Abrasive Industry Round Up – Financials and Milestones
Three major groups have made announcements in the past few days. The Sandvik group, which is still in the throes of its restructuring programme, will celebrate its 150th anniversary on 31 January. From its beginnings in steel-making, the company still employs 50,000 people around the world. Now the company is transforming itself again. The Abrasives Hub congratulates the company on this milestone.
Both Kennametal and 3M have announced its latest set of financial results. Kennametal has
reported record fiscal 2012 second quarter earnings per diluted share (EPS) of $0.91 compared with prior year quarter reported EPS of $0.52. The prior year EPS included restructuring and related charges of $0.05 per share.
Carlos Cardoso, Kennametal’s Chairman, President and Chief Executive Officer said "Kennametal again delivered strong results for the December quarter. These results are attributable to the successful implementation of our strategies to outperform industrial production and improve our market position. Organic sales grew by 14 percent year over year, which reflects ongoing customer demand even with strong comparisons from the prior year quarter. Our profitability remains at a high level and we achieved an all-time historical record return on invested capital."
Cardoso added, "As we announced last week, the pending acquisition of Deloro Stellite reinforces our strategy of acquiring technologies that strengthen our core business. The acquisition is consistent with our strategy of growth by further diversifying our customer base, products, end markets and geographic regions. Also, it reflects our mission to provide customers with innovative solutions to improve their productivity. As always, we are highly disciplined in executing strategies to grow our business and remain committed to continuing to deliver shareowner value."
The UK-based Deloro Stellite, with approximately euro 220 million in annual sales, is a global manufacturer and provider of alloy-based critical wear solutions for extreme environments involving high temperature, corrosion and abrasion. The company employs approximately 1,300 people across seven primary operating facilities globally, including locations in the U.S., Canada, Germany, Italy, India and China. Through proprietary metal alloys and materials expertise as well as specialized engineering design and fabrication capabilities, Deloro Stellite delivers value-added, tailored wear solutions for customers in Kennametal’s current end markets of energy, which includes oil and gas and power generation, transportation, and aerospace.
3M moves ahead.
For the full year 2011, 3M posted sales of $29.6 billion, up 11.1percent. Five of the company’s six business segments posted growth for
the year, led by Industrial and Transportation at 19.5 percent and Safety, Security and Protection Services at 15.2 percent. Latin
America/Canada was the fastest-growing geographic region in 2011 at 15.6 percent. Full-year 2011 earnings were $5.96 per share, an increase of
5.9 percent, operating margins were 20.9 percent and return on invested capital was 19.9 percent.
2011 was a successful year for 3M, with record sales and earnings per share, said George W. Buckley, 3M chairman, president and chief
executive officer. ”We were resilient enough to achieve these results in the face of deteriorating demand in both Western Europe and consumer
electronics. Our commitment to the future continued, with investments of $1.6 billion in research and development and $1.4 billion in capital
expenditures during the year, aimed primarily at faster growing markets. Our 2011 results demonstrate the underlying strength of 3M’s business
model, as we once again generated double-digit top-line growth and premium return on capital.”
Buckley continued, “Looking ahead, we believe that slower growth will persist into the first half of 2012, so we will increase attention to
the bottom line in the near term. We know that in uncertain times, it is even more important that we innovate and differentiate ourselves,
therefore we will preserve key investments in R&D, sales and manufacturing to achieve accelerated growth.