Nordson Corporation (NDSN) reported in-line results for the fiscal second quarter of 2013 (ended April 30). Non-GAAP earnings per share came in at 84 cents, same as the Zacks Consensus Estimate and the year-ago earnings.
Revenue
Nordson Corporation reported net sales of $382.1 million in the quarter, up 21.2% year over year. The year-over-year growth was achieved by a 23.2% increase in volumes, offset partially by a 2.0% negative foreign currency translation impact.
Backlog exiting the quarter stood at $200 million, up 3% compared with the year-ago period while orders for the 12-week ended May 19, 2013 were down 2% over the same period a year-ago.
A brief discussion of revenue segments of Nordson Corporation has been provided below:
Adhesive dispensing systems revenue increased 26.9% year over year and represented 51.4% of total revenue in the quarter. Revenue from Advanced technology systems, roughly 34% of total revenue, grew 13.0% in the quarter while that from Industrial coating systems expanded by 22.5% and stood at 14.6% of total revenue.
On a regional basis, revenue generated in the United States grew 34.1% year over year; the Americas by 39.4%; Europe by 8.5%; Japan by 5.4% and Asia Pacific by 22.1%.
Margins
Cost of sales in the fiscal second quarter went up 31.6% year over year and represented 43.2% of total revenue; up from 39.8% in the year-ago quarter. Selling and administrative expenses, as a percentage of total revenue, stood at 35.3%. Operating margin in the quarter was 21.5%, down from 24.4% in the year-ago quarter.
Balance Sheet
Exiting the fiscal second quarter 2013, Nordson Corporation had cash and marketable securities balance of $62.8 million, up from $54.7 million in the previous quarter. Long-term debt stood at $551.6 million up from $517.6 million in the sequential quarter.
Cash Flow
During the quarter, Nordson Corporation distributed roughly $10 million as dividend and repurchased shares worth $22 million. Free cash flow in the quarter was approximately $47 million.
Outlook
For the fiscal third quarter of 2013, management of Nordson Corporation anticipates sales to range within $404-$419 million, up 6%-10% year over year. Organic growth is predicted to fall within the 0%-4% range while acquisitions are expected to have a 7% positive impact. Currency translation is likely to impact results negatively by 1%. Earnings per share are expected to be within the $1.00-$1.09 range.
Nordson Corporation is a $4.7 billion company, operating in the diversified machinery industry. The stock currently has a Zacks Rank #3 (Hold). Other stocks to watch out for in the industry are Graco Inc. (GGG), with a Zacks Rank #1 (Strong Buy) while Altra Holdings, Inc. (AIMC) and Colfax Corporation (CFX), each has a Zacks Rank #2 (Buy).
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