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© nordson (illustration purpose only) Business | May 24, 2017

Nordson with record 1H/2017 revenue

Nordson Corporation reported 2Q/2017 sales of USD 496 million, a 13 percent increase from the prior year’s second quarter.
This change in sales included a 9 percent increase in organic volume, a 6 percent increase related to the first year effect of acquisitions, and a negative 2 percent impact related to the unfavorable effects of currency translation as compared to the prior year’s second quarter. Reported operating profit was USD 104 million, net income was USD 65 million. Prior year second quarter sales, operating profit and net income were USD 438 million, USD 102 million and USD 71 million respectively.

“These results demonstrate the underlying strength of our base business, the strategic fit of our recent acquisitions, and strong execution across the enterprise by our global team,” said Nordson President and Chief Executive Officer Michael F. Hilton. “Excluding the Vention Medical AT acquisition which was not included in our quarterly guidance, our performance exceeded the high end of our revenue expectations, and operating margin expanded by one percentage point above the prior year second quarter. Second quarter organic sales growth of 9 percent is against a very challenging prior year comparison and is the result of organic growth in all segments and geographies. We’re also pleased with the four acquisitions we have added fiscal year to date, including Vention which closed during the quarter, all of which are performing as expected and where integration efforts are proceeding as planned."

Through the first six months of the fiscal year, EBITDA increased 13 percent compared to the prior year to USD 217 million, and free cash flow before dividends increased 13 percent to USD 116 million, representing strong cash conversion of 101 percent of net income. Adjusted EBITDA increased 20 percent and adjusted free cash flow before dividends increased 23 percent compared to the prior year.

Order rates and backlog

Order rates for the 12-week period ending May 14, 2017, measured in constant currency, increased by 13 percent over the same period a year ago. Order rates by segment and geography are provided in the accompanying financial tables, with pro-forma growth in order rates calculated as though fiscal year 2016 and 2017 acquisitions were owned in both years.

Backlog for the quarter ended April 30, 2017 was approximately USD 403 million, an increase of 37 percent compared to the same period a year ago, and inclusive of 18 percent organic growth and 19 percent growth due to acquisitions. Backlog amounts are calculated at April 30, 2017 exchange rates.

Outlook

For the third quarter of fiscal 2017, sales are expected to increase 15 percent to 19 percent as compared to the third quarter a year ago. This growth includes organic volume up 6 percent to up 10 percent, 10 percent growth from the first year effect of acquisitions, and a negative currency effect of 1 percent based on the current exchange rate environment. EBITDA is expected to be approximately USD 164 million, an increase of 18 percent over the prior year.

“We are forecasting strong third quarter organic sales volume growth in each of our segments given the strength of our current backlog, recent order rates and project activity,” said Hilton. “Our recent acquisitions add to our profitable growth opportunities, particularly Vention AT, which significantly expands our medical platform and remains on track to deliver USD 0.05 to 0.10 cents EPS accretion this fiscal year, excluding transaction costs. At the midpoint of our third quarter guidance, operating margin is expected to be approximately 24 percent, or 25 percent excluding the third quarter charges highlighted above. This is an excellent outlook that builds on our record first half performance. Our global team remains focused on creating shareholder value by offering customers the best technology solutions and outstanding support across the diverse end markets we serve.”

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November 14 2017 8:30 PM V8.8.9-1