Moog Reports First Quarter Sales up 3%

Marketwired

EAST AURORA, NY--(Marketwire - Jan 25, 2013) - Moog Inc. (NYSE: MOG.A) (NYSE: MOG.B) today announced first quarter sales of $621 million, up 3% from a year ago. Net earnings were $34 million and earnings per share were $.75, both 6% lower compared to last year's first quarter on lower industrial sales.

Aircraft segment sales of $252 million were up 9% from last year with gains in both military and commercial markets. Commercial aircraft sales increased 16% compared to a year ago. Strong OEM production sales of $75 million included a 47% increase in sales to Boeing. Commercial aircraft aftermarket sales of $27 million were 5% higher. 

Military aircraft sales were up 5% to $150 million. Military aftermarket sales were 17% higher, at $57 million, and OEM sales were unchanged.

Space and Defense sales at $87 million were down marginally from a year ago. Sales in satellite-related businesses were stronger and helped by recent acquisitions. This increase offset weaker launch vehicle and NASA sales. Sales for ground vehicle and security and surveillance systems were also soft during the quarter.

Industrial Systems sales of $148 million were down 6% from a year ago. Sales of simulation and test systems were 3% higher, at $33 million, while industrial automation sales were down 4% and sales of wind power controls were down 36%.

Components Group sales of $99 million were very strong, up 13% in the quarter. Sales of energy market products, including marine sales, more than doubled to $24 million compared to a year ago. Medical components sales were 8% higher partially offsetting lower sales into defense and industrial markets.

Medical Devices sales were unchanged at $35 million. Pump sales were down while sales of administration sets were up 12%.

Twelve month consolidated backlog was $1.3 billion, unchanged from a year ago.

The Company also updated its projections for fiscal 2013. Given the results of the first quarter, the Company's revised forecast includes sales of $2.62 billion, a net earnings range of $160 million to $165 million and a range of $3.50 to $3.60 for earnings per share. The midpoint of the range, at $3.55, represents a 7% increase in EPS.

"We're off to a slow start in 2013," said John Scannell, CEO. "The weakness in the major economies around the world is affecting our industrial business. On the other hand, the aircraft market is strong. We have moderated our forecast for the year slightly but we are still projecting growth in both sales and earnings in 2013, despite the headwinds in our industrial markets." 

Moog Inc. is a worldwide designer, manufacturer, and integrator of precision control components and systems. Moog's high-performance systems control military and commercial aircraft, satellites and space vehicles, launch vehicles, missiles, automated industrial machinery, wind energy, marine and medical equipment. Additional information about the company can be found at www.moog.com.

Cautionary Statement

Information included or incorporated by reference in this report that does not consist of historical facts, including statements accompanied by or containing words such as "may," "will," "should," "believes," "expects," "expected," "intends," "plans," "projects," "approximate," "estimates," "predicts," "potential," "outlook," "forecast," "anticipates," "presume" and "assume," are forward-looking statements. Such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are not guarantees of future performance and are subject to several factors, risks and uncertainties, the impact or occurrence of which could cause actual results to differ materially from the expected results described in the forward-looking statements. These important factors, risks and uncertainties include:

  • the markets we serve are cyclical and sensitive to domestic and foreign economic conditions and events, which may cause our operating results to fluctuate
  • we operate in highly competitive markets with competitors who may have greater resources than we possess
  • we depend heavily on government contracts that may not be fully funded or may be terminated, and the failure to receive funding or the termination of one or more of these contracts could reduce our sales and increase our costs
  • we make estimates in accounting for long-term contracts, and changes in these estimates may have significant impacts on our earnings
  • we enter into fixed-price contracts, which could subject us to losses if we have cost overruns
  • if our subcontractors or suppliers fail to perform their contractual obligations, our prime contract performance and our ability to obtain future business could be materially and adversely impacted
  • contracting on government programs is subject to significant regulation, including rules related to bidding, billing and accounting kickbacks and false claims, and any non-compliance could subject us to fines and penalties or possible debarment
  • the loss of Boeing as a customer or a significant reduction in sales to Boeing could adversely impact our operating results
  • our new product research and development efforts may not be successful which could reduce our sales and earnings
  • our inability to adequately enforce and protect our intellectual property or defend against assertions of infringement could prevent or restrict our ability to compete
  • our business operations may be adversely affected by information systems interruptions or infringements
  • our indebtedness and restrictive covenants under our credit facilities could limit our operational and financial flexibility
  • significant changes in discount rates, rates of return on pension assets, mortality tables and other factors could affect our earnings, equity and pension funding requirements
  • a write-off of all or part of our goodwill or other intangible assets could adversely affect our operating results and net worth
  • our sales and earnings growth may be affected if we cannot identify, acquire or integrate strategic acquisitions
  • our operations in foreign countries expose us to political and currency risks and adverse changes in local legal and regulatory environments
  • unforeseen exposure to additional tax income liabilities may affect our operating results
  • government regulations could limit our ability to sell our products outside the United States and otherwise adversely affect our business
  • the failure or misuse of our products may damage our reputation, necessitate a product recall or result in claims against us that exceed our insurance coverage, thereby requiring us to pay significant damages
  • future terror attacks, natural disasters or other catastrophic events beyond our control could negatively impact our business
  • our operations are subject to environmental laws, and complying with those laws may cause us to incur significant costs
  • we are involved in various legal proceedings, the outcome of which may be unfavorable to us

