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Actionable news in SNA: SNAP-ON INCORPORATED,

Snap-On Announces Third Quarter 2015 Results

The following excerpt is from the company's SEC filing.

Organic sales up 7.3%;

Operating earnings before financial services of 17.5% of sales improves 130 basis points;

Diluted EPS of $1.98 increases 12.5%

KENOSHA, Wis.--(BUSINESS WIRE)--October 22, 2015--Snap-on Incorporated (NYSE: SNA), a leading global innovator, manufacturer and marketer of tools, equipment, diagnostics, repair information and systems solutions for professional users performing critical tasks, today announced operating results for the third quarter of 2015.

Sales of $821.5 million increased $15.2 millio n, or 1.9%, from 2014 levels; excluding $42.6 million of unfavorable foreign currency translation and $2.1 million of acquisition-related sales, organic sales increased $55.7 million or 7.3%.

Operating earnings before financial services of $143.6 million improved 130 basis points to 17.5% of sales as compared to $130.6 million, or 16.2% of sales, last year.

Financial services operating earnings of $43.5 million increased $5.8 million, or 15.4%, from 2014 levels; financial services revenue of $61.1 million increased 14.0% from 2014 levels.

Consolidated operating earnings of $187.1 million improved to 21.2% of revenues (net sales plus financial services revenue) as compared to $168.3 million, or 19.6% of revenues, last year.

The third quarter effective income tax rate was 31.6% in 2015 and 31.8% in 2014.

Net earnings of $116.8 million, or $1.98 per diluted share, compared to net earnings of $103.7 million, or $1.76 per diluted share, a year ago.

“We believe our third quarter results continue to confirm Snap-on’s capabilities in serving serious professionals performing critical tasks in workplaces of consequence around the world,” said Nick Pinchuk, Snap-on chairman and chief executive officer. “These results, which include 7.3% organic sales growth and a 12.5% increase in diluted earnings per share, demonstrate continued progress along our defined runways for coherent growth while overcoming headwinds in certain end markets and geographies. The 130 basis point improvement in operating margin before financial services also reflects contributions from our Snap-on Value Creation Processes, which drive ongoing improvements in safety, quality, customer connection, innovation and rapid continuous improvement. As further evidence of our success in connecting with customers and translating that insight into winning innovation, new products again aided our growth in the quarter and we were honored to have several of them recognized by both

MOTOR Magazine

Professional Tool & Equipment News

with multiple awards. Finally, these results and achievements reflect significant effort and dedication across the organization and I thank our franchisees and associates worldwide for their extraordinary contributions and commitment.”

Segment Results

Commercial & Industrial Group

segment sales of $288.5 million in the quarter decreased $10.3 million, or 3.4%, from 2014 levels. Excluding $19.8 million of unfavorable foreign currency translation, organic sales increased $9.5 million, or 3.4%, as sales gains in the segment’s European-based hand tools business and its Asia/Pacific and power tools operations, were partially offset by lower sales to the military and to customers in the oil and gas sector.

Operating earnings of $41.3 million in the period, including $2.9 million of unfavorable foreign currency effects, increased $0.5 million from 2014 levels, and the operating margin (operating earnings as a percentage of segment sales) of 14.3% improved 60 basis points from 13.7% a year ago.

Snap-on Tools Group

segment sales of $380.6 million in the quarter rose $25.6 million, or 7.2%, from 2014 levels. Excluding $12.1 million of unfavorable foreign currency translation, organic sales increased $37.7 million, or 11.0%, reflecting similar sales increases in both the company’s U.S. and international franchise operations.

Operating earnings of $56.3 million in the period, including $6.8 million of unfavorable foreign currency effects, increased $6.8 million from 2014 levels, and the operating margin of 14.8% improved 90 basis points from 13.9% a year ago.

Repair Systems & Information Group

segment sales of $282.9 million in the quarter increased $11.7 million, or 4.3%, from 2014 levels. Excluding $11.7 million of unfavorable foreign currency translation and $2.1 million of acquisition-related sales, organic sales increased $21.3 million, or 8.2%, reflecting increased sales to OEM dealerships, higher sales of undercar equipment, and gains in sales of diagnostic and repair information products to independent repair shop owners and managers.

Operating earnings of $69.7 million in the period, including $2.2 million of unfavorable foreign currency effects, increased $6.4 million from 2014 levels, and the operating margin of 24.6% improved 130 basis points from 23.3% a year ago.

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