Snap-on Announces Fourth Quarter and Full Year 2012 Results
Diluted EPS of $1.43 for the quarter; $5.20 for the full year; Operating
earnings before financial services improves to 14.8% of sales in the
quarter; Organic (excluding foreign currency) sales
in the quarter up 2.5%; Full year 2012 organic sales
up 4.6%
KENOSHA, Wis.--(BUSINESS WIRE)--
Snap-on Incorporated (NYSE: SNA), a leading global innovator,
manufacturer and marketer of tools, equipment, diagnostics, repair
information and systems solutions for professional users performing
critical tasks, today announced 2012 operating results for the fourth
quarter and full year.
Sales of $753.2 million in the quarter increased $16.6 million, or
2.3%, from 2011 levels; excluding $1.9 million of unfavorable foreign
currency translation, organic sales increased 2.5%.
Operating earnings before financial services of $111.4 million in the
quarter improved to 14.8% of sales as compared to $103.8 million, or
14.1% of sales, last year.
Financial services operating earnings of $29.3 million in the quarter
increased $7.2 million from 2011 levels, reflecting the growth of the
on-book finance portfolio.
Consolidated operating earnings of $140.7 million in the quarter
improved to 17.7% of revenues (net sales plus financial services
revenue) as compared to $125.9 million, or 16.3% of revenues, last
year.
Net earnings of $84.6 million, or $1.43 per diluted share, for the
quarter compares with net earnings of $74.3 million, or $1.27 per
diluted share, a year ago.
Full year 2012 sales of $2.94 billion increased 2.9% from 2011 levels;
excluding $46.0 million of unfavorable foreign currency translation,
organic sales increased 4.6%. Full year 2012 net earnings of $306.1
million, or $5.20 per diluted share, compares with 2011 net earnings
of $265.2 million, or $4.52 per diluted share, excluding last year’s
$18.0 million pretax ($11.1 million after tax, or $0.19 per diluted
share) arbitration settlement gain. Net earnings for the full year
2011, including the arbitration settlement gain, were $276.3 million
or $4.71 per diluted share.
“We believe our performance in the fourth quarter of 2012 further
confirms Snap-on’s strengths in making work easier for serious
professionals performing critical tasks, where the costs and penalties
for failure can be high,” said Nick Pinchuk, Snap-on chairman and chief
executive officer. “In the fourth quarter and throughout 2012, we
continued to progress in those strategic areas of importance that we’ve
identified as being decisive to our future, while achieving higher
year-over-year sales and operating income despite ongoing macroeconomic
and political headwinds impacting specific parts of our business. As we
move forward in 2013, we believe we will make continued advancements
along our coherent runways for growth and achieve further improvements
from our Snap-on Value Creation Processes. Finally, our progress in 2012
would not have been possible without the tremendous contributions and
efforts of our franchisees and associates worldwide; I thank them all
for their significant commitment and extraordinary dedication.”
Segment Results
Commercial & Industrial Group segment sales of $275.6 million
in the quarter decreased $19.8 million, or 6.7%, from 2011 levels.
Excluding $1.7 million of unfavorable foreign currency translation,
organic sales in the quarter decreased 6.2% year over year primarily due
to lower sales to the military and in the segment’s European-based hand
tools business as a result of continued economic weakness in that region.
Operating earnings of $31.9 million in the period decreased $1.1
million, or 3.3%, from 2011 levels, while the operating margin
(operating earnings as a percentage of segment sales) of 11.6% increased
from 11.2% a year ago.
Snap-on Tools Group segment sales of $321.6 million in the
quarter rose $28.8 million, or 9.8%, from 2011 levels; excluding $1.4
million of favorable foreign currency translation, organic sales
increased 9.3%, reflecting increases across both the company’s U.S. and
international franchise operations.
Operating earnings of $45.6 million in the period increased $6.0
million, or 15.2%, from 2011 levels and the operating margin of 14.2%
improved from 13.5% a year ago.
Repair Systems & Information Group segment sales of $241.6
million in the quarter increased $5.1 million, or 2.2%, from 2011
levels; excluding $1.6 million of unfavorable foreign currency
translation, organic sales rose 2.9%, primarily due to gains in sales of
diagnostics and repair information products to repair shop owners and
managers, and in sales to Original Equipment Manufacturer (OEM)
dealerships.
