Other deductions was essentially flat as higher restructuring of $14 million and currency transaction losses of $11 million were offset by the payments received related to dumping duties of $37 million under the US Continued Dumping and Subsidy Offset Act. Pretax margin reflected an increase of 200 basis points.
Next slide, cash flow. Operating cash flow decreased 6% as strong earnings were offset by higher receivables related to sales timing. Free cash flow was essentially flat to prior year with strong conversion from earnings at 90%. Trade working capital as a percent of sales was even to prior year benefiting from strong inventory performance.
Moving to slide 7, business segment earnings. Business segment margin of 18.5% improved 160 basis points reflecting strong volume leverage and cost production benefit as well as the dumping duty payments received as mentioned earlier.
Corporate expense declined $14 million, primarily due to lower stock compensation expense and interest expense decreased 8%.Moving to slide eight, Process Management results. Process management net sales grew 19% and underlying sales grew 23% as currency translation deducted 4%. By region, the US was up 29%, Asia up 25%, Europe up 14%, Latin America up 33% and Middle East and Africa up 13%. Robust investment in oil and gas, chemical and power industries drove growth in all businesses and geographies. Sales benefited from approximately $130 million of converted backlog related to the Thailand flooding supply chain disruption. Segment margin of 23.1% improved 270 basis points, primarily driven by volume leverage and cost reduction benefits. Year-to-date underlying orders have grown 17%, with the US up over 20% which has driven backlog of 15% from the prior year. Continued energy in market strength and the high backlog supported strong outlook for the next several quarters. Next slide, Industrial Automation. Industrial automation net sales decreased 1%, but excluding currency translation grew to 3%, with the US up 12%, Asia flat, Europe down 4%, Latin America up 9% and Middle East and Africa down 1%. Read the rest of this transcript for free on seekingalpha.com
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- 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 + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV