Snap-on Inc.'s (SNA) fourth-quarter earnings surged 58% as the
toolmaker saw demand improve across all business segments, helping
results top analysts' expectations.
Snap-on controls about 55% of the professional tool market,
where it competes with Stanley Black & Decker Inc.'s (SWK) Mac
Tools unit and Danaher Corp.'s (DHR) Matco, according to
Morningstar estimates. Snap-on gets more than half its sales from
the U.S. and from the auto sector but has sought growth in emerging
markets and higher-margin segments such as power generation and
aerospace.
The company reported a profit of $57.9 million, or 99 cents a
share, up from $36.6 million, or 63 cents a share, a year earlier.
The latest results included a 6-cent tax benefit. Net sales
increased 13% to $696.9 million.
Analysts polled by Thomson Reuters most recently forecast
earnings of 90 cents a share on revenue of $685.5 million.
Prior cost-cutting also has boosted margins in recent quarters,
although in the fourth quarter, gross margin slid to 45.7% from
46%.
The commercial and industrial segment, its largest by revenue,
saw sales rise 15% due to higher sales across all units, including
those serving critical industries and emerging markets. The tools
group posted a sales growth of 13%, driven by a strong performance
in the U.S.
Revenue from the financial-services business grew to $21.5
million from $6.7 million.
Snap-on shares closed Wednesday at $57.52 and were inactive
premarket.
-By John Kell and Lee Roberts, Dow Jones Newswires;
212-416-2480; john.kell@dowjones.com