Operating earnings of $55.4 million in the period increased $6.2
million, or 12.6%, from 2011 levels and the operating margin of 22.9%
increased from 20.8% a year ago.
Financial Services operating earnings of $29.3 million on revenue
of $42.9 million in the quarter compared with operating earnings of
$22.1 million on revenue of $35.5 million a year ago.
Corporate expenses of $21.5 million in the fourth quarter
compared with $18.0 million last year.
Outlook
In 2013, Snap-on expects to continue with the advancement of its
strategic framework designed to enhance its mobile tool distribution
network, expand in the vehicle repair garage, extend to critical
industries and build in emerging markets. In pursuit of these
initiatives, Snap-on anticipates that capital expenditures in 2013 will
be in a range of $70 million to $80 million. Snap-on expects that its
full year 2013 effective income tax rate will be comparable to its 2012
rate.
Conference Call and Webcast February 7, 2013,
at 9:00 a.m. Central Time
A discussion of this release will be webcast on Thursday, February 7,
2013, at 9:00 a.m. Central Time, and a replay will be available for at
least 10 days following the call. To access the webcast and supporting
materials, visit www.snapon.com/sna
and click on the link toward the bottom of the page. Additional detail
about Snap-on is also available on the Snap-on web site.
About Snap-on
Snap-on Incorporated is a leading global innovator, manufacturer and
marketer of tools, equipment, diagnostics, repair information and
systems solutions for professional users performing critical tasks.
Products and services include hand and power tools, tool storage,
diagnostics software, information and management systems, shop equipment
and other solutions for vehicle dealerships and repair centers, as well
as for customers in industries, including aviation and aerospace,
agriculture, construction, government and military, mining, natural
resources, power generation and technical education. Snap-on also
derives income from various financing programs to facilitate the sales
of its products. Products and services are sold through the company’s
franchisee, company-direct, distributor and internet channels. Founded
in 1920, Snap-on is a $2.9 billion, S&P 500 company headquartered in
Kenosha, Wisconsin.
Forward-looking Statements
Statements in this news release that are not historical facts,
including statements that (i) are in the future tense; (ii) include the
words “expects,” “anticipates,” “intends,” “approximates,” or similar
words that reference Snap-on or its management; (iii) are specifically
identified as forward-looking; or (iv) describe Snap-on’s or
management’s future outlook, plans, estimates, objectives or goals, are
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995.Snap-on cautions the reader that
this news release contains statements, including earnings projections,
that are forward-looking in nature and were developed by management in
good faith and, accordingly, are subject to risks and uncertainties
regarding Snap-on’s expected results that could cause (and in some cases
have caused) actual results to differ materially from those described or
contemplated in any forward-looking statement. Factors that may cause
the company’s actual results to differ materially from those contained
in the forward-looking statements include those found in the company’s
reports filed with the Securities and Exchange Commission, including the
information under the “Safe Harbor” and “Risk Factors” headings in its
Annual Report on Form 10-K for the fiscal year ended December 31, 2011,
which are incorporated herein by reference.Snap-on disclaims any
responsibility to update any forward-looking statement provided in this
news release, except as required by law.
For additional information, please visit www.snapon.com.
SNAP-ON INCORPORATED
Condensed Consolidated Statements of Earnings
(Amounts in millions, except per share data)
(unaudited)
Fourth Quarter
Full Year
2012
2011
2012
2011
Net sales
$
753.2
$
736.6
$
2,937.9
$
2,854.2
Cost of goods sold
(401.2
)
(400.8
)
(1,547.9
)
(1,516.3
)
Gross profit
352.0
335.8
1,390.0
1,337.9
Operating expenses
(240.6
)
(232.0
)
(980.3
)
(953.7
)
Operating earnings before financial services
111.4
103.8
409.7
384.2
Financial services revenue
42.9
35.5
161.3
124.3
Financial services expenses
(13.6
)
(13.4
)
(54.6
)
(51.4
)
Operating earnings from financial services
before arbitration settlement
29.3
22.1
106.7
72.9
Arbitration settlement
-
-
-
18.0
Operating earnings from financial services
29.3
22.1
106.7
90.9
Operating earnings
140.7
125.9
516.4
475.1
Interest expense
(14.4
)
(13.5
)
(55.8
)
(61.2
)
Other income (expense) – net
0.1
(1.0
)
(0.4
)
(1.0
)
Earnings before income taxes and equity earnings
126.4
111.4
460.2
412.9
Income tax expense
(39.8
)
(36.2
)
(148.2
)
(133.7
)
Earnings before equity earnings
86.6
75.2
312.0
279.2
Equity earnings, net of tax
0.1
0.9
2.6
4.6
Net earnings
86.7
76.1
314.6
283.8
Net earnings attributable to noncontrolling interests
(2.1
)
(1.8
)
(8.5
)
(7.5
)
Net earnings attributable to Snap-on Inc.
