Cleveland, OH — Applied Industrial Technologies has reported record earnings for its second quarter and first half ended December 31, 2004. Applied’s net income and earnings per share rose by 94% on a sales increase of 12.4% for its fiscal 2005 second quarter. This represents the ninth consecutive quarter in which Applied’s per-share earnings have increased by 25% or more.
Net sales for the quarter were $404,139,000 compared with $359,711,000 in the same period a year ago. Net income for the quarter increased to $9,980,000 from $5,133,000. (All figures are in U.S. dollars.) Earnings per share increased to $0.33 from $0.17 per share last year and was consistent with Applied’s previous guidance. All per-share amounts are adjusted to reflect a 3-for-2 stock split paid December 17, 2004.
For the six months ended December 31, 2004, sales increased 13.4% to $817,265,000 from $720,857,000 in the same period last year. Net income increased 131% to $23,020,000, or $0.76 per share, versus $9,965,000, or $0.34 per share, last year.
Commenting on the results, Applied chairman and chief executive officer David L. Pugh said, “We were once again pleased with the strength of our quarterly results, and with our ability to convert sales increases to proportionately higher levels of profitability. This was a direct result of the continued focus on our core strategies of profitable sales growth, cost containment and asset management.
“Productivity improvements served as an offset to margin pressures created by inflation in vendor prices, as well as a shift in our product and customer mix.
“Selling, distribution and administrative expenses for the second quarter stayed essentially flat compared to last year, even with a sales increase of more than 12%. We continued to actively manage our expenses with special attention paid to discretionary spending, helping to raise our operating margin to 4.3% this quarter, compared with 2.6% in the same period last year.
With more than 430 facilities and 4,300 employee associates across North America, Applied Industrial Technologies offers more than two million parts critical to the operations of MRO and OEM customers in virtually every industry. In addition, Applied provides engineering, design and systems integration for industrial and fluid power applications, as well as customized mechanical, fabricated rubber and fluid power shop services.