Parker-hannifin Corporation · NYSE:PH
Parker-hannifin — Q4 FY2013 Earnings Presentation
29 slides from Parker-hannifin's earnings presentation, Aug 6, 2013
Slide 1: 4th Quarter & Fiscal Year 2013 Earnings Release
4th Quarter & Fiscal Year 2013 Earnings Release Parker Hannifin Corporation August 6, 2013 Exhibit 99.299.2
Slide 2: Forward-Looking Statements
Forward-Looking Statements 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. All statements regarding future performanc
Slide 3: Non-GAAP Financial Measures
Non-GAAP Financial Measures This presentation reconciles sales amounts reported in accordance with U.S. GAAP to sales amounts adjusted to remove the effects of acquisitions made within the prior four quarters and the effects of currency exchange rates. This presentation also reconciles cash flow fro
Slide 4: Agenda
Agenda 4 • CEO Full Year & 4th Quarter Highlights • Key Performance Measures & Outlook • CEO Closing Comments • Questions and Answers
Slide 5: Highlights FY2013
Highlights FY2013 Sales • Sales of $13b • Acquisitions offset negative impact of currency, divestitures and organic Earnings & Margins • Segment Operating Margins of 13.8% in challenging economic environment • Earnings impacted by • Volume • Acquisition, Integration and Related Expenses Cash Flow •
Slide 6: Highlights 4th Quarter FY2013
Highlights 4th Quarter FY2013 Sales & Orders • Achieved Record Quarterly Sales • Acquisitions contributed 3% to offset organic decline of 2% • Signs global economy bottoming • Orders reversed negative trend Earnings & Margins • Achieved Net Income of $271m or $1.78 per fully diluted share • Highest
Slide 7: Diluted Earnings Per Share 4th Quarter FY2013
Diluted Earnings Per Share 4th Quarter FY2013 7 $1.78 $1.96 $6.26 $7.45 0.00 1.00 2.00 3.00 4.00 5.00 6.00 7.00 8.00 Q4 FY13 Q4 FY12 YTD FY13 YTD FY12
Slide 8: Influences on Earnings 4th Quarter FY2013 vs. 4th Quarter FY2012
1.96 0.02 (0.14) (0.06) 1.78 (1) - 1 1 2 2 3 FY12 Q4 EPS Shares Segment Operating Income Other (Pension) FY13 Q4 EPS Influences on Earnings 4th Quarter FY2013 vs. 4th Quarter FY2012 * Segment Operating Income decline mainly due to Industrial North America 8 *
Slide 9: Influences on Earnings FY2013 vs. FY2012
Influences on Earnings FY2013 vs. FY2012 9 * Segment Operating Income decline mainly due to Industrial International 7.45 0.12 (1.00) (0.30) (0.01) 6.26 4 5 5 6 6 7 7 8 8 FY2012 EPS Shares Segment Operating Income Other (Pension) Below the Line Items FY2013 EPS *
Slide 10: Sales & Operating Margin - Total Parker
Sales & Operating Margin 4th Quarter FY2013 - Total Parker 10 $ in millions FY2013 % Change FY2012 FY2013 % Change FY2012 Sales As reported 3,428$ 0.5 % 3,412$ 13,016$ (1.0)% 13,146$ Acquisitions 105 3.1 % 449 3.4 % Currency (7) (0.2)% (141) (1.1)% Adjusted Sales 3,330$ (2.4)% 12,708$ (3.3)% Operati
Slide 11: Sales & Operating Margin - Industrial North America
Sales & Operating Margin 4th Quarter FY2013 - Industrial North America 11 $ in millions FY2013 % Change FY2012 FY2013 % Change FY2012 Sales As reported 1,303$ (2.6)% 1,338$ 5,051$ 0.2 % 5,041$ Acquisitions 47 3.5 % 217 4.3 % Currency 1 0.1 % 2 0.0 % Adjusted Sales 1,255$ (6.2)% 4,832$ (4.1)% Operati
Slide 12: Sales & Operating Margin - Industrial International
Sales & Operating Margin 4th Quarter FY2013 - Industrial International 12 $ in millions FY2013 % Change FY2012 FY2013 % Change FY2012 Sales As reported 1,280$ 3.3 % 1,239$ 4,867$ (3.3)% 5,034$ Acquisitions 58 4.7 % 232 4.6 % Currency (9) (0.7)% (137) (2.7)% Adjusted Sales 1,231$ (0.7)% 4,772$ (5.2)%
Slide 13: Sales & Operating Margin - Aerospace
Sales & Operating Margin 4th Quarter FY2013 - Aerospace 13 $ in millions FY2013 % Change FY2012 FY2013 % Change FY2012 Sales As reported 620$ 9.5 % 566$ 2,268$ 7.8 % 2,103$ Acquisitions - - % - - % Currency - - % (3) (0.1)% Adjusted Sales 620$ 9.5 % 2,271$ 7.9 % Operating Margin As reported 86$ 85$
Slide 14: Sales & Operating Margin - Climate & Industrial Controls
Sales & Operating Margin 4th Quarter FY2013 - Climate & Industrial Controls 14 $ in millions FY2013 % Change FY2012 FY2013 % Change FY2012 Sales As reported 225$ (16.3)% 269$ 830$ (14.3)% 968$ Acquisitions - - % - - % Currency 1 0.1 % (3) (0.4)% Adjusted Sales 224$ (16.4)% 833$ (13.9)% Operating Mar
Slide 15: Order Rates
