Rockwell Automation Inc, whose automated systems help factories run smoothly, reported a steeper-than-expected fall in quarterly profit, hurt by lower sales outside the United States and in its largest business.
Rockwell narrowed its 2014 adjusted earnings forecast to $6.10-$6.25 per share from $6.00-$6.35. It also narrowed its organic sales growth forecast to 4-6 percent, from 3-6 percent.
Analysts on average were expecting a profit of $6.20 per share, according to Thomson Reuters I/B/E/S.
Milwaukee, Wisconsin-based Rockwell gets about half its revenue from outside the United States and has been affected by the strengthening U.S. dollar.
The company’s revenue from Latin America and Canada fell 7.1 and 14 percent, respectively, in the third quarter ended June 30, weighed down by subdued economic activity and weak spending in Brazil and Canada. Sales from Asia Pacific fell 1.2 percent.
Revenue from Europe, Middle East and Africa rose 5.6 percent, and, along with a 5 percent rise in revenue from its largest market, the United States, helped Rockwell’s total revenue rise 1.56 percent to $1.65 billion in the quarter.
Lower sales and margins at Rockwell’s control products business – which makes motor starters, push buttons, condition sensors, and accounts for more than half of total sales – weighed on the company’s profitability.
Rockwell’s net income fell 2 percent to $199.7 million, or $1.43 per share, also pulled down by a higher effective tax rate. Excluding items, Rockwell earned $1.49 per share.
Analysts on average had expected earnings of $1.56 per share, on revenue $1.68 billion. (Reuters)