ST. LOUIS, May 6 /PRNewswire/ -- Sales, net earnings and earnings per
share of Emerson Electric Co. (NYSE: EMR) for the second quarter and first six
months of fiscal 1998 were the highest for any second quarter and first half
in the company's history, it was announced today by Charles F. Knight,
chairman and chief executive officer.
The company's net sales for the three months ended March 31, 1998, were
$3,382,455,000, an increase of 9 percent (12 percent at constant currency)
over net sales of $3,103,410,000 for the second quarter a year ago.
The company's net earnings were $307,587,000 for the second quarter of
fiscal 1998, an increase of 10 percent over net earnings of $280,352,000 for
the second quarter of fiscal 1997. Earnings per share for the three months
ended March 31, 1998, were $0.69 per share, an increase of 11 percent over
earnings per share of $0.62 for the same period a year ago.
Emerson's net sales for the six months ended March 31, 1998, were
$6,553,941,000, an increase of 10 percent (14 percent at constant currency)
over net sales of $5,934,052,000 for the same period a year ago.
Emerson's earnings per common share for the first six months of fiscal
1998 were $1.33, an increase of 12 percent over earnings per common share of
$1.19 for the same period a year ago. Net earnings for the first half of
fiscal 1998 were $589,905,000, an increase of 10 percent over net earnings of
$535,278,000 for the first half of fiscal 1997.
In announcing the results, Mr. Knight said, "We are pleased with the
record second-quarter results, our 17th consecutive quarter of reported
double-digit growth in earnings per share. These results reflect strong U.S.
and Latin American growth, solid European performance and the contribution of
acquisitions. Excluding the negative impact of currency, underlying
international subsidiary sales showed solid improvement. Continued weakness
in Asia-Pacific limited our export sales, particularly those of our heating,
ventilating and air-conditioning products. Nonetheless, we are encouraged
that our growth programs are beginning to have some impact. Excluding sales
in Asia-Pacific, the underlying company grew approximately 8 percent in
local currencies.
"The electronics business achieved very strong underlying sales growth,
driven by contributions from all product lines and service offerings. Sales
of the underlying fractional motors and appliance components business also
were strong, benefiting from robust domestic markets and new products.
Excluding the impact of the strengthening dollar, the process business
achieved strong sales growth reflecting very strong domestic demand and solid
international demand. Sales of the industrial motors and drives business were
solid before the effects of unfavorable currency due to strong international
demand and recent acquisitions. Excluding the impact of currency translation,
the industrial components and equipment business achieved moderate underlying
domestic and international sales growth. The tools business achieved modest
underlying sales growth, while the heating, ventilating and air-conditioning
business reported a moderate decrease in sales as weakness in Asia-Pacific
severely limited export sales.
"Consolidated profit margins remained at high levels despite the inclusion
of lower margin acquisitions. Underlying operating margins showed solid
improvement as a result of the company's Best Cost Producer strategy,
reflecting both domestic and international gains. These efforts include
ongoing cost reduction and productivity improvement programs.
"Emerson finished the quarter in a strong financial position, with
approximately 27 percent net debt to net capital. The company's high levels
of profitability and strong cash flow are significant competitive assets that
permit enhanced rates of investment in internal growth, allow us to pursue
strategic acquisitions, and provide funds for the repurchase of shares."
In discussing the prospects for the remainder of fiscal 1998, Mr. Knight
said, "We expect similar demand in the United States, Europe and Latin America
in the second half of the year. We remain optimistic that fiscal 1998 will be
another good year for Emerson."
Statements in this release that are not strictly historical may be
"forward-looking" statements, which involve risks and uncertainties. These
include economic and currency conditions, market demand, pricing, and
competitive and technological factors, among others, which are set forth in
the company's SEC filings.
EMERSON ELECTRIC CO. AND SUBSIDIARIES
CONSOLIDATED OPERATING RESULTS
(DOLLARS IN MILLIONS EXCEPT PER SHARE AMOUNTS)
Quarter Ended March 31, Percent
1998 1997 Increase
Net sales $3,382.4 $3,103.5 9.0%
Earnings before income taxes 480.6 445.7 7.8%
Net earnings 307.6 280.4 9.7%
Basic earnings per common share 0.70 0.63 11.1%
Diluted earnings per common share 0.69 0.62 11.3%
Six Months Ended March 31, Percent
1998 1997 Increase
Net sales $6,553.9 $5,934.1 10.4%
Earnings before income taxes 921.7 851.0 8.3%
Net earnings 589.9 535.3 10.2%
Basic earnings per common share 1.34 1.20 11.7%
Diluted earnings per common share 1.33 1.19 11.8%
EMERSON ELECTRIC CO. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(DOLLARS IN MILLIONS)
March 31,
1998 1997
Assets
Cash and equivalents $ 426.5 $ 284.2
Receivables, net 2,385.9 2,254.6
Inventories 1,877.3 1,824.1
Other current assets 405.6 336.0
Total current assets 5,095.3 4,698.9
Property, plant & equipment, net 2,806.8 2,538.0
Other assets 4,208.5 3,682.6
$12,110.6 $10,919.5
Liabilities and Stockholders' Equity
Short-term borrowings and current maturities
of long-term debt $ 1,921.0 $ 1,308.9
Other current liabilities 2,153.8 1,995.6
Total current liabilities 4,074.8 3,304.5
Long-term debt 601.9 783.8
Other liabilities 1,703.0 1,413.6
Stockholders' equity 5,730.9 5,417.6
$12,110.6 $10,919.5
SOURCE Emerson Electric Co.
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CONTACT:
William K. Anderson, or Carter L. Dunkin for
Emerson Electric Co., 314-982-1700
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