Rexnord Corporation (NYSE:RXN):
Third Quarter Highlights
- Net sales increased 4% (+4% core sales) to $489 million
- Income from operations increased 13% to $68 million year-over-year resulting in a 120 basis point increase in operating margin to 14%
- Adjusted earnings per share increased 79% from the prior year to $0.34
- Adjusted EBITDA of $98 million resulting in an adjusted EBITDA margin of 20%
- Completed acquisition of Precision Gear Holdings, LLC
Todd A. Adams, President and Chief Executive Officer, commented, "We are pleased with our third quarter results and overall levels of core growth, profitability and free cash flow. As it relates to each of our platforms, the 12 percent core growth and 160 basis point adjusted operating margin improvement in our Water Management platform aligns with our expectations of accelerating growth and margin improvement within the platform while the outlook in our served markets continues to improve. In Process & Motion Control, we are encouraged by the very strong margin performance amidst, in aggregate, a stable set of industrial end markets that we expect to improve over the next several quarters. Finally, our strong free cash flow in the quarter allowed us to both de-lever and acquire Precision Gear Holdings, which expands our exposure to the energy and aerospace end markets."
Fourth Quarter and Fiscal 2014 Outlook and GuidanceMr. Adams continued, "We are raising our full year adjusted earnings per share guidance to $1.35 to $1.39 reflecting our third quarter results, latest outlook, benefit of the recently completed Precision Gear Holdings acquisition as well as the inclusion of incremental expenses we will incur related to acquisition opportunities that we are currently pursuing." Third Quarter Fiscal 2014 Segment Highlights Process & Motion Control Process & Motion Control ("PMC") net sales were $301 million in the third quarter of fiscal 2014 and $303 million in the third quarter of fiscal 2013. Core net sales decreased 1% year-over-year as low single digit sales growth in the majority of our end-markets was offset by a decline in sales to our bulk material handling markets.