By Melodie Warner
Pentair Ltd.'s (PNR) first-quarter earnings fell 16% as
acquisition charges and a sharp rise in input costs masked the
water-treatment and storage-systems maker's sales growth.
The company forecast current-quarter adjusted earnings of 88
cents to 91 cents a share on revenue of $1.9 billion, while
analysts surveyed by Thomson Reuters expect 90 cents on $1.97
billion. Pentair also backed its full-year guidance.
"We continue to see signs of a North American residential
recovery and global energy remains strong, while infrastructure and
industrial markets continue to be mixed," said Chairman and Chief
Executive Randall J. Hogan.
Pentair completed its $4.5 billion merger with the
pipe-and-valve business of Tyco International Ltd. (TYC) in
September, a move that gave Pentair greater exposure to industrial
customers and the energy sector.
Pentair reported a profit of $52 million, or 25 cents a share,
down from $62 million, or 62 cents a share, a year earlier.
Excluding items such as acquisition expenses, repositioning costs
and gain on sale of business, adjusted earnings rose to 58 cents
from 54 cents. Sales more than doubled to $1.77 billion.
In January, Pentair forecast adjusted earnings of 54 cents to 56
cents a share on revenue of $1.8 billion, below consensus estimates
at the time.
Gross margin shrank to 29.5% from 32.7% as input costs soared to
$1.25 billion from $577 million last year.
Shares closed Monday at $50.05 and were inactive premarket. The
stock has gained 13% over the past year.
Write to Melodie Warner at melodie.warner@dowjones.com
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