IDEX Corporation (IEX) has posted an adjusted EPS of 57 cents in the first quarter of fiscal 2011, excluding the impact from restructuring related charges, compared with 46 cents in the year-ago quarter. This was above management’s guidance of 52 cents – 54 cents and quite easily beating the Zacks Consensus Estimate of 53 cents.
Sales of $427 million were up 20% from the year-ago quarter, including an organic growth of 12%, ahead of the Zacks Consensus Estimate of $403 million. The growth in revenues was powered by increased revenues from all segments excepting Dispensing Equipment. New orders in the quarter were $442 million, up 19% from the year-ago quarter.
On a segmental basis, Fluid & Metering Technologies accounted for 46% of total sales, up 17% from the year-ago quarter. Health & Science Technologies represented 31% of total sales, up 43% from the year-ago quarter. Dispensing Equipment accounted for 7% of total sales, down 4% from the year-ago quarter. Fire & Safety/Diversified Products contributed 16% of total sales, up 5% from the year-ago quarter.
The company’s Fluid & Metering and the Health & Science segments benefited a great deal from exposure to end markets and expanded global reach.
Gross margin inched up 30 basis points from the year-ago quarter to 41.8%. Excluding prior-year restructuring-related charges, operating margin was 18.2%, up from 16.8% in the year-ago quarter, led by higher volume and improved product mix. There was growth in operating margins across all segments barring Dispensing Equipment.
During the first quarter of fiscal 2011, IDEX generated cash of $29.4 million from operations and used $11.4 million for capital expenditure. Free cash flow was $20.3 million.
IDEX Corporation exited its first quarter of fiscal 2011 with cash and cash equivalents of $195.5 million, down $39.6 million from the previous year. Long-term borrowings increased to $415.4 million from $408.5 million in the previous year.
Management stated that in the quarter the company acquired Advanced Thin Films and Microfluidics. In the near term, the company will continue to invest in Health & Science Technologies.
Guidance
For fiscal 2011, IDEX Corporation projects EPS in the range of $2.30 – $2.40, up from the previous guidance range of $2.23 – $2.33.
For the second quarter of fiscal 2011, the company estimates EPS in the range of 58 cents – 60 cents.
We have a Neutral recommendation on IDEX Corporation and wait for realization of synergies from acquisitions. The stock at present retains its Zacks #2 Rank (short-term Buy rating), as the company’s results were above expectations and fiscal 2011 guidance was upgraded.
Be the first to comment