Machinery company Colfax Corporation CFX impressed its investors with better-than-expected results for first-quarter 2016. The company’s adjusted earnings of 30 cents per share surpassed the Zacks Consensus Estimate of 27 cents by 11.1%. However, the bottom line declined 16.7% from the year-ago tally of 36 cents.Colfax Corporation - Earnings Surprise | FindTheBest Talking about Colfax’s top-line performance, net sales decreased 3.8% year over year to $876.8 million. The year-over-year fall was triggered by a 0.3% fall in existing business revenues and 5.9% negative impact from foreign currency translation, partially offset by a 2.4% gain from acquisitions. However, the top line beat the Zacks Consensus Estimate of $825 million by 6.3%.Exiting the quarter, Colfax’s orders were worth $407.6 million, down 8.8% year over year. Backlog at period-end stood at $1,135.3 million.Segmental DetailsColfax reports its net sales under two heads/segments. The segmental results are briefly discussed below:Revenues from the Gas and Fluid Handling segment totaled $432.7 million, up 2.5% year over year. The result was driven by 1.7% gain in the existing businesses and 5.3% benefit from acquisitions, partially offset by 4.5% adverse impact from foreign currency translations.Organically, sales declined in power generation, marine, mining and general industrial & other end-markets by 1.8%, 5.5%, 24.3% and 1.4% respectively.Revenues from the Fabrication Technology segment fell 9.2% year over year to $444.1 million due to 2.5% decline in volumes and 7.3% negative impact from foreign currency translations, partially offset by 0.6% gain from favorable pricing. MarginsIn the quarter, Colfax’s margin profile weakened due mainly to negative impact from lower revenue generation, partially offset by a decline in costs and expenses. Cost of sales decreased 3.3% year over year, representing 68% of net sales compared with 67.7% in the year-ago quarter. Gross margin inched down 30 basis points (bps) year over year to 32%. Selling, general and administrative (SG&A) expenses, as a percentage of revenues, were 24.4% compared with 23.4% recorded in the year-ago quarter.Adjusted operating income declined 18.6% year over year, while margin fell 140 bps to 7.5%. Balance Sheet and Cash FlowExiting first-quarter 2016, Colfax had cash and cash equivalents of $196 million, slightly below $197.5 million in the preceding quarter. Long-term debt increased 2% sequentially to $1,440.3 million.In the quarter, Colfax generated net cash of $15.5 million from its operating activities versus $2.1 million used in the year-ago quarter. Capital spending totaled $15.4 million, increasing 37.9% year over year. Share buybacks totaled $20.8 million.OutlookColfax reaffirmed its financial goals for 2016. Adjusted earnings is anticipated within $1.40−$1.55 per share range while total revenue is predicted in a range of $3.6−$3.75 billion, including approximately $140−$150 million of adverse impact from foreign currency translations.The company expects organic revenues to be down 3.5−6%, including a 5−7% drop in Fabrication Technology, 3−6% in Howden and 0−3% in Colfax Fluid Handling.Adjusted tax rate will likely be 28−30%, while interest expense is projected to be $50 million.Also, management communicated that it is on track to generate roughly $50 million incremental cost savings from its previously initiated cost-reduction programs by the end of 2016. Earlier, the company anticipated $100 million in cost savings in 2016 from its cost base in 2014.With a market capitalization of $3.5 billion, Colfax currently carries a Zacks Rank #2 (Buy). Other stocks worth considering in the machinery industry include Gorman-Rupp Co. GRC, Luxfer Holdings PLC LXFR and Altra Industrial Motion Corp. AIMC. While both Gorman-Rupp and Luxfer Holdings sport a Zacks Rank #1 (Strong Buy), Altra Industrial Motion carries a Zacks Rank #2 (Buy).Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report ALTRA INDUS MOT (AIMC): Free Stock Analysis Report GORMAN RUPP CO (GRC): Free Stock Analysis Report COLFAX CORP (CFX): Free Stock Analysis Report LUXFER HOLDINGS (LXFR): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research