Industrial automation solutions provider Rockwell Automation Inc. (ROK) on Monday reported a 77% decline in fourth-quarter profit, as revenue dropped 28% from the previous year. However, adjusted earnings easily topped Wall Street view.
Looking ahead, the company guided fiscal 2010 almost in line with Wall Street estimates.
The Milwaukee, Wisconsin-based company said its fourth-quarter net income plunged to $28.9 million or $0.20 per share from $125.6 million or $0.87 per share in the fourth quarter of fiscal 2008. In the third quarter, the company reported net income of $32.8 million or $0.23 per share.
Excluding restructuring charges, fourth-quarter net income was $53.1 million or $0.37 per share. On average, 10 analysts polled by Thomson Reuters expected the company to earn $0.27 per share for the quarter. Analysts' estimates typically exclude special items.
Total sales for the quarter dropped to $1.074 billion from $1.484 billion reported in the fourth quarter of fiscal 2008. The company noted that currency translation contributed 3 percentage points to the decline. Analysts were looking for revenues of $1.05 billion. Third-quarter sales were $1.01 billion. The company said that sequential revenue growth for the quarter supports its view that macroeconomic conditions and demand trends are stabilizing.
Total segment operating earnings for the fourth quarter declined to $79.6 million from $269.1 million in the prior year, owing to the revenue decline and the inclusion of restructuring charges in segment operating earnings.
Rockwell provides industrial automation power, control, and information solutions primarily in the U.S. through two segments, namely Architecture & Software, and Control Products & Solutions. The company employs about 20,000 people serving customers in more than 80 countries.
For the fourth quarter, sales of Architecture & Software segment dropped to $424.1 million from $617.1 million. The segment's operating profit plunged to $36.9 million from $141.6 million.
At Control Products & Solutions, sales for the quarter declined to $650.3 million from $867.2 million. Operating earnings of the segment plummeted to $42.7 million from $127.5 million.
For the fiscal year, net income dropped to $220.7 million or $1.55 per share from $577.6 million or $3.90 per share in the prior year. Sales dropped to $4.333 billion from $5.698 billion. Wall Street expected earnings of $1.58 per share on revenues of $4.32 billion.
Among others in the industry, Swiss power and automation technologies company ABB Ltd. (ABB) in late October reported a 12% rise in third-quarter net income attributable to ABB to $1.03 billion or $0.45 per share from $927 million or $0.40 per share last year, reflecting significant net gain on provision adjustments. Revenues fell 10% to $7.91 billion from $8.79 billion in the year-ago quarter, on 21% drop in orders.
Another peer, Emerson Electric Co. (EMR) last week reported a decline in fourth-quarter net income to $506 million from $688 million in the year ago quarter. Earnings per share fell 24% to $0.67 from $0.88. The company's quarterly net sales totaled $5.32 billion, a decline of 20.5% from prior year's $6.69 billion.
Looking ahead, Keith Nosbusch, chairman and chief executive officer of Rockwell Automation, said, "Based on improving macroeconomic indicators and stabilization in our own demand trends, it appears we have reached the bottom of the cycle. In this uncertain economic environment, I cannot predict the shape of the recovery, but I do not expect a sharp upturn. Accordingly, we will continue our operating discipline, with a focus on cost control and cash management.''
For fiscal fiscal 2010, the company expects earnings to be in the range of $1.25 - $1.75 per share. Analysts expect the company to report earnings of $1.51 per share with estimates in the range of $1.10-$1.70 per share.
The company estimates fiscal 2010 revenue in the range of $4.1 billion to $4.4 billion. Analysts expect revenues of $3.95-$4.36 billion with a consensus of $4.22 billion.
ABB had said last month that outlook for its businesses over the rest of 2009 and into 2010 remains uncertain.
ROK closed Friday's regular trading session at $43.32, down $0.88 or 1.99%, on a volume of 3.19 million shares. In the past 52 weeks, shares have been trading between $17.50 and $45.12, with a 3-month average volume of 1.34 million shares.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.