|
--EPS from continuing operations of $1.07 exceeded prior forecast, primarily due to strong execution of operational excellence programs
--Revenues of $3,593 million in the third quarter, down 8 percent compared with 2011 (down 1 percent excluding Hussmann)
--Q3 2012 operating margin of 12.5 percent, up by 1.1 percentage points
--$480 million of shares repurchased as of Oct. 18, 2012; expect to repurchase $840 million of shares by year end
--Full-year 2012 EPS from continuing operations forecast $3.17 to $3.23
Ingersoll-Rand plc (IR), a world leader in creating and sustaining
safe, comfortable and efficient environments, today reported diluted
earnings per share (EPS) from continuing operations of $1.07 for the
third quarter of 2012.
The company reported net earnings of $321.6 million, or EPS of $1.03,
for the third quarter of 2012. Third-quarter net earnings included
$333.9 million, or EPS of $1.07, from continuing operations, as well as
an after tax loss of $12.3 million, or EPS of ($0.04) from discontinued
operations. This compares with net earnings for the 2011 third quarter
of $86.2 million, which included EPS of $0.28 from continuing operations
and an after-tax EPS loss of ($0.03) from discontinued operations.
Third-quarter 2011 EPS included $180.6 million, or EPS of ($0.53), of
impairment costs related to the disposition of the Hussmann
refrigeration business. Excluding impairment costs, third-quarter 2011
adjusted EPS from continuing operations totaled $0.81. (See table
below)
Third-Quarter EPS Table
-----------------------------------------------------------
Q3 2012 Q3 2011
--------- ----------------
Reported EPS $1.03* $0.25
Adjustments: Add Back
----------------------------------
0.04 0.03
- Discontinued Operations
--- 0.53
- Asset Impairment/Loss on Sale
--------- ----------------
Adjusted EPS Continuing Operations $1.07* $0.81
========= ================
*Reported and adjusted EPS included $0.09 from a net discrete tax
benefit
"We have delivered on our strategy to increase profitability and
shareholder value with solid third-quarter earnings per share that
exceeded our forecast," said Michael W. Lamach, chairman and chief
executive officer. "We are continuing to generate significant operating
leverage while we invest in future growth platforms. I believe the
combination of our strategy and a sound use of capital will drive strong
earnings growth in the coming years, even if economies do not improve.
We will remain focused on organic revenue growth, expansion of operating
margins and a balanced, disciplined capital allocation strategy in the
face of expected economic headwinds."
Additional Highlights for the 2012 Third Quarter
Revenues: The company’s reported revenues
declined by 8 percent to $3,593 million, compared with revenues of
$3,910 million for the 2011 third quarter. Total revenues, excluding the
results of Hussmann, were down 1 percent compared with 2011 (up 1
percent excluding currency). U.S. revenues, excluding Hussmann, were up
3 percent compared to 2011, and revenues from international operations
declined by approximately 7 percent (down 1 percent excluding currency).
Operating Income and Margin: Operating
income for the 2012 third quarter was $448 million, compared with $181
million ($415 million excluding Hussmann’s results and impairment costs)
for the 2011 third quarter. The third-quarter operating margin was 12.5
percent compared with an operating margin of 4.6 percent (11.4 percent
excluding Hussmann’s results and impairment costs) for the same period
of 2011. The year-over-year margin improvement was due to higher prices
and productivity, partially offset by inflation, unfavorable product
mix, currency translation and increased investments.
Interest Expense and Other Income/Expense:
Interest expense of $61 million for the third quarter of 2012 decreased
by approximately $9 million compared with the same period last year due
to lower debt balances. Other income totaled $17 million for the third
quarter of 2012, compared with approximately $21 million of income for
the 2011 third quarter. The year-over-year change was primarily due to
currency losses and lower interest income.
Taxes: The company had a tax rate of 16
percent in the third quarter of 2012. The rate for the third quarter of
2011 was 22 percent. During the three months ended Sept. 30, 2012, the
company recorded a net discrete tax benefit of approximately $29
million, primarily resulting from the consolidation of legal entities
outside of the United States.
Third-Quarter Business Review
Climate Solutions delivers energy-efficient
solutions globally and includes Trane, which provides heating,
ventilation and air conditioning (HVAC) systems and building services,
parts, support and controls for commercial buildings, and Thermo King,
the leader in transport temperature control solutions. The total results
of the divested Hussmann refrigeration business are included through the
third quarter of 2011. The company’s ownership interest in Hussmann was
reported within other income/ expense using the equity method of
accounting for the third quarter of 2012. Third-quarter 2011 results
included approximately $282 million of revenues and $30 million of
operating income attributable to Hussmann.
