KENOSHA, Wis. - October 18, 2012 - ()--Snap-on Incorporated (NYSE: SNA), a leading global innovator, manufacturer and marketer of tools, equipment, diagnostics, repair information and systems solutions for professional users performing critical tasks, today announced operating results for the third quarter of 2012.
“We believe our third quarter results demonstrate continued progress along our defined runways for coherent growth: enhancing the franchise network, expanding in the vehicle repair garage, extending into critical industries and building in emerging markets,” said Nick Pinchuk, Snap-on chairman and chief executive officer. “These results also underscore the way in which our commitment to the Snap-on Value Creation processes drives ongoing improvement in safety, quality, customer connection, innovation and rapid continuous improvement. As further evidence of our success in connecting with customers and translating that insight into winning innovation, we are honored to have been recognized again in 2012 by both MOTOR Magazine and Professional Tool & Equipment News with multiple awards for Snap-on products in each publication. Finally, these results and achievements reflect significant effort and dedication across the organization and I thank our franchisees and associates worldwide for their extraordinary contributions and commitment.”
Commercial & Industrial Group segment sales of $280.4 million in the third quarter increased $2.1 million, or 0.8%, from 2011 levels; excluding $8.8 million of unfavorable foreign currency translation, organic sales increased 4.0%.
Operating earnings of $33.4 million in the period increased $3.8 million, or 12.8%, from 2011 levels and the operating margin (operating earnings as a percentage of segment sales) of 11.9% increased from 10.6% a year ago.
Snap-on Tools Group segment sales of $308.8 million in the third quarter rose $29.2 million, or 10.4%, from 2011 levels; excluding $1.6 million of unfavorable foreign currency translation, organic sales increased 11.1%.
Operating earnings of $40.2 million in the period increased $4.6 million, or 12.9%, from 2011 levels and the operating margin of 13.0% improved from 12.7% a year ago.
Repair Systems & Information Group segment sales of $222.0 million in the third quarter decreased $0.6 million from 2011 levels; excluding $6.5 million of unfavorable foreign currency translation, organic sales rose 2.7%.
Operating earnings of $49.5 million in the period increased $5.8 million from 2011 levels and the operating margin of 22.3% increased from 19.6% a year ago.
Financial Services operating earnings were $27.9 million on $40.5 million of revenue in the third quarter of 2012, as compared to operating earnings of $20.8 million on $32.7 million of revenue a year ago.
Corporate expenses of $26.9 million increased $12.3 million from prior-year levels primarily due to $12.2 million of higher stock-based (mark-to-market) expense. As a result of changes in the company’s quarter-end stock price, operating expenses in the third quarter of 2012 included $4.4 million of mark-to-market expense, while operating expenses in the third quarter of 2011 were partially offset by $7.8 million of mark-to-market benefit.
Snap-on expects to continue with its planned strategic investments to enhance its mobile tool distribution network, expand in the vehicle repair garage, extend to critical industries and build in emerging markets. As a result of these initiatives, Snap-on anticipates that capital expenditures in 2012 will be in a range of $75 million to $80 million, of which $59.5 million was spent in the first nine months of 2012. Snap-on anticipates that its full year 2012 effective income tax rate will approximate 33.2%.
Conference Call and Webcast October 18, 2012, at 9:00 a.m. Central Time
A discussion of this release will be webcast on Thursday, October 18, 2012, at 9:00 a.m. Central Time, and a replay will be available for at least 10 days following the call. To access the webcast and supporting materials, visitwww.snapon.com/sna and click on the link toward the bottom of the page. Additional detail about Snap-on is also available on the Snap-on web site.
Snap-on Incorporated is a leading global innovator, manufacturer and marketer of tools, equipment, diagnostics, repair information and systems solutions for professional users performing critical tasks. Products and services include hand and power tools, tool storage, diagnostics software, information and management systems, shop equipment and other solutions for vehicle dealerships and repair centers, as well as for customers in industries, including aviation, aerospace, agriculture, construction, government and military, mining, natural resources and power generation. Products and services are sold through the company’s franchisee, company-direct, distributor and internet channels. Founded in 1920, Snap-on is a $2.9 billion, S&P 500 company headquartered in Kenosha, Wisconsin.
Statements in this news release that are not historical facts, including statements that (i) are in the future tense; (ii) include the words “expects,” “anticipates,” “intends,” “approximates,” or similar words that reference Snap-on or its management; (iii) are specifically identified as forward-looking; or (iv) describe Snap-on’s or management’s future outlook, plans, estimates, objectives or goals, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Snap-on cautions the reader that this news release contains statements, including earnings projections, that are forward-looking in nature and were developed by management in good faith and, accordingly, are subject to risks and uncertainties regarding Snap-on’s expected results that could cause (and in some cases have caused) actual results to differ materially from those described or contemplated in any forward-looking statement. Factors that may cause the company’s actual results to differ materially from those contained in the forward-looking statements include those found in the company’s reports filed with the Securities and Exchange Commission, including the information under the “Safe Harbor” and “Risk Factors” headings in its Annual Report on Form 10-K for the fiscal year ended December 31, 2011, which are incorporated herein by reference. Snap-on disclaims any responsibility to update any forward-looking statement provided in this news release, except as required by law.
For additional information, please visit www.snapon.com.
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Snap-on Incorporated is a leading global innovator, manufacturer and marketer of tools, equipment, diagnostics, repair information and systems solutions for professional users performing critical tasks.