Parker Announces Consolidation of the Climate and Industrial Controls Group

CLEVELAND, July 31, 2013 /PRNewswire/ -- Parker Hannifin Corporation (NYSE: PH), the global leader in motion and control technologies, today announced that it has consolidated its Climate and Industrial Controls (CIC) group into other existing operating groups within the company's Industrial Segment.  As a result of this consolidation and the resulting change in management structure, the company will have two reporting segments beginning with fiscal year 2014, Diversified Industrial (which will continue to include supplemental sales and profitability data for North America and International) and Aerospace Systems.

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"We have completed strategic divestitures within the CIC group during this past year, including our previously announced transaction to sell the automotive air conditioning portion of our Mobile Climate Systems Division to ContiTech AG," said Chairman, CEO and President, Don Washkewicz.  "We believe this change in group and management structure will better leverage the natural synergies among our operating groups and will foster greater focus, efficiencies and opportunities for growth. Our new reporting segment names more accurately describe the breadth of our capabilities and the position we have achieved as an innovative provider of highly engineered aerospace systems to our customers."

In fiscal year 2014, the financial results of the CIC group will be reported in the Diversified Industrial Segment.  On a geographic basis, approximately 70% of CIC group sales will be reported within Diversified Industrial North America and approximately 30% of CIC group sales will be reported within Diversified Industrial International.

The company also announced that, beginning with the first quarter of fiscal year 2014, it will provide supplemental information, including sales, on three global technology platforms.  This supplemental information is expected to provide greater clarity into the operations that comprise the Diversified Industrial Segment.  The three global technology platforms are strategically aligned based on complementary technologies and will be called Motion Systems, Flow and Process Control, and Filtration and Engineered Materials.

"This supplemental information will provide greater transparency and showcase the breadth of the technologies that we leverage in unique ways to meet our customers' needs around the world," added Washkewicz.  "We believe that this information will broaden awareness of our competitive strengths and the scope of our global footprint, end markets, sales channels, products and applications."

Historical sales and operating income for the CIC segment, that will now be included in the Diversified Industrial Segment in North America and International, is included in this press release and will be posted on the company's investor information site at www.phstock.com.   

With annual sales exceeding $13 billion in fiscal year 2012, Parker Hannifin is the world's leading diversified manufacturer of motion and control technologies and systems, providing precision-engineered solutions for a wide variety of mobile, industrial and aerospace markets. The company employs approximately 60,000 people in 48 countries around the world. Parker has increased its annual dividends paid to shareholders for 57 consecutive fiscal years, among the top five longest-running dividend-increase records in the S&P 500 index. For more information, visit the company's web site at www.parker.com or its investor information web site at www.phstock.com.

Forward-Looking Statements
Forward-looking statements contained in this and other written and oral reports are made based on known events and circumstances at the time of release, and as such, are subject in the future to unforeseen uncertainties and risks. All statements regarding future performance, earnings projections, events or developments are forward-looking statements. It is possible that the future performance and earnings projections of the company, including its individual segments, may differ materially from current expectations, depending on economic conditions within its mobile, industrial and aerospace markets, and the company's ability to maintain and achieve anticipated benefits associated with announced realignment activities, strategic initiatives to improve operating margins, actions taken to combat the effects of the current economic environment, and growth, innovation and global diversification initiatives. A change in the economic conditions in individual markets may have a particularly volatile effect on segment performance. Among other factors which may affect future performance are: changes in business relationships with and purchases by or from major customers, suppliers or distributors, including delays or cancellations in shipments, disputes regarding contract terms or significant changes in financial condition, changes in contract cost and revenue estimates for new development programs and changes in product mix; ability to identify acceptable strategic acquisition targets; uncertainties surrounding timing, successful completion or integration of acquisitions; ability to realize anticipated cost savings from business realignment activities; ability to realize anticipated benefits of the consolidation of the Climate and Industrial Controls Group; threats associated with and efforts to combat terrorism; uncertainties surrounding the ultimate resolution of outstanding legal proceedings, including the outcome of any appeals; competitive market conditions and resulting effects on sales and pricing; increases in raw material costs that cannot be recovered in product pricing; the company's ability to manage costs related to insurance and employee retirement and health care benefits; and global economic factors, including manufacturing activity, air travel trends, currency exchange rates, difficulties entering new markets and general economic conditions such as inflation, deflation, interest rates and credit availability. The company makes these statements as of the date of this disclosure, and undertakes no obligation to update them unless otherwise required by law.

