(Source: Business Wire)
Rockwell Automation, Inc. (NYSE: ROK):
Revenue down 28 percent compared to the fourth quarter of fiscal 2008,
up 6 percent sequentially
Diluted EPS of $0.20; $0.37 excluding restructuring charges
Company provides guidance for fiscal 2010 diluted EPS of $1.25 - $1.75
Rockwell Automation, Inc. (NYSE: ROK) today reported fiscal 2009 fourth
quarter revenue of $1,074.4 million, down 28 percent compared to
$1,484.3 million in the fourth quarter of fiscal 2008. Currency
translation contributed 3 percentage points to the decline. Fiscal 2009
fourth quarter revenue was up 6 percent sequentially compared to the
third quarter of this fiscal year. Fiscal 2009 fourth quarter net income
was $28.9 million or $0.20 per share, compared to $125.6 million or
$0.87 per share in the fourth quarter of fiscal 2008. Excluding
restructuring charges from 2009 and special items from 2008, fiscal 2009
fourth quarter net income was $53.1 million or $0.37 per share, compared
to $156.0 million or $1.08 per share in the fourth quarter of fiscal
2008.
Segment operating earnings were $79.6 million in the fourth quarter of
fiscal 2009, down from $269.1 million in the same period of 2008.
Earnings decreased primarily due to the significant revenue decline and
the inclusion of restructuring charges in segment operating earnings in
2009, partially offset by cost reductions. Segment operating earnings,
excluding restructuring charges of $33.1 million, were $112.7 million in
the fourth quarter of fiscal 2009. Segment operating margin in the
fourth quarter of fiscal 2009 was 7.4 percent compared to 18.1 percent
in the fourth quarter of fiscal 2008. Excluding restructuring charges,
segment operating margin in the fourth quarter of fiscal 2009 was 10.5
percent.
Full Fiscal Year 2009
Sales for the full fiscal year were $4,332.5 million, down 24 percent
compared to $5,697.8 million in fiscal 2008. Foreign currency
translation contributed 5 percentage points to the decline. Income from
continuing operations was $217.9 million or $1.53 per share, compared to
$3.90 per share in fiscal 2008. Segment operating earnings were $429.7
million, down 58 percent compared to $1,025.2 million in 2008. Full
fiscal year 2009 free cash flow from continuing operations was $430.8
million. Return on invested capital was 10.7 percent.
Diluted EPS and net income, both excluding restructuring charges and
special items; segment operating earnings and segment operating margin,
both excluding restructuring charges; free cash flow and return on
invested capital are non-GAAP measures that are defined in the
attachments to this release under "Other Supplemental Information".
Commenting on the results, Keith D. Nosbusch, chairman and chief
executive officer, said, "2009 was clearly a difficult year with
significant year-over-year revenue declines for the full year and the
fourth quarter. However, sequential revenue growth for the quarter
supports our view that macroeconomic conditions and demand trends are
stabilizing.
"I am pleased with our accomplishments during this challenging year. We
took decisive actions throughout the year to right-size the cost
structure to current business conditions, including cost actions in the
fourth quarter that will create additional tailwinds for fiscal 2010.
Excluding the charges associated with these actions, segment margin
improved sequentially for the quarter, reflecting the benefit of our
cost reduction efforts and the earnings leverage we expect as sales
improve.
"We also quickly aligned inventory levels to lower demand, effectively
managed receivables in a difficult credit environment, and appropriately
constrained capital spending, enabling us to generate strong free cash
flow of over $430 million for the year.
"These accomplishments, made possible by the continued commitment of our
employees, have allowed us to navigate this economic storm while
continuing to invest in our core technologies and our most attractive
growth opportunities."
Outlook
Commenting on the outlook for fiscal 2010, Nosbusch said, "Based on
improving macroeconomic indicators and stabilization in our own demand
trends, it appears we have reached the bottom of the cycle. In this
uncertain economic environment, I cannot predict the shape of the
recovery, but I do not expect a sharp upturn. Accordingly, we will
continue our operating discipline, with a focus on cost control and cash
management. Given the timing of the revenue declines in fiscal 2009, we
expect year-over-year revenue to be lower in the first half of fiscal
2010 with growth turning positive in the second half of the year. Based
on a revenue outlook of $4.1 to $4.4 billion, we are providing fiscal
2010 earnings per share guidance of $1.25 to $1.75."
