Clarcor Q1 Profit Tops View, But Sales Miss; Boosts 2014 EPS Outlook

(RTTNews) - Filtration and packaging product maker Clarcor, Inc. (CLC) reported Wednesday a profit for the first quarter that edged up from last year, despite lower operating margins, reflecting strong double-digit sales growth amid contributions from GE Air Filtration acquisition.

Earnings per share topped analysts' expectations, while quarterly sales missed their estimates. The company also raised earnings forecast for the full-year 2014, while maintaining annual sales forecast.

"Our first quarter results were influenced by several items which make the comparison to our prior year results somewhat challenging, including the impact of the two acquisitions we completed in the first quarter of 2014, certain costs and benefits associated with these acquisitions and restructuring charges at our HVAC air filtration business," Chairman, President and CEO Chris Conway said in a statement.

The Franklin, Tennessee-based air filter maker reported net earnings of $24.32 million or $0.48 per share for the first quarter, edging up from $23.46 million or $0.47 per share in the prior-year quarter.

On average, six analysts polled by Thomson Reuters expect the company to report earnings of $0.41 per share for the quarter. Analysts' estimates typically exclude special items.

Net sales for the quarter grew 22 percent to $312.69 million from $256.27 million in the same quarter last year, but missed five Wall Street analysts' consensus estimate of $317.45 million.

Sales growth was aided primarily by the first quarter sales contribution of $45.4 million from the December 2013 acquisition of GE Air Filtration.

"When the impact of the two first quarter acquisitions and the HVAC restructuring charges are removed from our financial results, net sales increased approximately 3%, operating profit increased slightly and operating margin declined slightly from the first quarter of 2013.," Conway added.

Net sales at engine/mobile filtration segment grew 4 percent, and industrial/environmental filtration segment sales surged 43 percent from last year. Meanwhile, packaging segment sales declined 4 percent for the quarter.

Operating margin for the quarter contracted 320 basis points to 10.0 percent from last year's 13.2 percent.

Looking ahead to fiscal 2014, the company raised its earnings guidance to a range of $2.60 to $2.75 per share from its previous forecast in the $2.55 to $2.70 per share range, while still continuing to project consolidated net sales between $1.41 billion and $1.47 billion.

Street is currently looking for full-year 2014 earnings of $2.70 per share, on annual revenues of $1.43 billion.

The company noted that the guidance is inclusive of earnings of $0.15 to $0.20 per share and sales of $250 million to $275 million anticipated from the GE Air Filtration and Bekaert Advanced Filtration acquisitions.

CLC closed Wednesday's regular trading session at $56.34, down $0.39 or 0.69% on a volume of 0.20 million shares.