:30 AM ET. The live audio webcast will be available and later archived in the Investors section of www.ametek.com.
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Corporate Profile
AMETEK is a leading global manufacturer of electronic instruments and electromechanical devices with annualized sales of more than $4.7 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 AMETEK’s ability to consummate and successfully integrate future acquisitions; risks associated with international sales and operations; AMETEK’s 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.
Contact:
AMETEK, Inc.
Kevin Coleman
Vice President, Investor Relations
1100 Cassatt Road
Berwyn, Pennsylvania 19312
kevin.coleman@ametek.com
Phone: 610.889.5247
(Financial Information Follows)
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AMETEK, Inc.
Consolidated Statement of Income
(In thousands, except per share amounts)
(Unaudited)
| Three Months Ended | ||||||||
| March 31, | ||||||||
| 2018 | 2017 (1) | |||||||
| Net sales |
$ | 1,172,647 | $ | 1,007,682 | ||||
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| Cost of sales |
776,800 | 667,402 | ||||||
| Selling, general and administrative |
137,679 | 122,833 | ||||||
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| Total operating expenses |
914,479 | 790,235 | ||||||
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| Operating income |
258,168 | 217,447 | ||||||
| Interest expense |
(21,686 | ) | (24,516 | ) | ||||
| Other income (expense), net |
(658 | ) | (1,509 | ) | ||||
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| Income before income taxes |
235,824 | 191,422 | ||||||
| Provision for income taxes |
54,484 | 52,496 | ||||||
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| Net income |
$ | 181,340 | $ | 138,926 | ||||
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| Diluted earnings per share |
$ | 0.78 | $ | 0.60 | ||||
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| Basic earnings per share |
$ | 0.79 | $ | 0.61 | ||||
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| Weighted average common shares outstanding: |
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| Diluted shares |
232,965 | 231,004 | ||||||
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| Basic shares |
230,928 | 229,548 | ||||||
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| Dividends per share |
$ | 0.14 | $ | 0.09 | ||||
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(1) - The first quarter of 2017 has been restated to reflect the adoption of new accounting guidance in 2018, which resulted in the presentation of $2.9 million of other net periodic benefit income in Other income (expense), net rather than in Operating income, with no change in Net income.
AMETEK, Inc.
Information by Business Segment
(In thousands)
(Unaudited)
| Three Months Ended | ||||||||
| March 31, | ||||||||
| 2018 | 2017 | |||||||
| Net sales: |
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| Electronic Instruments |
$ | 716,426 | $ | 619,769 | ||||
| Electromechanical |
456,221 | 387,913 | ||||||
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| Consolidated net sales |
$ | 1,172,647 | $ | 1,007,682 | ||||
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| Operating income: |
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| Segment operating income: |
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| Electronic Instruments |
$ | 183,359 | $ | 155,261 | ||||
| Electromechanical |
91,002 | 78,343 | ||||||
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| Total segment operating income |
274,361 | 233,604 | ||||||
| Corporate administrative expenses |
(16,193 | ) | (16,157 | ) | ||||
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| Consolidated operating income |
$ | 258,168 | $ | 217,447 | ||||
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AMETEK, Inc.
Condensed Consolidated Balance Sheet
(In thousands)
| March 31, | December 31, | |||||||
| 2018 | 2017 | |||||||
| (Unaudited) | ||||||||
| ASSETS |
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| Current assets: |
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| Cash and cash equivalents |
$ | 556,776 | $ | 646,300 | ||||
| Receivables, net |
684,617 | 668,176 | ||||||
| Inventories, net |
596,312 | 540,504 | ||||||
| Other current assets |
122,500 | 79,675 | ||||||
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| Total current assets |
1,960,205 | 1,934,655 | ||||||
| Property, plant and equipment, net |
492,350 | 493,296 | ||||||
| Goodwill |
3,238,599 | 3,115,619 | ||||||
| Other intangibles, investments and other assets |
2,367,207 | 2,252,494 | ||||||
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| Total assets |
$ | 8,058,361 | $ | 7,796,064 | ||||
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| LIABILITIES AND STOCKHOLDERS’ EQUITY |
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| Current liabilities: |
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| Short-term borrowings and current portion of long-term debt, net |
$ | 308,069 | $ | 308,123 | ||||
| Accounts payable and accruals |
851,854 | 830,540 | ||||||
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| Total current liabilities |
1,159,923 | 1,138,663 | ||||||
| Long-term debt, net |
1,897,633 | 1,866,166 | ||||||
| Deferred income taxes and other long-term liabilities |
796,408 | 763,602 | ||||||
| Stockholders’ equity |
4,204,397 | 4,027,633 | ||||||
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| Total liabilities and stockholders’ equity |
$ | 8,058,361 | $ | 7,796,064 | ||||
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Exhibit 99.2
AMETEK ACQUIRES SOUNDCOM SYSTEMS
-- Expands AMETEK’s Healthcare Communication Solutions Capability --
BERWYN, PA, MAY 2, 2018 – AMETEK, Inc. (NYSE: AME) today announced that it has completed the acquisition of SoundCom Systems, a leader in the design, integration, installation, and support of clinical workflow and communication systems for healthcare facilities, educational institutions and corporations.
SoundCom also serves as a value-added reseller for AMETEK Rauland’s mission-critical healthcare communication workflow solutions in Ohio and Michigan. SoundCom joins existing Rauland owned value-added resellers in Florida and California.
“SoundCom is an excellent acquisition for AMETEK given its 40-year history as a valued business partner to Rauland,” comments David A. Zapico, AMETEK Chairman and Chief Executive Officer. “The acquisition expands Rauland’s presence in the attractive healthcare and education markets in the Midwest while providing our customers with expanded value-added solutions and services.”
SoundCom was a privately held company and is headquartered in Cleveland, Ohio. SoundCom has annual sales of approximately $40 million. It joins AMETEK as part of its Electronic Instruments Group (EIG) - a leader in advanced analytical, monitoring, testing, calibrating and display instruments with annualized sales of $2.9 billion.
Corporate Profile
AMETEK is a leading global manufacturer of electronic instruments and electromechanical devices with annualized sales of more than $4.7 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.
Contact:
AMETEK, Inc.
Kevin Coleman
Vice President, Investor Relations
1100 Cassatt Road
Berwyn, Pennsylvania 19312
kevin.coleman@ametek.com
Phone: 610.889.5247
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