$
84.6
$
74.3
$
306.1
$
276.3
Net earnings per share attributable to Snap-on Inc.:
Basic
$
1.45
$
1.28
$
5.26
$
4.75
Diluted
1.43
1.27
5.20
4.71
Weighted-average shares outstanding:
Basic
58.2
58.2
58.2
58.2
Effect of dilutive options
0.8
0.5
0.7
0.5
Diluted
59.0
58.7
58.9
58.7
SNAP-ON INCORPORATED
Supplemental Segment Information
(Amounts in millions)
(unaudited)
Fourth Quarter
Full Year
2012
2011
2012
2011
Net sales:
Commercial & Industrial Group
$
275.6
$
295.4
$
1,125.9
$
1,125.8
Snap-on Tools Group
321.6
292.8
1,272.0
1,153.4
Repair Systems & Information Group
241.6
236.5
917.1
920.6
Segment net sales
838.8
824.7
3,315.0
3,199.8
Intersegment eliminations
(85.6
)
(88.1
)
(377.1
)
(345.6
)
Total net sales
$
753.2
$
736.6
$
2,937.9
$
2,854.2
Financial Services revenue
42.9
35.5
161.3
124.3
Total revenues
$
796.1
$
772.1
$
3,099.2
$
2,978.5
Operating earnings:
Commercial & Industrial Group
$
31.9
$
33.0
$
127.3
$
123.4
Snap-on Tools Group
45.6
39.6
176.4
158.5
Repair Systems & Information Group
55.4
49.2
205.7
184.7
Financial Services*
29.3
22.1
106.7
90.9
Segment operating earnings
162.2
143.9
616.1
557.5
Corporate
(21.5
)
(18.0
)
(99.7
)
(82.4
)
Operating earnings
$
140.7
$
125.9
$
516.4
$
475.1
Interest expense
(14.4
)
(13.5
)
(55.8
)
(61.2
)
Other income (expense) – net
0.1
(1.0
)
(0.4
)
(1.0
)
Earnings before income taxes
and equity earnings
$
126.4
$
111.4
$
460.2
$
412.9
*
Financial Services' operating earnings for the full year 2011
includes an $18.0 million pretax arbitration settlement gain from
a second quarter 2011 arbitration settlement.
SNAP-ON INCORPORATED
Reconciliation of Non-GAAP Financial Measures
(Amounts in millions, except per share data)
(unaudited)
Fourth Quarter
Full Year
2012
2011
2012
2011
AS REPORTED
Net sales
$
753.2
$
736.6
$
2,937.9
$
2,854.2
Financial services revenue
42.9
35.5
161.3
124.3
Total revenues
$
796.1
$
772.1
$
3,099.2
$
2,978.5
PRO FORMA INFORMATION
1) Operating earnings
As reported
$
140.7
$
125.9
$
516.4
$
475.1
Less: Arbitration settlement gain
-
-
-
(18.0
)
Excluding arbitration settlement gain
$
140.7
$
125.9
$
516.4
$
457.1
Operating earnings as a percentage of total revenues
As reported
17.7
%
16.3
%
16.7
%
16.0
%
Excluding arbitration settlement gain
17.7
%
16.3
%
16.7
%
15.3
%
2) Arbitration settlement gain
As reported
$
-
$
-
$
-
$
18.0
Income tax expense
-
-
-
(6.9
)
Arbitration settlement gain, net of tax
$
-
$
-
$
-
$
11.1
Weighted-average shares outstanding - Diluted
59.0
58.7
58.9
58.7
Diluted EPS - Arbitration settlement gain
$
-
$
-
$
-
$
0.19
3) Net earnings attributable to Snap-on Incorporated
As reported
$
84.6
$
74.3
$
306.1
$
276.3
Less: Arbitration settlement gain, net of tax
-
-
-
(11.1
)
Excluding arbitration settlement gain
$
84.6
$
74.3
$
306.1
$
265.2
4) Diluted EPS
As reported
$
1.43
$
1.27
$
5.20
$
4.71
Less: Diluted EPS - Arbitration settlement gain
-
-
-
(0.19
)
Excluding arbitration settlement gain
$
1.43
$
1.27
$
5.20
$
4.52
Snap-on is providing the above reconciliations of non-GAAP
financial measures (excluding last year's $18.0 million pretax
arbitration settlement gain recorded in the second quarter of 2011)
as management believes that these non-GAAP measures provide a more
meaningful year-over-year comparison of the company's operating
performance.
