Milwaukee-based A.O. Smith Corp. has turned in record second quarter profits.
The water technology company, which joined the S&P 500 index this morning, today reported second quarter net income of $92.4 million, or 53 cents per diluted share, up from $87.1 million, or 49 cents per share, in the second quarter of 2016.
Revenue totaled $738.2 million, up 11 percent from $667 million in the same period last year. That was despite unfavorable foreign currency translation that cut into sales by about 1 percent.
Second quarter sales were up about 9 percent for the North America segment. Sales in the rest of the world, mainly China, Europe and India, were up about 14 percent year-over-year. China sales were up 20 percent, which continued to drive the company’s growth.
“We continued to see solid demand for our premium products in China with sales growth in local currency of 20 percent, led by water treatment and air purification,” said Ajita Rajendra, chairman and chief executive officer. “Sales of our commercial water heaters and boilers in North America continued to be strong.”
But the higher earnings were more than offset by higher outlays for working capital.
For the first half of the year, cash flow was $73.2 million, down significantly from $155.1 million in the first six months of 2016, driven by a $149.9 million expense on current assets and liabilities. During the second quarter, A.O. Smith repurchased about 1.3 million shares of stock for $66.2 million.
