Snap-On 1Q Profit Up 26% On Strength In Tools Segment
04/19/2012| 09:15am US/Eastern
Snap-On Inc.'s (>> Snap-on Incorporated) first-quarter earnings rose 26% as the tool maker booked a double-digit increase in tool sales, along with higher commercial and industrial segment sales.
The company controls a big chunk of the professional tool market, where it competes with Stanley Black & Decker Inc.'s (SWK) Mac Tools unit and Danaher Corp.'s (>> Danaher Corporation) Matco. Snap-On gets more than half its sales from the U.S. and from the auto sector, but has sought growth in emerging markets and higher-margin segments such as power generation and aerospace.
The company, which offers its products and services in more than 130 countries, has seen sales improve in recent quarters.
Snap-On reported a profit of $71 million, or $1.21 a share, up from $56.2 million, or 96 cents a share, a year earlier. Net sales increased 6% to $735.2 million. Excluding currency impacts, organic sales were up 7%.
Analysts polled by Thomson Reuters were expecting earnings of $1.16 a share on revenue of $737 million.
The company's commercial and industrial segment sales rose 5.2%, while the tools group's sales climbed 12%. Meanwhile, sales in the repair systems group edged down 0.4%.
Gross margin narrowed to 47.3% from 47.7%.
Shares closed Wednesday at $59.65 and were inactive premarket. The stock is up 18% this year.
-By Lauren Pollock and Anne Pallivathuckal, Dow Jones Newswires; 212-416-2356; firstname.lastname@example.org