This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
$1 buys you full access to ALL of TheStreet's Subscription Services! Learn More

Crane Co. Reports First Quarter Earnings

Stocks in this article: CR

Full Year 2012 Guidance

As detailed at our February Investor Day Conference, sales for 2012 are expected to increase approximately 3-5% driven by a core sales increase of 5-6%, incremental sales from the WTA acquisition of less than 1%, partially offset by unfavorable foreign exchange of approximately 2%. 2012 earnings guidance is a range of $3.75 - $3.95 per diluted share, reflecting revenue and profit growth across all segments. The Company’s 2012 free cash flow (cash provided by operating activities less capital spending) guidance of $160 - $190 million includes the effect of asbestos related cash flows.

Additional Information

Please see the condensed financial statements and the Non-GAAP Financial Measures table attached to this press release for supporting details. Additional information with respect to the Company’s asbestos liability and related accounting provisions and cash requirements is set forth in the Current Report on Form 8-K filed with a copy of this press release.

Conference Call

Crane Co. has scheduled a conference call to discuss the first quarter financial results on Tuesday, April 24, 2012 at 10:00 A.M. (Eastern). All interested parties may listen to a live webcast of the call at http://www.craneco.com. An archived webcast will also be available to replay this conference call directly from the Company’s website.

Crane Co. is a diversified manufacturer of highly engineered industrial products. Founded in 1855, Crane provides products and solutions to customers in the aerospace, electronics, hydrocarbon processing, petrochemical, chemical, power generation, automated merchandising, transportation and other markets. The Company has five business segments: Aerospace & Electronics, Engineered Materials, Merchandising Systems, Fluid Handling, and Controls. Crane has approximately 11,000 employees in North America, South America, Europe, Asia and Australia. Crane Co. is traded on the New York Stock Exchange (NYSE:CR). For more information, visit www.craneco.com.

This press release may contain forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. These statements present management’s expectations, beliefs, plans and objectives regarding future financial performance, and assumptions or judgments concerning such performance. Any discussions contained in this press release, except to the extent that they contain historical facts, are forward-looking and accordingly involve estimates, assumptions, judgments and uncertainties. There are a number of factors that could cause actual results or outcomes to differ materially from those addressed in the forward-looking statements. Such factors are detailed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2011 and subsequent reports filed with the Securities and Exchange Commission.

 
CRANE CO.
Income Statement Data
(in thousands, except per share data)
   
Three Months Ended
March 31,

   2012   

   2011   

Net Sales:
Aerospace & Electronics $ 175,168 $ 161,936
Engineered Materials 58,159 61,832
Merchandising Systems 87,675 94,878
Fluid Handling 301,886 264,142
Controls 34,991   28,232  
Total Net Sales $ 657,879   $ 611,020  
 
Operating Profit (Loss):
Aerospace & Electronics $ 38,069 $ 34,042
Engineered Materials 8,409 10,143
Merchandising Systems 4,713 4,673
Fluid Handling 39,640 35,453
Controls 4,701 3,111
Corporate (15,972 ) (14,562 )
Total Operating Profit 79,560 72,860
 
Interest Income 395 290
Interest Expense (6,711 ) (6,622 )
Miscellaneous- Net (347 ) 3,625

 

*

Income Before Income Taxes 72,897 70,153
Provision for Income Taxes 21,101   21,775  
Net income before allocations to noncontrolling interests 51,796 48,378
Less: Noncontrolling interest in subsidiaries' gains (losses) 134   (89 )
Net income attributable to common shareholders $ 51,662   $ 48,467  
 
Share Data:
Earnings per Diluted Share $ 0.88   $ 0.81  
 
Average Diluted Shares Outstanding 58,880 59,552
Average Basic Shares Outstanding 57,889 58,330
 

Supplemental Data:

Cost of Sales $ 437,471 $ 397,850
Selling, General & Administrative 140,848 140,310
Depreciation and Amortization ** 14,674 15,774
Stock-Based Compensation Expense 4,007 3,503
 
* Primarily related to the sale of a building and the divestiture of a small product line in the three months ended March 31, 2011.
 
** Amount included within cost of sales and selling, general & administrative costs.
 
 
CRANE CO.
Condensed Balance Sheets
(in thousands)
   

 March 31, 

December 31,
2012 2011
 
ASSETS
Current Assets
Cash and Cash Equivalents $ 195,860 $ 245,089
Accounts Receivable, net 404,418 349,250
Current Insurance Receivable - Asbestos 16,345 16,345
Inventories, net 368,495 360,689
Other Current Assets 64,092 60,859
Total Current Assets 1,049,210 1,032,232
 
Property, Plant and Equipment, net 284,289 284,146
Long-Term Insurance Receivable - Asbestos 204,929 208,952
Other Assets 485,268 497,377
Goodwill 826,717 820,824
 
Total Assets $ 2,850,413 $ 2,843,531
 
LIABILITIES AND EQUITY
Current Liabilities
Notes Payable and Current Maturities of Long-Term Debt $ 794 $ 1,112
Accounts Payable 184,319 194,158
Current Asbestos Liability 100,943 100,943
Accrued Liabilities 187,006 226,717
Income Taxes 14,745 10,165
Total Current Liabilities 487,807 533,095
 
