KENOSHA, Wis. (April 26, 2016) — Tool maker and marketer Snap-on Inc.'s earnings for the first quarter jumped 16.1 percent to $128.3 million despite a slight 0.8-percent increase in sales to $834.2 million, compared with the year-ago period.
The company noted that when excluding $16.4 million of unfavorable foreign currency translation and $2.6 million of acquisition-related sales, its organic sales increased 2.5 percent to $20.2 million for the period ended April 2.
“Our first quarter results, including a 15.5-percent increase in diluted earnings per share, represent an encouraging start to 2016,” said Nick Pinchuk, Snap-on chairman and CEO. “We believe these results demonstrate not only the fundamental strength of Snap-on's value proposition of making work easier for serious professionals, but also the continued progress along our defined runways for coherent growth while overcoming the headwinds of the current environment.
“At the same time, our operating margin improvement further confirms the ongoing potential of our Snap-on Value Creation Processes, which we employ every day around safety, quality, customer connection, innovation and rapid continuous improvement.
“Finally, these results would not have been possible without the dedication and capability of our franchisees and associates worldwide; I thank them for their continuing commitment and extraordinary contributions.”
The company's Snap-on Tools Group segment reported an 11.5-percent increase in operating earnings to $66.7 million on a 6.4-percent jump in sales to $402.5 million for the quarter, due to revenue increases in both the company's U.S. and international franchise operations.
Excluding $6 million of unfavorable foreign currency translation, organic sales rose 8.1 percent, the company said. Operating earnings included $4.2 million of unfavorable foreign currency effects.
Snap-on said it expects to make continued progress in 2016, including developing and expanding its professional customer base in automotive repair and adjacent markets and in additional geographies.
Kenosha-based Snap-on's capital expenditures in 2016 are expected to be in the range of $80 million to $90 million. Its full year 2016 effective income tax rate will be comparable to its 2015 full year rate, the company said.
Snap-on will discuss its financial results during a shareholder conference call and webcast at 9 a.m. CT on April 21. To access the webcast, visit the company's website.