Crane Co Reports First-Quarter Results Payment Merchandising Technologies Sales Remain Flat At 172 Million

STAMFORD, CT -- Crane Co. (NYSE:CR), a diversified manufacturer of highly engineered industrial products, including unattended payment systems and vending machines, reported first-quarter 2016 earnings of $0.93 per diluted share, compared with $0.87 per share in the first quarter of 2015. Excluding special items, first-quarter 2015 earnings per diluted share were $0.92.

First quarter 2016 sales were $660 million, a decrease of 3%, compared with $679 million in the first quarter of 2015. The sales decline was comprised of a $13 million, or 2%, impact from unfavorable foreign exchange and a core sales decline of $6 million, or 1%.

Operating profit in the first quarter was $85.5 million, down 1%, compared with $86 million in the first quarter of 2015. Excluding special items, operating profit was $90.4 million in the first quarter of 2015.

The effective tax rate in the first quarter was 27.9%, down from 32.7% last year. The lower effective tax rate reflects changes in Japanese tax law, along with an expected favorable geographic mix of earnings.

Crane Co.'s four business segments are Fluid Handling, Payment & Merchandising Technologies, Engineered Materials and Aerospace & Electronics. Sales in Payments & Merchandising, which consists of Crane Payment Innovations and Crane Merchandising Systems, were flat at $172 million, with a $4 million, or 2%, increase, in core sales offset by unfavorable foreign exchange of $4 million, or -2%. The segment's operating margin expanded 300 basis points to 16.3%, driven primarily by integration synergies, higher volumes and strong productivity.

Click here to see Crane Co.'s full first-quarter release and non-GAAP financial measures tables.

"Our operating results in the first quarter were in line with our expectations," said Crane Co. president and chief executive Max Mitchell. "While Fluid Handling sales and orders remain depressed, market conditions and our margin performance were consistent with the outlook we provided earlier this year. We remain pleased with the continued strong performance from our other three segments, and we believe that we are on track to achieve our 2016 objectives. Consequently, we are reaffirming our previously issued full-year guidance."

Sales for 2016 are expected to approximate $2.7 billion, reflecting core sales in a range of -1.5% to +1.5%, and an approximate -2% impact from unfavorable foreign exchange. Earnings are expected to be in the range of $3.85-$4.15 per diluted share. Full-year 2016 free cashflow (cash provided by operating activities less capital spending) is expected to be in a range from $190 million to $220 million. Compared with the first quarter, the effective tax rate and corporate expense are expected to revert to more normal levels for the remainder of 2016, in line with previously issued guidance.