Actuant Corporation announced results for its fourth quarter and fiscal year ended August 31, 2015. Q4 total sales declined 15% year-over-year with 8% attributable to the strengthening of the US dollar.
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Core sales were down 7% (total sales excluding the impact of acquisitions, divestitures and foreign currency rate changes).
Diluted earnings per share (EPS) were $0.37 in the fourth quarter of fiscal 2015 versus $0.47 in the prior year, which excluded a $0.04 divestiture gain (see “Consolidated Results†below and attached reconciliation of earnings).
Continued tight cost control with the year-over-year percentage reduction in selling, administrative and engineering (SA&E) expense exceeding that of the sales decline for the second consecutive quarter.
Strong fourth quarter free cash flow resulting in full year free cash flow conversion of over 100% of net earnings for the 15th consecutive year.
Introduced fiscal 2016 full year sales and EPS guidance of $1.16-1.20 billion and $1.20-1.40, respectively, excluding restructuring charges associated with incremental cost reduction actions.
Robert C. Arzbaecher, chairman, president and CEO of Actuant commented, “Fourth quarter sales and operating earnings were in line with our expectations and reflect the continuing impact of the downturn across key end markets including energy, agriculture and general industrial. Our focus remains on tightly managing costs while continuing to fund our best growth initiatives across the businesses.
"On the cost front, we again achieved a year-over-year percentage reduction in SA&E expense greater than the decline in revenues.
"However, gross profit and operating margins in the fourth quarter were down due to the adverse impact of lower production and absorption levels associated with inventory destocking, approximately $3 million of downsizing costs, unfavorable sales mix, and negative purchase price variances driven by the stronger US dollar.
"We were especially pleased with the strong fourth quarter cash flow which drove our 15th consecutive year of free cash flow conversion of net earnings in excess of 100%, which provides the fuel for future business growth. ■