Revenues for the third quarter of 2012 were $1,942 million and declined
by 15 percent compared with the third quarter of 2011. Excluding
Hussmann, revenue decreased by 3 percent (down 1 percent excluding
currency). Bookings, excluding Hussmann, increased by 1 percent
year-over-year (up 3 percent excluding currency).
On a year-over-year basis, total commercial HVAC revenues decreased by 2
percent (flat excluding currency) primarily due to declining markets in
Western Europe and currency translation. Total Thermo King refrigerated
transport revenues declined in the third quarter compared with last year
as moderate growth in the Americas was more than offset by declines in
European and Asian markets and unfavorable currency translation.
Third-quarter 2012 segment operating margin was 12.7 percent, compared
with 11.5 percent (11.7 percent excluding Hussmann’s results) last year.
The year-over-year margin improvement was due to pricing and
productivity actions, partially offset by inflation, negative currency,
unfavorable revenue volume/mix and higher investment spending.
Industrial Technologies provides products,
services and solutions to enhance customers’ productivity, energy
efficiency and operations. Products include compressed air systems,
tools, fluid power products, and golf and utility vehicles. Total
revenues in the third quarter of $702 million increased by 1 percent (up
4 percent excluding currency) compared with the third quarter of 2011.
Air and productivity revenues declined slightly, as volume gains in the
United States were more than offset by revenue declines in international
markets, primarily related to currency translation.
Club Car revenues increased mid-single digits compared with the third
quarter of 2011 from gains in the golf market.
Third-quarter segment operating margin for Industrial Technologies was
15.2 percent, and increased by 1.4 percentage points compared with last
year. Margin benefits from improved productivity and pricing were
partially offset by inflation and increased investment spending.
Residential Solutions includes the Trane
and Schlage brands, which deliver safety, comfort and efficiency to
homeowners throughout the Americas. Products, services and solutions
include mechanical and electronic locks, HVAC systems, indoor air
quality solutions and controls, and remote home management systems.
Third-quarter revenues were $559 million, an increase of approximately
11 percent (up 11 percent excluding currency) compared with 2011.
Total reported residential security revenues were up low teens compared
with 2011 due to sales gains from the new residential builder markets
and "big box" customers in the United States and from strong growth in
South America.
HVAC revenues were up low teens compared with the third quarter of 2011
due to improving market conditions and market share gains in air
conditioning units and furnaces. Third-quarter segment operating margin
was 8.1 percent, an increase of 4.3 percentage points, compared with 3.8
percent recorded in 2011. The segment margin increase was due to
increased volume, improved productivity and higher pricing, which were
partially offset by inflation and an unfavorable revenue mix shift to
lower efficiency and opening price point air conditioning products.
Security Technologies is a leading global
supplier of commercial security products and services. The segment’s
market-leading products include mechanical and electronic security
products, biometric and access-control systems, and security and time
and attendance scheduling software. Third-quarter revenues of $391
million decreased by approximately 7 percent (down 4 percent excluding
currency) compared with the third quarter of 2011. Revenues in the
Americas were down by low single digits, as price improvements were more
than offset by lower volumes. Revenues in overseas markets also
decreased primarily due to declining construction markets and currency
translation. Third-quarter segment operating margin was 21.5 percent, up
slightly compared with the third quarter of 2011. The higher segment
operating margin was due to higher productivity and improved pricing,
partially offset by inflation, unfavorable revenue mix and increased
investment spending.
Balance Sheet
During the third quarter, working capital was 3.9 percent of revenues
and increased slightly compared with 2011. Cash balances and total debt
balances were $0.9 billion and $3.3 billion, respectively, at the end of
the third quarter. The company repurchased 7.6 million shares during the
third quarter. Approximately 10.8 million shares have been repurchased
for approximately $480 million as of Oct. 18, 2012. The company expects
to spend a total of $840 million during 2012 to complete the current $2
billion share repurchase authorization. Approximately 47 million shares
have been repurchased for $1.6 billion since the program’s inception in
June of 2011.
Outlook
Ingersoll Rand’s major end markets showed an uneven and choppy demand
pattern in the third quarter of 2012 with moderate organic growth rates
in the United States and Latin America, and declining activity in
Western Europe and in Asia. Based on current order rates, the company
expects fourth quarter revenues to be flat compared with last year.
Revenues for full-year 2012 are expected to be in the range of $13.95
billion to $14.05 billion. The year-over-year change in currency
exchange rates is expected to reduce reported revenue growth by 2
percentage points in 2012. Full-year EPS from continuing operations are
expected to be in the range of $3.17 to $3.23. The forecast includes a
tax rate of 19 percent for continuing operations and an average diluted
share count for the full year of approximately 311 million shares.
Available cash flow for full-year 2012 is expected to approximate $1.0
billion, based on projected earnings, capital expenditures and working
capital requirements.
