ECOLAB REPORTS 13% EARNINGS PER SHARE GAIN, RECORD RESULTS FOR SECOND QUARTER 1996.ST.PAUL, Minn.--(BUSINESS WIRE)--July 18, 1996-- 1996 SECOND QUARTER HIGHLIGHTS:
Record earnings per share +13% to $0.43
Record earnings +7% to $28 million
Record sales +12% to $373 million
Double-digit domestic and international sales and income
growth
1996
($ Millions, except per share) Second % Six %
Quarter Increase Months Increase
Net Sales $ 373 12% $ 707 10% Operating Income 45 12 79 11 Pretax Income 41 8 71 7 Taxes 16 7 29 7 Earnings from the joint venture 3 - 5 2 Net Income $ 28 7% $ 47 7% Net Income Per Share $0.43 13% $0.73 12% Average Shares Outstanding (000) 64,307 (5)% 64,449 (5)% ST. PAUL St. Paul as a missionary he fearlessly confronts the “perils of waters, of robbers, in the city, in the wilderness.” [N.T.: II Cor. 11:26] See : Bravery , Minn., July July: see month. 18, 1996: Double-digit dou·ble-dig·it adj. Being between 10 and 99 percent: double-digit inflation. domestic and international sales and operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. growth fueled results as Ecolab reported a 13% earnings per share increase for its second quarter ended June 30, 1996. Ecolab s consolidated sales rose 12% to a record $373 million for 1996's second quarter. Net income increased 7% to a record $28 million as the benefits of higher sales and continued attention to cost management were partially offset by higher interest expense related to acquisitions and share repurchases Share Repurchase A program by which a company buys back its own shares from the marketplace, reducing the number of outstanding shares. This is usually an indication that the company's management thinks the shares are undervalued. . Earnings per share rose a stronger 13% to $0.43 as the earnings gain was leveraged by lower average shares outstanding due to the company's 3.5 million share repurchase in June 1995 and share repurchases during the first half of 1996. Sales for the six-month period ended June 30, 1996 rose 10% to $707 million. Net income for the first half of 1996 rose 7% to $47 million. Net income per share increased to $0.73, a 12% increase over net income per share for the first six months of last year. Allan L. Schuman Allan L. Schuman, age 71, is the former CEO of Ecolab, Inc. He resigned as chairman of the board in May 2006 and was named chairman emeritus, an honorary position. He worked at Ecolab for 49 years. Mr. , Ecolab's President and Chief Executive Officer, commented on the results, stating, "As expected, the second quarter showed a solid rebound rebound (rē´bownd), n/v 1. a recovery from illness. n 2. an outbreak of fresh reflex activity after withdrawal of a stimulus rebound adjective from the weather's adverse effect on the first quarter. Second quarter results were led by double-digit sales and income gains in our U.S. business, including improved sales growth in our core Institutional business and double-digit increases in Pest Elimination and Kay KAY Kick Ass Year KAY Kansas Association of Youth . Our International business also posted double-digit sales and profit growth with strong growth in Latin America Latin America, the Spanish-speaking, Portuguese-speaking, and French-speaking countries (except Canada) of North America, South America, Central America, and the West Indies. and Canada. The joint venture's results were flat with last year, reflecting the continuing soft conditions in Europe s Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). hospitality markets.