SNAP-ON INCORPORATED
Condensed Consolidated Balance Sheets
(Amounts in millions)
(unaudited)
Fiscal Year End
2012
2011
Assets
Cash and cash equivalents
$
214.5
$
185.6
Trade and other accounts receivable – net
497.9
463.5
Finance receivables – net
323.1
277.2
Contract receivables – net
62.7
49.7
Inventories – net
404.2
386.4
Deferred income tax assets
81.8
92.6
Prepaid expenses and other assets
84.8
75.7
Total current assets
1,669.0
1,530.7
Property and equipment – net
375.2
352.9
Deferred income tax assets
110.4
125.2
Long-term finance receivables – net
494.6
431.8
Long-term contract receivables – net
194.4
165.1
Goodwill
807.4
795.8
Other intangibles – net
187.2
188.3
Other assets
64.1
83.1
Total assets
$
3,902.3
$
3,672.9
Liabilities and Equity
Notes payable
$
5.2
$
16.2
Accounts payable
142.5
124.6
Accrued benefits
50.6
48.8
Accrued compensation
88.3
91.0
Franchisee deposits
54.7
47.3
Other accrued liabilities
247.9
255.9
Total current liabilities
589.2
583.8
Long-term debt
970.4
967.9
Deferred income tax liabilities
127.1
108.1
Retiree health care benefits
48.4
52.8
Pension liabilities
260.7
317.7
Other long-term liabilities
87.5
95.3
Total liabilities
2,083.3
2,125.6
Equity
Shareholders' equity attributable to Snap-on Inc.
Common stock
67.4
67.3
Additional paid-in capital
204.6
181.4
Retained earnings
2,067.0
1,843.7
Accumulated other comprehensive loss
(124.2
)
(174.6
)
Treasury stock at cost
(412.7
)
(386.9
)
Total shareholders' equity attributable to Snap-on Inc.
1,802.1
1,530.9
Noncontrolling interests
16.9
16.4
Total equity
1,819.0
1,547.3
Total liabilities and equity
$
3,902.3
$
3,672.9
SNAP-ON INCORPORATED
Condensed Consolidated Statements of Cash Flow
(Amounts in millions)
(unaudited)
Fourth Quarter
2012
2011
Operating activities:
Net earnings
$
86.7
$
76.1
Adjustments to reconcile net earnings to net cash provided (used) by
operating activities:
Depreciation
12.6
12.5
Amortization of other intangibles
6.9
6.7
Provision for losses on finance receivables
4.9
4.6
Provision for losses on non-finance receivables
5.0
0.3
Stock-based compensation expense
7.1
7.9
Excess tax benefits from stock-based compensation
(3.2
)
(0.6
)
Deferred income tax provision
25.7
14.3
Gain on sale of assets
-
(0.1
)
Changes in operating assets and liabilities:
Increase in trade and other accounts receivable
(24.5
)
(21.5
)
Increase in contract receivables
(3.2
)
(8.2
)
Decrease in inventories
14.0
8.3
Decrease (increase) in prepaid and other assets
7.2
(1.7
)
Decrease in accounts payable
(7.2
)
(7.5
)
Decrease in accruals and other liabilities
(29.1
)
(18.8
)
Net cash provided by operating activities
102.9
72.3
Investing activities:
Additions to finance receivables
(143.5
)
(132.6
)
Collections of finance receivables
116.6
97.2
Capital expenditures
(19.9
)
(14.6
)
Disposal of property and equipment
0.2
0.7
Proceeds from sale of equity investment
27.0
-
Other
0.1
(0.1
)
Net cash used by investing activities
(19.5
)
(49.4
)
Financing activities:
Proceeds from short-term borrowings
4.8
4.5
Repayments of short-term borrowings
(16.2
)
(1.6
)
Net decrease in other short-term borrowings
(2.3
)
(0.8
)
Cash dividends paid
(22.1
)
(20.2
)
Purchase of treasury stock
(16.3
)
-
Proceeds from stock purchase and option plans
6.5
0.6
Excess tax benefits from stock-based compensation
3.2
0.6
Other
(2.5
)
(5.2
)
Net cash used by financing activities
(44.9
)
(22.1
)
Effect of exchange rate changes on cash and cash equivalents
(0.1
)
(0.9
)
Increase (decrease) in cash and cash equivalents