Fourth-quarter 2012 revenues are expected to be in the range of $3.4
billion to $3.5 billion and EPS from continuing operations are expected
to be in the range of $0.64 to $0.70. The fourth-quarter forecast
reflects a tax rate of 29 percent for continuing operations (includes a
$22 million discrete tax charge) and an average diluted share count of
approximately 306 million shares.
This news release includes "forward-looking statements," which are
statements that are not historical facts, including statements that
relate to the mix of and demand for our products, performance of the
markets in which we operate, our capital allocation strategy and our
2012 full-year and fourth-quarter financial performance. These
forward-looking statements are based on our current expectations and are
subject to risks and uncertainties, which may cause actual results to
differ materially from our current expectations. Factors that could
cause such differences can be found in our Form 10-K for the year ended
December 31, 2011, Form 10-Q for the quarters ended March 31, 2012 and
June 30, 2012, and in our other SEC filings. We assume no obligation to
update these forward-looking statements.
This news release also includes adjusted non-GAAP financial information
which should be considered supplemental to, not a substitute for, or as
superior to, the financial measure calculated in accordance with GAAP.
Further information about the adjusted non-GAAP financial information,
including reconciliation to the nearest GAAP measure, is included in
financial tables attached to this news release.
All amounts reported within the earnings release above related to net
earnings (loss), earnings (loss) from continuing operations, earnings
(loss) from discontinued operations, and per share amounts are
attributed to Ingersoll Rand’s ordinary shareholders.
Ingersoll Rand (IR) advances the quality of life by creating and
sustaining safe, comfortable and efficient environments. Our people and
our family of brands--including Club Car(R), Ingersoll Rand(R), Schlage(R),
Thermo King(R) and Trane(R)--work together to enhance the quality and comfort
of air in homes and buildings; transport and protect food and
perishables; secure homes and commercial properties; and increase
industrial productivity and efficiency. We are a $14 billion global
business committed to a world of sustainable progress and enduring
results. For more information, visit ingersollrand.com.
10/19/12
(See Accompanying Tables)
--
Condensed Consolidated Income Statement
--
Segments
--
Non-GAAP Financial Tables
--
Condensed Consolidated Balance Sheet
--
Condensed Consolidated Statement of Cash Flow
--
Balance Sheet Metrics and Available Cash Flow
INGERSOLL-RAND PLC
Condensed Consolidated Income Statement
(In millions, except per share amounts)
UNAUDITED
----------------------------------------------------------------------------------------------------------
Three Months Nine Months
Ended September 30, Ended September 30,
--------------------------------- ---------------------------------
2012 2011 2012 2011
-------- -------- -------- --------
Net revenues $ 3,592.8 $ 3,910.1 $ 10,564.7 $ 11,275.3
Cost of goods sold (2,454.4 ) (2,756.2 ) (7,347.7 ) (7,987.7 )
Selling & administrative expenses (690.6 ) (708.6 ) (2,083.8 ) (2,115.0 )
Gain (loss) on sale / (asset impairment) - (264.8 ) 4.5 (651.6 )
-------- -------- -- -------- -------- --
Operating income 447.8 180.5 1,137.7 521.0
Interest expense (60.6 ) (69.7 ) (192.1 ) (209.7 )
Other income (expense), net 17.4 21.3 21.2 28.6
-------- -------- -------- --------
Earnings (loss) before income taxes 404.6 132.1 966.8 339.9
Provision for income taxes (65.3 ) (28.4 ) (157.9 ) (169.0 )
-------- -- -------- -- -------- -- -------- --
Earnings (loss) from continuing operations 339.3 103.7 808.9 170.9
Discontinued operations, net of tax (12.3 ) (10.2 ) (6.7 ) (49.7 )
-------- -- -------- -- -------- -- -------- --
Net earnings (loss) 327.0 93.5 802.2 121.2
Less: Net earnings attributable to noncontrolling interests (5.4 ) (7.3 ) (19.2 ) (20.3 )
-------- -- -------- -- -------- -- -------- --
Net earnings (loss) attributable to Ingersoll-Rand plc $ 321.6 $ 86.2 $ 783.0 $ 100.9
== ======== == ======== == ======== == ========
Amounts attributable to Ingersoll-Rand plc
----------------------------------------------------------
ordinary shareholders:
----------------------------------------------------------
Continuing operations $ 333.9 $ 96.4 $ 789.7 $ 150.6
Discontinued operations (12.3 ) (10.2 ) (6.7 ) (49.7 )
-------- -- -------- -- -------- -- -------- --
Net earnings (loss) $ 321.6 $ 86.2 $ 783.0 $ 100.9
== ======== == ======== == ======== == ========
Diluted earnings (loss) per share
attributable to
----------------------------------------------------------
Ingersoll-Rand plc ordinary shareholders:
----------------------------------------------------------
Continuing operations $ 1.07 $ 0.28 $ 2.52 $ 0.43
Discontinued operations (0.04 ) (0.03 ) (0.02 ) (0.14 )
-------- -- -------- -- -------- -- -------- --
$ 1.03 $ 0.25 $ 2.50 $ 0.29
== ======== == ======== == ======== == ========
Weighted-average number of ordinary
shares outstanding:
Diluted 312.0 340.2 312.9 347.1
INGERSOLL-RAND PLC
Business Review
(In millions, except percentages)
UNAUDITED
------------------------------------------------------------------------------------------------
Three Months Nine Months
Ended September 30, Ended September 30,
------------------------------- ---------------------------------
2012 2011 2012 2011
------- ------- -------- --------
Climate Solutions
----------------------------------------------
Net revenues $ 1,941.7 $ 2,289.7 $ 5,570.6 $ 6,380.0
Segment operating income * 247.0 264.3 ** 579.6 631.7 **
and as a % of Net revenues 12.7 % 11.5 % 10.4 % 9.9 %
Industrial Technologies
----------------------------------------------
Net revenues 701.6 696.5 2,180.6 2,108.9
Segment operating income 106.6 95.9 332.5 301.6
and as a % of Net revenues 15.2 % 13.8 % 15.2 % 14.3 %
Residential Solutions
----------------------------------------------
Net revenues 558.6 504.4 1,632.7 1,569.8
Segment operating income 45.4 19.0 86.3 67.2
and as a % of Net revenues 8.1 % 3.8 % 5.3 % 4.3 %
Security Technologies
----------------------------------------------
Net revenues 390.9 419.5 1,180.8 1,216.6
Segment operating income 83.9 89.2 236.2 252.2
and as a % of Net revenues 21.5 % 21.3 % 20.0 % 20.7 %
Gain (loss) on sale / (asset impairment) - (264.8 ) ** 4.5 (651.6 ) **
Unallocated corporate expense (35.1 ) (23.1 ) (101.4 ) (80.1 )
------- -- ------- -- -------- -- -------- --
Consolidated net revenues $ 3,592.8 $ 3,910.1 $ 10,564.7 $ 11,275.3
Consolidated operating income $ 447.8 $ 180.5 $ 1,137.7 $ 521.0
== ======= == ======= == ======== == ========
and as a % of Net revenues 12.5 % 4.6 % 10.8 % 4.6 %
* Segment operating income is the measure of profit and loss that
the Company uses to evaluate the financial performance of the
business and as the basis for performance reviews, compensation
and resource allocation. For these reasons, the Company believes
that Segment operating income represents the most relevant measure
of segment profit and loss. The Company may exclude certain
charges or gains from Operating income to arrive at Segment
operating income that is a more meaningful measure of profit and
loss upon which to base its operating decisions.
** During the three and nine months ended September 30, 2011, the
Company recorded a pre-tax impairment charge related to the Hussmann
divestiture of approximately $265 million and $652 million,
respectively. These charges have been excluded from Segment
operating income within the Climate Solutions segment.
INGERSOLL-RAND PLC
Reconciliation of non-GAAP to GAAP
(In millions, except per share amounts)
UNAUDITED
--------------------------------------------------------------------------------------------------------------
For the quarter ended September 30, 2012 For the nine months ended September 30, 2012
------------------------------------------------- ----------------------------------------------------
As As As As
Reported Adjustments Adjusted Reported Adjustments Adjusted
---------------- ------------- -------------- --------------- ---------------- ---------------
Net revenues $ 3,592.8 $ - $ 3,592.8 $ 10,564.7 $ - $ 10,564.7
Operating income 447.8 - (a) 447.8 1,137.7 (4.5 ) (a) 1,133.2
Operating margin 12.5 % 12.5 % 10.8 % 10.7 %
Earnings from continuing operations
before income taxes 404.6 - (a) 404.6 966.8 (4.5 ) (a) 962.3
Provision for income taxes (65.3 ) - (b) (65.3 ) (157.9 ) 7.4 (b) (150.5 )
Tax rate 16.1 % 16.1 % 16.3 % 15.6 %
Earnings from continuing operations
attributable to Ingersoll-Rand plc 333.9 - (c) 333.9 789.7 2.9 (c) 792.6
Diluted earnings per common share
-------------------------------------
Continuing operations $ 1.07 $ - $ 1.07 $ 2.52 $ 0.01 $ 2.53
Weighted-average number of common
shares outstanding
Diluted 312.0 - 312.0 312.9 - 312.9
Detail of Adjustments:
-------------------------------------
(a)Adjustment to Hussmann loss on sale $ - $ (4.5 )
(b)Tax impact of Hussmann divestiture - 7.4
--- ----
(c)Impact of adjustments on earnings from
continuing operations attributable to
Ingersoll-Rand plc $ - $ 2.9
=== === == ====
The Company reports its financial results in accordance with
generally accepted accounting principles in the United States
(GAAP). This supplemental schedule provides adjusted non-GAAP
financial information and a quantitative reconciliation of the
difference between the non-GAAP financial measures and the
financial measures calculated and reported in accordance with GAAP.
