* 3rd-quarter adj profit, sales miss estimates
* Cuts top end of 2014 profit forecast
* Mining weakness hits sales outside US
* Sales fall in company's largest business
* Shares fall as much as 7 percent
(Adds CEO, analyst comment; updates shares)
By Ankit Ajmera and Sagarika Jaisinghani
July 30 Rockwell Automation Inc, whose
automated systems help factories run smoothly, said a decrease
in spending by miners globally led to lower quarterly sales
outside the United States and in its largest business.
Rockwell's shares fell as much as 7 percent after the
company also cut the top end of its full-year earnings forecast
and reported lower-than-expected third-quarter profit.
"We don't expect to see a pick up in mining," Chief
Executive Keith Nosbusch told Reuters. "We would not expect
major projects until late 2015 or later."
Globally coal miners have idled projects and delayed
investments due to a supply glut and weak prices, which in turn
has hurt demand for Rockwell's products.
The company's systems such as electronic motor starters,
signaling devices and condition sensors help increase personnel
safety in mines, allow remote control of equipment and increase
mineral yield. Such sales contribute in the high single digit
percentage to Rockwell's revenue.
"Much of the debate has been whether (Rockwell) is aligned
to the "right" end markets for organic growth at this time, and
this quarter appears more mixed," Sanford C. Bernstein analyst
Steven Winoker wrote in a note.
Milwaukee, Wisconsin-based Rockwell, which gets about half
its revenue from outside the United States, said U.S. sanctions
against Russia had also hurt business. The country accounts for
less than 1 percent of its total revenue.
"Depending upon what happens with sanctions, there is a
strong possibility that we won't see much of an uptick (in
Russia) as we go forward," Nosbusch said.
Rockwell narrowed its 2014 adjusted earnings forecast to
$6.10-$6.25 per share from $6.00-$6.35. Analysts on average were
expecting a profit of $6.20 per share, according to Thomson
The company also narrowed its full-year organic sales growth
forecast to 4-6 percent, from 3-6 percent. Its organic sales
rose 2 percent in the third quarter ended June 30.
Lower sales and margins in the quarter at Rockwell's control
products business - which makes the systems also used in mines,
and is the company's largest - weighed on profitability.
Rockwell's revenue from Latin America and Canada fell 7.1
and 14 percent, respectively, in the quarter. Sales from Asia
Pacific fell 1.2 percent.
Total revenue rose 1.56 percent to $1.65 billion, helped by
higher sales in the United States.
Rockwell's net income fell 2 percent to $199.7 million, or
$1.43 per share, also pulled down by a higher effective tax
rate. Excluding items, Rockwell earned $1.49 per share.
Analysts had expected earnings of $1.56 per share on revenue
Rockwell's shares were down 7 percent at $111.69 in midday
trading and were the biggest loser on the Dow Jones U.S.
industrial machinery index.
(Editing by Savio D'Souza)