BERWYN, Pa., May 5, 2020 /PRNewswire/ -- AMETEK, Inc.
(NYSE: AME) today announced its financial results for the first
quarter ended March 31, 2020.
AMETEK's first quarter 2020 sales were $1.20 billion, a 6.6% decline compared to the
first quarter of 2019. GAAP operating income was $232.0 million. Adjusted operating income was
$276.0 million, down 3% versus last
year's first quarter, with adjusted operating margins of 23.0%, an
increase of 100 basis points over the prior year.
On a GAAP basis, first quarter earnings per diluted share were
$1.22. Adjusted earnings were
$1.02 per diluted share, up 2% versus
the first quarter of 2019. Adjusted earnings adds back non-cash,
after-tax, acquisition-related intangible amortization of
$0.13 per diluted share, and excludes
a pre-tax $141 million, or
$0.47 per diluted share, gain from
the sale of Reading Alloys and a pre-tax $44
million, or $0.15 per diluted
share, realignment charge. A reconciliation of reported GAAP
results to adjusted results is included in the financial tables
accompanying this release and on the AMETEK website.
"We are pleased with the way our colleagues have responded to
the unprecedented personal and professional challenges presented by
the COVID-19 pandemic," commented David A. Zapico, AMETEK
Chairman and Chief Executive Officer. "The safety and well-being of
our employees remains our top priority. To that end, we have
implemented significant safety measures to help safeguard our
employees while also providing continued support for our essential
customers."
"Although first quarter sales were impacted by the spread of
COVID-19, our businesses reacted swiftly and our proven operating
capability allowed us to expand adjusted operating margins 100
basis points and deliver earnings in-line with expectations," Mr.
Zapico continued. "Additionally, AMETEK's operating cash flow in
the quarter was excellent at $271
million, up 38% over the first quarter of 2019. This cash
generation, along with proceeds from the sale of Reading Alloys,
have strengthened AMETEK's already strong balance sheet."
Electronic Instruments Group (EIG)
First quarter EIG
sales were $774.2 million, down 4%
compared to the same period in 2019. On a GAAP basis, EIG's first
quarter 2020 operating income was $171.3
million. Excluding realignment costs, first quarter EIG
operating income was $194.1 million
and operating margins were 25.1% in the quarter.
"While recent acquisitions, including Rauland, Mocon, Telular
and Gatan continue to deliver solid performance given the
attractive, secular growth opportunities in markets they serve, EIG
sales were negatively impacted as the coronavirus spread globally
during the quarter. Despite lower than expected sales, our
businesses delivered strong operating performance and core margin
expansion," noted Mr. Zapico.
Electromechanical Group (EMG)
EMG sales in the first
quarter were $428.0 million, down 11%
compared to last year's first quarter. On a GAAP basis, EMG first
quarter operating income was $76.6
million. Excluding realignment costs, EMG's operating income
was $97.5 million and operating
income margins were a record 22.8%.
"Despite a challenging macro environment due to the spread of
the coronavirus, EMG delivered exceptional operating performance in
the quarter. By proactively driving Operational Excellence
initiatives, EMG achieved impressive operating margins in the
quarter," commented Mr. Zapico.
Long-term Outlook
"Given the uncertainty related to
the timing and magnitude of the COVID-19 pandemic, we previously
withdrew our full year financial guidance provided on February 5, 2020," noted Mr. Zapico. "We will
provide forward guidance when visibility improves."
"While these are historically uncertain times, we remain focused
on delivering long-term, sustainable success for our shareholders,
colleagues, customers and suppliers, and the communities where we
operate. The AMETEK Growth Model is adaptable and provides our
businesses with the tools needed to successfully navigate uncharted
economic environments," noted Mr. Zapico.
"We are well positioned to manage this challenge with a
portfolio of outstanding businesses that provide our customers with
innovative solutions. The niche markets our businesses serve today
are diverse, our operating capabilities are robust and proven, and
we have a strong, flexible balance sheet and excellent liquidity.
Most importantly, we have a world-class workforce dedicated to our
mission of solving our customers' most complex challenges with
differentiated technology solutions. We are confident in AMETEK's
future," Mr. Zapico concluded.
Conference Call
AMETEK will webcast its first quarter
2020 investor conference call on Tuesday, May 5, 2020,
beginning at 8:30 AM ET. The live
audio webcast will be available and later archived in the Investors
section of www.ametek.com.
About AMETEK
AMETEK is a leading global
manufacturer of electronic instruments and electromechanical
devices with 2019 sales of approximately $5.0 billion. The AMETEK Growth Model integrates
the Four Growth Strategies - Operational Excellence, New Product
Development, Global and Market Expansion, and Strategic
Acquisitions - with a disciplined focus on cash generation and
capital deployment. 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 500.
