Emerson Electric Company (EMR) has reported 20.87 percent fall in profit for the quarter ended Mar. 31, 2017. The company has earned $292 million, or $0.45 a share in the quarter, compared with $369 million, or $0.57 a share for the same period last year.
Revenue during the quarter went down marginally by 0.14 percent to $3,574 million from $3,579 million in the previous year period. Gross margin for the quarter expanded 48 basis points over the previous year period to 43.56 percent. Total expenses were 83.04 percent of quarterly revenues, down from 83.29 percent for the same period last year. This has led to an improvement of 25 basis points in operating margin to 16.96 percent.
Operating income for the quarter was $606 million, compared with $598 million in the previous year period.
"Following our solid first quarter, the second quarter results again exceeded our expectations delivering continued profitability improvement over the prior year," said chairman and chief executive officer David N. Farr. "During the quarter we saw improving demand across both of our platform businesses, positioning us for a stronger second half of the year. Considering our solid performance in the first half of the fiscal year and current order trends, we are raising our full year sales and EPS guidance. We now expect earnings per share from continuing operations to be $2.55 to $2.65, versus our prior guidance of $2.47 to $2.62. This EPS guidance assumes full year sales are approximately flat with underlying sales up approximately 1 percent excluding unfavorable currency translation."
For financial year 2017, the company forecasts diluted earnings per share to be in the range of $2.55 to $2.65.
Operating cash flow drops significantlyEmerson Electric Company has generated cash of $410 million from operating activities during the first half, down 66 percent or $796 million, when compared with the last year period. Cash flow from investing activities was $4,791 million for the first half as against cash outgo of $188 million in the last year period.
The company has spent $3,282 million cash to carry out financing activities during the first six months as against cash outgo of $725 million in the last year period.
Cash and cash equivalents stood at $5,039 million as on Mar. 31, 2017, up 51.69 percent or $1,717 million from $3,322 million on Mar. 31, 2016.
Debt comes down significantly
Emerson Electric Company has recorded a decline in total debt over the last one year. It stood at $4,068 million as on Mar. 31, 2017, down 44.13 percent or $3,213 million from $7,281 million on Mar. 31, 2016. Interest coverage ratio improved to 14.78 for the quarter from 13 for the same period last year.
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