The non-GAAP financial measures should be considered supplemental
to, not a substitute for or superior to, financial measures
calculated in accordance with GAAP. They have limitations in that
they do not reflect all of the costs associated with the
operations of our businesses as determined in accordance with
GAAP. In addition, these measures may not be comparable to
non-GAAP financial measures reported by other companies.
We believe the non-GAAP financial information provides important
supplemental information to both management and investors
regarding financial and business trends used in assessing our
financial condition and results of operations. We believe that it
is meaningful to provide the relative impact of impairment charges
and the corresponding tax impacts in order to present a better
understanding of our results on a period to period comparative
basis.
The non-GAAP financial measures for operating income and margin,
tax rate and EPS assist investors with analyzing our business
segment results as well as with predicting future performance. In
addition, these non-GAAP financial measures are also reviewed by
management in order to evaluate the financial performance of each
segment. They are the basis for performance reviews, compensation
and resource allocation. We believe that the presentation of these
non-GAAP financial measures will permit investors to assess the
performance of the Company on the same basis as management.
As a result, one should not consider these measures in isolation
or as a substitute for our results reported under GAAP. We
compensate for these limitations by analyzing results on a GAAP
basis as well as a non-GAAP basis, prominently disclosing GAAP
results and providing reconciliations from GAAP results to
non-GAAP results.
INGERSOLL-RAND PLC
Reconciliation of non-GAAP to GAAP
(In millions, except per share amounts)
UNAUDITED
-------------------------------------------------------------------------------------------------------------------
For the quarter ended September 30, 2011 For the nine months ended September 30, 2011
------------------------------------------------------ -----------------------------------------------------
As As As As
Reported Adjustments Adjusted Reported Adjustments Adjusted
----------------- ----------------- -------------- --------------- ----------------- ---------------
Net revenues $ 3,910.1 $ - $ 3,910.1 $ 11,275.3 $ - $ 11,275.3
Operating income 180.5 264.8 (a) 445.3 521.0 651.6 (a) 1,172.6
Operating margin 4.6 % 11.4 % 4.6 % 10.4 %
Earnings (loss) from continuing operations
before income taxes 132.1 264.8 (a) 396.9 339.9 651.6 (a) 991.5
Provision for income taxes (28.4 ) (84.2 ) (b) (112.6 ) (169.0 ) (84.2 ) (b) (253.2 )
Tax rate 21.5 % 28.4 % 49.7 % 25.5 %
Earnings (loss) from continuing operations
attributable to Ingersoll-Rand plc 96.4 180.6 (c) 277.0 150.6 567.4 (c) 718.0
Diluted earnings per common share
-------------------------------------
Continuing operations $ 0.28 $ 0.53 $ 0.81 $ 0.43 $ 1.64 $ 2.07
Weighted-average number of common
shares outstanding
Diluted 340.2 - 340.2 347.1 - 347.1
Detail of Adjustments:
-------------------------------------
(a)Impairment charge related to Hussmann $ 264.8 $ 651.6
(b)Tax impact of Hussmann divestiture (84.2 ) (84.2 )
----- -- ----- --
(c)Impact of adjustments on earnings from
continuing operations attributable to
Ingersoll-Rand plc $ 180.6 $ 567.4
== ===== == =====
The Company reports its financial results in accordance with
generally accepted accounting principles in the United States
(GAAP). This supplemental schedule provides adjusted non-GAAP
financial information and a quantitative reconciliation of the
difference between the non-GAAP financial measures and the
financial measures calculated and reported in accordance with GAAP.
The non-GAAP financial measures should be considered supplemental
to, not a substitute for or superior to, financial measures
calculated in accordance with GAAP. They have limitations in that
they do not reflect all of the costs associated with the
operations of our businesses as determined in accordance with
GAAP. In addition, these measures may not be comparable to
non-GAAP financial measures reported by other companies.
We believe the non-GAAP financial information provides important
supplemental information to both management and investors
regarding financial and business trends used in assessing our
financial condition and results of operations. We believe that it
is meaningful to provide the relative impact of impairment charges
and the corresponding tax impacts in order to present a better
understanding of our results on a period to period comparative
basis.
