Parker Reports Year End Results

Parker reports its 2011 year end results with all-time record sales, net income and earnings per share.

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Parker Hannifin Corporation, a global manufacturer of motion and control technologies, reports all-time record results for the fiscal 2011 fourth quarter and year ended June 30, 2011. Fiscal 2011 sales were $12.3 billion, an increase of 23.5% from $10.0 billion in the prior year and surpassing the previous record achieved in fiscal 2008. Net income for the year was a record $1.1 billion, an increase of 90.0% compared with $556.4 million in fiscal 2010. Fiscal 2011 earnings per diluted share were a record at $6.37 compared with $3.40 in the previous year. Cash flow from operations for fiscal 2011 was $1.2 billion, or 9.5% of sales, compared with cash flow from operations of $1.2 billion, or 12.2% of sales in the prior year period. Cash flow from operations included discretionary contributions to the company's pension plan of $400 million in fiscal 2011 and $100 million in fiscal 2010. Excluding these discretionary contributions, cash flow as a percent of sales in fiscal 2011 and fiscal 2010, was 12.7% and 13.2%, respectively.

Fiscal 2011 fourth quarter sales were a record $3.4 billion, an increase of 22.4% from $2.8 billion in the same quarter a year ago. Net income for the fourth quarter was also a record at $294.7 million, a 32.1% increase compared with $223.1 million in the fourth quarter of fiscal 2010. Earnings per diluted share for the quarter were a record $1.79, compared with $1.35 in last year's fourth quarter. Cash flow from operations for fiscal 2011 fourth quarter was $367 million, or 10.8% of sales, compared with cash flow from operations of $377 million, or 13.5% of sales in the prior year period. Fiscal 2011 fourth quarter cash flow from operations included a $200 million discretionary contribution to the company's pension plan. Excluding this discretionary contribution, cash flow as a percent of sales was 16.6% for the fiscal 2011 fourth quarter.

"Achieving record performance this year is a remarkable accomplishment," says Chairman, CEO and President, Don Washkewicz. "I am especially proud of our global team that delivered this performance. We will continue the focus on executing Parker's Win Strategy and build on this success."

Parker also achieved all-time record sales and earnings per share in the fourth quarter and strong segment operating margin performance. Total sales for the quarter increased 22% as organic sales increased 15%, acquisitions contributed 1% and foreign currency translation was a positive 6%. Profitability in the quarter was strongest in the Industrial segment. Industrial North America segment operating margin reached 16.9% and Industrial International segment operating margin was 14.7%.  

Segment Results

In the Industrial North America segment, fourth quarter sales increased 18.6% to $1.2 billion, and operating income was $207.3 million compared with $162.9 million in the same period a year ago.  

In the Industrial International segment, fourth quarter sales increased 33.8% to $1.4 billion, and operating income was $202.8 million compared with $140.3 million in the same period a year ago. 

In the Aerospace segment, fourth quarter sales increased 9.3% to $521.9 million, and operating income was $70.7 million compared with $64.1 million in the same period a year ago.

In the Climate and Industrial Controls segment, fourth quarter sales increased 15.2% to $276.8 million, and operating income was $22.5 million compared with $20.5 million in the same period a year ago.    

Orders

Parker reported an increase of 15% in orders for the quarter ending June 30, 2011, compared with the same quarter a year ago. The company reported the following orders by operating segment:  

  • Orders increased 11% in the Industrial North America segment, compared with the same quarter a year ago.
  • Orders increased 18% in the Industrial International segment, compared with the same quarter a year ago.
  • Orders increased 27% in the Aerospace segment on a rolling 12-month average basis.
  • Orders increased 1% in the Climate and Industrial Controls segment, compared with the same quarter a year ago. 

Outlook

For fiscal 2012, the company has issued guidance for earnings from continuing operations in the range of $6.70 to $7.50 per diluted share.

Washkewicz adds, "Our earnings range for fiscal 2012 anticipates another record year for Parker. We will continue in fiscal 2012 with a strong focus on the fundamentals defined by the Win Strategy. We will continue to invest in profitable growth through new product and systems innovation, strategic acquisitions, and expansion of our distribution network."

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