38.4
(0.1
)
Cash and cash equivalents at beginning of period
176.1
185.7
Cash and cash equivalents at end of year
$
214.5
$
185.6
Supplemental cash flow disclosures:
Cash paid for interest
$
(1.8
)
$
(0.4
)
Net cash paid for income taxes
(33.7
)
(20.0
)
SNAP-ON INCORPORATED
Condensed Consolidated Statements of Cash Flow
(Amounts in millions)
(unaudited)
Full Year
2012
2011
Operating activities:
Net earnings
$
314.6
$
283.8
Adjustments to reconcile net earnings to net cash provided (used) by
operating activities:
Depreciation
50.2
49.3
Amortization of other intangibles
26.5
25.3
Provision for losses on finance receivables
18.7
13.3
Provision for losses on non-finance receivables
12.6
12.9
Stock-based compensation expense
32.1
20.3
Excess tax benefits from stock-based compensation
(8.2
)
(2.8
)
Deferred income tax provision
29.3
5.1
Gain on sale of assets
(0.9
)
(0.1
)
Changes in operating assets and liabilities:
Increase in trade and other accounts receivable
(43.4
)
(36.8
)
Increase in contract receivables
(41.1
)
(51.5
)
Increase in inventories
(13.4
)
(60.9
)
Increase in prepaid and other assets
(24.8
)
(35.7
)
Increase (decrease) in accounts payable
16.6
(21.5
)
Decrease in accruals and other liabilities
(39.5
)
(72.2
)
Net cash provided by operating activities
329.3
128.5
Investing activities:
Additions to finance receivables
(569.6
)
(519.1
)
Collections of finance receivables
445.5
356.9
Capital expenditures
(79.4
)
(61.2
)
Disposal of property and equipment
2.6
3.7
Proceeds from sale of equity investment
27.0
-
Other
0.8
0.1
Net cash used by investing activities
(173.1
)
(219.6
)
Financing activities:
Repayment of long-term debt
-
(200.0
)
Proceeds from short-term borrowings
16.0
19.7
Repayments of short-term borrowings
(30.3
)
(17.9
)
Net increase (decrease) in other short-term borrowings
3.1
(1.2
)
Cash dividends paid
(81.5
)
(76.7
)
Purchase of treasury stock
(78.1
)
(37.4
)
Proceeds from stock purchase and option plans
46.8
25.7
Excess tax benefits from stock-based compensation
8.2
2.8
Other
(11.2
)
(8.7
)
Net cash used by financing activities
(127.0
)
(293.7
)
Effect of exchange rate changes on cash and cash equivalents
(0.3
)
(1.8
)
Increase (decrease) in cash and cash equivalents
28.9
(386.6
)
Cash and cash equivalents at beginning of year
185.6
572.2
Cash and cash equivalents at end of year
$
214.5
$
185.6
Supplemental cash flow disclosures:
Cash paid for interest
$
(55.6
)
$
(59.3
)
Net cash paid for income taxes
(93.6
)
(128.8
)
SNAP-ON INCORPORATED
Supplemental Consolidating Data - Condensed Statements of Earnings
(Amounts in millions)
(unaudited)
Operations*
Financial Services
Fourth Quarter
Fourth Quarter
2012
2011
2012
2011
Net sales
$
753.2
$
736.6
$
-
$
-
Cost of goods sold
(401.2
)
(400.8
)
-
-
Gross profit
352.0
335.8
-
-
Operating expenses
(240.6
)
(232.0
)
-
-
Operating earnings before financial services
111.4
103.8
-
-
Financial services revenue
-
-
42.9
35.5
Financial services expenses
-
-
(13.6
)
(13.4
)
Operating earnings from financial services
-
-
29.3
22.1
Operating earnings
111.4
103.8
29.3
22.1
Interest expense
(13.5
)
(13.3
)
(0.9
)
(0.2
)
Intersegment interest income (expense) – net
11.1
9.6
(11.1
)
(9.6
)
Other income (expense) – net
-
(1.0
)
0.1
-
Earnings before income taxes and equity earnings
109.0
99.1
17.4
12.3
Income tax expense
(33.5
)
(31.7
)
(6.3
)
(4.5
)
Earnings before equity earnings
75.5
67.4
11.1
7.8
Financial services – net earnings
attributable to Snap-on Inc.
