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Pall Corporation Reports First Quarter Results

Stocks in this article: PLL

Pall Corporation (NYSE: PLL) today reported financial results for the first quarter of fiscal year 2013 which ended on October 31, 2012.

First Quarter Sales and Earnings Overview

Continuing Operations: (1)

First quarter sales were $627.6 million compared to $651.3 million last year, a decrease of 3.6%. Sales in local currency (“LC”) were flat year over year. Diluted EPS were $0.77 in the quarter, compared to $0.51 last year. Pro forma diluted EPS (2) were $0.68 compared to $0.66 last year, an increase of 3.0%. Foreign currency translation negatively impacted first quarter EPS by $0.03.

Total Company:

Diluted EPS were $2.92 in the quarter, compared to $0.59 last year. This includes a gain on the sale of certain assets of the Company’s blood product line.

Larry Kingsley, Pall President and CEO, said, “The first quarter proved to be challenging due to order cancellations and a reduction in customer volume commitment, particularly in three of our industrial global end markets. The emerging country markets are taking a more cautious approach to industrial capital commitment. Our more resilient Life Sciences business held up well driven by 8% growth in the BioPharmaceuticals markets. The team responded well to the situation and is managing to achieve reasonable profitability given the soft industrial segment demand. Structural cost improvement and product rationalization is enabling us to improve margin in the down sales environment.”

Life Sciences – First Quarter Highlights

(Dollar Amounts in Thousands and Discussion of Sales Changes are in Local Currency)
             

Sales:

OCT. 31, 2012 OCT. 31, 2011

% CHANGE

% CHANGE IN LC

BioPharmaceuticals $ 202,577 $ 196,012 3.3 7.9
Food & Beverage 49,586 56,019 (11.5 ) (6.8 )
Medical   47,788   49,723 (3.9 ) (0.1 )
Total Life Sciences segment $ 299,951 $ 301,754 (0.6 ) 3.8
 
 
Gross profit $ 175,954 $ 178,213
% of sales 58.7 59.1
Segment profit $ 69,842 $ 79,717
% of sales 23.3 26.4
 

BioPharmaceuticals : Within BioPharmaceuticals, our Pharmaceuticals sales increased nearly 10%. Consumables sales to Pharmaceuticals customers grew about 9%, on strength in the Americas and Asia, while systems sales grew 20%. Continued strength in the biotech market, as well as a 4% contribution from ForteBio, drove consumables sales growth. Laboratory sales were down 2% overall. This reflects the residual impact of supply chain issues in the Americas, partly mitigated by growth in Europe of 17%.

Food and Beverage : Consumables sales were down 3.1%. Excluding the impact of a divestiture in Italy, consumables sales were up slightly. This reflects strong consumables sales growth in the Americas, due in part to Latin America, largely offset by weakness in Europe related to lower beer and wine production levels. Overall systems sales declined 22.5%, reflective of weak capital commitment for systems in the Americas.

Medical : Medical sales were flat on weakness in the OEM market.

Industrial – First Quarter Highlights

(Dollar Amounts in Thousands and Discussion of Sales Changes are in Local Currency)
             

Sales:

OCT. 31, 2012 OCT. 31, 2011

% CHANGE

% CHANGE IN LC

Process Technologies $ 198,534 $ 214,285 (7.4 ) (4.0 )
Aerospace 58,435 56,633 3.2 5.0
Microelectronics   70,680   78,590 (10.1 ) (8.3 )
Total Industrial segment $ 327,649 $ 349,508 (6.3 ) (3.5 )
 
 
Gross profit $ 151,129 $ 157,139
% of sales 46.1 45.0
Segment profit $ 52,766 $ 43,635
% of sales 16.1 12.5
 

Process Technologies : Machinery & Equipment sales decreased 9%, reflecting reduced demand. Europe experienced broad-based slowing in this end market. Asian sales performance is off expectations due to slow end market demand in the primary metals and construction sectors, particularly in China. The Americas was also impacted by fulfillment challenges.

Sales in Fuels & Chemicals increased 9% driven by growth in Europe and in Asia. Growth in the Americas was hampered by weakness in the refinery sector.

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