Nosbusch added, "I am encouraged by how we strengthened our competitive
advantage during the downturn. We expect that this, along with our
dedicated employees and partners, strong balance sheet and improved cost
position, will enable us to outperform the eventual market recovery. We
believe we are positioned to deliver a solid 2010 and to grow faster
than the underlying markets with accelerating benefits in 2011 and
beyond. Our ongoing commitment to innovation, technology
differentiation, domain expertise and thought leadership will enable us
to continue to meet our customers' global productivity and
sustainability needs."
Following is a discussion of fourth quarter results for both segments.
Architecture & Software
Architecture & Software fiscal 2009 fourth quarter sales were $424.1
million, a decrease of 31 percent from $617.1 million in the fourth
quarter of fiscal 2008. Currency translation contributed 2 percentage
points to the decline. Fiscal 2009 fourth quarter sales were up 6
percent sequentially compared to $399.5 million in the third quarter of
this fiscal year. Segment operating earnings were $36.9 million in the
fourth quarter of fiscal 2009 compared to $141.6 million in the fourth
quarter of fiscal 2008. Architecture & Software segment operating margin
was 8.7 percent in the fourth quarter of fiscal 2009 compared to 22.9
percent in the same period of 2008. Excluding restructuring charges,
segment operating earnings in the fourth quarter of fiscal 2009 was
$58.4 million and segment operating margin was 13.8 percent.
Control Products & Solutions
Control Products & Solutions fiscal 2009 fourth quarter sales were
$650.3 million, a decrease of 25 percent from $867.2 million in the
fourth quarter of fiscal 2008. Currency translation contributed 3
percentage points to the decline. Fiscal 2009 fourth quarter sales were
up 6 percent sequentially compared to $611.3 million in the third
quarter of this fiscal year. Segment operating earnings were $42.7
million in the fourth quarter of fiscal 2009 compared to $127.5 million
in the fourth quarter of fiscal 2008. Control Products & Solutions
segment operating margin was 6.6 percent in the fourth quarter of fiscal
2009 compared to 14.7 percent in the same period of 2008. Excluding
restructuring charges, segment operating earnings in the fourth quarter
of fiscal 2009 was $54.3 million and segment operating margin was 8.3
percent.
General Corporate -- Net
Fiscal 2009 fourth quarter general corporate net expense was $31.2
million, $6.7 million higher than the fourth quarter of fiscal 2008,
primarily due to funding of the Company's charitable corporation.
General corporate net expense for the full year was $80.3 million
compared to $77.2 million in 2008.
Income Taxes
The effective tax rate for the fourth quarter of fiscal 2009 was
negative 0.3 percent, compared to 28.9 percent for the fourth quarter of
fiscal 2008. The tax rate for the quarter primarily benefited from the
resolution of various tax matters related to prior years. The effective
tax rate for the full year was 20.4 percent compared to 28.6 percent in
2008. In 2010, the Company expects the full year tax rate to be in the
range of 21 to 25 percent, subject to quarterly variability.
Conference Call
A conference call to discuss our financial results will take place at
8:30 A.M. Eastern Time on November 9. The call and related financial
charts will be webcast and accessible via the Rockwell Automation
website (www.rockwellautomation.com).
This news release contains statements (including certain projections
and business trends) that are "forward-looking statements" as defined in
the Private Securities Litigation Reform Act of 1995. Words such
as "believe", "estimate", "project", "plan", "expect", "anticipate",
"will", "intend" and other similar expressions may identify
forward-looking statements. Actual results may differ materially from
those projected as a result of certain risks and uncertainties, many of
which are beyond our control, including but not limited to:
economic changes in global markets where we compete, such as
currency exchange rates, inflation rates, recession, interest rates
and the volatility and disruption of the capital and credit markets
for us, our customers and our suppliers;
laws, regulations and governmental policies affecting our
activities in the countries where we do business;
successful development of advanced technologies and demand for and
market acceptance of new and existing products;
general global and regional economic, business or industry
conditions, including levels of capital spending in industrial markets;
the availability, effectiveness and security of our information
technology systems;
competitive product and pricing pressures;
disruption of our operations due to natural disasters, acts of war,
strikes, terrorism or other causes;
intellectual property infringement claims by others and the ability
to protect our intellectual property;
our ability to successfully address claims by taxing authorities in
the various jurisdictions where we do business;
our ability to attract and retain qualified personnel;
the uncertainties of litigation;
disruption of our distribution channels;
the availability and price of components and materials;
successful execution of our cost productivity, restructuring and
globalization initiatives; and
other risks and uncertainties, including but not limited to those
detailed from time to time in our Securities and Exchange Commission
filings.