Order Rates 15 Excludes Acquisitions, Divestitures & Currency 3-month year-over-year comparisons of total dollars, except Aerospace Aerospace is calculated using a 12-month rolling average Jun 2013 Mar 2013 Jun 2012 Mar 2012 Total Parker 0 %+ 7 %- 1 %- 2 %+ Industrial North America 5 %- 10 %- 4 %+ 7
Slide 16: Balance Sheet Summary
Balance Sheet Summary • Cash • Working capital • Accounts receivable • Inventory • Accounts payable 16
Slide 17: Cash Flow from Operating Activities 4th Quarter and FY2013
Cash Flow from Operating Activities 4th Quarter and FY2013 17 $472 $524 $1,417 $1,530 Q4 FY13 Q4 FY12 FY13 FY12 Cash Flow From Operating Activities 4th Quarter Total Year FY2013 FY2012 FY2013 FY2012 As Reported 472$ 524$ 1,191$ 1,530$ As Reported % Sales 13.8% 15.4% 9.1% 11.6% Discretionary Pension
Slide 18: FY2014 Guidance Assumptions: Sales & Segment Operating Margins
FY2014 Guidance Assumptions Sales & Segment Operating Margins 18 FY 2014 Sales Change versus FY 2013 Total Parker 0.0% - 4.0 % Diversified Industrial North America 0.0% - 5.0 % Diversified Industrial International 0.0% - 4.8 % Aerospace Systems 0.0% - 4.0 % FY 2014 Segment Operating Margin Percentag
Slide 19: FY2014 Guidance Assumptions
FY2014 Guidance Assumptions • Sales Growth, 0% to +4% • Segment Operating Margins, 13.4% to 14.0% • Below Segment Operating Margin Line (+/- 2.5%) • Corporate Admin, Interest and Other Expense (Income) • $120M at Midpoint including expected AAT JV gain • Expected Pre-Tax gain of $360M from AAT JV in
Slide 20: FY2014 Guidance
FY2014 Guidance 20 Low Midpoint High Diluted Earnings Per Share 7.35$ 7.75$ 8.15$ 6.26 1.50 0.44 (0.32) (0.12) (0.01) 7.75 4 5 5 6 6 7 7 8 8 9 FY13 EPS Actual AAT JV Gain Segment Operating Income Possible Restructuring Tax Other FY14 EPS Guidance at Midpoint
Slide 21: NYSE Listed
[LISTED ] NYSE
Slide 22: Appendix
Appendix • Consolidated Statement of Income • Business Segment Information By Industry • Consolidated Balance Sheet • Consolidated Statement of Cash Flows • Business Segment Information – CIC Consolidation
Slide 23: Consolidated Statement of Income
Consolidated Statement of Income 23 Three Months Ended June 30, Year Ended June 30, (Dollars in thousands except per share amounts) 2013 2012 2013 2012 Net sales 3,428,233$ 3,411,666$ 13,015,704$ 13,145,942$ Cost of sales 2,618,067 2,572,258 10,086,675 9,958,337 Gross profit 810,166 839,408 2,929,02
Slide 24: Business Segment Information By Industry
Business Segment Information By Industry 24 Three Months Ended June 30, Year Ended June 30, (Dollars in thousands) 2013 2012 2013 2012 Net sales Industrial: North America 1,303,203$ 1,337,580$ 5,050,604$ 5,041,106$ International 1,280,443 1,239,571 4,867,758 5,034,249 Aerospace 619,950 565,990 2,267
Slide 25: Consolidated Balance Sheet
Consolidated Balance Sheet 25 June 30, June, 30 (Dollars in thousands) 2013 2012 Assets Current assets: Cash and cash equivalents 1,781,412$ 838,317$ Accounts receivable, net 2,062,745 1,992,284 Inventories 1,377,405 1,400,732 Prepaid expenses 182,669 137,429 Deferred income taxes 126,955 129,352 To
Slide 26: Consolidated Statement of Cash Flows
Consolidated Statement of Cash Flows 26 Year Ended June 30, (Dollars in thousands) 2013 2012 Cash flows from operating activities: Net income 948,784$ 1,155,492$ Depreciation and amortization 335,624 321,929 Stock incentive plan compensation 84,996 80,935 Net change in receivables, inventories, and
Slide 27: Business Segment Information Reflecting CIC Consolidation – FY2013
Business Segment Information Reflecting CIC Consolidation – FY2013 27 (Unaudited) (Dollars in thousands) Three Months Ending Fiscal Year-to-Date September 30, 2012 December 31, 2012 March 31, 2013 June 30, 2013 September 30, 2012 December 31, 2012 March 31, 2013 June 30, 2013 Net sales Industrial: N
Slide 28: Business Segment Information Reflecting CIC Consolidation – FY2012
Business Segment Information Reflecting CIC Consolidation – FY2012 28 (Unaudited) Three Months Ending Fiscal Year-to-Date (Dollars in thousands) September 30, 2011 December 31, 2011 March 31, 2012 June 30, 2012 September 30, 2011 December 31, 2011 March 31, 2012 June 30, 2012 Net sales Industrial: N
Slide 29: Business Segment Information Reflecting CIC Consolidation – FY2011
Business Segment Information Reflecting CIC Consolidation – FY2011 29 (Unaudited) Three Months Ending Fiscal Year-to-Date (Dollars in thousands) September 30, 2010 December 31, 2010 March 31, 2011 June 30, 2011 September 30, 2010 December 31, 2010 March 31, 2011 June 30, 2011 Net sales Industrial: N