"We are optimistic op·ti·mist n. 1. One who usually expects a favorable outcome. 2. A believer in philosophical optimism. op regarding our outlook for 1996. Overall, our markets are showing good trends, and key economies served by our International operations Internal Operations (I.O., IO or I/O) is a fictional American Intelligence Agency in Wildstorm comics. It was originally called International Operations. I.O. first appeared in WildC.A.T.S. volume 1 #1 (August, 1992) and was created by Brandon Choi and Jim Lee. are beginning to recover. While Europe remains challenging, fundamental operating improvements are underway in our joint venture business. Our Circle the Customer - Circle the Globe strategy, our focus on innovative, differentiated products and the continued expansion and development of our renowned sales-and-service force are yielding excellent results in both our domestic and international operations. We believe these strengths and continued good industry trends will enable us to once again achieve record results for 1996. Second quarter sales for Ecolab's domestic operations rose 13% over last year to $287 million as the Pest Elimination and Kay divisions recorded double-digit growth. Institutional and Textile Care also showed good gains, and the Janitorial sales increase was bolstered bol·ster n. A long narrow pillow or cushion. tr.v. bol·stered, bol·ster·ing, bol·sters 1. To support or prop up with or as if with a long narrow pillow or cushion. 2. by the February 1996 acquisition of Huntington Laboratories. Food & Beverage sales rose modestly, reflecting the impact of reduced milk production in the southeastern U.S. Domestic operating income rose 11% to $40 million reflecting the higher sales and close attention to costs. Ecolab's International sales rose 10% to $86 million in the second quarter, with double-digit gains in Latin America and Canada. Sales in Asia Pacific rose nicely in local currencies but reported sales were flat due to the negative effects of currency translation. These negative currency effects also impacted overall International sales; excluding the effects of currency, International sales increased 16% over the second quarter of last year. Operating income rose 12% to $6 million due to the higher sales, improved product mix and cost controls. Joint venture operations are included in the financial statements using the equity method of accounting. Sales continue to reflect challenging conditions in Europe s foodservice and hospitality markets, particularly in Germany. When measured in deutsche marks, sales for the second quarter grew 5%. When translated into U.S. dollars, joint venture sales comparisons were hurt by the strengthening U.S. dollar and decreased 2% to $233 million compared with $238 million in the second quarter of last year. Ecolab's equity in the earnings of the Henkel-Ecolab joint venture was $3 million for the second quarter, flat with last year. Net interest expense for the second quarter rose to $4.6 million from $2.4 million last year. The increase reflects the use of cash for share repurchases and business acquisitions. In May 1995, Ecolab announced a 6 million share repurchase program. As part of that program, Ecolab purchased 3.5 million shares in June 1995 under a "Dutch auction Dutch Auction An auction where the price on an item is lowered until it gets its first bid, and then the item is sold at that price. Notes: The U.S. Treasury (and other countries) uses a Dutch auction when it sells securities. " self-tender offer Self-tender offer A company that tenders for its own shares. . At June 30, 1996 there were approximately 2.4 million shares remaining under the existing repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. authorization The right or permission to use a system resource; the process of granting access. See access control. . Additionally, consistent with its longstanding practice, Ecolab has acquired shares under its systematic program to fund employee benefit plans. During the first six months of 1996, approximately 520,000 shares were purchased under these programs. The company intends to continue making purchases from time to time in open market and privately negotiated transactions. Ecolab is the leading global developer and marketer of premium cleaning, sanitizing and maintenance products and services for the hospitality, institutional and industrial markets. For the year ended December 31, 1995, Ecolab reported sales of $1.3 billion; including European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. joint venture sales of $0.9 billion, Ecolab's global sales coverage exceeded $2.2 billion. Ecolab shares are traded on the New York Stock Exchange New York Stock Exchange (NYSE) World's largest marketplace for securities. The exchange began as an informal meeting of 24 men in 1792 on what is now Wall Street in New York City. and the Pacific Stock Exchange under the symbol ECL (Emitter-Coupled Logic) A digital circuit composed of bipolar transistors in which the emitter ends are wired together. ECL gates switch faster than TTL gates, but consume more power. See TTL, I2L and bipolar. 1. . Ecolab news releases and other investor information are available on the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the at http://www.shareholder.com/ecolab/; and by telephone at 1-800-FACT-ECL. -0-
ECOLAB INC
CONSOLIDATED STATEMENT OF INCOME
SECOND QUARTER AND SIX MONTHS ENDED JUNE 30, 1996
(Unaudited)
Second Quarter Six Months
(thousands,except per share) 1996 1995 1996 1995
Net Sales United States $287,278 $255,030 $542,973 $497,256 International 85,918 78,384 163,943 145,718 Total 373,196 333,414 706,916 642,974 Cost of Sales 170,856 149,324 323,445 287,943 Selling, General and Administrative Expenses 156,991 143,748 304,324 283,618 Operating Income United States 39,919 35,937 70,073 65,462 International 6,271 5,619 10,649 8,314 Corporate (841) (1,214) (1,575) (2,363) Total 45,349 40,342 79,147 71,413 Interest Expense, Net 4,584 2,444 8,024 5,017 Income Before Income Taxes and Equity in Earnings of Joint Venture 40,765 37,898 71,123 66,396 Provision for Income Taxes 16,346 15,235 28,517 26,693 Equity in Earnings of Henkel-Ecolab Joint Venture 3,179 3,175 4,637 4,530 Net Income $ 27,598 $ 25,838 $ 47,243 $ 44,233 Net Income Per Common Share $ 0.43 $ 0.38 $ 0.73 $ 0.65 Average Common Shares Outstanding 64,307 67,444 64,449 67,593 CONTACT: Michael J. Monahan (612) 293-2809 (Tel) 612/225-3123 (Fax) |
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