11.1
7.8
-
-
Equity earnings, net of tax
0.1
0.9
-
-
Net earnings
86.7
76.1
11.1
7.8
Net earnings attributable to noncontrolling interests
(2.1
)
(1.8
)
-
-
Net earnings attributable to Snap-on Inc.
$
84.6
$
74.3
$
11.1
$
7.8
* Snap-on Inc. with Financial Services on the equity method.
Transactions between Operations and Financial Services were
eliminated to arrive at the consolidated financial statements.
SNAP-ON INCORPORATED
Supplemental Consolidating Data - Condensed Statements of Earnings
(Amounts in millions)
(unaudited)
Operations*
Financial Services
Full Year
Full Year
2012
2011
2012
2011
Net sales
$
2,937.9
$
2,854.2
$
-
$
-
Cost of goods sold
(1,547.9
)
(1,516.3
)
-
-
Gross profit
1,390.0
1,337.9
-
-
Operating expenses
(980.3
)
(953.7
)
-
-
Operating earnings before financial services
409.7
384.2
-
-
Financial services revenue
-
-
161.3
124.3
Financial services expenses
-
-
(54.6
)
(51.4
)
Operating earnings from financial services
before arbitration settlement
-
-
106.7
72.9
Arbitration settlement
-
-
-
18.0
Operating earnings from financial services
-
-
106.7
90.9
Operating earnings
409.7
384.2
106.7
90.9
Interest expense
(54.0
)
(60.0
)
(1.8
)
(1.2
)
Intersegment interest income (expense) – net
42.4
35.8
(42.4
)
(35.8
)
Other income (expense) – net
(0.4
)
(1.0
)
-
-
Earnings before income taxes and equity earnings
397.7
359.0
62.5
53.9
Income tax expense
(125.3
)
(113.9
)
(22.9
)
(19.8
)
Earnings before equity earnings
272.4
245.1
39.6
34.1
Financial services – net earnings
attributable to Snap-on Inc.
39.6
34.1
-
-
Equity earnings, net of tax
2.6
4.6
-
-
Net earnings
314.6
283.8
39.6
34.1
Net earnings attributable to noncontrolling interests
(8.5
)
(7.5
)
-
-
Net earnings attributable to Snap-on Inc.
$
306.1
$
276.3
$
39.6
$
34.1
* Snap-on Inc. with Financial Services on the equity method.
Transactions between Operations and Financial Services were
eliminated to arrive at the consolidated financial statements.
