Dépêches

Crane Co. Reports First Quarter Earnings

Dépèche transmise le 23 avril 2012 par Business Wire

STAMFORD, Conn.--(BUSINESS WIRE)--Crane Co. (NYSE: CR), a diversified manufacturer of highly engineered industrial products, reported that first quarter 2012 earnings per diluted share increased 8% to $0.88 compared to $0.81 in the first quarter of 2011. First quarter 2011 results include a gain of $4.3 million, or $0.05 per share, related to the sale of a building and the divestiture of a small product line.

“Record first quarter earnings were driven by our Aerospace & Electronics and Fluid Handling segments, which are benefiting from their exposure to late cycle end markets”

First quarter 2012 sales of $658 million increased $47 million, or 8%, compared to the first quarter of 2011, resulting from a core sales increase of $48 million (8%), an increase in sales from acquisitions, net of divestitures, of $4 million (1%), and unfavorable foreign currency translation of $5 million (-1%).

First quarter 2012 operating profit increased 9% to $79.6 million, compared to $72.9 million in the first quarter of 2011, and operating profit margin increased to 12.1%, compared to 11.9% in the first quarter of 2011.

“Record first quarter earnings were driven by our Aerospace & Electronics and Fluid Handling segments, which are benefiting from their exposure to late cycle end markets,” said Crane Co. president and chief executive officer Eric C. Fast. “We have started off 2012 with robust demand in our later, longer cycle businesses, including strong orders and a growing backlog. We are on track to deliver full year EPS in line with our $3.75-$3.95 guidance and free cash flow in the range of $160-$190 million.”

Cash Flow and Financial Position

Cash used for operating activities in the first quarter of 2012 was $42.8 million, compared to cash used for operating activities of $16.2 million in the first quarter of 2011, reflecting an increase in working capital. The Company’s cash position at March 31, 2012 was $196 million, as compared to $245 million at December 31, 2011.

Segment Results

All comparisons detailed in this section refer to the first quarter 2012 versus the first quarter 2011.

Aerospace & Electronics
				First Quarter								Change
(dollars in millions)				2012				2011
Sales				$175.2				$161.9				$13.2				8%
Operating Profit				$38.1				$34.0				$4.0				12%
Profit Margin				21.7%				21.0%

First quarter 2012 sales increased $13.2 million, or 8%, reflecting a $10.2 million (10%) improvement in Aerospace Group sales and an increase of $3.0 million (5%) in Electronics Group revenue. The Aerospace Group sales increase reflected higher OEM and aftermarket shipments for both commercial and military applications, while Electronics Group sales growth was primarily driven by strength in Power Solutions. Segment operating profit of $38.1 million increased by $4.0 million, or 12%, reflecting strong sales growth and margin improvement in Aerospace.

Aerospace & Electronics order backlog was $438 million at March 31, 2012, as compared to $411 million at December 31, 2011 and $455 million at March 31, 2011.

Engineered Materials
				First Quarter								Change
(dollars in millions)				2012				2011
Sales				$58.2				$61.8				($3.7)				(6%)
Operating Profit				$8.4				$10.1				($1.7)				(17%)
Profit Margin				14.5%				16.4%

Segment sales of $58.2 million declined 6% compared to the first quarter of 2011, as a result of lower demand from transportation and recreational vehicle customers, slightly offset by a modest increase in building products sales. Operating profit decreased 17% primarily reflecting the lower sales.

Merchandising Systems

				First Quarter								Change
(dollars in millions)				2012				2011
Sales				$87.7				$94.9				($7.2)				(8%)
Operating Profit				$4.7				$4.7				-				1%
Profit Margin				5.4%				4.9%

Merchandising Systems sales of $87.7 million decreased $7.2 million, or 8%, reflecting lower sales in Payment Solutions and, to a lesser extent, Vending. Operating profit of $4.7 million in 2012 includes costs incurred to settle a lawsuit. Solid productivity improvements offset the deleverage impact of the lower sales.

Fluid Handling

				First Quarter								Change
(dollars in millions)				2012				2011
Sales				$301.9				$264.1				$37.7				14%
Operating Profit				$39.6				$35.5				$4.2				12%
Profit Margin				13.1%				13.4%

First quarter 2012 sales increased $37.7 million, or 14%, which included a core sales increase of $37.4 million (14%), $4.4 million from the acquisition of WTA (2%), and unfavorable foreign currency translation of $4.1 million (-2%). Sales were broadly higher across Fluid Handling end markets. Orders from ChemPharma and Energy customers strengthened markedly on both a year over year and sequential basis. Operating profit increased to $39.6 million while operating margin declined slightly to 13.1%, reflecting throughput inefficiencies in certain European operations. Backlog increased to $338 million at March 31, 2012, compared to $314 million at December 31, 2011 and $305 million at March 31, 2011.

Controls

				First Quarter								Change
(dollars in millions)				2012				2011
Sales				$35.0				$28.2				$6.8				24%
Operating Profit				$4.7				$3.1				$1.6				51%
Profit Margin				13.4%				11.0%

First quarter 2012 sales of $35.0 million increased 24%, primarily reflecting improvement in industrial, transportation and upstream oil and gas related demand. Operating profit increased 51%, reflecting leverage of the higher sales volume.

Full Year 2012 Guidance

As detailed at our February Investor Day Conference, sales for 2012 are expected to increase approximately 3-5% driven by a core sales increase of 5-6%, incremental sales from the WTA acquisition of less than 1%, partially offset by unfavorable foreign exchange of approximately 2%. 2012 earnings guidance is a range of $3.75 - $3.95 per diluted share, reflecting revenue and profit growth across all segments. The Company’s 2012 free cash flow (cash provided by operating activities less capital spending) guidance of $160 - $190 million includes the effect of asbestos related cash flows.

