CORPORATE OFFICE 37 North Valley Road, Building 4, P.O. Box 1764, PAOLI, PA 19301-0801
Contact: William J. Burke (610) 889-5249
AMETEK ACHIEVES RECORD SECOND QUARTER RESULTS —Sales Increase 15%, Net Income Increases 25%— —Internal Growth of 7%, Raising Estimates—
Paoli, PA, July 19, 2007 – AMETEK, Inc. (NYSE: AME) today announced second quarter results that established records for sales, operating income, net income and diluted earnings per share.
AMETEK’s second quarter 2007 sales of $519.5 million were up 15% over the same period of 2006. Operating income for the second quarter of 2007 was $96.6 million, a 22% increase from the $79.1 million recorded in the same period of 2006. Net income in the second quarter of 2007 increased 25% to $58.0 million, or $.54 per diluted share, from the second quarter 2006 level of $46.5 million, or $.43 per diluted share.
“AMETEK had an outstanding quarter which exceeded our expectations,” noted Frank S. Hermance, AMETEK Chairman and Chief Executive Officer. “Strong internal growth of 7%, combined with the contributions from acquired businesses enabled us to grow the top-line by 15%. Operating income margin was up 100 basis points and diluted earnings per share were up 26% as we translated the top-line growth into bottom-line performance,” he commented.
For the first half of 2007, AMETEK sales increased 17% to $1.02 billion from $874.5 million in the same period of 2006. Operating income totaled $186.5 million, a 24% increase from $149.9 million earned in the first half of last year. Net income for the first half of 2007 was $108.9 million, up 26% from $86.7 million in the same period of 2006. Diluted earnings per share were $1.02 for the first half of 2007, up 26% from $.81 per diluted share in the first half of 2006.
Electronic Instruments Group (EIG) For the 2007 second quarter, EIG sales increased 15% to $281.7 million. Operating income was $62.2 million, compared with $50.4 million in the second quarter of 2006, an increase of 23%. Operating margins for the quarter improved dramatically to 22.1%, from 20.7% in the second quarter of 2006.
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AMETEK ACHIEVES RECORD SECOND QUARTER RESULTS Page 2
“EIG had a great second quarter. Sales were up on excellent core growth driven by our process and analytical, power and aerospace businesses together with the contribution from the Land Instruments, Precitech, Advanced Industries and B&S Aircraft Parts acquisitions. Operating income was up 23%, benefiting from the top-line growth as well as from operational excellence improvements,” said Mr. Hermance.
Electromechanical Group (EMG) For the second quarter of 2007, EMG sales were $237.8 million, a 15% increase over the same period of 2006. Operating income of $43.7 million was up 19% from the $36.8 million recorded in the same period of 2006. Operating margins for the quarter were 18.4%, up from 17.8% in the second quarter of 2006.
“EMG also had a great second quarter. Sales were up on solid core growth and the contributions from the acquisitions of PennEngineering Motion Technologies, Southern Aeroparts, Seacon Phoenix and Hamilton Precision Metals. Profitability was up nicely as a result of the increased volume and our operational excellence initiatives,” commented Mr. Hermance.
2007 Outlook “Given current market conditions and our strong second quarter results, we are raising our earnings estimate for the year to approximately $2.01 to $2.05 per diluted share, an increase of 18% to 20% over the 2006 level of $1.71 per diluted share. Revenue is estimated to increase in the mid teens on a percentage basis over 2006,” commented Mr. Hermance.
“Our third quarter 2007 sales are expected to be up approximately 10% from last year’s third quarter. We expect third quarter earnings to be approximately $.50 to $.51 per diluted share, an increase of 11% to 13% over last year’s third quarter level of $.45 per diluted share,” concluded Mr. Hermance.
Conference Call AMETEK, Inc. will Web cast its Second Quarter 2007 investor conference call on Thursday, July 19, 2007, beginning at 8:30 AM ET. The live audio Web cast will be available atwww.ametek.com/investors and atwww.streetevents.com. The call will also be archived atwww.ametek.com/investors.
Corporate Profile AMETEK is a leading global manufacturer of electronic instruments and electromechanical devices with 2006 sales of $1.8 billion. AMETEK’s Corporate Growth Plan is based on Four Key Strategies: Operational Excellence, Strategic Acquisitions & Alliances, Global & Market Expansion and New Products. AMETEK’s objective is double-digit percentage growth in earnings per share over the business cycle and a superior return on total capital. The common stock of AMETEK is a component of the S&P MidCap 400 Index and the Russell 1000 Index.
