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CORRECTED-UPDATE 2-Emerson profit lifted by process management
August 7, 2012 / 11:05 AM / in 5 years

CORRECTED-UPDATE 2-Emerson profit lifted by process management

(Corrects paragraph 4 to show net profit rose 13 percent, not 11 percent; the error also appeared in earlier versions)

* Earnings $1.04/share vs Street view $1

* Revenue up 3 pct to $6.48 bln

* Trims 2012 profit forecast

* Shares up 1.6 pct in premarket trade

By Nick Zieminski

Aug 7 (Reuters) - Emerson Electric Co reported higher quarterly profit on Tuesday, lifted by improved results in the process management business, but the conglomerate trimmed its full-year earnings forecast because of slowing economies around the world.

Emerson said many consumers and businesses were losing confidence amid the European financial crisis, weaker economic growth in China, a rising dollar and looming fiscal challenges in the United States. It called business investment “tepid.”

But its reduced earnings forecast was slightly ahead of Wall Street estimates, and its shares gained 1.6 percent in premarket trading.

Emerson, a provider of wireless networks used in oil and gas production and uninterruptible power supplies, said net earnings rose 13 percent to $770 million, or $1.04 per share, in the fiscal third quarter ended June 30, from $683 million, or 90 cents per share, a year earlier.

Analysts, on average, expected $1 a share, according to Thomson Reuters I/B/E/S.

Sales rose 3 percent to $6.48 billion but came in below Wall Street estimates of $6.61 billion.

Emerson’s process management segment posted a 19 percent increase in revenue, lifted by demand from the oil and gas, chemicals and power-generation markets.

Earnings jumped by a third in process management, reflecting both higher sales and recent cost cuts, and Emerson said the unit’s outlook was favorable for the next several quarters.

The St. Louis-based company, which also makes industrial automation systems and heating and cooling technology, said economies around the world were slowing and business investment was expected to remain “tepid.”

It cut its full-year earnings forecast to a range of $3.35 to $3.40 a share, compared with a May forecast of $3.35 to $3.50.

Analyst estimates, which have come down in recent weeks, average $3.34 a share. (Reporting By Nick Zieminski in New York; editing by Lisa Von Ahn, Jeffrey Benkoe and John Wallace)

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