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Emerson shared its third quarter 2019 results

International. Emerson disclosed its results for the third quarter ended June 30, 2019. Third-quarter net sales increased 5 percent, with underlying sales up 2 percent excluding unfavorable currencies of 2 percent and a positive impact from acquisitions of 5 percent.

Growth was below management expectations on both trading platforms due to milder conditions in global manufacturing end markets and cooler and wetter weather conditions in North America that adversely affected the air conditioning and construction markets. These factors also weighed on Emerson's three-month underlying order growth, which moderated to 2 percent in June.

Third-quarter gross profit margin of 42.7 percent decreased 90 basis points compared to a year earlier, primarily reflecting dilution from recent acquisitions and an unfavorable mix. The pre-tax margin of 16.4 percent and the EBIT margin of 17.3 percent were down 80 basis points, reflecting the dilution of recent acquisitions. Pre-tax margin increased 160 basis points compared to the second quarter of 2019, as strong operating execution mitigated the impact on earnings of slower-than-expected sales growth. The segment's total margin of 18.1 percent decreased 160 basis points compared to the prior year, and increased 120 basis points compared to the second quarter of 2019, reflecting strong sequential leverage of 65 percent, above management expectations.

GAAP earnings per share were $0.97 in the quarter, down 13 percent from a year earlier, and were $0.94, up 7 percent, excluding a discrete tax benefit of $0.03 this year and a one-time tax benefit from the previous year of $0.24 related to the Cuts and Jobs Act.

- Publicidad -

Third quarter operating cash flow increased 2% to $946 million, and free cash flow increased 3% to $825 million. The conversion of net profit to free cash flow was 135 percent in the quarter.

"Trends remain strong in our global processes and hybrid markets, and we continue to see steady growth in our long-cycle businesses. Discrete global end markets slowed in the third quarter, and our growth in North America was further hampered by moderate upward demand for oil and gas," said President and Chief Executive Officer David N. Farr. colder and wetter weather adversely affected the growth of air conditioning sales and orders in North America; however, we remain optimistic that demand will recover, supported by a strong macroeconomic backdrop and improving weather patterns early in the fourth fiscal quarter. Demand in Asia, which bottomed out in December 2018, continued to improve during the quarter.

Commercial & Residential Solutions
In the Americas, underlying sales increased 1 percent, reflecting the end markets for stable professional tools and the impact of unfavorable weather conditions on air conditioning markets. Europe rose 1 percent, supported by stable demand in professional tool markets, partially offset by softer cold chain demand and demand for commercial air conditioning. The Asia, Middle East and Africa region fell 6 percent. China was down 2 percent in the quarter and continued a trend of steady improvement as underlying sales growth bottomed out in the first quarter, at 30 percent.

Duván Chaverra Agudelo
Duván Chaverra AgudeloEmail: [email protected]
Jefe Editorial de las revistas AVI Latinoamérica, ACR Latinoamérica, Ventas de Seguridad, Zona de Pinturas, Aftermarket Internation, Gerencia de Edificios, TV y Video, y Director Académico en Latin Press, Inc,.
Comunicador Social y Periodista con experiencia de más de 18 años en medios de comunicación. Apasionado por la tecnología y por esta industria.

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