Crane co. reports second quarter results
Stamford, conn.--(business wire)--crane co. (nyse: cr), a diversified manufacturer of highly engineered industrial products, reported second quarter 2017 earnings of $1.14 per diluted share, compared to $1.15 per share in the second quarter of 2016. excluding special items, second quarter 2017 earnings per diluted share were $1.17, compared to $1.21 per share in the second quarter of 2016. (please see the attached non-gaap financial measures tables.) second quarter 2017 sales were $703 million, down -1% compared to $712 million in 2016. core sales increased slightly and acquisitions contributed $6 million, which were more than offset by a $14 million, or -2%, impact from unfavorable foreign exchange, and a small divestiture impact. operating profit in the second quarter was $109 million, up 6% compared to $103 million in the second quarter of 2016. excluding special items, operating profit was $112 million in the second quarter of 2017, up 4% compared to the second quarter of 2016. (please see the attached non-gaap financial measures tables.) the effective tax rate in the second quarter was 30.5% compared to 27.0% last year. excluding special items, the effective tax rate in the second quarter of 2017 was 30.4%, up from 27.4% last year. (please see the attached non-gaap financial measures tables.) during the second quarter, crane completed two acquisitions: the previously announced westlock controls transaction, and the acquisition of microtronic ag (microtronic). microtronic was acquired for cash consideration of approximately $18 million. with operations in oensingen, switzerland, microtronic develops and manufactures electronic payment systems, primarily for the european vending market, strengthening crane payment innovations’ portfolio of cashless solutions. max mitchell, crane co. president and chief executive officer, stated: "we reported another quarter of strong operating results, and achieved record-high operating margins. end market demand remains in line with our expectations, and we are continuing to drive margin improvement with productivity and solid execution. we were also very pleased to deploy $58 million of capital on two acquisitions in the quarter: westlock controls in fluid handling, and microtronic in payment & merchandising technologies. we are also re-affirming our adjusted eps guidance of $4.35-$4.55." segment results all comparisons detailed in this section refer to operating results for the second quarter 2017 versus the second quarter 2016. fluid handling sales decreased $2 million, driven by $8 million, or -3%, of unfavorable foreign exchange, partially offset by a $6 million contribution from an acquisition; core sales were approximately flat. operating margin declined to 12.0%, compared to 13.3% last year, primarily reflecting acquisition related expenses and unfavorable mix, partially offset by productivity. excluding special items, operating margin was 12.8% in the quarter. fluid handling order backlog was $259 million at june 30, 2017 compared to $228 million at december 31, 2016, and $246 million at june 30, 2016. payment & merchandising technologies sales increased $6 million, or 3%, driven by $14 million, or 7%, of core growth, partially offset by a $6 million, or -3%, impact from unfavorable foreign exchange and a $2 million, or -1%, net acquisition/divestiture impact. operating margin expanded 350 basis points to 21.4%, driven primarily by the higher core sales and productivity, partially offset by unfavorable mix. excluding special items, operating margin rose 390 basis points to 21.8% in the quarter. aerospace & electronics sales decreased $18 million, or 10%, primarily as a result of unfavorable comparisons related to shipments for a large military program in the second quarter of 2016. operating margins increased 180 basis points to 22.2% driven by productivity and improved mix, partially offset by the lower volumes. aerospace & electronics order backlog was $328 million at june 30, 2017, compared to $353 million at december 31, 2016, and $436 million at june 30, 2016. engineered materials sales increased $5 million, or 8%, driven primarily by higher sales to the recreational vehicle market. operating margin decreased 190 basis points to 19.1%, as the higher volumes and productivity were more than offset by higher material costs, unfavorable mix, and competitive pricing. reaffirming 2017 guidance excluding special items gaap earnings for full-year 2017 are expected to be in a range of $4.31-$4.51 per diluted share, now including $0.04 per diluted share of acquisition related special items. (please see the attached non-gaap financial measures tables.) excluding special items, we continue to expect earnings of $4.35-$4.55 per diluted share. additional information additional information with respect to the company’s asbestos liability and related accounting provisions and cash requirements is set forth in the current report on form 8-k filed with a copy of this press release. conference call crane co. has scheduled a conference call to discuss the second quarter financial results on tuesday, july 25, 2017 at 10:00 a.m. (eastern). all interested parties may listen to a live webcast of the call at http://www.craneco.com. an archived webcast will also be available to replay this conference call directly from the company’s website. slides that accompany the conference call will be available on the company’s website. crane co. is a diversified manufacturer of highly engineered industrial products. founded in 1855, crane provides products and solutions to customers in the hydrocarbon processing, petrochemical, chemical, power generation, unattended payment, automated merchandising, aerospace, electronics, transportation and other markets. the company has four business segments: fluid handling, payment & merchandising technologies, aerospace & electronics and engineered materials. crane has approximately 11,000 employees in the americas, europe, the middle east, asia and australia. crane co. is traded on the new york stock exchange (nyse:cr). for more information, visit www.craneco.com. this press release may contain forward-looking statements as defined by the private securities litigation reform act of 1995. these statements present management’s expectations, beliefs, plans and objectives regarding future financial performance, and assumptions or judgments concerning such performance. any discussions contained in this press release, except to the extent that they contain historical facts, are forward-looking and accordingly involve estimates, assumptions, judgments and uncertainties. there are a number of factors that could cause actual results or outcomes to differ materially from those addressed in the forward-looking statements. such factors are detailed in the company’s annual report on form 10-k for the fiscal year ended december 31, 2016 and subsequent reports filed with the securities and exchange commission. (cr-e) (financial tables follow) three months ended six months ended june 30, june 30, supplemental data: * includes a $5 million legal settlement charge. ** amount included within cost of sales and selling, general & administrative costs. proceeds from issuance of commercial paper ** includes $0.5 million of backlog pertaining to the microtronic business acquired in june 2017. income items three monthsended six monthsended percentchange percentchange special items impacting operating profit: special items impacting net income attributable to common shareholders: special items impacting provision for income taxes segment information: payment &merchandisingtechnologies $263.8 $198.2 $171.1 $69.4 $702.5 payment &merchandisingtechnologies $265.9 $192.6 $189.2 $64.5 $712.2 three monthsended six monthsended 25.2
