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Crane Co. Reports Operating Results (10-Q)

November 05, 2012 | About:
10qk

10qk

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Crane Co. (CR) filed Quarterly Report for the period ended 2012-09-30.

Crane Company has a market cap of $2.4 billion; its shares were traded at around $42.33 with a P/E ratio of 11.3 and P/S ratio of 0.9. The dividend yield of Crane Company stocks is 2.7%.

Highlight of Business Operations:

Year to date 2012 sales increased $68.7 million, or 3.7%, over the same period in 2011. Year to date 2012 core business sales increased approximately $95.1 million, or 5.1%. Year to date 2012 sales increased $11.7 million, or 0.6%, due to the impact of acquisitions. The impact of currency translation decreased reported sales by approximately $38.1 million, or 2.0%, as the U.S. dollar strengthened against other major currencies in the first nine months of 2012 compared to the same period in 2011. Net sales related to operations outside the U.S. for the nine month periods ended September 30, 2012 and 2011 were 41.1% and 41.6% of total net sales, respectively.

Year to date Aerospace Group sales of $325.9 million increased $16.9 million, or 5.5%, from $309.0 million in the prior year period. The increase was largely attributable to higher OEM product sales of 7.2% and higher aftermarket product sales of 3.1%. The OEM sales increase reflects higher commercial product sales associated with business jet and large aircraft manufacturers. The aftermarket sales increase reflects modernization and upgrade and repair and overhaul product sales. During the nine months of 2012, sales to OEMs and sales to aftermarket customers were 59.3% and 40.7%, respectively, of total sales, compared to 58.3% and 41.7%, respectively, in the same period last year. Operating profit increased by $12.4 million in the first nine months of 2012, compared to the same period in the prior year primarily due to lower engineering expense and the leverage on the higher sales volume.

Year to date 2012 sales decreased $5.4 million, or 3.1%, reflecting lower sales to transportation-related and international customers and, to a lesser extent, building product customers, partially offset by higher sales to RV manufacturers. Sales to our transportation-related customers decreased by 19.0%, sales to our international customers decreased 24.1%, sales to our building products customers decreased 0.7% and sales to RV manufacturers increased 6.3%. Operating profit in the first nine months of 2012 decreased $4.0 million, or 15.9%, primarily as a result of lower sales and restructuring and related charges of $2.2 million recorded in the nine months ended September 30, 2012 ($0.9 million was related to the write-down of inventory resulting from the closure of a product line which is included in cost of sales).

Year to date 2012 sales decreased $10.0 million, or 3.5%, including unfavorable foreign currency translation of $6.5 million, or 2.3%, and to a lesser extent a decline in core sales of $3.5 million, or 1.2%. Sales were lower in both our Payment Solutions and Vending Solutions businesses. Segment operating profit for the first nine months of 2012 increased $0.7 million, or 3.1%, over the same period in 2011, reflecting solid productivity gains and the absence of a non-recurring purchase accounting charge associated with our Money Controls acquisition in 2011 which offset the impact of lower sales, restructuring and related charges recorded in the second quarter of 2012, and the costs to settle a lawsuit in the first quarter of 2012.

Year to date 2012 sales increased $57.7 million, or 6.8%, including an increase in core sales of $75.4 million, or 8.9%, and a sales increase resulting from the acquisition of WTA of $11.8 million, or 1.4%, offset by unfavorable foreign currency exchange of $29.5 million, or 3.5%. The core sales performance primarily reflected sales growth in our later, long cycle Energy and ChemPharma businesses due to strong demand in the North America chemical industry as well as higher sales in our Crane Supply business resulting from increases in commercial construction and mining activity in Canada. Operating profit in the first nine months of 2012 decreased $2.6 million, or 2.3%, reflecting restructuring and related charges of $11.6 million in the first nine months of 2012, throughput inefficiencies and higher manufacturing costs in certain European manufacturing operations, partially offset by higher sales.

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