Applied Industrial Technologies Reports Fiscal 2012 Third Quarter Results and Declares Quarterly Dividend
Apr 26, 2012, 07:30 ET
CLEVELAND, April 26, 2012 /PRNewswire-FirstCall/ -- Applied Industrial Technologies (NYSE: AIT) today reported third quarter fiscal 2012 sales and earnings for the three months ended March 31, 2012.
Net sales for the third quarter increased 7.0% to $605.5 million from $566.0 million in the comparable period a year ago. Net income for the quarter increased 10.9% to $29.4 million, or $0.69 per share, compared to $26.5 million, or $0.61 per share, last year.
For the nine months ended March 31, 2012, sales increased 8.2% to $1.76 billion from $1.62 billion in the same period last year. Net income increased 12.0% to $76.7 million, or $1.79 per share, compared to $68.5 million, or $1.58 per share, last year.
Commenting on the Company's performance, Applied's Chief Executive Officer Neil A. Schrimsher said, "We had solid business performance in the third quarter, continuing our sound operating discipline and focus on operational excellence. We effectively translated our sales gains into good profit contribution, while continuing our asset management execution and strong cash generation. As we finalize our long-range strategic plans, we are encouraged by our opportunities to generate profitable growth and increase shareholder value.
"Entering the final quarter of our fiscal year, we are operating in an active industrial economic environment. We are maintaining our full fiscal 2012 sales guidance of $2.35 billion to $2.45 billion, and we are narrowing our earnings per share guidance to between $2.45 and $2.55 per share," said Schrimsher.
In addition, Mr. Schrimsher announced today that the Company's Board of Directors declared a quarterly cash dividend of $0.21 per common share, payable on May 31, 2012, to shareholders of record on May 15, 2012.
The Company will host its quarterly conference call for investors and analysts at 4 p.m. ET on April 26, 2012. To join the call, dial 1-800-927-0469 or 1-847-944-7323 (for International callers) using passcode 32073750. The call will be conducted by CEO Neil A Schrimsher, President & COO Benjamin J. Mondics, and Vice President & CFO Mark O. Eisele. A live audio webcast can be accessed online at www.Applied.com. A replay of the call will be available for two weeks by dialing 1-888-843-7419 or 1-630-652-3042 (International) using passcode 32073750.
With approximately 480 facilities and 4,600 employee associates, Applied Industrial Technologies is a leading industrial distributor that offers more than 4 million parts critical to the operations of MRO and OEM customers in virtually every industry. In addition, Applied provides engineering, design and systems integration for industrial and fluid power applications, as well as customized mechanical, fabricated rubber and fluid power shop services. Applied also offers maintenance training, plus solutions to meet inventory and storeroom management needs that help provide enhanced value to its customers. For its fiscal year ended June 30, 2011, Applied posted sales of $2.2 billion. Applied can be visited on the Internet at http://www.applied.com.
This press release contains statements that are forward-looking, as that term is defined by the Securities and Exchange Commission in its rules, regulations and releases. Forward-looking statements are often identified by qualifiers such as "guidance" and similar expressions. Applied intends that such forward-looking statements be subject to the safe harbors created thereby. All forward-looking statements are based on current expectations regarding important risk factors including trends in the industrial sector of the economy, and other risk factors identified in Applied's most recent periodic report and other filings made with the Securities and Exchange Commission. Accordingly, actual results may differ materially from those expressed in the forward-looking statements, and the making of such statements should not be regarded as a representation by the Company or any other person that the results expressed therein will be achieved. Applied assumes no obligation to update publicly or revise any forward-looking statements, whether due to new information, or events, or otherwise, except as required by law.
