flowserve Corporation (FLS) reported fourth-quarter 2010 earnings per share from continuing operations of $ 2.09, exceeding the Zacks consensus estimate of $ 1.98. For 2010, earnings per share from continuing operations was $ 7.03, exceeding the Zacks consensus estimate of $ 6.91.
During 2010, the company received its initiatives, realignment, which has helped to reduce its costs. Flowserve also expanded its global presence as it has increased its activities in flowering Asian, Middle East and Latin America markets.
Total revenue
Total revenue during the quarter decreased by 4.9% year-over-year, $ 1.14 billion. Excluding negative currency impact of 33 million, sales fell by 2.1%. On a constant currency basis, total bookings in the quarter rose by 9.8% to 1.03 billion.
For 2010, the total revenue was $ 4.23 billion, a decrease of 7.6 percent year on year. Excluding negative currency impact of 32 million, sales fell by 6.9%. Refused shipment volumes and difficult environment prices witnessed the beginning of 2009 affected the results of 2010.
Segment results
FSG Engineered Product Division (EPD) revenue for the quarter was 585.1 million, a decline of 10.8% (8.7% on a constant currency basis). industrial product Division (IPD) FSG 219.2 million, a decrease of 4.0% (7.4% on constant currency basis). flow control Division (FCD) turnover was $ 327.8 million, a decrease of 12.6% (6.3% on a constant currency basis).
Margins
Gross margin for the quarter was 13.3%, down 40 basis points year over year. Excluding realignment and effects of the acquisition of Valbart, the gross margin came to 35.1%. The operating margin increased 90 basis points to 5.7% or 16.1% before the impact of tax realignment and acquisition of Valbart.
Essay of the segment, the operating margin was 19.0% EPD (220 basis points), IPD was 9.6% (down 180 basis points) and FCD was 14.6% (down 340 basis points).
Balance sheet and Cash Flow
Cash and cash equivalents was EUR 557.6 million at the end of 2010 than 654. $ 3 million at the end of 2009. Cash flow exceeded total debt of $ 30 million at the end of the year. Total shareholders ' equity amounted to 2.11 billion.
Net cash from operating activities was $ 355.8 million in 2010 compared with 431. $ 3 million in 2009.
Outlook
Flowserve is expecting the 2011 earnings per share to be in the range of $ 7.10 for $ 8.00.
The company considers the difficult context of prices in 2010 will continue during the period starting in 2011, making the first half of the year more difficult than the second half of the year. Flowserve expects first quarter 2011 to see earnings increasing pressures from cost absorption, redistribution and dilutive acquisition Valbart. However, the company claims to compensate for these challenges through its focus on the increasing volumes of shipments and aftermarket business, anticipated savings from the activities of realignment, perform efficiently, and improve business operations.
Through its investment in China, India, the Middle East and Brazil, the company expects to maintain its strong margin performance forward. The company is building a series of new production facilities in those regions, with many projects already completed.
Flowserve Corporation is a leading global manufacturer and provider of after-sale service of systems of full flow control. The company develops and produces equipment for precision flow control-designed, such as pumps, valves and gaskets for critical service applications that require high reliability. The company uses its platform to offer a wide range of spare parts for equipment, services such as installation, advanced diagnostics, repair and adaptation. The company uses an imprint of rapid response centers (QRCs) around the globe to provide these services post-sale. Principal competitors of Flowserve shall itt Corporation (ITT), John Crane Inc. and Metso Corporation.
Currently, we maintain our neutral rating on Flowserve with a Zacks # 5 Rank (recommendation to sell short-term) in the coming months one to three.
FLOWSERVE CORP. (FLS): Report of Free Stock Analysis
ITT CORP. (ITT): Free Stock Analysis reports
Zacks Investment Research
No comments:
Post a Comment