These factors are not exhaustive. New factors, risks and uncertainties may emerge from time to time that may affect the forward-looking statements made herein. Given these factors, risks and uncertainties, investors should not place undue reliance on forward-looking statements as predictive of future results. We disclaim any obligation to update the forward-looking statements made in this report.

   
Moog Inc.  
CONSOLIDATED STATEMENTS OF EARNINGS  
(dollars in thousands, except per share data)  
             
    Three Months Ended  
    December 29,     December 31,  
     2012       2011  
             
             
Net sales   $ 620,803     $ 600,618  
Cost of sales     428,103       415,483  
Gross profit     192,700       185,135  
                 
Research and development     32,328       29,190  
Selling, general and administrative     105,075       95,798  
Interest     8,596       8,546  
Other     (2,370 )     (1,348 )
Earnings before income taxes     49,071       52,949  
Income taxes     14,953       16,576  
Net earnings   $ 34,118     $ 36,373  
                 
Net earnings per share                
  Basic   $ 0.75     $ 0.80  
  Diluted   $ 0.75     $ 0.80  
                 
Average common shares outstanding                
  Basic     45,353,332       45,211,734  
  Diluted     45,708,289       45,679,965  
                   
                   
   
MoogInc.  
CONSOLIDATED SALES AND OPERATING PROFIT  
(dollars in thousands)  
             
    Three Months Ended  
    December 29,     December 31,  
    2012     2011  
             
Net Sales                
  Aircraft Controls   $ 252,281     $ 231,080  
  Space and Defense Controls     86,465       88,394  
  Industrial Systems     147,976       158,085  
  Components     99,275       88,147  
  Medical Devices     34,806       34,912  
Net sales   $ 620,803     $ 600,618  
                 
Operating Profit and Margins                
  Aircraft Controls   $ 31,075     $ 24,827  
        12.3 %     10.7 %
  Space and Defense Controls     8,228       12,743  
        9.5 %     14.4 %
  Industrial Systems     9,047       15,826  
        6.1 %     10.0 %
  Components     18,846       15,029  
        19.0 %     17.0 %
  Medical Devices     1,602       1,598  
      4.6 %     4.6 %
Total operating profit     68,798       70,023  
      11.1 %     11.7 %
                 
Deductions from Operating Profit                
  Interest expense     8,596       8,546  
  Equity-based compensation expense     3,891       4,105  
  Corporate expenses and other     7,240       4,423  
Earnings before Income Taxes   $ 49,071     $ 52,949  
                 
                 
 
Moog Inc.
CONSOLIDATED BALANCE SHEETS
(dollars in thousands)
         
    December 29,   September 29,
    2012   2012
         
Cash   $ 152,133   $ 148,841
Receivables     744,356     744,551
Inventories     551,700     538,262
Other current assets     120,862     117,254
    Total current assets     1,569,051     1,548,908
Property, plant and equipment     549,171     546,179
Goodwill and intangible assets     972,188     975,049
Other non-current assets     35,990     35,771
  Total assets   $ 3,126,400   $ 3,105,907
             
Short-term borrowings   $ 77,537   $ 90,774
Current installments of long-term debt     64     3,186
Contract loss reserves     42,463     48,428
Other current liabilities     502,621     521,488
    Total current liabilities     622,685     663,876
Long-term debt     681,572     670,662
Other long-term liabilities     467,362     466,579
    Total liabilities     1,771,619     1,801,117
Shareholders' equity     1,354,781     1,304,790
    Total liabilities and shareholders' equity   $ 3,126,400   $ 3,105,907
               
               
Contact:
Contact
Ann Marie Luhr
716-687-4225

MOOG INC.,
EAST AURORA
NEW YORK 14052
TEL-716/652-2000
FAX -716/687-4457

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