Ingersoll-Rand Q1 Profit Down 10%, But Affirms 2014 Outlook

(RTTNews) - Diversified industrial company Ingersoll-Rand Plc (IR) on Wednesday reported a 10 percent decline in profit for the first quarter from last year, as higher revenues and margins were more than offset by an increase in provision for income taxes.

Looking ahead, the company forecast earnings for the second quarter above analysts' estimates and also affirmed its financial outlook for fiscal 2014.

Ingersoll-Rand's net earnings for the first quarter were $79.0 million or $0.28 per share, down from $88.0 million or $0.29 per share in the year-ago period. The latest results included $0.02 per share of restructuring charges, compared to $0.05 per share of restructuring costs in the prior-year quarter.

Excluding items, adjusted earnings per share from continuing operations was $0.29, compared to $0.22 per share in the year-ago period. On average, 21 analysts polled by Thomson Reuters expected the company to report earnings of $0.26 per share for the quarter. Analysts' estimates typically exclude special items.

Net revenues for the quarter grew 3 percent to $2.72 billion from $2.64 billion in the prior-year period. Analysts had a consensus revenue estimate of $2.71 billion.

Total U.S. revenues for the quarter increased 3 percent, while revenues from international operations also rose 3 percent.

The company's operating margin for the quarter was 5.7 percent, compared with 4.5 percent in the same period last year.

Ingersoll-Rand had an effective tax rate of 23.3 percent in the latest quarter, compared to an effective tax rate of 7.5 percent in the prior-year period. Provision for income taxes in the quarter was $24.5 million, compared to $4.5 million in the year-ago quarter.

In Climate Solutions, net revenues for the quarter improved 4 percent from the prior-year period to $2.04 billion and bookings increased 7 percent year-over-year. Industrial Segment net revenues for the quarter edged up from the year-ago period to $682.1 million, while bookings declined by low-single digits compared with last year.

Looking ahead to the second quarter, Ingersoll-Rand forecast earnings per share from continuing operations in a range of $1.08 to $1.12, adjusted earnings per share from continuing operations of $1.09 to $1.13, and revenues to increase 4 percent to 5 percent from last year.

Street expect the company to report earnings of $1.06 per share for the quarter on revenues of $3.54 billion.

For fiscal 2014, Ingersoll-Rand affirmed its outlook for earnings per share from continuing operations in a range of $2.95 to $3.10, adjusted earnings of $3.05 to $3.20 per share, and revenues to increase in a range of 3 percent to 4 percent.

Analysts expect the company to report earnings of $3.14 per share for the year on revenues of $12.85 billion.

IR is currently trading at $60.24, up $2.25 or 3.88 percent on a volume of 1.53 million shares.