Crane Co. reported fourth quarter 2012 earnings from continuing operations of $0.79 per share, compared to a net loss of $2.18 per share in the fourth quarter of 2011. Fourth quarter 2012 results included after-tax charges of $4 million, or $0.07 per share, associated with previously announced repositioning actions, as well as transaction-related costs of $4 million, or $0.07 per share, related to the recently announced acquisition of MEI Conlux Holdings. Fourth quarter 2011 results included an after-tax asbestos provision of $157 million and an after-tax environmental provision of $20 million (totaling $3.05 per share). Excluding these Special Items, fourth quarter 2012 and 2011 earnings per diluted share from continuing operations were $0.92 and $0.86, respectively. The company noted that adjusted fourth quarter 2012 earnings of $0.92 did not include a previously anticipated $0.05 per share benefit associated with the reinstatement of the research and development tax credit in the U.S., as the legislation was not enacted until early January 2013.
Fourth quarter 2012 sales from continuing operations of $630 million increased $10 million, or 1.6 percent compared to the fourth quarter of 2011, resulting entirely from core sales growth. Operating profit from continuing operations in the fourth quarter of 2012 was $76.2 million compared to an operating loss of $194.0 million in the fourth quarter of 2011. Excluding Special Items, fourth quarter 2012 operating profit from continuing operations increased 8.5 percent to $84.6 million compared to $78.0 million in the fourth quarter of 2011, and operating profit margin increased to 13.4 percent, compared to 12.6 percent in the fourth quarter of 2011.
Merchandising systems fourth quarter sales increased $8 million from $86.2 million to $94.2 million or 9 percent reflecting strong sales growth in both payment solutions and vending solutions. Operating profit and profit margins increased, reflecting the impact of the higher sales and productivity gains in both businesses.
Full Year 2012 Results
Total sales from continuing operations in 2012 were $2.58 billion, an increase of 3.1 percent from $2.5 billion in 2011, resulting from a core sales increase of $105 million (4.2 percent) and an increase from acquisitions of $12 million (0.5 percent), partially offset by unfavorable foreign currency translation of $38 million (1.6 percent).
Operating profit from continuing operations for the full year 2012 was $310.4 million compared to $36.6 million in 2011. Excluding Special Items, 2012 operating profit from continuing operations increased 9 percent to $334.9 million, compared to $308.5 million in 2011, and operating profit margin increased to 13.0 percent, compared to 12.3 percent in 2011.
Full year 2012 earnings per diluted share were $3.72, compared to $0.44 per share in 2011. Excluding Special Items, 2012 earnings per diluted share increased 9 percent to $3.75, compared to $3.43 per share in 2011. Full year 2012 results did not include the previously anticipated $0.05 per share benefit associated with the reinstatement of the R&D tax credit (Please see the attached Non-Generally Accepted Account Principles-Financial Measures table.) Order backlog was $749 million at December 31, 2012 compared to $778 million at December 31, 2011.
“We are pleased to report record full year EPS of $3.75, excluding Special Items, which is in line with our most recent guidance,” said Crane Co. chief executive officer, Eric C. Fast, in a prepared statement. “Our adjusted, full year operating margin was 13 percent, a substantial improvement over 12.3 percent in 2011. In 2013, we are expecting our third consecutive year of record earnings, with continued operating margin expansion and strong free cash flow. Our 2013 forecast does not include the recently announced acquisition of MEI which, in combination with Crane Payment Solutions, establishes a third large growth platform for Crane.”