Ecolab Reports Profit, Sales Decline but Backs Year View
May 03 2016 - 12:25PM
Dow Jones News
By Lisa Beilfuss
Cleaning-products maker Ecolab said earnings and sales slipped
in its latest quarter, thanks to slower global economic growth and
adverse foreign exchange rates.
Still, results topped expectations.
The St. Paul, Minn., company sells specialized cleaning and
sanitizing products to customers across the industrial, hospitality
and health-care sectors, among others. For first-quarter results,
Chief Executive Douglas Baker pointed to sluggish global economies
and a tough oil and gas market. In addition, the company has been
hurt by the stronger U.S. dollar that makes its products more
expensive in foreign currencies.
Mr. Baker said Tuesday that energy and currency effects should
lessen as the year progresses, adding that Ecolab remains on track
to meet its financial targets for the year. The company continues
to forecast $4.35 to $4.55 in adjusted earnings per share,
bracketing the $4.46 average analyst estimate.
The company has grown its footprint through acquisitions,
including its purchase of some Swisher Hygiene Inc. operations late
last year, a water treatment provider in China and its 2011
purchase of water-treatment chemicals maker Nalco. In the first
quarter, acquisitions helped boost performance in Ecolab's
industrial and institutional segments, where operating income rose
23% and 19%, respectively, on an acquisition and currency-adjusted
basis. Those increases helped offset a 46% slide in operating
income at the company's energy business.
In all, Ecolab reported a profit of $230.8 million, down from
$233.4 million a year earlier. On a per-share basis, earnings were
flat at 77 cents a share, thanks to a lower share count. The
company said adverse exchange rates knocked off 11 cents per
share.
Revenue declined 6.1% to $3.10 billion. Analysts projected 76
cents in adjusted earnings per share on $3.12 billion in sales.
Shares in the company declined 0.4% in morning trading.
Write to Lisa Beilfuss at lisa.beilfuss@wsj.com
(END) Dow Jones Newswires
May 03, 2016 12:10 ET (16:10 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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