SNAP-ON INCORPORATED
Supplemental Consolidating Data - Condensed Balance Sheets
(Amounts in millions)
(unaudited)
Operations*
Financial Services
Fiscal Year End
Fiscal Year End
2012
2011
2012
2011
Assets
Cash and cash equivalents
$
211.2
$
181.1
$
3.3
$
4.5
Intersegment receivables
14.1
10.8
-
-
Trade and other accounts receivable – net
497.5
463.3
0.4
0.2
Finance receivables – net
-
-
323.1
277.2
Contract receivables – net
7.4
6.5
55.3
43.2
Inventories – net
404.2
386.4
-
-
Deferred income tax assets
68.8
90.0
13.0
2.6
Prepaid expenses and other assets
88.3
78.1
1.0
0.9
Total current assets
1,291.5
1,216.2
396.1
328.6
Property and equipment – net
373.2
351.9
2.0
1.0
Investment in Financial Services
165.3
142.0
-
-
Deferred income tax assets
110.2
119.8
0.2
5.4
Long-term finance receivables – net
-
-
494.6
431.8
Long-term contract receivables – net
12.1
9.1
182.3
156.0
Goodwill
807.4
795.8
-
-
Other intangibles – net
187.2
188.3
-
-
Other assets
65.3
83.7
1.1
1.0
Total assets
$
3,012.2
$
2,906.8
$
1,076.3
$
923.8
Liabilities and Equity
Notes payable
$
5.2
$
16.2
$
-
$
-
Accounts payable
142.1
124.0
0.4
0.6
Intersegment payables
-
-
14.1
10.8
Accrued benefits
50.6
48.8
-
-
Accrued compensation
84.9
87.1
3.4
3.9
Franchisee deposits
54.7
47.3
-
-
Other accrued liabilities
207.8
229.7
46.9
31.1
Total current liabilities
545.3
553.1
64.8
46.4
Long-term debt and intersegment long-term debt
143.2
257.6
827.2
710.3
Deferred income tax liabilities
125.7
108.0
1.4
0.1
Retiree health care benefits
48.4
52.8
-
-
Pension liabilities
260.7
317.7
-
-
Other long-term liabilities
69.9
70.3
17.6
25.0
Total liabilities
1,193.2
1,359.5
911.0
781.8
Total shareholders' equity attributable to Snap-on Inc.
1,802.1
1,530.9
165.3
142.0
Noncontrolling interests
16.9
16.4
-
-
Total equity
1,819.0
1,547.3
165.3
142.0
Total liabilities and equity
$
3,012.2
$
2,906.8
$
1,076.3
$
923.8
* Snap-on Inc. with Financial Services on the equity method.
Transactions between Operations and Financial Services were
eliminated to arrive at the consolidated financial statements.
Snap-on Incorporated Investors: Leslie Kratcoski, 262/656-6121 or Media: Richard
Secor, 262/656-5561
Press Release $SNA Snap-on Inc.
Diluted EPS of $1.43 for the quarter; $5.20 for the full year;
Operating earnings before financial services improves to 14.8% of sales in the quarter;
Organic (excluding foreign currency) sales in the quarter up 2.5%;
Full year 2012 organic sales up 4.6%
KENOSHA, Wis.--(BUSINESS WIRE)-- Snap-on Incorporated (NYSE: SNA), a leading global innovator, manufacturer and marketer of tools, equipment, diagnostics, repair information and systems solutions for professional users performing critical tasks, today announced 2012 operating results for the fourth quarter and full year.
“We believe our performance in the fourth quarter of 2012 further confirms Snap-on’s strengths in making work easier for serious professionals performing critical tasks, where the costs and penalties for failure can be high,” said Nick Pinchuk, Snap-on chairman and chief executive officer. “In the fourth quarter and throughout 2012, we continued to progress in those strategic areas of importance that we’ve identified as being decisive to our future, while achieving higher year-over-year sales and operating income despite ongoing macroeconomic and political headwinds impacting specific parts of our business. As we move forward in 2013, we believe we will make continued advancements along our coherent runways for growth and achieve further improvements from our Snap-on Value Creation Processes. Finally, our progress in 2012 would not have been possible without the tremendous contributions and efforts of our franchisees and associates worldwide; I thank them all for their significant commitment and extraordinary dedication.”
Segment Results
Commercial & Industrial Group segment sales of $275.6 million in the quarter decreased $19.8 million, or 6.7%, from 2011 levels. Excluding $1.7 million of unfavorable foreign currency translation, organic sales in the quarter decreased 6.2% year over year primarily due to lower sales to the military and in the segment’s European-based hand tools business as a result of continued economic weakness in that region.
Operating earnings of $31.9 million in the period decreased $1.1 million, or 3.3%, from 2011 levels, while the operating margin (operating earnings as a percentage of segment sales) of 11.6% increased from 11.2% a year ago.
