Most popular Emerson announced fiscal year 2012 an

2022-08-26
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Emerson announced its fiscal year 2012 and fourth quarter results

sales increased by 1% to $24.4 billion, of which basic sales increased by 3%

achieve record gross profit margin and operating profit margin

net income per share was $2.67, reflecting the pre tax non cash goodwill impairment of $592million in telecommunications and information technology related businesses.

standard earnings per share was $3.39, excluding the goodwill impairment charge of $0.72 per share.

Emerson company (NYSE: EMR) in St. Louis, Missouri (November 6, 2012) today announced that its net sales in fiscal year 2012 increased by 1% to $24.4 billion, This is mainly due to the double-digit growth of the process management business for two consecutive years. Basic sales increased by 3%, indicating a significant slowdown in global economic growth over time. Among them, the exchange rate has a negative impact of 2%, while the impact of mergers and acquisitions and divestitures on net asset value can be ignored. Anlimu said that compared with the previous fiscal year, basic sales in the United States increased by 2%, in Asia by 3%, and in Europe by 1%

the gross profit margin reached a record 40.0%, an increase of 50 basis points over the previous fiscal year, indicating that technological innovation, product portfolio management and cost readjustment have brought benefits. As the cost control plan contributed to an increase of 20 basis points over the 2011 fiscal year, the operating profit margin also reached a record high of 17.7% [1]. The continuous downturn in the global telecommunications and information technology terminal market has lowered the growth expectations of the embedded computing and power supply business and DC power supply business, resulting in a non cash goodwill impairment charge of $592million. Net income per share, including this goodwill impairment charge, was $2.67, compared with $3.27 in the previous fiscal year. Excluding goodwill impairment charges, the standard EPS was $3.39, compared with $3.30 in the previous fiscal year

despite the severe global macroeconomic environment, Emerson still achieved solid operating performance in fy2012, said fan Dawei (RR), chairman and CEO of Emerson. The global economy is in a normal recovery cycle, but this stage is extremely weak. Our businesses are still committed to implementing and dealing with uncertain market conditions, which is also the mark of our Emerson culture. The record operating profit margin shows that we are still committed to promoting innovation and operational excellence in the face of many challenges, thus laying a solid foundation for fiscal year 2013

fourth quarter performance

net sales in the fourth quarter increased by 2% year-on-year, of which the exchange rate had a negative impact of 3%, while the impact of mergers and acquisitions and divestitures on net assets was negligible. Basic sales increased by 5%, of which the United States increased by 2%, Asia increased by 8%, while Europe was relatively flat. The process management business led the growth of sales (announced sales increased by 18% and basic sales increased by 21%), which was mainly due to the strong energy related end market and the continuous reversal of inventory backlog caused by floods in Thailand

the gross profit margin in the fourth quarter increased by 140 basis points year-on-year to 41.0%, exceeding 40% for two consecutive quarters. This increased the operating profit margin to 20.4% [2], breaking the record of any previous quarter. Net income per share was $0.39, reflecting the goodwill impairment charges mentioned above, so this value decreased by 61% compared with the same period of the previous fiscal year. The standard earnings per share was $1.11, a year-on-year increase of 7%

although the basic economic demand fell to the lowest level in this fiscal year, our business units still performed well in the fourth quarter, fan Dawei said. The company ended fiscal year 2012 with such a stable profitability, which proved that our global management team was able to cope with excellent work and operation under the severe business environment and limited economic viability

balance sheet/cash flow

operating cash flow in this quarter increased by 4% year-on-year to $1.3 billion, while free cash flow increased by 6% to $1.1 billion. The operating cash flow for the whole year of fiscal year 2012 decreased by 6% year-on-year, which was due to the 16.2% year-end sales trade working capital ratio decreased year-on-year due to the strong year-end sales related higher receivables, but it improved compared with the third quarter. In fy2012, dividends and share repurchases were $1.2 billion and $800million respectively, indicating that the dividend payment rate of operating cash flow to shareholders reached 64%. Fiscal year 2012 became the 56th year that Emerson maintained continuous growth of annual dividends. On Monday, November 5, the board of Directors voted to increase the cash dividend per common share in the first quarter from 40 cents (US $0.4) to 41 cents (US $0.41), indicating an annual rate of US $1.64 per share. The newly generated dividend is expected to be paid on December 10, 2012 to the shareholders who sent the express after November 1, 2012. They can continue to send the express with this old box "recorded on the 6th

returning cash to our shareholders is still the core purpose of Emerson's value creation philosophy, said fan Dawei. Our strong cash generating capacity enables us to adopt a balanced way of capital disposal, so as to create sustainable value through the comprehensive use of dividends, share repurchases, mergers and acquisitions and investment in different ways of growth. The resolution of the board of directors to increase the dividend in the first quarter of fiscal 2013 shows our firm commitment to shareholders, which will continue to be the core belief of our management team

