Gardner Denver's CEO Discusses Q2 2012 Results - Earnings Call Transcript
Revenues in the second quarter with $613 million were essentially flat versus the same period last year as the Robuschi acquisition added 4% and currency was a 4% headwind. Operating income for the second quarter was $108 million compared to $99.2 million, an increase of 9% versus the prior-year, reflecting the positive impact of the recent Robuschi acquisition and the impact of operational excellence initiatives.
Operating margin in the quarter was 17.6%, a 140 basis points improvement over the second quarter of 2011. Net income was up 12% to $75.3 million and diluted earnings per share of $1.51 were up 19% of the last year’s second quarter and included unfavorable charges of $0.02 resulting in adjusted EPS of $1.53.
The more challenging macro environment and expected down cycle in Pressure Pumping contributed to a 17% decline in orders to $526 million. The Robuschi acquisition added 4% and currency was a 4% headwind to orders. Cancellations were about $40 million split evenly between the two segments. The book-to-bill ratio in the quarter was 0.86 and our backlog is $654 million as we entered the second half. Cash flow improved sequentially to $66 million, up 36% over the first quarter.
Turning our attention to the individual segments starting with the Engineered Products Group, revenues were $283 million essentially flat as positive revenue growth in our petroleum industrial pump business and our latest cycle project business Nash was offset by declines in Thomas and Emco Wheaton loading arms. EPG operating income increased 4% to $67.2 million and operating margins improved to 23.7%, up 80 basis points from last years second quarter.On orders, EPG orders in the second quarter declined by 36% to $200 million, driven principally by significantly lower demand in the petroleum and industrial pump business, which was down approximately 60% as well as weakness in Thomas and Emco Wheaton, both down approximately 20%.These declines were partially offset by high single-digit order growth in our later cycle project business Nash, driven by strength in chemicals and oil and gas globally.
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