Additional Information

Please see the condensed financial statements and the Non-GAAP Financial Measures table attached to this press release for supporting details. Additional information with respect to the Company’s asbestos liability and related accounting provisions and cash requirements is set forth in the Current Report on Form 8-K filed with a copy of this press release.

Conference Call

Crane Co. has scheduled a conference call to discuss the first quarter financial results on Tuesday, April 24, 2012 at 10:00 A.M. (Eastern). All interested parties may listen to a live webcast of the call at http://www.craneco.com. An archived webcast will also be available to replay this conference call directly from the Company’s website.

Crane Co. is a diversified manufacturer of highly engineered industrial products. Founded in 1855, Crane provides products and solutions to customers in the aerospace, electronics, hydrocarbon processing, petrochemical, chemical, power generation, automated merchandising, transportation and other markets. The Company has five business segments: Aerospace & Electronics, Engineered Materials, Merchandising Systems, Fluid Handling, and Controls. Crane has approximately 11,000 employees in North America, South America, Europe, Asia and Australia. Crane Co. is traded on the New York Stock Exchange (NYSE:CR). For more information, visit www.craneco.com.

This press release may contain forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. These statements present management’s expectations, beliefs, plans and objectives regarding future financial performance, and assumptions or judgments concerning such performance. Any discussions contained in this press release, except to the extent that they contain historical facts, are forward-looking and accordingly involve estimates, assumptions, judgments and uncertainties. There are a number of factors that could cause actual results or outcomes to differ materially from those addressed in the forward-looking statements. Such factors are detailed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2011 and subsequent reports filed with the Securities and Exchange Commission.

CRANE CO.
Income Statement Data
(in thousands, except per share data)
		Three Months Ended
		March 31,
			2012				2011
Net Sales:
Aerospace & Electronics		$	175,168			$	161,936
Engineered Materials			58,159				61,832
Merchandising Systems			87,675				94,878
Fluid Handling			301,886				264,142
Controls			34,991				28,232
Total Net Sales		$	657,879			$	611,020
Operating Profit (Loss):
Aerospace & Electronics		$	38,069			$	34,042
Engineered Materials			8,409				10,143
Merchandising Systems			4,713				4,673
Fluid Handling			39,640				35,453
Controls			4,701				3,111
Corporate			(15,972	)			(14,562	)
Total Operating Profit			79,560				72,860
Interest Income			395				290
Interest Expense			(6,711	)			(6,622	)
Miscellaneous- Net			(347	)			3,625		*
Income Before Income Taxes			72,897				70,153
Provision for Income Taxes			21,101				21,775
Net income before allocations to noncontrolling interests			51,796				48,378
Less: Noncontrolling interest in subsidiaries' gains (losses)			134				(89	)
Net income attributable to common shareholders		$	51,662			$	48,467
Share Data:
Earnings per Diluted Share		$	0.88			$	0.81
Average Diluted Shares Outstanding			58,880				59,552
Average Basic Shares Outstanding			57,889				58,330
Supplemental Data:
Cost of Sales		$	437,471			$	397,850
Selling, General & Administrative			140,848				140,310
Depreciation and Amortization **			14,674				15,774
Stock-Based Compensation Expense			4,007				3,503

* Primarily related to the sale of a building and the divestiture of a small product line in the three months ended March 31, 2011.

** Amount included within cost of sales and selling, general & administrative costs.

CRANE CO.
Condensed Balance Sheets
(in thousands)
			March 31,			December 31,
			2012			2011
ASSETS
Current Assets
Cash and Cash Equivalents		$	195,860		$	245,089
Accounts Receivable, net			404,418			349,250
Current Insurance Receivable - Asbestos			16,345			16,345
Inventories, net			368,495			360,689
Other Current Assets			64,092			60,859
Total Current Assets			1,049,210			1,032,232
Property, Plant and Equipment, net			284,289			284,146
Long-Term Insurance Receivable - Asbestos			204,929			208,952
Other Assets			485,268			497,377
Goodwill			826,717			820,824
Total Assets		$	2,850,413		$	2,843,531
LIABILITIES AND EQUITY
Current Liabilities
Notes Payable and Current Maturities of Long-Term Debt		$	794		$	1,112
Accounts Payable			184,319			194,158
Current Asbestos Liability			100,943			100,943
Accrued Liabilities			187,006			226,717
Income Taxes			14,745			10,165
Total Current Liabilities			487,807			533,095
Long-Term Debt			398,958			398,914
Long-Term Deferred Tax Liability			42,664			41,668
Long-Term Asbestos Liability			770,443			792,701
Other Liabilities			254,685			255,097
Total Equity			895,856			822,056
Total Liabilities and Equity		$	2,850,413		$	2,843,531

CRANE CO.
Condensed Statements of Cash Flows
(in thousands)
		Three Months Ended
		March 31,
		2012				2011
Operating Activities:
Net income attributable to common shareholders		$	51,662			$	48,467
Noncontrolling interest in subsidiaries' gains (losses)			134				(89	)
Net income before allocations to noncontrolling interests			51,796				48,378
Gain on divestiture			-				(4,258	)
Depreciation and amortization			14,674				15,774
Stock-based compensation expense			4,007				3,503
Defined benefit plans and postretirement expense			4,991