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Forward-looking Information Statements in this news release relating to future events, such as AMETEK’s expected business and financial performance, are “forward-looking statements”. Forward-looking statements are subject to various factors and uncertainties that may cause actual results to differ significantly from expectations. These factors and uncertainties include our ability to consummate and successfully integrate future acquisitions; risks associated with international sales and operations; our ability to successfully develop new products, open new facilities or transfer product lines; the price and availability of raw materials; compliance with government regulations, including environmental regulations; changes in the competitive environment or the effects of competition in our markets; the ability to maintain adequate liquidity and financing sources; and general economic conditions affecting the industries we serve. A detailed discussion of these and other factors that may affect our future results is contained in AMETEK’s filings with the Securities and Exchange Commission, including its most recent reports on Form 10-K, 10-Q and 8-K. AMETEK disclaims any intention or obligation to update or revise any forward-looking statements.
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AMETEK, Inc. CONSOLIDATED STATEMENT OF INCOME (Unaudited) (In thousands, except per share amounts)
Three months ended
Six months ended
June 30,
June 30,
2007
2006
2007
2006
Net sales
$
519,468
$
450,585
$
1,024,751
$
874,452
Expenses:
Cost of sales, excluding depreciation
350,235
308,308
693,581
601,076
Selling, general and administrative
62,856
53,315
124,907
104,127
Depreciation
9,767
9,863
19,729
19,349
Total expenses
422,858
371,486
838,217
724,552
Operating income
96,610
79,099
186,534
149,900
Other expenses:
Interest expense
(10,998
)
(10,301
)
(21,907
)
(20,389
)
Other, net
(1,537
)
(589
)
(2,104
)
(1,326
)
Income before income taxes
84,075
68,209
162,523
128,185
Provision for income taxes
26,062
21,741
53,610
41,459
Net income
$
58,013
$
46,468
$
108,913
$
86,726
Diluted earnings per share
$
0.54
$
0.43
$
1.02
$
0.81
Basic earnings per share
$
0.55
$
0.44
$
1.03
$
0.83
Average common shares outstanding:
Diluted shares
107,433
106,849
107,157
106,767
Basic shares
105,665
105,128
105,395
104,983
Dividends per share
$
0.06
$
0.04
$
0.12
$
0.08
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AMETEK, INC. INFORMATION BY BUSINESS SEGMENT (Unaudited) (In thousands)
Three months ended
Six months ended
June 30,
June 30,
2007
2006
2007
2006
Net sales
Electronic Instruments
$
281,713
$
244,031
$
564,646
$
480,470
Electromechanical
237,755
206,554
460,105
393,982
Total Consolidated
$
519,468
$
450,585
$
1,024,751
$
874,452
Operating income
Electronic Instruments
$
62,157
$
50,399
$
124,358
$
98,111
Electromechanical
43,711
36,752
81,717
68,704
Total segments
105,868
87,151
206,075
166,815
Corporate and other
(9,258
)
(8,052
)
(19,541
)
(16,915
)
Total Consolidated
$
96,610
$
79,099
$
186,534
$
149,900
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AMETEK, Inc. CONDENSED CONSOLIDATED BALANCE SHEET (In thousands)
June 30,
December 31,
2007
2006
(Unaudited)
ASSETS
Current assets:
Cash, cash equivalents
and marketable securities
$
86,690
$
58,220
Receivables, net
367,322
328,762
Inventories
265,469
236,783
Other current assets
58,073
60,298
Total current assets
777,554
684,063
Property, plant and equipment, net
266,179
258,008
Goodwill
921,686
881,433
Other intangibles, investments and other assets
359,225
307,372
Total assets
$
2,324,644
$
2,130,876
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Short-term borrowings and current
portion of long-term debt
$
184,498
$
163,608
Accounts payable and accruals
346,659
317,292
Total current liabilities
531,157
480,900
Long-term debt
526,057
518,267
Deferred income taxes and
other long-term liabilities
183,155
165,037
Stockholders’ equity
1,084,275
966,672
Total liabilities and stockholders’ equity
$
2,324,644
$
2,130,876
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