ENP Newswire -
Release date- 02052014 -
Results for the fourth quarter also reflected the negative impact of severe weather across much of the U.S. on both sales and expenses.
'We delivered record free cash flow of
'We estimate that in our fourth quarter the net impact of severe weather conditions across much of the U.S. cost us at least
'Absent those particular issues, our earnings for the quarter were within our guidance range.' The Company's fourth quarter guidance had assumed year-over-year negative impacts of approximately
Fourth quarter earnings per diluted share were
'Though there were bright spots within certain sectors, on balance, underlying business conditions remained choppy throughout the quarter, weather-related challenges notwithstanding,' said Molinini. 'We remain focused on the things we can control, including leveraging the SAP system, managing expenses, expanding our telesales business, and enhancing our e-Business platform, and are ready to capitalize when sustained growth in the industrial economy resumes.'
Fourth quarter sales were
Selling, distribution, and administrative expenses increased 2% over the prior year. The favorable impact of the reduction in SAP implementation costs compared to the prior year was more than offset by rising healthcare costs and higher operating expenses due to severe weather, as well as by expenses associated with the Company's expansion of its telesales business through Airgas Total Access, strategic pricing initiative, and enhancement of its e-Business platform.
Fourth quarter operating margin was 11.8%, down 30 basis points compared to prior year operating margin of 12.1% and down 40 basis points compared to prior year adjusted operating margin of 12.2%, which included restructuring and other special charges. Distribution segment operating margin was 12.5% for the quarter, down 30 basis points compared to prior year.
The combination of a reduction in SAP implementation costs and the achievement of SAP-related benefits contributed favorably to operating margin this quarter as compared to the prior year. Low organic sales growth challenged the Company's operating margin in the quarter, as did R-22 pricing in its refrigerants business following the
For the full year, earnings per diluted share were
Excluding the loss on the extinguishment of debt and state income tax benefits, adjusted earnings per diluted share were
The favorable year-over-year impact of share repurchases completed in the second half of fiscal 2013 on the Company's earnings growth in fiscal 2014 was more than offset by the negative year-over-year impact related to its refrigerants business, which posted record results in fiscal 2013.
Full year sales were
Full year free cash flow was a record
Return on capital was 12.2% for the twelve months ended
During fiscal year 2014, the Company acquired 11 businesses with aggregate annual sales of approximately
Fiscal 2015 Guidance
'We had expected the U.S. industrial economy to be much stronger by now. But areas of strength within certain industries are still being weighed down by weakness in other areas. There are many significant non-residential construction projects just now starting to move forward, which is a good sign; however, given the persistent uncertainty in the U.S. industrial economy over the past two years and with overall sluggishness still apparent, growth in fiscal 2015 is very difficult to predict,' said
'The low end of our fiscal 2015 guidance assumes a gradual uptick in growth rates as the year progresses, with average organic sales growth of 4% for the full year. The high end assumes a more robust acceleration in growth rates over the course of the year, with average organic sales growth of 6% for the full year.'
'We continue to believe the long-term growth prospects for the U.S. manufacturing and energy industries are strong, as structural drivers like the abundant supply of low-cost energy and higher shipping costs from overseas should favor the U.S. for years to come,' McCausland added.
'Fiscal 2015 will be a year in which we continue to invest in the business to enhance our long-term growth prospects through strategic initiatives, including the development of our new e-Business platform, and enhancements to our regional management structures, like the reorganizations of our Southwest and North Central distribution regions this past year and other structural changes within all of our regions.
We expect these and other initiatives to help drive decision-making as close to our customers as possible, bring additional focus to our sales efforts and increase operating efficiencies enabled by SAP, ultimately strengthening our competitive position and ability to capitalize when sustained improvement in the industrial economy returns.'
For the first quarter of fiscal year 2015, the Company expects earnings per diluted share in the range of
For the full fiscal year 2015, the Company expects earnings per diluted share in the range of
The Company will conduct an earnings teleconference at
A webcast of the teleconference will be available live and on demand through
More than 16,000 employees work in approximately 1,100 locations, including branches, retail stores, gas fill plants, specialty gas labs, production facilities and distribution centers.
This press release contains statements that are forward looking, as that term is defined by the Private Securities Litigation Reform Act of 1995 or by the
Forward-looking statements also include any statement that is not based on historical fact, including statements containing the words 'believes,' 'may,' 'plans,' 'will,' 'could,' 'should,' 'estimates,' 'continues,' 'anticipates,' 'intends,' 'expects,' and similar expressions. We intend that such forward-looking statements be subject to the safe harbors created thereby.
All forward-looking statements are based on current expectations regarding important risk factors and should not be regarded as a representation by us or any other person that the results expressed therein will be achieved.
Important factors that could cause actual results to differ materially from those contained in any forward-looking statement include: adverse changes in customer buying patterns or weakening in the operating and financial performance of our customers, any of which could negatively impact our sales and our ability to collect our accounts receivable; postponement of projects due to economic conditions; customer acceptance of price increases; increases in energy costs and other operating expenses at a faster rate than our ability to increase prices; changes in customer demand resulting in our inability to meet minimum product purchase requirements under long-term supply agreements and the inability to negotiate alternative supply arrangements; supply cost pressures; shortages and/or disruptions in the supply chain of certain gases, including, but not limited to, the continued or increased disruption in our helium supply chain;
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