AMETEK 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 THIRD QUARTER RESULTS —Sales Increase 14%, Net Income Increases 21%— — Raising Estimates—
Paoli, PA, October 18, 2007 – AMETEK, Inc. (NYSE: AME) today announced record third quarter results and raised its earnings estimate for the full year 2007.
AMETEK’s third quarter 2007 sales of $528.8 million were up 14% over the same period of 2006. Operating income for the third quarter of 2007 was $96.0 million, a 20% increase from the $79.8 million recorded in the same period of 2006. Net income in the third quarter of 2007 increased 21% to $57.2 million, or $.53 per diluted share, from the third quarter 2006 level of $47.4 million, or $.45 per diluted share.
“AMETEK had another outstanding quarter,” noted Frank S. Hermance, AMETEK Chairman and Chief Executive Officer. “Strong internal growth, combined with the contributions from acquired businesses enabled us to grow the top-line by 14%. Operating income margin was up 100 basis points and diluted earnings per share were up 18% driven by the top-line growth and our operational excellence improvements,” he commented.
For the first nine months of 2007, AMETEK sales increased 16% to $1.55 billion from $1.34 billion in the same period of 2006. Operating income totaled $282.5 million, a 23% increase from $229.7 million earned in the first nine months of last year. Net income for the first nine months of 2007 was $166.2 million, up 24% from $134.1 million in the same period of 2006. Diluted earnings per share were $1.55 for the first nine months of 2007, up 23% from $1.26 per diluted share in the first nine months of 2006.
Electronic Instruments Group (EIG) For the 2007 third quarter, EIG sales increased 14% to $299.0 million. Operating income was $62.9 million, compared with $52.0 million in the third quarter of 2006, an increase of 21%. Operating margins for the quarter improved to 21.0%, from 19.8% in the third quarter of 2006.
“EIG had an excellent third quarter. Sales were up on strong core growth driven by our process and analytical, power and aerospace businesses together with the contribution from the Precitech, Advanced Industries, B&S Aircraft Parts and Cameca acquisitions. Operating margins expanded 120 basis points to 21.0%, driven by strong margin performance in our long-cycle aerospace and power businesses,” said Mr. Hermance.
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AMETEK ACHIEVES RECORD THIRD QUARTER RESULTS Page 2
Electromechanical Group (EMG) For the third quarter of 2007, EMG sales were $229.8 million, a 14% increase over the same period of 2006. Operating income of $43.0 million was up 19% from the $36.2 million recorded in the same period of 2006. Operating margins for the quarter were 18.7%, up from 17.9% in the third quarter of 2006.
“EMG also had a great third quarter. Sales were up on solid core growth in both our differentiated and cost driven businesses and the contributions from the acquisitions of Southern Aeroparts, Seacon Phoenix and Hamilton Precision Metals. Operating margins expanded 80 basis points as a result of the increased volume and our operational excellence initiatives,” commented Mr. Hermance.
2007 Outlook “Given current market conditions and our strong third quarter results, we are raising our earnings estimate for the year from $2.01 to $2.05 previously, to approximately $2.06 to $2.08 per diluted share, an increase of 20% to 22% 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 fourth quarter 2007 sales are expected to be up in the mid teens on a percentage basis from last year’s fourth quarter. We expect fourth quarter earnings to be approximately $.51 to $.53 per diluted share, an increase of 13% to 18% over last year’s fourth quarter level of $.45 per diluted share,” concluded Mr. Hermance.
Conference Call AMETEK, Inc. will Web cast its Third Quarter 2007 investor conference call on Thursday, October 18, 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 annualized sales of more than $2 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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AMETEK ACHIEVES RECORD THIRD QUARTER RESULTS Page 3
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
Nine months ended
September 30,
September 30,
2007
2006
2007
2006
Net sales
$
528,849
$
464,164
$
1,553,600
$
1,338,616
Expenses:
Cost of sales, excluding depreciation
356,682
318,275
1,050,263
919,351
Selling, general and administrative
65,687
56,197
190,594
160,324
Depreciation
10,476
9,862
30,205
29,211
Total expenses
432,845
384,334
1,271,062
1,108,886
Operating income
96,004
79,830
282,538
229,730
Other (expenses) income:
Interest expense
(12,182
)
(11,162
)
(34,089
)
(31,551
)
Other, net
(425
)
17
(2,528
)
(1,309
)
Income before income taxes
83,397
68,685
245,921
196,870
Provision for income taxes
26,153
21,314
79,764
62,773
Net income
$
57,244
$
47,371
$
166,157
$
134,097
Diluted earnings per share
$
0.53
$
0.45
$
1.55
$
1.26
Basic earnings per share
$
0.54
$
0.45
$
1.57
$
1.28
Average common shares outstanding:
Diluted shares
107,764
106,332
107,359
106,622
Basic shares
106,136
104,667
105,642
104,878
Dividends per share
$
0.06
$
0.04
$
0.18
$
0.12
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AMETEK, INC. INFORMATION BY BUSINESS SEGMENT (Unaudited) (In thousands)
Three months ended
Nine months ended
September 30,
September 30,
2007
2006
2007
2006
Net sales
Electronic Instruments
$
299,006
$
262,250
$
863,652
$
742,720
Electromechanical
229,843
201,914
689,948
595,896
Total Consolidated
$
528,849
$
464,164
$
1,553,600
$
1,338,616
Operating income
Electronic Instruments
$
62,870
$
52,000
$
187,228
$
150,111
Electromechanical
43,045
36,239
124,762
104,943
Total segments
105,915
88,239
311,990
255,054
Corporate and other
(9,911
)
(8,409
)
(29,452
)
(25,324
)
Total Consolidated
$
96,004
$
79,830
$
282,538
$
229,730
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AMETEK, Inc. CONDENSED CONSOLIDATED BALANCE SHEET (In thousands)
September 30,
December 31,
2007
2006
(Unaudited)
ASSETS
Current assets:
Cash, cash equivalents
and marketable securities
$
83,442
$
58,220
Receivables, net
377,166
328,762
Inventories
313,267
236,783
Other current assets
64,857
60,298
Total current assets
838,732
684,063
Property, plant and equipment, net
285,437
258,008
Goodwill
992,473
881,433
Other intangibles, investments and other assets
397,508
307,372
Total assets
$
2,514,150
$
2,130,876
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Short-term borrowings and current
portion of long-term debt
$
233,111
$
163,608
Accounts payable and accruals
375,046
317,292
Total current liabilities
608,157
480,900
Long-term debt
547,219
518,267
Deferred income taxes and
other long-term liabilities
204,869
165,037
Stockholders’ equity
1,153,905
966,672
Total liabilities and stockholders’ equity
$
2,514,150
$
2,130,876
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