These forward-looking statements reflect our beliefs as of the date
of filing this release. We undertake no obligation to update or
revise any forward-looking statement, whether as a result of new
information, future events or otherwise.
Rockwell Automation, Inc. (NYSE: ROK), the world's largest company
dedicated to industrial automation and information, makes its customers
more productive and the world more sustainable. Headquartered in
Milwaukee, Wis., Rockwell Automation employs about 19,000 people serving
customers in more than 80 countries.
ROCKWELL AUTOMATION, INC.
SALES AND EARNINGS INFORMATION
(in millions, except per share amounts)
Three Months Ended Twelve Months Ended
September 30, September 30,
2009 2008 2009 2008
Sales
Architecture & Software $ 424.1 $ 617.1 $ 1,723.5 $ 2,419.7
Control Products & Solutions 650.3 867.2 2,609.0 3,278.1
Total sales $ 1,074.4 $ 1,484.3 $ 4,332.5 $ 5,697.8
Segment Operating Earnings
Architecture & Software $ 36.9 $ 141.6 $ 223.0 $ 584.7
Control Products & Solutions 42.7 127.5 206.7 440.5
Total segment operating earnings 79.6 269.1 429.7 1,025.2
Purchase accounting depreciation and amortization (4.4 ) (5.1 ) (18.6 ) (24.2 )
General corporate - net (31.2 ) (24.5 ) (80.3 ) (77.2 )
Interest expense (15.2 ) (16.1 ) (60.9 ) (68.2 )
Special items - (46.7 ) 4.0 (46.7 )
Income from continuing operations before income taxes 28.8 176.7 273.9 808.9
Income tax benefit (provision) 0.1 (51.1 ) (56.0 ) (231.3 )
Income from continuing operations 28.9 125.6 217.9 577.6
Income from discontinued operations - - 2.8 -
Net income $ 28.9 $ 125.6 $ 220.7 $ 577.6
Diluted earnings per share
Continuing operations $ 0.20 $ 0.87 $ 1.53 $ 3.90
Discontinued operations - - 0.02 -
Net income $ 0.20 $ 0.87 $ 1.55 $ 3.90
Average diluted shares 143.3 145.1 142.5 148.2
-------------------------------------------------------------------------------
ROCKWELL AUTOMATION, INC.
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(in millions)
Three Months Ended Twelve Months Ended
September 30, September 30,
2009 2008 2009 2008
Sales $ 1,074.4 $ 1,484.3 $ 4,332.5 $ 5,697.8
Cost of sales (709.1 ) (896.0 ) (2,763.0 ) (3,357.1 )
Gross profit 365.3 588.3 1,569.5 2,340.7
Selling, general and administrative expenses (316.8 ) (397.6 ) (1,228.0 ) (1,482.1 )
Other (expense) income (4.5 ) 2.1 (6.7 ) 18.5
Interest expense (15.2 ) (16.1 ) (60.9 ) (68.2 )
Income from continuing operations before income taxes 28.8 176.7 273.9 808.9
Income tax benefit (provision) 0.1 (51.1 ) (56.0 ) (231.3 )
Income from continuing operations 28.9 125.6 217.9 577.6
Income from discontinued operations - - 2.8 -
Net income $ 28.9 $ 125.6 $ 220.7 $ 577.6
-------------------------------------------------------------------------------
ROCKWELL AUTOMATION, INC.
CONDENSED BALANCE SHEET INFORMATION
(in millions)
September 30, September 30,
2009 2008
Assets
Cash and cash equivalents $ 643.8 $ 582.2
Receivables 726.3 959.9
Inventories 436.4 575.5
Property, net 532.5 553.8
Goodwill and intangibles 1,144.1 1,165.8
Other assets 822.6 756.4
Total $ 4,305.7 $ 4,593.6
Liabilities and Shareowners' Equity
Short-term debt $ - $ 100.1
Accounts payable 313.3 437.3
Long-term debt 904.7 904.4
Other liabilities 1,771.3 1,463.0
Shareowners' equity 1,316.4 1,688.8
Total $ 4,305.7 $ 4,593.6
-------------------------------------------------------------------------------
ROCKWELL AUTOMATION, INC.