 

 

PARKER HANNIFIN CORPORATION

















BUSINESS SEGMENT INFORMATION BY INDUSTRY - REFLECTING CONSOLIDATION OF CIC SEGMENT INTO INDUSTRIAL SEGMENT








FY2013





































(Unaudited)


















(Dollars in thousands)



Three Months Ending



Fiscal Year-to-Date







September 30,
2012


December 31,
2012


March 31,
2013




September 30,
2012


December 31, 2012


March 31,
2013


Net sales


















Industrial:


















North America

















North America - As Reported



$        1,266,047


$        1,197,705


$        1,283,649




$        1,266,047


$        2,463,752


$        3,747,401


CIC North America



159,232


119,675


144,781




159,232


278,907


423,688


North America w/ CIC



1,425,279


1,317,380


1,428,430




1,425,279


2,742,659


4,171,089





















International

















International - As Reported



1,176,890


1,168,961


1,241,464




1,176,890


2,345,851


3,587,315


CIC International



71,683


50,498


59,121




71,683


122,181


181,302


International w/ CIC



1,248,573


1,219,459


1,300,585




1,248,573


2,468,032


3,768,617





















Aerospace



541,083


528,656


578,026




541,083


1,069,739


1,647,765


Total




$        3,214,935


$        3,065,495


$        3,307,041




$        3,214,935


$        6,280,430


$        9,587,471


Segment operating income




































Industrial:


















North America

















North America - As Reported



$           227,192


$           183,914


$           209,048




$           227,192


$           411,106


$           620,154


CIC North America



16,883


6,517


15,439




16,883


23,400


38,839


North America w/ CIC



244,075


190,431


224,487




244,075


434,506


658,993





















International

















International - As Reported



151,771


123,434


152,309




151,771


275,205


427,514


CIC International



4,827


1,613


5,885




4,827


6,440


12,325


International w/ CIC



156,598


125,047


158,194




156,598


281,645


439,839





















Aerospace



61,898


52,172


80,080




61,898


114,070


194,150


Total segment operating income


462,571


367,650


462,761




462,571


830,221


1,292,982


Corporate general and administrative expenses


39,767


45,401


41,410




39,767


85,168


126,578


Income before interest and other expense





422,804


322,249


421,351




422,804


745,053


1,166,404


Interest expense



23,509


24,216


23,050




23,509


47,725


70,775


Other expense



63,237


35,404


59,750




63,237


98,641


158,391


Income before income taxes



$           336,058


$           262,629


$           338,551




$           336,058


$           598,687


$           937,238


 

PARKER HANNIFIN CORPORATION


















BUSINESS SEGMENT INFORMATION BY INDUSTRY - REFLECTING CONSOLIDATION OF CIC SEGMENT INTO INDUSTRIAL SEGMENT









FY2012







































(Unaudited)
(Dollars in thousands)




Three Months Ending


Fiscal Year-to-Date 




September 30,
2011


December 31, 2011


March 31,
2012


June 30,
2012


September 30,
2011


December 31, 2011


March 31,
2012


June 30,
2012

Net sales



















Industrial:



















North America


















North America - As Reported



$        1,204,817


$        1,183,352


$        1,315,357


$        1,337,580


$        1,204,817


$        2,388,169


$        3,703,526


$        5,041,106

CIC North America



165,310


138,030


171,338


192,273


165,310


303,340


474,678


666,951

North America w/ CIC



1,370,127


1,321,382


1,486,695


1,529,853


1,370,127


2,691,509


4,178,204


5,708,057





















International


















International - As Reported



1,289,115


1,218,812


1,286,751


1,239,571


1,289,115


2,507,927


3,794,678


5,034,249

CIC International



77,147


70,133


77,357


76,252


77,147


147,280


224,637


300,889

International w/ CIC



1,366,262


1,288,945


1,364,108


1,315,823


1,366,262


2,655,207


4,019,315


5,335,138





















Aerospace



497,492


496,505


542,760


565,990


497,492


993,997


1,536,757


2,102,747

Total




$        3,233,881


$        3,106,832


$        3,393,563


$        3,411,666


$        3,233,881


$        6,340,713


$        9,734,276


$      13,145,942

Segment operating income


















Segment operating income


















Industrial:



















