How Did Emerson Electric’s Operating Segments Fare in Fiscal 1Q17?
Emerson Electric’s operating segments
Emerson Electric (EMR) reports its sales under two operating segments: Automation Solutions and Commercial & Residential Solutions. The Commercial & Residential Solutions segment includes the results of company’s Climate Technologies and Tools & Home Products businesses.
In fiscal 1Q16, EMR’s Automation Solutions segment accounted for ~65% of the company’s total sales. The remaining 35% of its sales came from its Commercial & Residential Solutions segment.
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Automation Solutions segment
For fiscal 1Q17, Emerson Electric (EMR) reported ~$2.1 billion in sales from its Automation Solutions segment compared to ~$2.2 billion in fiscal 1Q16, accounting for nearly 61% of the company’s total sales. According to the company’s earnings call, the decline in its Automation Solutions sales was primarily due to low-level spending in the energy-related and general industrial markets in fiscal 1Q17.
However, Emerson Electric expects that the improving MRO1 spending by its Oil & Gas customers could benefit the company in the next two quarters. Notably, the company witnessed an ~8% decline in its underlying organic sales on a YoY (year-over-year) basis. The decline in energy-related sales was offset by the growth in the segment’s Power, Chemical, and Life Sciences business to some extent.
Commercial & Residential Solutions segment
Emerson Electric (EMR) reported ~$1.3 billion in sales from its Control Products & Solutions segment in fiscal 1Q17 compared to ~$1.2 billion during fiscal 1Q16. This accounted for nearly 39% of the company’s total sales.
The company reported segmental organic sales growth of 7% on a YoY basis. The segment’s overall sales rose 6% compared to the sales reported for fiscal 1Q16.
Next, we’ll look into Emerson Electric’s fiscal 1Q17 operational performance.
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