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 risks related to COVID-19 and its potential impact on
AMETEK's operations, supply chain, and demand across key end
markets; AMETEK's ability to consummate and successfully integrate
future acquisitions; risks with international sales and operations,
including supply chain disruptions; AMETEK's 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 U.S. 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.
Contact:
AMETEK, Inc.
Kevin Coleman
Vice President, Investor Relations
1100 Cassatt Road
Berwyn, Pennsylvania 19312
kevin.coleman@ametek.com
Phone: 610.889.5247
AMETEK,
Inc.
|
Consolidated
Statement of Income
|
(In thousands,
except per share amounts)
|
(Unaudited)
|
|
|
Three Months
Ended
|
|
March
31,
|
|
2020
|
|
2019
|
Net
sales
|
$1,202,218
|
|
$1,287,691
|
|
|
|
|
Cost of
sales
|
824,647
|
|
851,307
|
Selling, general and
administrative
|
145,531
|
|
153,125
|
Total operating
expenses
|
970,178
|
|
1,004,432
|
|
|
|
|
Operating
income
|
232,040
|
|
283,259
|
|
|
|
|
Interest
expense
|
(22,741)
|
|
(22,653)
|
Other income
(expense), net
|
141,776
|
|
(3,668)
|
|
|
|
|
Income before income
taxes
|
351,075
|
|
256,938
|
|
|
|
|
Provision for income
taxes
|
70,459
|
|
52,670
|
|
|
|
|
Net
income
|
$
280,616
|
|
$
204,268
|
|
|
|
|
Diluted earnings
per share
|
$
1.22
|
|
$
0.89
|
Basic earnings per
share
|
$
1.23
|
|
$
0.90
|
|
|
|
|
Weighted average
common shares outstanding:
|
|
|
|
Diluted shares
|
230,872
|
|
228,686
|
Basic shares
|
228,962
|
|
226,861
|
|
|
|
|
Dividends per
share
|
$
0.18
|
|
$
0.14
|
AMETEK,
Inc.
|
Information by
Business Segment
|
(In
thousands)
|
(Unaudited)
|
|
|
Three Months
Ended
|
|
March
31,
|
|
2020
|
|
2019
|
Net
sales:
|
|
|
|
Electronic
Instruments
|
$
774,225
|
|
$
806,911
|
Electromechanical
|
427,993
|
|
480,780
|
Consolidated net sales
|
$1,202,218
|
|
$1,287,691
|
|
|
|
|
Operating
income:
|
|
|
|
Segment operating
income:
|
|
|
|
Electronic
Instruments
|
$
171,271
|
|
$
203,084
|
Electromechanical
|
76,564
|
|
98,813
|
Total segment operating income
|
247,835
|
|
301,897
|
Corporate administrative
expenses
|
(15,795)
|
|
(18,638)
|
Consolidated operating income
|
$
232,040
|
|
$
283,259
|
AMETEK,
Inc.
|
Condensed
Consolidated Balance Sheet
|
(In
thousands)
|
|
|
March
31,
|
|
December
31,
|
|
2020
|
|
2019
|
|
(Unaudited)
|
|
|
ASSETS
|
|
|
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
$
1,253,382
|
|
$
393,030
|
Receivables, net
|
712,195
|
|
744,760
|
Inventories, net
|
654,298
|
|
624,567
|
Other current
assets
|
154,616
|
|
263,414
|
Total current assets
|
2,774,491
|
|
2,025,771
|
|
|
|
|
Property, plant and
equipment, net
|
534,786
|
|
548,908
|
Right of use asset,
net
|
168,543
|
|
179,679
|
Goodwill
|
4,075,633
|
|
4,047,539
|
Other intangibles,
investments and other assets
|
3,048,493
|
|
3,042,662
|
Total assets
|
$10,601,946
|
|
$
9,844,559
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
Current
liabilities:
|
|
|
|
Short-term borrowings and
current portion of long-term debt, net
|
$
510,792
|
|
$
497,449
|
Accounts payable and
accruals
|
966,879
|
|
928,409
|
Total current liabilities
|
1,477,671
|
|
1,425,858
|
|
|
|
|
Long-term debt,
net
|
2,741,798
|
|
2,271,292
|
Deferred income taxes
and other long-term liabilities
|
1,056,474
|
|
1,031,917
|
Stockholders'
equity
|
5,326,003
|
|
5,115,492
|
Total liabilities and stockholders' equity
|
$10,601,946
|
|
$
9,844,559
|
AMETEK,
Inc.