The non-GAAP financial measures for operating income and margin,
tax rate and EPS assist investors with analyzing our business
segment results as well as with predicting future performance. In
addition, these non-GAAP financial measures are also reviewed by
management in order to evaluate the financial performance of each
segment. They are the basis for performance reviews, compensation
and resource allocation. We believe that the presentation of these
non-GAAP financial measures will permit investors to assess the
performance of the Company on the same basis as management.
As a result, one should not consider these measures in isolation
or as a substitute for our results reported under GAAP. We
compensate for these limitations by analyzing results on a GAAP
basis as well as a non-GAAP basis, prominently disclosing GAAP
results and providing reconciliations from GAAP results to
non-GAAP results.
INGERSOLL-RAND PLC
Reconciliation of non-GAAP to GAAP
(In millions)
UNAUDITED
----------------------------------------------------------------------------
For the quarter ended September 30, 2012
----------------------------------------------------------------------
As Reported Margin Hussmann As Adjusted Margin
---------------- --------- ---------- -------------- ---------
Climate Solutions
Net revenues $ 1,941.7 $ - $ 1,941.7
Segment operating income $ 247.0 12.7 % $ - $ 247.0 12.7 %
Other income (expense) 2.7 0.2 % - 2.7 0.2 %
Depreciation and amortization 38.9 2.0 % - 38.9 2.0 %
------- ---- --- ---- ------- ---- ---
EBITDA $ 288.6 14.9 % $ - $ 288.6 14.9 %
=== ======= ==== === ==== ==== ===== ======= ==== ===
Industrial Technologies
Net revenues $ 701.6
Segment operating income $ 106.6 15.2 %
Other income (expense) (2.3 ) -0.3 %
Depreciation and amortization 12.8 1.8 %
------- ---- ---
EBITDA $ 117.1 16.7 %
=== ======= ==== ===
Residential Solutions
Net revenues $ 558.6
Segment operating income $ 45.4 8.1 %
Other income (expense) 0.1 0.0 %
Depreciation and amortization 27.9 5.0 %
------- ---- ---
EBITDA $ 73.4 13.1 %
=== ======= ==== ===
Security Technologies
Net revenues $ 390.9
Segment operating income $ 83.9 21.5 %
Other income (expense) 0.1 0.0 %
Depreciation and amortization 9.2 2.3 %
------- ---- ---
EBITDA $ 93.2 23.8 %
=== ======= ==== ===
Total Company
Net revenues $ 3,592.8 $ - $ 3,592.8
Segment operating income $ 447.8 12.5 % $ - $ 447.8 12.5 %
Other income (expense) 13.4 0.3 % - 13.4 0.3 %
Depreciation and amortization 92.3 2.6 % - 92.3 2.6 %
------- ---- --- ---- ------- ---- ---
EBITDA $ 553.5 15.4 % $ - $ 553.5 15.4 %
=== ======= ==== === ==== ==== ===== ======= ==== ===
The Company reports its financial results in accordance with
generally accepted accounting principles in the United States
(GAAP). This supplemental schedule provides adjusted non-GAAP
financial information and a quantitative reconciliation of the
difference between the non-GAAP financial measures and the financial
measures calculated and reported in accordance with GAAP.
The non-GAAP financial measures should be considered supplemental
to, not a substitute for or superior to, financial measures
calculated in accordance with GAAP. They have limitations in that
they do not reflect all of the costs associated with the operations
of our businesses as determined in accordance with GAAP. In
addition, these measures may not be comparable to non-GAAP financial
measures reported by other companies.
We believe the non-GAAP financial information provides important
supplemental information to both management and investors regarding
financial and business trends used in assessing our financial
condition and results of operations.
The non-GAAP financial measures of EBITDA and EBITDA margin assist
investors with analyzing our business segment results as well as
with predicting future performance. In addition, these non-GAAP
financial measures are also reviewed by management in order to
evaluate the financial performance of each segment. They are the
basis for performance reviews, compensation and resource allocation.
We believe that the presentation of these non-GAAP financial
measures will permit investors to assess the performance of the
Company on the same basis as management.
As a result, one should not consider these measures in isolation or
as a substitute for our results reported under GAAP. We compensate
for these limitations by analyzing results on a GAAP basis as well
as a non-GAAP basis, prominently disclosing GAAP results and
providing reconciliations from GAAP results to non-GAAP results.
