Snap-on Announces Second Quarter 2019 Results
Snap-on Incorporated (NYSE: SNA), a leading global innovator, manufacturer and marketer of tools, equipment, diagnostics, repair information and systems solutions for professional users performing critical tasks, today announced operating results for the second quarter of 2019.
- Net sales of $951.3 million decreased $3.3 million, or 0.3%, from 2018 levels, reflecting a $15.1 million, or 1.6%, organic sales increase and $1.1 million of acquisition-related sales, more than offset by $19.5 million of unfavorable foreign currency translation.
- Operating earnings before financial services for the quarter of $189.9 million, or 20.0% of sales, including $5.9 million of unfavorable foreign currency effects, compared to $193.1 million, or 20.2% of sales, last year.
- Financial services revenue of $84.1 million in the second quarter of 2019 increased $2.1 million from 2018 levels; financial services operating earnings of $60.6 million increased $2.8 million from $57.8 million last year.
- Consolidated operating earnings of $250.5 million, including $6.3 million of unfavorable currency effects, compared to $250.9 million last year. As a percentage of revenues (net sales plus financial services revenue), consolidated operating earnings were 24.2% in both years.
- The second quarter effective income tax rate of 23.6% compared to 23.8% last year. In 2018, the effective income tax rate included a benefit of 20 basis points, or $0.5 million, related to the implementation of U.S. tax legislation (the “tax benefit”). Excluding the tax benefit, the effective tax rate, as adjusted, was 24.0% last year.
- Net earnings of $180.4 million, or $3.22 per diluted share, compared to $178.7 million, or $3.12 per diluted share, a year ago. Excluding the above-mentioned tax benefit, net earnings, as adjusted, were $178.2 million in 2018, or $3.11 per diluted share.
See “Non-GAAP Measures” below for a definition of, and further explanation about, organic sales and measures, as adjusted, excluding the tax benefit.
“We are encouraged by our second quarter 2019 results. While sales were mixed in the period, we did experience clear sales gains to customers across our U.S. operations and delivered overall organic growth, overcoming the variation and the turbulence,” said Nick Pinchuk, Snap-on chairman and chief executive officer. “The quarter did see continuing headwinds related to particularly challenged geographies and to unfavorable currency, but the effectiveness of our Snap-on Value Creation Processes drove strength in our operating earnings margins and yet another year-over-year increase in earnings per diluted share. Despite the challenges of this period, we believe the overall macro-economic environment for the vehicle repair and the critical industries markets we serve generally remain robust and provide continuing opportunities to make work easier for serious professionals. Finally, our results are only possible with the ongoing capability and contributions from our franchisees and associates, and I thank them for their dedication and commitment.”