|
Reconciliations of
GAAP to Non-GAAP Financial Measures
|
(In thousands,
except per share amounts)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
March
31,
|
|
|
|
|
2020
|
|
2019
|
|
|
|
|
|
|
|
|
EIG Segment operating
income (GAAP)
|
|
$
171,271
|
|
$
203,084
|
|
|
Realignment
costs
|
|
22,846
|
|
-
|
|
Adjusted EIG Segment
operating income (Non-GAAP)
|
|
$
194,117
|
|
$
203,084
|
|
|
|
|
|
|
|
|
EMG Segment operating
income (GAAP)
|
|
$
76,564
|
|
$
98,813
|
|
|
Realignment
costs
|
|
20,890
|
|
-
|
|
Adjusted EMG Segment
operating income (Non-GAAP)
|
|
$
97,454
|
|
$
98,813
|
|
|
|
|
|
|
|
|
Operating income
(GAAP)
|
|
$
232,040
|
|
$
283,259
|
|
|
Realignment
costs
|
|
43,928
|
|
-
|
|
Adjusted Operating
income (Non-GAAP)
|
|
$
275,968
|
|
$
283,259
|
|
|
|
|
|
|
|
|
Income before income
taxes (GAAP)
|
|
$
351,075
|
|
$
256,938
|
|
|
Realignment
costs
|
|
43,928
|
|
-
|
|
|
Gain from sale of
Reading Alloys
|
|
(141,020)
|
|
-
|
|
Adjusted Income
before income taxes (Non-GAAP)
|
|
$
253,983
|
|
$
256,938
|
|
|
|
|
|
|
|
|
Net income
(GAAP)
|
|
$
280,616
|
|
$
204,268
|
|
|
Realignment
costs
|
|
43,928
|
|
-
|
|
|
Income tax benefit on
realignment costs
|
|
(10,293)
|
|
-
|
|
|
Gain from sale of
Reading Alloys
|
|
(141,020)
|
|
-
|
|
|
Income tax expense on
sale of business
|
|
31,446
|
|
-
|
|
Adjusted Net income
(Non-GAAP)
|
|
$
204,677
|
|
$
204,268
|
|
|
|
|
|
|
|
|
Diluted earnings per
share (GAAP)
|
|
$
1.22
|
|
$
0.89
|
|
|
Realignment
costs
|
|
0.19
|
|
-
|
|
|
Income tax benefit on
realignment costs
|
|
(0.04)
|
|
-
|
|
|
Gain from sale of
Reading Alloys
|
|
(0.61)
|
|
-
|
|
|
Income tax charge on
gain on sale of Reading Alloys
|
|
0.14
|
|
-
|
|
|
Pretax amortization
of acquisition-related intangible assets
|
|
0.17
|
|
0.14
|
|
|
Income tax benefit on
amortization of acquisition-related intangible assets
|
|
(0.04)
|
|
(0.03)
|
|
|
Rounding
|
|
(0.01)
|
|
-
|
|
Adjusted Diluted
earnings per share (Non-GAAP)
|
|
$
1.02
|
|
$
1.00
|
|
|
|
|
|
|
|
|
EIG Segment operating
margin (GAAP)
|
|
22.1%
|
|
25.2%
|
|
|
Realignment
costs
|
|
3.0%
|
|
-
|
|
Adjusted EIG Segment
operating margin (Non-GAAP)
|
|
25.1%
|
|
25.2%
|
|
|
|
|
|
|
|
|
EMG Segment operating
margin (GAAP)
|
|
17.9%
|
|
20.6%
|
|
|
Realignment
costs
|
|
4.9%
|
|
-
|
|
Adjusted EMG Segment
operating margin (Non-GAAP)
|
|
22.8%
|
|
20.6%
|
|
|
|
|
|
|
|
|
Operating income
margin (GAAP)
|
|
19.3%
|
|
22.0%
|
|
|
Realignment
costs
|
|
3.7%
|
|
-
|
|
Adjusted Operating
income margin (Non-GAAP)
|
|
23.0%
|
|
22.0%
|
|
|
|
|
|
|
|
|
Use of Non-GAAP
Financial Information
The Company supplements its consolidated financial statements
presented on a U.S. generally accepted accounting principles
("GAAP") basis with certain non‑GAAP financial information to
provide investors with greater insight, increased transparency and
allow for a more comprehensive understanding of the information
used by management in its financial and operational
decision-making. Reconciliation of non‑GAAP measures to their
most directly comparable GAAP measures are included in the
accompanying financial tables. These non‑GAAP financial measures
should be considered in addition to, and not as a replacement for,
or superior to, the comparable GAAP measure, and may not be
comparable to similarly titled measures reported by other
companies.
The Company believes that these measures provide useful information
to investors by reflecting additional ways of viewing AMETEK's
operations that, when reconciled to the comparable GAAP measure,
helps our investors to better understand the long-term
profitability trends of our business, and facilitates easier
comparisons of our profitability to prior and future periods and to
our peers.
|
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SOURCE AMETEK, Inc.