Parker-hannifin Corporation · NYSE:PH
Parker-hannifin — Q4 FY2015 Earnings Presentation
26 slides from Parker-hannifin's earnings presentation, Aug 4, 2015
Slide 1: 4th Quarter Fiscal Year 2015 Earnings Release
4th Quarter Fiscal Year 2015 Earnings Release Parker Hannifin Corporation August 4, 2015 Exhibit 99.2
Slide 2: Forward-Looking Statements and Non-GAAP Financial Measures Safe Harbor
Forward-Looking Statements and Non-GAAP Financial Measures Safe Harbor Forward-looking statements contained in this and other written and oral reports are made based on known events and circumstances at the time of release, and as such, are subject in the future to unforeseen uncertainties and risks
Slide 3: Agenda
Agenda 3 • CEO Comments • Results & Outlook • Questions & Answers
Slide 4: Highlights 4th Quarter FY2015
Highlights 4th Quarter FY2015 • Fourth Quarter Sales of $3.1B • Significantly Impacted by Currency and End Markets • Segment Operating Margins 14.0% • Adjusted Segment Operating Margins 14.9% • As Reported Earnings per Share of $1.27 • Adjusted Earnings per Share of $1.43 • Tax Impact of $.30 per Sh
Slide 5: Highlights FY2015
Highlights FY2015 • Full Year Sales of $12.7B • Significantly Impacted by Currency Rates • Segment Operating Margins 14.5% • Adjusted Segment Operating Margins 14.9% • As Reported Earnings per Share of $6.97 • Adjusted Earnings per Share of $7.25 • Includes Transaction Currency Gains of $.38 per Sha
Slide 6: Diluted Earnings Per Share 4th Quarter FY2015
Diluted Earnings Per Share 4th Quarter FY2015 6 * FY 15 EPS Adjusted for Business Realignment Charges/Voluntary Retirement Expense ** FY 14 EPS Adjusted for Business Realignment Charges/Impairment/JV with GE Aviation $1.27 $1.98 $6.97 $6.87 FY15 Q4 FY14 Q4 FY15 FY14 EPS - As Reported
Slide 7: Influences on Adjusted Earnings Per Share 4th Quarter FY2015 vs. 4th Quarter FY2014
Influences on Adjusted Earnings Per Share 4th Quarter FY2015 vs. 4th Quarter FY2014 7 * FY 15 EPS Adjusted for Business Realignment Charges/Voluntary Retirement Expense ** FY 14 EPS Adjusted for Business Realignment Charges
Slide 8: Influences on Adjusted Earnings Per Share FY2015 vs. FY2014
Influences on Adjusted Earnings Per Share FY2015 vs. FY2014 8 * FY 15 EPS Adjusted for Business Realignment Charges/Voluntary Retirement Expense ** FY 14 EPS Adjusted for Business Realignment Charges/Impairment/JV with GE Aviation
Slide 9: Sales & Segment Operating Margin Total Parker
Sales & Segment Operating Margin Total Parker 9 Full Year FY2015 % Change FY2014 FY2015 % Change FY2014 12,712$ (3.8)% 13,215$ 12,712$ (3.4)% 13,166$ 15 0.1 % 15 0.1 % (546) (4.1)% (546) (4.1)% 13,243$ 0.2 % 13,243$ 0.6 % FY2015 % of Sales FY2014 % of Sales 1,838$ 14.5 % 1,790$ 13.5 % 32 102 18 - 1,
Slide 10: Sales & Segment Operating Margin Diversified Industrial North America
Sales & Segment Operating Margin Diversified Industrial North America 10 $ in millions 4th Quarter FY2015 % Change FY2014 Sales As Reported 1,413$ (7.3)% 1,525$ Acquisitions - - % Currency (18) (1.2)% Organic Sales 1,431$ (6.1)% FY2015 % of Sales FY2014 % of Sales Segment Operating Margin As Reporte
Slide 11: Sales & Segment Operating Margin Diversified Industrial International
Sales & Segment Operating Margin Diversified Industrial International 11 Full Year FY2015 % Change FY2014 4,742$ (10.3)% 5,288$ 8 0.1 % (487) (9.2)% 5,221$ (1.2)% FY2015 % of Sales FY2014 % of Sales 584$ 12.3 % 572$ 10.8 % 27 99 611$ 12.9 % 671$ 12.7 % $ in millions 4th Quarter FY2015 % Change FY201
Slide 12: Sales & Segment Operating Margin Aerospace Systems
Sales & Segment Operating Margin Aerospace Systems 12 $ in millions 4th Quarter FY2015 % Change FY2014 Sales As Reported 589$ (4.6)% 617$ Acquisitions - - % Currency (3) (0.6)% Organic Sales 592$ (4.0)% FY2015 % of Sales FY2014 % of Sales Segment Operating Margin As Reported 93$ 15.9 % 105$ 17.0 % B
Slide 13: Order Rates
Order Rates 13 Excludes Acquisitions, Divestitures & Currency 3-month year-over-year comparisons of total dollars, except Aerospace Systems Aerospace Systems is calculated using a 12-month rolling average Jun 2015 Mar 2015 Jun 2014 Mar 2014 Total Parker 9 %- 4 %- 4 %+ 7 %+ Diversified Industrial Nor
