Parker Reports Fiscal 2017 Third Quarter Results
Parker Hannifin Corporation (NYSE:PH), the global leader in motion and control technologies, reported results for the fiscal 2017 third quarter ended March 31, 2017. Fiscal 2017 third quarter sales increased 10 percent to $3.12 billion compared with $2.83 billion in the prior year quarter.
Net income increased 28 percent to $238.8 million compared with $187.1 million in the prior year quarter. Fiscal 2017 third quarter earnings per share increased 28 percent to $1.75, compared with $1.37 in the fiscal 2016 third quarter. Earnings per share were $2.11, when adjusted for business realignment and acquisition related expenses, compared with $1.51 in the prior year quarter, which was adjusted for business realignment expenses. Cash flow from operations for the first nine months of fiscal 2017 was $789.3 million or 9.2 percent of sales, compared with $704.6 million or 8.4 percent of sales in the prior year period. Excluding discretionary pension contributions, year-to-date cash flow from operations was 11.8 percent of sales compared with 10.8 percent of sales in the prior year period.
"Accelerated sales growth combined with the benefits of ongoing execution of our Win StrategyTM initiatives, contributed to another strong quarter for Parker across many measures," said Chairman and Chief Executive Officer, Tom Williams. "While sales growth included the CLARCOR acquisition, we were particularly pleased that organic sales increased 6 percent. We drove meaningful year-over-year adjusted segment operating margin improvement of 140 basis points with total segment operating margins reaching 16.1 percent. With the completion of the CLARCOR acquisition, we are well underway with the integration of our two great filtration businesses designed to achieve significant synergies. We were also pleased at Parker s ability to be a consistent generator of cash with strong year-to-date operating cash flow performance."
Diversified Industrial Segment: North American third quarter sales increased 13 percent to $1.4 billion, and operating income increased 12 percent to $227.4 million compared with $202.2 million in the same period a year ago. International third quarter sales increased 11 percent to $1.1 billion, and operating income increased 45 percent to $153.0 million compared with $105.2 million in the same period a year ago.
Aerospace Systems Segment: Third quarter sales increased 3 percent to $577.0 million, and operating income decreased 5 percent to $80.0 million compared with $84.2 million in the same period a year ago.
Parker reported the following orders for the quarter ending March 31, 2017, compared with the same quarter a year ago:
- Orders increased 8 percent for total Parker;
- Orders increased 9 percent in the Diversified Industrial North America businesses;
- Orders increased 13 percent in the Diversified Industrial International businesses; and
- Orders were flat in the Aerospace Systems Segment on a rolling 12-month average basis
For the fiscal year ending June 30, 2017, the company has increased guidance for earnings from continuing operations to the range of $6.90 to $7.20 per share, or $7.70 to $8.00 per share on an adjusted basis. Fiscal year 2017 guidance is adjusted for expected business realignment expenses of approximately $0.25 per share and acquisition related expenses of approximately $0.55 per share. Full fiscal year 2017 earnings guidance has been updated to include acquisitions.
Williams added, "Our results reflect the hard work of Parker team members in executing the Win Strategy as we continue with actions targeted at achieving top quartile financial performance among our peer companies. In addition, we see broad based improvements in many end markets and regions, which is reflected in our strong order growth in the third quarter."
Source: Parker Hannifin Corp