Nordson Corporation

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NASDAQ $146.10   +1.72

Nordson Corporation Reports Fiscal Year 2019 First Quarter Results

20 Feb 2019

 

  • Sales were $498 million
  • Operating profit was $84 million, or 17 percent of sales
  • EBITDA was $108 million, or 22 percent of sales
  • GAAP diluted EPS was $0.83; adjusted diluted EPS, which excludes one-time charges and net discrete tax expense in the quarter, was $0.92

Westlake, Ohio, USA – February 20, 2019 – Nordson Corporation (Nasdaq: NDSN) today reported results for the first quarter of fiscal year 2019.  For the quarter ended January 31, 2019, sales were $498 million, a 10 percent decrease compared to the prior year’s first quarter, where organic sales volume grew 19 percent compared to the first quarter of 2017. This change in first quarter 2019 sales included a decrease of 9 percent organic volume, growth related to the first year effect of acquisitions of 1 percent, and a decrease related to the unfavorable effects of currency translation as compared to the prior year’s first quarter of 2 percent. 

In the first quarter of fiscal year 2019, reported operating profit was $84 million, net income was $49 million, and GAAP diluted earnings per share were $0.83, inclusive of a $0.09 per share charge related to one-time items. Prior year first quarter sales, operating profit, net income and GAAP diluted earnings per share were $550 million, $119 million, $105 million and $1.78, respectively.  A reconciliation of GAAP diluted earnings per share to adjusted diluted earnings per share and calculations for EBITDA, adjusted EBITDA, free cash flow before dividends, and adjusted free cash flow before dividends are included in the attached financial exhibits

The current quarter’s results include a non-recurring restructuring charge of approximately $1.5 million, or $0.02 per diluted share.  Additionally, net discrete tax expense of approximately $4 million, or $0.07 per diluted share, primarily related to the U.S. federal income tax reform legislation was recognized in the quarter.

First Quarter Segment Results

Adhesive Dispensing Systems sales decreased approximately 4 percent compared to the prior year’s first quarter, inclusive of a decrease in organic volume of approximately 2 percent and a decrease of approximately 3 percent related to the unfavorable effects of currency translation as compared to the prior year.  Reported operating margin in the segment was 23 percent in the quarter.

Advanced Technology Systems sales decreased approximately 14 percent compared to the prior year’s first quarter, inclusive of a decrease in organic volume of approximately 15 percent, an increase of approximately 2 percent related to the first year effect of acquisitions, and a decrease of approximately 1 percent related to the unfavorable effects of currency translation as compared to the prior year.  The first quarter’s acquisitive growth includes the fiscal 2018 acquisition of Clada Medical Devices and two months of the fiscal 2018 acquisition of Sonoscan.  Sales growth in the first quarter of 2018 increased 87 percent compared to the same period of 2017, inclusive of 50 percent organic sales volume growth. In the first of quarter 2019, reported operating margin in the segment was 17 percent.

Industrial Coating Systems sales decreased approximately 10 percent compared to the prior year’s first quarter, inclusive of a decrease in organic volume of approximately 9 percent and a decrease of approximately 2 percent related to the unfavorable effects of currency translation as compared to the prior year. Reported operating margin in the segment was 14 percent in the quarter.

Detailed results by operating segment and geography are included in the attached financial exhibits.

“Given the difficult comparisons to the strong first quarter of fiscal 2018, where total company organic sales growth was 19 percent, this quarter’s performance was in line with our expectations for a more typical seasonal pattern of sequential quarterly sales growth. As our spending is generally consistent throughout the year, segment operating margins in the quarter were impacted by the decline in sales,” said Michael F. Hilton, President and Chief Executive Officer.  “In line with our capital allocation strategy, we invested $102 million for the repurchase of approximately 856,000 shares and distributed $20 million in dividends during the quarter. We are pleased to return this value to our shareholders.”

Backlog

Backlog for the quarter ended January 31, 2019 was $439 million, an increase of 9 percent compared to the same period a year ago.  Impact from acquisitions was not significant.  Backlog amounts are calculated at January 31, 2019 exchange rates.

Commenting on the company’s fiscal 2019 outlook, Hilton said, “While we will continue to monitor macroeconomic challenges, as well as the resolution of the international tariff legislation, we believe the strength of our diverse end markets and our ability to execute on our growth initiatives continue to support organic growth guidance of 3 to 5 percent for fiscal 2019.  Our global team also remains committed to achieving the operational improvements that support our previously announced operating and EBITDA margin enhancement targets for the full fiscal year 2019.”

Nordson management will provide additional commentary on these results and outlook during a conference call Thursday, February 21, 2019 at 8:30 a.m. eastern time which can be accessed at www.nordson.com/investors.  For persons unable to listen to the live broadcast, a replay will be available for 14 days after the event. Information about Nordson’s investor relations and shareholder services is available from Lara Mahoney, Vice President, Investor Relations and Corporate Communications at (440) 414-5639 or lara.mahoney@nordson.com.

Except for historical information and comparisons contained herein, statements included in this release may constitute “forward-looking statements,” as defined by the Private Securities Litigation Reform Act of 1995. These statements involve a number of risks, uncertainties and other factors, as discussed in the company’s filing with the Securities and Exchange Commission that could cause actual results to differ.

Nordson Corporation engineers, manufactures and markets differentiated products and systems used for the precision dispensing of adhesives, coatings, sealants, biomaterials, polymers, plastics and other materials, fluid management, test and inspection, UV curing and plasma surface treatment, all supported by application expertise and direct global sales and service.  Nordson serves a wide variety of consumer non-durable, durable and technology end markets including packaging, nonwovens, electronics, medical, appliances, energy, transportation, construction, and general product assembly and finishing.  Founded in 1954 and headquartered in Westlake, Ohio, the company has operations and support offices in more than 35 countries.  Visit Nordson on the web at http://www.nordson.com, @Nordson_Corp, or www.facebook.com/nordson.

 

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CONTACT:
Nordson Corporation
Lara Mahoney (Vice President, Investor Relations & Corporate Communications)
440.414.5639
Lara.Mahoney@nordson.com