Crane Co., a diversified manufacturer of highly engineered industrial products, reported that second quarter 2011 earnings per diluted share increased 27 percent to $0.85 compared to $0.67 in the second quarter of 2010.
Second quarter 2011 sales of $644 million increased $91 million, or 16 percent, compared to the second quarter of 2010, resulting from a core sales increase of $57 million (10 percent), favorable foreign currency translation of $24 million (4 percent) and an increase in sales from acquisitions, net of divestitures, of $10 million (2 percent).
Second quarter 2011 operating profit increased 22 percent to $79.9 million, compared to $65.3 million in the second quarter of 2010, and operating profit margin increased to 12.4 percent, compared to 11.8 percent in the second quarter of 2010.
"I am pleased with our second quarter results as strong core revenue growth and continued solid execution are sustaining the momentum that we carried into 2011. I expect our earnings to continue to improve in the second half of the year," said Eric C. Fast, Crane Co. president and chief executive officer in a prepared statement. "Reflecting the strong performance of our late-cycle aerospace and fluid handling businesses, we are raising our full year sales, EPS and cash flow guidance. In addition, given our confidence in the company's future, we are increasing our quarterly dividend by 13 percent."
Sales for 2011 are now expected to increase approximately 14 percent to 16 percent, compared to prior guidance of 10 percent to 12 percent, driven by strong core sales growth. The company’s 2011 earnings guidance is now a range of $3.30 to $3.45 per diluted share, compared to our previous guidance of $3.05 to $3.25 per diluted share. Free cash flow (cash provided by operating activities less capital spending) is now expected to be in a range of $140 million to $160 million, compared to the previous estimate of $130 million to $150 million.
Cash provided by operating activities in the second quarter of 2011 was $31.4 million, which included investment in working capital to support improving sales trends, compared to $47.1 million in the second quarter of 2010. During the second quarter of 2011, the company repurchased 421,300 shares of its common stock for approximately $20 million. The company's cash position at June 30, 2011 was $231 million, as compared to $233 million at March 31, 2011.
Merchandising systems sales of $94.0 million increased $19.5 million, or 26 percent, reflecting $13.2 million of sales associated with the December 2010 acquisition of Money Controls (18 percent). Excluding the acquisition, both payment solutions and vending sales increased in the quarter. Operating profit of $7.1 million declined from the prior year as 2010 was favorably impacted by the receipt of a patent litigation settlement.