(Adds details on results, CEO, analyst comments, shares)
By Lewis Krauskopf
Aug 5 (Reuters) - Emerson Electric Co posted lower-than-expected quarterly profit and sales on Tuesday, pointing to “persisting economic challenges,” and said its full-year results would come in at the low end of its projections.
Shares of the U.S. automation and power supply systems maker slipped 1.4 percent to $63.07 in morning trade on the New York Stock Exchange.
Emerson’s report comes at the end of an uneven reporting season for diverse U.S. manufacturers, most of whose shares have underperformed the broader market since the second quarter ended. Some analysts said Emerson’s weak results were somewhat expected by investors, given the earlier sluggish reports by rivals.
“Fundamentals continue to gradually strengthen, but persisting economic challenges in some markets and rising geopolitical tension have hampered growth, which is not expected to improve in the near term,” Emerson Chief Executive Officer David Farr said in a statement.
Net earnings attributable to common shareholders rose to $728 million, or $1.03 per share, in the company’s fiscal third quarter ended June 30, from $194 million, or 27 cents per share, a year earlier.
Analysts on average were looking for $1.06 per share, according to Thomson Reuters I/B/E/S.
Emerson said earnings were 3 cents per share lower due to “difficult tax rate comparisons.”
Revenue fell 0.5 percent to $6.31 billion, below the $6.45 billion expected by analysts.
“None of the core businesses beat expectations,” JP Morgan analyst Stephen Tusa said in a research note. Tusa noted that the Process Management segment, the company’s largest division, was most off target, with sales rising 2 percent against his 5 percent estimate.
Emerson said its fiscal-year results were pointing toward the low end of its forecast of earnings in a range of $3.68 to $3.80 per share on underlying sales growth of 3 percent to 5 percent.
But it did say it expected fourth-quarter order trends to improve to growth of 5 percent to 7 percent, led by better conditions in emerging markets and firming demand in the United States. (Reporting by Lewis Krauskopf in New York and Ankit Ajmera in Bangalore; Editing by Savio D‘Souza and W Simon)