APPLIED INDUSTRIAL TECHNOLOGIES, INC. AND SUBSIDIARIES |
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CONDENSED STATEMENTS OF CONSOLIDATED INCOME |
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(In thousands, except per share data) |
|||||
Three Months Ended |
Nine Months Ended |
||||
2012 |
2011 |
2012 |
2011 |
||
Net Sales |
$ 605,461 |
$ 565,970 |
$ 1,755,432 |
$ 1,622,988 |
|
Cost of sales |
437,848 |
409,404 |
1,273,646 |
1,179,021 |
|
Gross Profit |
167,613 |
156,566 |
481,786 |
443,967 |
|
Selling, distribution and administrative, |
|||||
including depreciation |
125,594 |
118,365 |
363,165 |
337,819 |
|
Operating Income |
42,019 |
38,201 |
118,621 |
106,148 |
|
Interest expense, net |
54 |
52 |
111 |
1,634 |
|
Other (income) expense, net |
(1,887) |
(2,645) |
823 |
(3,409) |
|
Income Before Income Taxes |
43,852 |
40,794 |
117,687 |
107,923 |
|
Income Tax Expense |
14,434 |
14,258 |
40,952 |
39,439 |
|
Net Income |
$ 29,418 |
$ 26,536 |
$ 76,735 |
$ 68,484 |
|
Net Income Per Share - Basic |
$ 0.70 |
$ 0.63 |
$ 1.82 |
$ 1.61 |
|
Net Income Per Share - Diluted |
$ 0.69 |
$ 0.61 |
$ 1.79 |
$ 1.58 |
|
Average Shares Outstanding - Basic |
42,109 |
42,446 |
42,157 |
42,409 |
|
Average Shares Outstanding - Diluted |
42,779 |
43,339 |
42,838 |
43,254 |
|
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS |
|
(1) Applied uses the last-in, first-out (LIFO) method of valuing U.S. inventory. An actual valuation of inventory under the LIFO method can only be made at the end of each year based on the inventory levels and costs at that time. Accordingly, interim LIFO calculations are based on management's estimates of expected year-end inventory levels and costs and are subject to the final year-end LIFO inventory determination. |
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There were no LIFO layer liquidation benefits recognized for the nine months ended March 31, 2012. We recorded overall LIFO benefits in the quarter and nine months ended March 31, 2011 of $0.4 million and $2.5 million, respectively, and LIFO reserves were reduced by the same amount. |
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APPLIED INDUSTRIAL TECHNOLOGIES, INC. AND SUBSIDIARIES |
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CONDENSED CONSOLIDATED BALANCE SHEETS |
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(Amounts in thousands) |
||||
March 31, |
June 30, |
|||
2012 |
2011 |
|||
Assets |
||||
Cash and cash equivalents |
$ 79,408 |
$ 91,092 |
||
Accounts receivable, less allowances of $8,570 and $7,016 |
307,660 |
290,751 |
||
Inventories |
230,035 |
204,066 |
||
Other current assets |
31,897 |
33,005 |
||
Total current assets |
649,000 |
618,914 |
||
Property, net |
78,464 |
69,014 |
||
Intangibles, net |
88,768 |
89,551 |
||
Goodwill |
84,690 |
76,981 |
||
Other assets |
53,414 |
60,471 |
||
Total Assets |
$ 954,336 |
$ 914,931 |
||
Liabilities |
||||
Accounts payable |
$ 124,614 |
$ 108,509 |
||
Other accrued liabilities |
101,081 |
106,179 |
||
Total current liabilities |
225,695 |
214,688 |
||
Other liabilities |
56,432 |
66,680 |
||
Total Liabilities |
282,127 |
281,368 |
||
Shareholders' Equity |
672,209 |
633,563 |
||
Total Liabilities and Shareholders' Equity |
$ 954,336 |
$ 914,931 |
||
APPLIED INDUSTRIAL TECHNOLOGIES, INC. AND SUBSIDIARIES |
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CONDENSED STATEMENTS OF CONSOLIDATED CASH FLOWS |
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(In thousands) |
||||
Nine Months Ended |
||||
March 31, |
||||
2012 |
2011 |
|||
Cash Flows from Operating Activities |
||||
Net income |
$76,735 |
$68,484 |
||
Adjustments to reconcile net income to net cash provided |
||||
by operating activities: |
||||
Depreciation and amortization of property |
8,388 |
8,466 |
||
Amortization of intangibles |
8,455 |
8,468 |
||
Amortization of stock options and appreciation rights |
1,810 |
2,169 |
||
Gain on sale of property |
(626) |
(687) |
||
Other share-based compensation expense |
3,470 |
3,103 |
||
Changes in assets and liabilities, net of acquisitions |
(39,625) |
(29,275) |
||
Other, net |
3,364 |
3,254 |
||
Net Cash provided by Operating Activities |
61,971 |
63,982 |
||
Cash Flows from Investing Activities |
||||
Property purchases |
(18,295) |
(16,446) |
||
Proceeds from property sales |
1,209 |
1,079 |
||
Net cash paid for acquisition of businesses, net of cash acquired |
(14,297) |
(27,739) |
||
Other |
1,722 |
|||
Net Cash used in Investing Activities |
(31,383) |
(41,384) |
||
Cash Flows from Financing Activities |
||||
Repayments under revolving credit facility |
(50,000) |
|||
Long-term debt repayment |
(25,000) |
|||
Settlements of cross currency swap agreements |
(12,752) |
|||
Purchase of treasury shares |
(18,990) |
(4,491) |
||
Dividends paid |
(24,939) |
(21,649) |
||
Excess tax benefits from share-based compensation |
2,263 |
1,250 |
||
Exercise of stock options and appreciation rights |
324 |
477 |
||
Net Cash used in Financing Activities |
(41,342) |
(112,165) |
||
Effect of Exchange Rate Changes on Cash |
(930) |
2,349 |
||
Decrease in cash and cash equivalents |
(11,684) |
(87,218) |
||
Cash and cash equivalents at beginning of period |
91,092 |
175,777 |
||
Cash and Cash Equivalents at End of Period |
$ 79,408 |
$ 88,559 |
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SOURCE Applied Industrial Technologies