WASHINGTON (dpa-AFX) - Cleaning and pest-control service provider Ecolab, Inc. (ECL) reported Tuesday a profit for the first quarter that soared from last year, reflecting lower charges and revenue growth. Striping down charges, adjusted earnings per share topped analysts' expectations by a penny, while quarterly revenues missed their estimates by a whisker.
The company also provided earnings forecast for the second quarter, in line with Street view, and raised earnings guidance range for the full-year 2013, citing the anticipated accretion from the Champion acquisition.
'Our team did a good job delivering results, with new account growth, appropriate pricing and significant synergy and cost savings driving the strong double-digit earnings improvement,' Chairman and CEO Douglas Baker, Jr. said in a statement.
Ecolab noted that results were led by good results from global food & beverage and global specialty along with overall strong operating margin improvement.
The St. Paul, Minnesota-based company reported net income of $159.6 million or $0.53 per share for the first quarter, sharply higher than $49.7 million or $0.17 per share in the prior-year quarter.
Excluding special items, adjusted net income for the quarter was $180.5 million or $0.60 per share, compared to $150.3 million or $0.50 per share in the year-ago quarter.
On average, nine analysts polled by Thomson Reuters expected the company to earn $0.59 per share for the first quarter. Analysts' estimate typically excludes special items.
Net sales for the quarter grew 2 percent to $2.87 billion from $2.81 billion in the same quarter last year, and missed eight Wall Street analysts' consensus estimate of 2.88 billion by a whisker.
When adjusted for acquisitions and divestitures, fixed currency sales rose 3 percent.
Ecolab's global industrial sales grew 1 percent to $1.14 billion, reflecting solid global food & beverage growth which more than offset slight declines in global water and global paper sales.
Global institutional sales increased 2 percent to $945 million from last year, led by double-digit global specialty sales growth and modest global healthcare sales growth, with global institutional business sales remaining flat.
Global energy sales increased 7 percent to $579 million, while other sales, which include global pest elimination and equipment care, declined 5 percent to $167 million from last year.
Looking ahead to the second quarter, Ecolab anticipates adjusted earnings in a range of $0.81 to $0.85 per share, on projected double-digit fixed currency sales growth, and acquisition-adjusted fixed currency sales growth in the mid-single digits. Analysts expect the company to report earnings of $0.85 per share for the quarter.
For fiscal 2013, the company raised its adjusted earnings guidance to a range of $3.45 to $3.55 per share from the prior forecast in the range of $3.38 to $3.48 per share. Street is currently looking for full-year 2013 earnings of $3.52 per share.
Ecolab said it expects significant earnings accretion from the Champion Technologies acquisition which closed earlier in the month, adding about $0.07 to 2013 adjusted earnings per share and rising to $0.50 by 2016.
Additionally, the company announced plans to undertake restructuring and other cost-saving actions to realize its Champion acquisition-related cost synergies as well as streamline and strengthen its position in the fast growing energy market.
The company anticipates cost synergies of about $25 million in 2013, with annual acquisition cost synergies of $150 million achieved by the end of 2015.
The company also announced a reduction of the combined business's current global workforce by about 500 positions. The company said it expects to achieve the reductions through open positions and attrition.
In Tuesday's regular trading session, ECL is currently trading at $84.11, up $0.86 or 1.03% on a volume of 0.18 million shares.
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