INGERSOLL-RAND PLC
Reconciliation of non-GAAP to GAAP
(In millions)
UNAUDITED
----------------------------------------------------------------------------
For the quarter ended September 30, 2011
---------------------------------------------------------------------
As Reported Margin Hussmann As Adjusted Margin
-------------- --------- ----------- -------------- ---------
Climate Solutions
Net revenues $ 2,289.7 $ 281.8 $ 2,007.9
Segment operating income $ 264.3 11.5 % $ 30.1 $ 234.2 11.7 %
Other income (expense) 2.0 0.1 % - 2.0 0.1 %
Depreciation and amortization 42.4 1.9 % - 42.4 2.1 %
------- ---- --- ----- ------- ---- ---
EBITDA $ 308.7 13.5 % $ 30.1 $ 278.6 13.9 %
===== ======= ==== === ==== ===== ===== ======= ==== ===
Industrial Technologies
Net revenues $ 696.5
Segment operating income $ 95.9 13.8 %
Other income (expense) 1.1 0.1 %
Depreciation and amortization 12.6 1.8 %
------- ---- ---
EBITDA $ 109.6 15.7 %
===== ======= ==== ===
Residential Solutions
Net revenues $ 504.4
Segment operating income $ 19.0 3.8 %
Other income (expense) 3.0 0.6 %
Depreciation and amortization 27.6 5.4 %
------- ---- ---
EBITDA $ 49.6 9.8 %
===== ======= ==== ===
Security Technologies
Net revenues $ 419.5
Segment operating income $ 89.2 21.3 %
Other income (expense) 2.1 0.5 %
Depreciation and amortization 9.0 2.1 %
------- ---- ---
EBITDA $ 100.3 23.9 %
===== ======= ==== ===
Total Company
Net revenues $ 3,910.1 $ 281.8 $ 3,628.3
Segment operating income $ 445.3 11.4 % $ 30.1 $ 415.2 11.4 %
Other income (expense) 13.3 0.3 % - 13.3 0.4 %
Depreciation and amortization 96.8 2.5 % - 96.8 2.7 %
------- ---- --- ----- ------- ---- ---
EBITDA $ 555.4 14.2 % $ 30.1 $ 525.3 14.5 %
===== ======= ==== === ==== ===== ===== ======= ==== ===
The Company reports its financial results in accordance with
generally accepted accounting principles in the United States
(GAAP). This supplemental schedule provides adjusted non-GAAP
financial information and a quantitative reconciliation of the
difference between the non-GAAP financial measures and the
financial measures calculated and reported in accordance with GAAP.
The non-GAAP financial measures should be considered supplemental
to, not a substitute for or superior to, financial measures
calculated in accordance with GAAP. They have limitations in that
they do not reflect all of the costs associated with the
operations of our businesses as determined in accordance with
GAAP. In addition, these measures may not be comparable to
non-GAAP financial measures reported by other companies.
We believe the non-GAAP financial information provides important
supplemental information to both management and investors
regarding financial and business trends used in assessing our
financial condition and results of operations.
The non-GAAP financial measures of EBITDA and EBITDA margin assist
investors with analyzing our business segment results as well as
with predicting future performance. In addition, these non-GAAP
financial measures are also reviewed by management in order to
evaluate the financial performance of each segment. They are the
basis for performance reviews, compensation and resource
allocation. We believe that the presentation of these non-GAAP
financial measures will permit investors to assess the performance
of the Company on the same basis as management.
As a result, one should not consider these measures in isolation
or as a substitute for our results reported under GAAP. We
compensate for these limitations by analyzing results on a GAAP
basis as well as a non-GAAP basis, prominently disclosing GAAP
results and providing reconciliations from GAAP results to
non-GAAP results.
