Company also raises guidance for remainder of fiscal 2011
Kennametal Inc. today reported record third quarter fiscal sales of $615 million, a 25 percent increase compared to the same quarter last year.
Carlos Cardoso, Kennametal's Chairman, President and Chief Executive Officer said, "March quarter results continue to demonstrate that our global team is successfully executing our established strategies. We realized organic sales growth of 25 percent year-over-year, despite strong comparisons from the prior year. This growth reflected higher customer demand in both our served end markets as well as geographic regions. Even at a sales level that is lower than prior peak, we achieved a record operating margin for the March quarter. In addition, we again increased our guidance for sales and earnings per share for the current fiscal year. We continue to outperform the forecasted industrial production rate and expect to maintain our strong operating leverage."
Cardoso added, "Our long-term strategies remain consistent -- we continue to balance our served end markets, business mix and geographic presence. Kennametal is a 'Breakaway' company that has demonstrated its ability to be profitable throughout the economic cycle."
Here is a breakout of Kennametal’s segments for the quarter:
.
• Industrial segment sales of $392 million grew 28 percent from $306 million in the prior year quarter, driven by organic growth of 29 percent and a 1 percent favorable foreign currency impact, partially offset by an unfavorable impact due to fewer business days. On an organic basis, sales increased in all served market sectors led by strong growth in general engineering and transportation sales of 34 percent and 29 percent, respectively. On a regional basis, sales increased by approximately 32 percent in Asia, 29 percent in Europe and 23 percent in the Americas.
• Industrial segment operating income was $54 million compared with $11 million for the same quarter of the prior year. Absent restructuring and related charges recorded in both periods, Industrial operating income was $56 million compared with $26 million in the prior year quarter. The primary drivers of the increase in operating income were higher sales volume and price realization, improved capacity utilization and incremental restructuring benefits. These benefits were partially offset by higher raw material costs and the restoration of temporary cost reductions. Industrial adjusted operating margin increased to 14.3 percent from 8.6 percent in the prior year.
• Infrastructure segment sales of $223 million increased 19 percent from $187 million in the prior year quarter due to organic growth. The organic increase was driven by higher sales in the energy and earthworks markets of 21 percent and 17 percent, respectively. On a regional basis, organic sales increased by approximately 20 percent in the Americas, 15 percent in Asia and 11 percent in Europe.
• Infrastructure segment operating income was $36 million, compared with $19 million in the same quarter of the prior year. Absent restructuring and related charges recorded in both periods, Infrastructure operating income was $37 million in the current quarter compared with $26 million in the prior year quarter. Operating income improved primarily due to higher sales volume and price realization, increased capacity utilization and incremental restructuring benefits, partially offset by higher raw material costs and the restoration of temporary cost reductions. Infrastructure adjusted operating margin increased from the prior year quarter to 16.5 percent from 13.8 percent.
Kennametal executives in a press release said global economic conditions and worldwide industrial production continues to remain positive. As such, Kennametal expects its fiscal 2011 organic sales growth to be 24 percent to 25 percent. This is in line with our goal of growing at least two times the rate of increase in global industrial production.
The company expects EPS for fiscal 2011 to be in the range of $2.75 to $2.85 per share, excluding charges related to previously announced restructuring programs, increased from the previous range of $2.50 to $2.65 per share, excluding charges related to restructuring.
Kennametal also announced that its Board of Directors declared a regular quarterly cash dividend of $0.12 per share. The dividend is payable May 25, 2011 to shareowners of record as of the close of business on May 10, 2011.
Showing posts with label manufacturing; economy; ISM;. Show all posts
Showing posts with label manufacturing; economy; ISM;. Show all posts
Thursday, April 28, 2011
Monday, November 1, 2010
Manufacturing surged in October
PMI rises 2.5 points; manufacturing sector grows for 15th consecutive month
The Institute for Supply Management’s factory index increased to 56.9 last month, the highest since May, from 54.4, the Tempe, Arizona-based group said today. Readings greater than 50 signal the sector is expanding.
Norbert J. Ore, CPSM, C.P.M., chair of ISM's Manufacturing's Business Survey Committee said the report increases expectations for the quarter.
“The manufacturing sector grew during October, with both new orders and production making significant gains," said Ore. "Since hitting a peak in April, the trend for manufacturing has been toward slower growth. However, this month's report signals a continuation of the recovery that began 15 months ago, and its strength raises expectations for growth in the balance of the quarter. Survey respondents note the recovery in autos, computers and exports as key drivers of this growth. Concerns about inventory growth are lessened by the improvement in new orders during October. With 14 of 18 industries reporting growth in October, manufacturing continues to outperform the other sectors of the economy."
Meanwhile, other reports showed that manufacturing in China expanded in October at the fastest pace in six months, while U.K. factory growth unexpectedly accelerated as hiring and export orders improved.
The Institute for Supply Management’s factory index increased to 56.9 last month, the highest since May, from 54.4, the Tempe, Arizona-based group said today. Readings greater than 50 signal the sector is expanding.