Slide 14: Cash Flow from Operating Activities
Cash Flow from Operating Activities 14 $511 $570 $1,302 $1,463 FY15 Q4 FY14 Q4 FY15 FY14 4th Quarter Full Year FY 2015 % of Sales FY 2014 % of Sales FY 2015 % of Sales FY 2014 % of Sales As Reported Cash Flow From Operating Activities 5 1 16.2% 570 16.2% 1,302 10.2% 1,388 10.5% Discreti nary Pension
Slide 15: FY2016 Guidance
FY2016 Guidance Adjusted EPS Initiated at $7.00 Midpoint 15 FY16 Adjusted Segment Operating Margins exclude Business Realignment Charges FY16 Adjusted Earnings Per Share exclude Business Realignment Charges Sales Growth vs. Prior Year Diversified Industrial North America (3%) - 1% Diversified Indust
Slide 16: FY2016 Guidance vs FY15 Actual
FY2016 Guidance FY16 Guidance vs FY15 Actual 16 * FY 15 EPS Adjusted for Business Realignment Charges/Voluntary Retirement Expenses ** FY 16 EPS Guidance Adjusted for Business Realignment Charges
Slide 17: AIWA
PH AIWA
Slide 18: Appendix
Appendix • Consolidated Statement of Income • Reconciliation of Net Income & EPS • Business Segment Information By Industry • Reconciliation of Segment Operating Income & Segment Operating Margin • Consolidated Balance Sheet • Consolidated Statement of Cash Flows • Reconciliation of Forecasted EPS •
Slide 19: Consolidated Statement of Income
Consolidated Statement of Income 19 Three Months Ended June 30, Year Ended June 30, (Dollars in thousands except per share amounts) 2015 2014 2015 2014 Net sales 3,144,508$ 3,525,415$ 12,711,744$ 13,215,971$ Cost of sales 2,420,780 2,685,954 9,655,245 10,188,227 Gross profit 723,728 839,461 3,056,49
Slide 20: Reconciliation of Net Income & EPS
Reconciliation of Net Income & EPS 20 (Unaudited) Three Months Ended June 30, Year Ended June 30, 2015 2014 2015 2014 Net income 179,585$ 301,176$ 1,012,553$ 1,041,418$ Adjustments: Voluntary retirement expense 15,034 - 15,034 - Business realignment charges 7,014 12,854 25,180 73,684 Asset w ritedow
Slide 21: Business Segment Information
Business Segment Information 21 Three Months Ended June 30, Year Ended June 30, (Dollars in thousands) 2015 2014 2015 2014 Net sales Diversif ied Industrial: North America 1,413,098$ 1,525,038$ 5,715,742$ 5,693,527$ International 1,142,231 1,382,757 4,741,376 5,287,916 Aerospace Systems 589,179 617,
Slide 22: Reconciliation of Segment Operating Income & Segment Operating Margin
Reconciliation of Segment Operating Income & Segment Operating Margin 22 (Unaudited) Total net sales as reported 12,711,744$ 13,215,971$ Adjust ents: Sales related to GE joint venture - 49,510 Adjusted total net sales 12,711,744$ 13,166,461$ Total segment operating income Operating margin Operating
Slide 23: Consolidated Balance Sheet
Consolidated Balance Sheet 23 June 30, June 30, (Dollars in thousands) 2015 2014 Assets Current assets: Cash and cash equivalents 1,180,584$ 1,613,555$ Marketable securities and other investments 733,490 573,701 Trade accounts receivable, net 1,620,194 1,858,176 Non-trade and notes receivable 364,53
Slide 24: Consolidated Statement of Cash Flows
Consolidated Statement of Cash Flows 24 Year Ended June 30, (Dollars in thousands) 2015 2014 Cash flows from operating activities: Net income 1,012,553$ 1,041,418$ Depreciation and amortization 317,491 336,702 Stock incentive plan compensation 96,093 103,161 Goodw ill and intangible asset impairment
Slide 25: Reconciliation of Forecasted EPS
Reconciliation of Forecasted EPS 25 (Unaudited) (Amounts in dollars) Fiscal Year 2016 Forecasted earnings per diluted share $6.15 to $6.85 Adjustments: Business realignment charges .50 Adjusted forecasted earnings per diluted share $6.65 to $7.35
Slide 26: Supplemental Sales Information Global Technology Platforms
Supplemental Sales Information Global Technology Platforms 26 PARKER HANNIFIN CORPORATION SUPPLEMENTAL NET SALES INFORMATION: BY TECHNOLOGY PLATFORM (Unaudited) Three Months Ended June 30, Tw elve Months Ended June 30, (Dollars in thousands) 2015 2014 2015 2014 Net sales Diversif ied Industrial: Mot