Interest expense increased $2 million for the quarter and $9 million year-to-date due to higher borrowing levels. Other expense (income) includes dividends of $4 million for the quarter and $8 million year-to-date, received from the Liquid Finishing businesses that are required to be held separate from the Company’s other businesses and accounted for as a cost-method investment.
The effective income tax rates of 32 percent for the quarter and 33 percent for the year-to-date are consistent with the comparable periods last year. This year’s rate is reduced by the effect of the investment income from the Liquid Finishing businesses held separate. Last year’s rate was reduced by the effect of the federal R&D credit that is not available in 2012.
|Certain measurements of segment operations are summarized below:|
|Thirteen Weeks||Thirty-nine Weeks|
|Net sales (in millions)||$||154.7||$||74.9||$||26.9||$||447.0||$||228.9||$||82.8|
|from last year|
|Sales||24 %||(4)%||7 %||19 %||0 %||11 %|
|Operating earnings||11 %||(23)%||22 %||4 %||(2)%||24 %|
|Operating earnings as a|
|percentage of net sales|
|2012||30 %||17 %||20 %||31 %||19 %||21 %|
|2011||34 %||21 %||17 %||35 %||19 %||18 %|
Industrial segment sales increased 24 percent for the quarter and 19 percent year-to-date, mostly from the addition of Powder Finishing operations. Without the increase from Powder Finishing operations, sales for the quarter increased 12 percent in the Americas, decreased 7 percent in Europe (1 percent increase at consistent translation rates) and decreased 12 percent in Asia Pacific. On the same basis, year-to-date sales increased 10 percent in the Americas, decreased 2 percent in Europe (4 percent increase at consistent translation rates) and decreased 5 percent in Asia Pacific. Powder Finishing operations contributed to segment operating earnings in the third quarter, but at a lower rate on sales, which drove the decrease in the operating margin rate for this segment.
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