Snap-on Tools Group segment sales of $321.6 million in the quarter rose $28.8 million, or 9.8%, from 2011 levels; excluding $1.4 million of favorable foreign currency translation, organic sales increased 9.3%, reflecting increases across both the company’s U.S. and international franchise operations.
Operating earnings of $45.6 million in the period increased $6.0 million, or 15.2%, from 2011 levels and the operating margin of 14.2% improved from 13.5% a year ago.
Repair Systems & Information Group segment sales of $241.6 million in the quarter increased $5.1 million, or 2.2%, from 2011 levels; excluding $1.6 million of unfavorable foreign currency translation, organic sales rose 2.9%, primarily due to gains in sales of diagnostics and repair information products to repair shop owners and managers, and in sales to Original Equipment Manufacturer (OEM) dealerships.
Operating earnings of $55.4 million in the period increased $6.2 million, or 12.6%, from 2011 levels and the operating margin of 22.9% increased from 20.8% a year ago.
Financial Services operating earnings of $29.3 million on revenue of $42.9 million in the quarter compared with operating earnings of $22.1 million on revenue of $35.5 million a year ago.
Corporate expenses of $21.5 million in the fourth quarter compared with $18.0 million last year.
Outlook
In 2013, Snap-on expects to continue with the advancement of its strategic framework designed to enhance its mobile tool distribution network, expand in the vehicle repair garage, extend to critical industries and build in emerging markets. In pursuit of these initiatives, Snap-on anticipates that capital expenditures in 2013 will be in a range of $70 million to $80 million. Snap-on expects that its full year 2013 effective income tax rate will be comparable to its 2012 rate.
Conference Call and Webcast February 7, 2013, at 9:00 a.m. Central Time
A discussion of this release will be webcast on Thursday, February 7, 2013, at 9:00 a.m. Central Time, and a replay will be available for at least 10 days following the call. To access the webcast and supporting materials, visit www.snapon.com/sna and click on the link toward the bottom of the page. Additional detail about Snap-on is also available on the Snap-on web site.
About Snap-on
Snap-on Incorporated is a leading global innovator, manufacturer and marketer of tools, equipment, diagnostics, repair information and systems solutions for professional users performing critical tasks. Products and services include hand and power tools, tool storage, diagnostics software, information and management systems, shop equipment and other solutions for vehicle dealerships and repair centers, as well as for customers in industries, including aviation and aerospace, agriculture, construction, government and military, mining, natural resources, power generation and technical education. Snap-on also derives income from various financing programs to facilitate the sales of its products. Products and services are sold through the company’s franchisee, company-direct, distributor and internet channels. Founded in 1920, Snap-on is a $2.9 billion, S&P 500 company headquartered in Kenosha, Wisconsin.
Forward-looking Statements
Statements in this news release that are not historical facts, including statements that (i) are in the future tense; (ii) include the words “expects,” “anticipates,” “intends,” “approximates,” or similar words that reference Snap-on or its management; (iii) are specifically identified as forward-looking; or (iv) describe Snap-on’s or management’s future outlook, plans, estimates, objectives or goals, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Snap-on cautions the reader that this news release contains statements, including earnings projections, that are forward-looking in nature and were developed by management in good faith and, accordingly, are subject to risks and uncertainties regarding Snap-on’s expected results that could cause (and in some cases have caused) actual results to differ materially from those described or contemplated in any forward-looking statement. Factors that may cause the company’s actual results to differ materially from those contained in the forward-looking statements include those found in the company’s reports filed with the Securities and Exchange Commission, including the information under the “Safe Harbor” and “Risk Factors” headings in its Annual Report on Form 10-K for the fiscal year ended December 31, 2011, which are incorporated herein by reference. Snap-on disclaims any responsibility to update any forward-looking statement provided in this news release, except as required by law.
For additional information, please visit www.snapon.com.
*
Financial Services' operating earnings for the full year 2011 includes an $18.0 million pretax arbitration settlement gain from a second quarter 2011 arbitration settlement.
AS REPORTED
PRO FORMA INFORMATION
Total current liabilities
Net increase (decrease) in other short-term borrowings
Snap-on Incorporated
Investors:
Leslie Kratcoski, 262/656-6121
or
Media:
Richard Secor, 262/656-5561
Source: Snap-on Incorporated