INGERSOLL-RAND PLC
Condensed Consolidated Balance Sheets
(In millions)
UNAUDITED
September 30, December 31,
2012 2011
---------------- ----------------
ASSETS
Cash and cash equivalents $ 929.6 $ 1,160.7
Accounts and notes receivable, net 2,320.9 2,135.6
Inventories 1,462.1 1,278.3
Other current assets 517.0 613.9
-------- --------
Total current assets 5,229.6 5,188.5
Property, plant and equipment, net 1,618.6 1,639.4
Goodwill 6,112.5 6,104.0
Intangible assets, net 4,230.9 4,333.6
Other noncurrent assets 1,468.7 1,488.7
-------- --------
Total assets $ 18,660.3 $ 18,754.2
====== ======== ====== ========
LIABILITIES AND EQUITY
Accounts payable $ 1,300.5 $ 1,224.2
Accrued expenses and other current liabilities 2,001.0 2,137.0
Short-term borrowings and current maturities of long-term debt 1,024.6 763.3
-------- --------
Total current liabilities 4,326.1 4,124.5
Long-term debt 2,271.6 2,879.3
Other noncurrent liabilities 4,532.6 4,734.7
Equity 7,530.0 7,015.7
-------- --------
Total liabilities and equity $ 18,660.3 $ 18,754.2
====== ======== ====== ========
INGERSOLL-RAND PLC
Condensed Consolidated Statements of Cash Flows
(In millions)
UNAUDITED
-----------------------------------------------------------------------------------------------------------------------------------------------
Nine Months
Ended September 30,
-----------------------------------
2012 2011
------- -------
Operating Activities
Income from continuing operations $ 808.9 $ 170.9
Loss on sale/asset impairment (4.5 ) 651.6
Depreciation and amortization 285.4 301.8
Changes in assets and liabilities and other non-cash items (266.9 ) (355.5 )
------- --- ------- ---
Net cash from operating activities of continuing operations 822.9 768.8
(87.4 ) (28.0 )
Net cash from operating activities of discontinued operations
------- --- ------- ---
Net cash from operating activities 735.5 740.8
Investing Activities
Capital expenditures (170.9 ) (129.1 )
Proceeds from business dispositions, net of cash - 336.7
Other investing activities, net 12.8 47.5
------- -------
Net cash from investing activities of continuing operations (158.1 ) 255.1
Net cash from investing activities of discontinued operations 36.0 44.4
------- -------
Net cash from investing activities (122.1 ) 299.5
Financing Activities
Net debt proceeds (repayments) (351.5 ) (52.5 )
Dividends paid (145.1 ) (101.5 )
Repurchase of ordinary shares (374.8 ) (575.6 )
Other financing activities, net 34.0 79.3
------- -------
Net cash from financing activities of continuing operations (837.4 ) (650.3 )
Net cash from financing activities of discontinued operations - -
------- -------
Net cash from financing activities (837.4 ) (650.3 )
Effect of exchange rate changes on cash and cash equivalents (7.1 ) (0.5 )
------- --- ------- ---
Net increase (decrease) in cash and cash equivalents (231.1 ) 389.5
Cash and cash equivalents - beginning of period 1,160.7 1,014.3
------- -------
Cash and cash equivalents - end of period $ 929.6 $ 1,403.8
=== ======= === =======
INGERSOLL-RAND PLC
Balance Sheet Metrics and Available Cash Flow
($ in millions)
UNAUDITED
---------------------------------------------------------------------------
December 31, September 30,
-------------- ------------------------------------
2011 2012 2011 *
------------ -------- ------------------
Net Receivables $ 2,136 $ 2,321 $ 2,488
Days Sales Outstanding 56.2 58.9 58.1
Net Inventory $ 1,278 $ 1,462 $ 1,644
Inventory Turns 7.7 6.7 6.7
Accounts Payable $ 1,224 $ 1,301 $ 1,410
Days Payable Outstanding 45.1 48.4 46.7
* Figures include balances for Hussmann business divested on
September 30, 2011.
Nine Months
Ended
September 30, 2012
--------------------
Cash flow from operating activities (a) $ 735.5
Capital expenditures (a) (170.9 )
Available cash flow $ 564.6
========= =========
(a)Includes both continuing and discontinued operations.
The Company reports its financial results in accordance with
generally accepted accounting principles in the United States
(GAAP). This supplemental schedule provides adjusted non-GAAP
financial information and a quantitative reconciliation of the
difference between the non-GAAP financial measure and the financial
measure calculated and reported in accordance with GAAP.
The non-GAAP financial measure should be considered supplemental to,
not a substitute for or superior to, the financial measure
calculated in accordance with GAAP. It has limitations in that it
does not reflect all of the costs associated with the operations of
our businesses as determined in accordance with GAAP. In addition,
this measure may not be comparable to non-GAAP financial measures
reported by other companies.
We believe the non-GAAP financial information provides important
supplemental information to both management and investors regarding
financial and business trends used in assessing our financial
condition and cash flow.
The non-GAAP financial measure of available cash flow assists
investors with analyzing our business results as well as with
predicting future performance. In addition, this non-GAAP financial
measure is reviewed by management in order to evaluate the financial
performance of each segment as well as the Company as a whole. It is
the basis for performance reviews, compensation and resource
allocation. We believe that the presentation of this non-GAAP
financial measure will permit investors to assess the performance of
the Company on the same basis as management.
As a result, one should not consider this measure in isolation or as
a substitute for our results reported under GAAP. We compensate for
these limitations by analyzing results on a GAAP basis as well as a
non-GAAP basis, prominently disclosing GAAP results and providing
reconciliations from GAAP results to non-GAAP results.
SOURCE: Ingersoll-Rand plc
Ingersoll-Rand
Media:
Misty Zelent, 704-655-5324
mzelent@irco.com
-or-
Investors and Financial Analysts:
Joe Fimbianti, 704-655-4721
joseph_fimbianti@irco.com
-or-
Janet Pfeffer, 704-655-5319
janet_pfeffer@irco.com
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