North America


















North America - As Reported



$           223,227


$           195,738


$           226,986


$           249,059


$           223,227


$           418,965


$           645,951


$           895,010

CIC North America



15,556


6,980


16,781


25,925


15,556


22,536


39,317


65,242

North America w/ CIC



238,783


202,718


243,767


274,984


238,783


441,501


685,268


960,252





















International


















International - As Reported



208,219


165,940


195,065


163,899


208,219


374,159


569,224


733,123

CIC International



4,236


2,843


6,422


5,531


4,236


7,079


13,501


19,032

International w/ CIC



212,455


168,783


201,487


169,430


212,455


381,238


582,725


752,155





















Aerospace



68,637


70,262


65,925


85,311


68,637


138,899


204,824


290,135

Total segment operating income


519,875


441,763


511,179


529,725


519,875


961,638


1,472,817


2,002,542

Corporate general and administrative expenses


58,016


46,136


38,377


50,838


58,016


104,152


142,529


193,367

Income before interest and other expense





461,859


395,627


472,802


478,887


461,859


857,486


1,330,288


1,809,175

Interest expense



23,221


23,769


22,313


23,487


23,221


46,990


69,303


92,790

Other expense



27,053


32,911


49,662


30,061


27,053


59,964


109,626


139,687

Income before income taxes



$           411,585


$           338,947


$           400,827


$           425,339


$           411,585


$           750,532


$        1,151,359


$        1,576,698

 

PARKER HANNIFIN CORPORATION


















BUSINESS SEGMENT INFORMATION BY INDUSTRY - REFLECTING CONSOLIDATION OF CIC SEGMENT INTO INDUSTRIAL SEGMENT









FY2011



























































(Unaudited)
(Dollars in thousands)




Three Months Ending


Fiscal Year-to-Date 




September 30,
2010


December 31, 2010


March 31,
2011


June 30,
2011


September 30,
2010


December 31, 2010


March 31,
2011


June 30,
2011

Net sales



















Industrial:



















North America


















North America - As Reported



$        1,064,915


$        1,045,469


$        1,178,714


$        1,227,412


$        1,064,915


$        2,110,384


$        3,289,098


$        4,516,510

CIC North America



166,088


144,692


184,772


192,490


166,088


310,780


495,552


688,042

North America w/ CIC



1,231,003


1,190,161


1,363,486


1,419,902


1,231,003


2,421,164


3,784,650


5,204,552





















International


















International - As Reported



1,092,981


1,147,231


1,293,047


1,380,748


1,092,981


2,240,212


3,533,259


4,914,007

CIC International



68,609


69,642


79,764


84,312


68,609


138,251


218,015


302,327

International w/ CIC



1,161,590


1,216,873


1,372,811


1,465,060


1,161,590


2,378,463


3,751,274


5,216,334





















Aerospace



436,680


459,630


503,806


521,868


436,680


896,310


1,400,116


1,921,984

Total




$        2,829,273


$        2,866,664


$        3,240,103


$        3,406,830


$        2,829,273


$        5,695,937


$        8,936,040


$      12,342,870

Segment operating income


















Segment operating income


















Industrial:



















North America


















North America - As Reported



$           189,362


$           159,429


$           189,463


$           207,290


$           189,362


$           348,791


$           538,254


$           745,544

CIC North America



16,449


6,658


18,023


17,654


16,449


23,107


41,130


58,784

North America w/ CIC



205,811


166,087


207,486


224,944


205,811


371,898


579,384


804,328





















International


















International - As Reported



183,800


167,776


199,798


202,848


183,800


351,576


551,374


754,222

CIC International



5,103


2,843


4,554


4,850


5,103


7,946


12,500


17,350

International w/ CIC



188,903


170,619


204,352


207,698


188,903


359,522


563,874


771,572





















Aerospace



43,776


63,644


68,984


70,722


43,776


107,420


176,404


247,126

Total segment operating income


438,490


400,350


480,822


503,364


438,490


838,840


1,319,662


1,823,026

Corporate general and administrative expenses


33,354


37,593


41,734


51,187


33,354


70,947


112,681


163,868

Income before interest and other expense





405,136


362,757


439,088


452,177


405,136


767,893


1,206,981


1,659,158

Interest expense



24,633


25,631


24,619


24,821


24,633


50,264


74,883


99,704

Other expense



44,139


30,876


24,752


45,966


44,139


75,015


99,767


145,733

Income before income taxes



$           336,364


$           306,250


$           389,717


$           381,390


$           336,364


$           642,614


$        1,032,331


$        1,413,721

 

 

SOURCE Parker Hannifin Corporation



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