Economic pressures weigh on Actuant

Menomonee Falls-based Actuant Corp. today reported fiscal 2014 fourth quarter net earnings of $35.6 million, or 51 cents per share, down from $58.3 million, or 78 cents per share, in the fourth quarter of 2013.

Net sales were $354.3 million, up from $327.3 million in the same period a year ago.

The global diversified industrial firm repurchased three million shares of common stock that brought in $100 million during the fourth quarter. During the fourth quarter, it sold its RV business for about $35 million.

“Results for the fourth quarter were largely in line with our guidance,” said Mark Goldstein, chief executive officer. “Our overall financial performance continues to reflect markets and economies around the world that are challenged to find consistent growth. During the quarter, we recognized a gain on the sale of our RV business, the last of several portfolio streamlining actions taken during the year. In addition, we accelerated into the quarter certain restructuring actions initially anticipated to occur in fiscal 2015, and therefore were not included in fourth quarter guidance. We have taken actions to improve long-term margins, yet our results continue to be impacted by unfavorable segment mix, uneven demand, and challenging production line moves. We continue to focus on building shareholder value including investing in Growth and Innovation (G+I), executing on cost reduction activities and repurchasing outstanding shares.”

For the full year, Actuant reported net earnings of $163.6 million, or $2.26 per share, up from $30 million, or 40 cents per share, in fiscal 2013.

Net sales for the year were $1.4 billion, up from $1.3 billion last year.

The company attributed the earnings decrease to restructuring costs and market uncertainties in areas including mining and defense. Year-over-year, sales were $414 million in the industrial segment, down from $423 million in 2013. In the energy segment, sales were $362 million, up from $363 million last year. And in engineered solutions, sales were $524 million, up from $494 million in 2013.

“Our performance in fiscal 2014 was impacted by weak global economic conditions, however, we are successfully positioning the company for future scalable and profitable growth,” Goldstein said. “Highlights of the year include portfolio simplification through business unit and product line divestitures, restructuring activities, G+I successes, robust capital deployment, and leadership changes. We also generated free cash flow to net earnings conversion in excess of 100 percent for the 14th consecutive year. This allowed us to deploy over $30 million in acquisitions and $284 million in share repurchases, yet maintain year-end net debt to EBITDA leverage of just 1.1X. In summary, despite lackluster economic conditions, Actuant’s employees strengthened the Company and I am appreciative of their customer focus and hard work.”

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