business highlights

the sales of process management business increased by 18% in the fourth quarter, mainly due to the growth of all companies in this business due to the investment in the global energy sector and the reversal of inventory backlog caused by the floods in Thailand. Basic sales increased by 21%, while the exchange rate had a negative impact of 3%, including 16% in the United States, 21% in Asia and 11% in Europe. Excluding the impact of exchange rates, mergers and acquisitions and asset divestitures, basic orders increased by 5% in this quarter, of which the system business led by 20%, but some were offset by the weakness of the European market and adverse comparisons. The business profit margin increased by 200 basis points year-on-year to 24.3%, which is mainly due to the benefits of volume leverage and cost control. The sales stagnation caused by the floods in Thailand continued to rebound as expected, and the impact of supply chain disruption has now been completely eliminated. The double-digit sales and order volume growth in FY2011 and fy2012 for two consecutive years reflects the strong positioning of the process automation industry based on technological innovation and comprehensive solutions. Looking forward to the future, the project activities in the oil and gas, chemical and power terminal markets will continue to be active, which is expected to drive the recent business growth, so that the process management business will usher in another year of excellent performance

the sales of industrial automation business fell by 6% in the fourth quarter, which was due to the negative impact of the exchange rate of 4% and the slowing demand for global means of production, especially in Europe. Basic sales fell by 2%, with the United States and Asia flat, Europe down 5%, while the alternator and industrial motor business suffered the largest decline. The small increase in basic sales of fluid automation, power distribution and mechanical transmission businesses was more offset by the impact of exchange rates. The profit margin of the business increased by 280 basis points year-on-year to 17.5%, which was mainly due to the cost control plan and lower restructuring costs. The recent outlook of the business sees weak end market demand, especially in Europe, which accounts for 40% of the business's sales. The steady profitability of this business focuses on the further benefits brought by a reasonable cost structure when demand picks up, but the recent growth trend of sales is not optimistic

the fourth quarter sales of network energy business decreased by 4%, which is due to the low end market of telecommunications and information technology. Let's take a look at the advantages of the rubber fatigue testing machine of Jinan new era Gold Testing Instrument Co., Ltd. and the mysteries of the operation steps of the equipment. Basic sales fell by 3%, including the negative impact of exchange rate by 2% and the positive impact of mergers and acquisitions by 1%, of which the United States fell by 7%, Asia increased by 5% and Europe fell by 9%. As the implementation of the national broadband network project in Australia to avoid affecting the freezing effect and the steady growth in Latin America offset the general downturn in the data center market, the basic sales of the network energy system business achieved a slight increase, excluding the negative impact of the exchange rate. The market pressure of embedded computing and power supply business still exists, and the double-digit sales decline reflects the continued weakness of demand and the structural challenges of the industry. Due to the continued weakness of the end markets of this business, most of the goodwill impairment charges mentioned above are related to this business. The management and the board of directors have discussed the unique market and technical challenges faced by the embedded computing and power business, and believe that the company will adopt strategic options to maximize shareholder value, including the possible sale of this $1.4 billion business. The business profit margin decreased by 190 basis points year-on-year to 11.6%, which was mainly caused by sales deleveraging and restructuring costs. Thanks to cost control and higher sales of the network energy system business, the business profit margin increased by 130 basis points month on month, creating a good momentum for the operation of the next fiscal year

the fourth quarter sales of environmental optimization technology business decreased by 4%, which is because the global HVAC terminal market presents a complex demand pattern in different businesses and regions, while the overall industry situation tends to be depressed. The basic sales of this business decreased by 3%, including the negative impact of 2% brought by exchange rate and the positive impact of 1% brought by mergers and acquisitions, including a decrease of 4% in the United States, 7% in Asia and 1% in Europe. In the United States, residential, commercial and refrigeration terminal markets have shown a downturn, especially the transportation refrigeration business. Sales in China continued to decline, with weak housing market demand partially offset by strong commercial end markets. As the comparison slows down, the grim situation in the European market has improved, but demand remains weak under pressure. The profit margin of this business increased by 150 basis points year-on-year to 18.5%. Under the situation that the global market conditions are expected to remain volatile and the overall trend towards depression in the near future, the strong technical positioning and cost structure of the business are ready to deal with the difficult global environment

the sales of commercial and residential solutions business remained unchanged this quarter, because the 5% growth of basic sales was offset by the 4% and 1% negative effects of knaack's business divestiture and exchange rate, respectively. Driven by the U.S. commercial and residential markets, commercial storage and food waste disposal businesses have achieved strong growth. The business profit margin increased by 130 basis points year-on-year to 21.9%, mainly due to the cost control plan. In view of the continuous stability and improvement of the residential terminal market in North America recently, this business is actively positioned to achieve excellent yield

outlook for fiscal year 2013

due to the economic uncertainty in the United States, China and Europe, commercial investment has become more cautious recently, and market expectations have deteriorated, so the growth of orders has slowed down. This has led to a more challenging and fragile planning environment. Based on the current market conditions of slowing economic growth, the company announced and expected to achieve unit growth in basic sales in fiscal 2013, ranging from 0 to 5%. Excluding the impairment of goodwill, the EBIT margin is expected to increase by 10 to 20 basis points [3], which will promote the earnings per share to achieve a medium high number of units from $3.39 in fy2012. In addition, the vast majority of sales and revenue growth is expected to be achieved in the first half of the fiscal year, which is largely due to the quarterly impact of the floods in Thailand in fiscal year 2012

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