KENOSHA, Wis. - October 16, 2014 - (BUSINESS WIRE) - 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 2014.
"We were encouraged by our third quarter results that demonstrate ongoing progress along Snap-on’s runways for both coherent growth and improvement, as solid organic sales gains across all operating segments were accompanied by a 23.1% increase in earnings per share," said Nick Pinchuk, Snap-on chairman and chief executive officer. "In the third quarter, Snap-on was honored to again receive product awards from both MOTOR Magazine and Professional Tool & Equipment News. We believe this recognition reflects Snap-on’s capabilities in translating our deep understanding of professionals’ work into winning innovations. Finally, our results and progress reflect a tremendous dedication and effort all across Snap-on. In that regard, I thank our franchisees and associates worldwide for their commitment and their contributions."
Commercial & Industrial Group segment sales of $298.8 million in the quarter increased $23.6 million, or 8.6%, from 2013 levels. Excluding $2.0 million of unfavorable foreign currency translation, organic sales increased $25.6 million, or 9.4%, primarily due to higher volume with customers in critical industries and in the segment’s European-based hand tools business.
Operating earnings of $40.8 million in the period increased $4.8 million from 2013 levels, and the operating margin (operating earnings as a percentage of segment sales) of 13.7% improved 60 basis points from 13.1% a year ago.
Snap-on Tools Group segment sales of $355.0 million in the quarter rose $21.2 million, or 6.4%, from 2013 levels, reflecting sales increases in both the company’s U.S. and international franchise operations. Excluding $1.2 million of favorable foreign currency translation, organic sales increased 6.0%.
Operating earnings of $49.5 million in the period increased $7.6 million from 2013 levels, and the operating margin of 13.9% improved 130 basis points from 12.6% a year ago.
Repair Systems & Information Group segment sales of $271.2 million in the quarter increased $18.5 million, or 7.3%, from 2013 levels. Excluding $5.6 million of acquisition-related sales and $1.6 million of favorable foreign currency translation, organic sales increased $11.3 million, or 4.4%, primarily due to higher sales to OEM dealerships and increased sales of diagnostic and repair information products to independent repair shop owners and managers, partially offset by lower sales of undercar equipment, largely reflecting weakness in Eastern Europe.
Operating earnings of $63.3 million in the period increased $5.4 million from 2013 levels, and the operating margin of 23.3% improved 40 basis points from 22.9% a year ago.
Financial Services operating earnings of $37.7 million on revenue of $53.6 million in the quarter compared with operating earnings of $31.6 million on revenue of $45.1 million a year ago.
Corporate expenses of $23.0 million in the quarter compared with expenses of $24.5 million last year.
Snap-on expects to make continued progress along its defined runways for coherent growth, including enhancing the franchise network, expanding in the vehicle repair garage, extending to critical industries and building in emerging markets. In pursuit of these initiatives, Snap-on anticipates that capital expenditures in 2014 will be in a range of $75 million to $80 million, of which $63.3 million has been incurred through the end of the third quarter. Snap-on continues to expect that its full year 2014 effective income tax rate will be comparable to its 2013 rate.
Conference Call and Webcast on October 16, 2014, at 9:00 a.m. Central Time
A discussion of this release will be webcast on Thursday, October 16, 2014, 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, including the accompanying slide presentation, visit www.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 website.
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 and aerospace, agriculture, construction, government and military, mining, natural resources, power generation and technical education. Snap-on also derives income from various financing programs to facilitate the sales of its products. Products and services are sold through the company’s franchisee, company-direct, distributor and internet channels. Founded in 1920, Snap-on is a $3.1 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 may contain 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 28, 2013, 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.
SOURCE Snap-on
Leslie Kratcoski
Snap-on Incorporated
Investors Relations
262/656-6121
Richard Secori
Media Relations
Snap-on Incorporated
262/656-5561
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.