Norbert J. Ore, CPSM, C.P.M., chair of ISM's Manufacturing's Business Survey Committee said the report increases expectations for the quarter.
“The manufacturing sector grew during October, with both new orders and production making significant gains," said Ore. "Since hitting a peak in April, the trend for manufacturing has been toward slower growth. However, this month's report signals a continuation of the recovery that began 15 months ago, and its strength raises expectations for growth in the balance of the quarter. Survey respondents note the recovery in autos, computers and exports as key drivers of this growth. Concerns about inventory growth are lessened by the improvement in new orders during October. With 14 of 18 industries reporting growth in October, manufacturing continues to outperform the other sectors of the economy."
Meanwhile, other reports showed that manufacturing in China expanded in October at the fastest pace in six months, while U.K. factory growth unexpectedly accelerated as hiring and export orders improved.
Wednesday, September 1, 2010
Manufacturing grew more than expected in August
The factory growth surprises many economists
Manufacturing in the U.S. expanded at a faster pace than many had forecast in August, rising for the 13th consecutive month.
The Institute for Supply Management’s factory index rose to 56.3 from 55.5 in July, the group said today. Readings over 50% in the ISM index indicate that more firms are growing than contracting.
Norbert Ore, head of the ISM's survey committee, said production drove the index higher.
The production index increased in August to 59.9% from 57.0%.
"There is no sign of double-dip in manufacturing right now," Ore said.
Eleven of 18 industries as tracked by ISM grew in August, led by primary metals, apparel, and transportation equipment
ISM’s U.S. new orders index fell to 53.1 from 53.5.
The employment gauge rose to 60.4 from 58.6 in July and the index of export orders fell to 55.5 from 56.5 the prior month.
Most economists had not expected the index to rise to such a degree. Recent regional factory reports showed the manufacturing expansion weakening. The Federal Reserve Bank of Philadelphia’s general economic index contracted this month for the first time in a year, while the New York Fed’s gauge rose less than forecast.
Manufacturing in the U.S. expanded at a faster pace than many had forecast in August, rising for the 13th consecutive month.
The Institute for Supply Management’s factory index rose to 56.3 from 55.5 in July, the group said today. Readings over 50% in the ISM index indicate that more firms are growing than contracting.
Norbert Ore, head of the ISM's survey committee, said production drove the index higher.
The production index increased in August to 59.9% from 57.0%.
"There is no sign of double-dip in manufacturing right now," Ore said.
Eleven of 18 industries as tracked by ISM grew in August, led by primary metals, apparel, and transportation equipment
ISM’s U.S. new orders index fell to 53.1 from 53.5.
The employment gauge rose to 60.4 from 58.6 in July and the index of export orders fell to 55.5 from 56.5 the prior month.
Most economists had not expected the index to rise to such a degree. Recent regional factory reports showed the manufacturing expansion weakening. The Federal Reserve Bank of Philadelphia’s general economic index contracted this month for the first time in a year, while the New York Fed’s gauge rose less than forecast.
Monday, August 2, 2010
Manufacturing growth slows in July
But despite a slower growth rate, economic activity in the nation’s manufacturing sector expands for the 12th straight month
Economic activity in the manufacturing sector expanded in July for the 12th consecutive month while the overall economy grew for the 15th straight month, according to the latest manufacturing Report on Business, released today by the Institute for Supply Management.
Manufacturing growth in July declined 0.7% compared to June, registering a PMI of 55.5%. A reading above 50 indicates growth in the sector.
The report also showed improvement in employment, supply deliveries and inventories, which helped reduce the impact of a month-over-month deceleration in new orders and production, according to Norbert J. Ore, ISM’s Manufacturing Business Survey Committee chairman. New orders fell 5% in July and production fell 4.4%.
ISM’s July report also showed strong demand in 10 of 18 manufacturing industries surveyed: plastics and rubber products; miscellaneous manufacturing; paper products; electrical equipment, appliances and components; transportation equipment; primary metals; textile mills; computer and electronic products; fabricated metal products; and chemical products.
Economic activity in the manufacturing sector expanded in July for the 12th consecutive month while the overall economy grew for the 15th straight month, according to the latest manufacturing Report on Business, released today by the Institute for Supply Management.
Manufacturing growth in July declined 0.7% compared to June, registering a PMI of 55.5%. A reading above 50 indicates growth in the sector.
The report also showed improvement in employment, supply deliveries and inventories, which helped reduce the impact of a month-over-month deceleration in new orders and production, according to Norbert J. Ore, ISM’s Manufacturing Business Survey Committee chairman. New orders fell 5% in July and production fell 4.4%.
ISM’s July report also showed strong demand in 10 of 18 manufacturing industries surveyed: plastics and rubber products; miscellaneous manufacturing; paper products; electrical equipment, appliances and components; transportation equipment; primary metals; textile mills; computer and electronic products; fabricated metal products; and chemical products.
Subscribe to:
Posts (Atom)