Long-Term Debt 398,958 398,914
Long-Term Deferred Tax Liability 42,664 41,668
Long-Term Asbestos Liability 770,443 792,701
Other Liabilities 254,685 255,097
 
Total Equity 895,856 822,056
 
Total Liabilities and Equity $ 2,850,413 $ 2,843,531
 
   
CRANE CO.
Condensed Statements of Cash Flows
(in thousands)
 
Three Months Ended
March 31,
2012 2011
Operating Activities:
Net income attributable to common shareholders $ 51,662 $ 48,467
Noncontrolling interest in subsidiaries' gains (losses)   134     (89 )
Net income before allocations to noncontrolling interests 51,796 48,378
Gain on divestiture - (4,258 )
Depreciation and amortization 14,674 15,774
Stock-based compensation expense 4,007 3,503
Defined benefit plans and postretirement expense 4,991 2,749
Deferred income taxes 8,544 6,893
Cash used for operating working capital (103,503 ) (67,250 )
Defined benefit plans and postretirement contributions (1,183 ) (4,779 )
Environmental payments, net of reimbursements (2,579 ) (4,593 )
Other   (1,319 )   142  
Subtotal (24,572 ) (3,441 )
Asbestos related payments, net of insurance recoveries   (18,235 )   (12,725 )
Total used for operating activities   (42,807 )   (16,166 )
 
Investing Activities:
Capital expenditures (7,165 ) (8,138 )
Proceeds from disposition of capital assets 172 4,553
Proceeds from divestiture   -     1,000  
Total used for investing activities   (6,993 )   (2,585 )
 
Financing Activities:
Dividends paid (15,090 ) (13,474 )
Reacquisition of shares on open market - (29,999 )
Stock options exercised - net of shares reacquired 8,426 12,552
Excess tax benefit from stock-based compensation 2,947 3,952
Change in short-term debt   (318 )   (76 )
Total used for financing activities   (4,035 )   (27,045 )
 
Effect of exchange rate on cash and cash equivalents   4,606     6,017  
Decrease in cash and cash equivalents (49,229 ) (39,779 )
Cash and cash equivalents at beginning of period   245,089     272,941  
Cash and cash equivalents at end of period $ 195,860   $ 233,162  
 
 
CRANE CO.
Order Backlog
(in thousands)
   

 March 31, 

December 31, September 30,

 June 30, 

 March 31, 

2012 2011 2011 2011 2011
 
Aerospace & Electronics $ 437,822 $ 410,794 $ 409,284 $ 431,799 $ 454,559
Engineered Materials 11,129 11,110 9,879 13,087 13,826
Merchandising Systems 30,033 15,212 20,929 26,898 25,008
Fluid Handling 337,538 * 313,715 * 328,757 * 323,045 305,255
Controls   29,770   27,120   32,145   30,323   24,015
Total Backlog $ 846,292 $ 777,951 $ 800,994 $ 825,152 $ 822,663
 
* Includes Order Backlog of $7.5 million at March 31, 2012, $7.1 million at December 31, 2011 and $5.4 million at September 30, 2011 pertaining to the 2011 acquisition of WTA.
 
CRANE CO.
Non-GAAP Financial Measures
(in thousands)
   
Three Months Ended
March 31,
2012 2011
 

CASH FLOW ITEMS

Cash Used for Operating Activities
before Asbestos - Related Payments $ (24,572 ) $ (3,441 )
Asbestos Related Payments, Net of Insurance Recoveries   (18,235 )   (12,725 )
Cash Used for Operating Activities (42,807 ) (16,166 )
Less: Capital Expenditures   (7,165 )   (8,138 )
Free Cash Flow $ (49,972 ) $ (24,304 )
 
Certain non-GAAP measures have been provided to facilitate comparison with the prior year.
 
The Company reports its financial results in accordance with U.S. generally accepted accounting principles (GAAP). However, management believes that non-GAAP financial measures which exclude certain non-recurring items present additional useful comparisons between current results and results in prior operating periods, providing investors with a clearer view of the underlying trends of the business. Management also uses these non-GAAP financial measures in making financial, operating, planning and compensation decisions and in evaluating the Company's performance.
 
In addition, Free Cash Flow provides supplemental information to assist management and investors in analyzing the Company’s ability to generate liquidity from its operating activities. The measure of Free Cash Flow does not take into consideration certain other non-discretionary cash requirements such as, for example, mandatory principle payments on the Company's long-term debt. Non-GAAP financial measures, which may be inconsistent with similarly captioned measures presented by other companies, should be viewed in addition to, and not as a substitute for, the Company’s reported results prepared in accordance with GAAP.
 
Non-GAAP financial measures, which may be inconsistent with similarly captioned measures presented by other companies, should be viewed in the context of the definitions of the elements of such measures we provide and in addition to, and not as a substitute for, the Company’s reported results prepared in accordance with GAAP.




5 of 6

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,827.75 +12.81 0.07%
S&P 500 2,072.83 +5.80 0.28%
NASDAQ 4,787.3170 +29.0650 0.61%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs