Pall Corporation (NYSE:PLL) today reported financial results for the fourth quarter and fiscal year ended July 31, 2009. Sales and net earnings for the year were $2.3 billion and $195.6 million, respectively. Diluted earnings per share (EPS) were $1.64, compared to $1.76 a year earlier. Pro forma EPS were $1.77 versus last year's $1.97. The estimated impact of foreign currency translation reduced diluted EPS by $0.16 and pro forma EPS by $0.17.
Fourth quarter sales were $652 million and net earnings were $69.5 million. Diluted EPS were $0.58. Pro forma EPS were $0.57. The estimated impact of foreign currency translation reduced both measures of EPS by $0.05.
Eric Krasnoff, Chairman and CEO, stated, “The economy has certainly presented challenges. Revenues in the fourth quarter were still off from a robust 2008. Life Sciences sales grew 5.2% in the quarter and 3% for the year. Pall Industrial sales declined 8.8% in the quarter and 7.3% for the year. This is reflective of a generally depressed manufacturing landscape particularly in the microelectronics sector.
There are positive signs dotting the industrial horizon. This was the first quarter in a year that Microelectronics sales grew, turning in almost 40% sequential growth. This market led the overall sequential increase in Pall sales. Our Municipal Water, Power Generation and Military markets all showed double-digit growth in the quarter and for the year.
Pall's gross margin improved in the year despite the drop in sales volume. Continuing success of our pricing initiative and sustained cost reduction efforts were key to that result. SG&A reduced about 6 1/2% to $700 million. Operating cash flow improved, an accomplishment given the economy.”
Medical sales increased 1.6% in the quarter driven, in part, by strong growth of Pall-AquasafeTM water filters to hospitals. Sales to independent blood centers grew solidly in the United States. Medical product sales continue to be healthy in Asia.
BioPharmaceuticals sales increased 7.8% in the quarter with sales growing in all geographies. The vaccine and plasma derivatives markets were particularly strong. The Company continues to benefit from expanding adoption of single-use systems for biotechnology and vaccine production.
Life Sciences gross margin increased 70 basis points to 52.2%. SG&A as a percentage of sales decreased 120 basis points to 25.7%. This resulted in an improvement in operating margin to 22.1% from 20.5% a year earlier.
Energy, Water & Process Technologies (“EWPT”) sales decreased 2.5% in the quarter. Municipal Water posted a 12.7% sales increase. Industrial Manufacturing markets continued to be weak globally. Sales in the energy-related markets were flat overall with strong sales in Power Generation offset by weakness in Fuels & Chemicals.
Aerospace & Transportation decreased 8.3% for the quarter. Military Aerospace sales increased 14.9% in the quarter on strong performance led by Europe. Commercial Aerospace declined 9.2% reflecting weakness in airline aftermarket sales and reduced airframe production, particularly in the small jet market. Sales in the Transportation market were down on continued weakness in global mobile equipment production and operations.
Fourth quarter Microelectronics sales decreased 31.7% over the prior year. Sales on a sequential basis grew. Activity in the microelectronics markets rebounded and their chemical suppliers began replenishing inventory. This is suggestive of a bottoming out in the semiconductor and consumer electronics markets.
Industrial gross margin was negatively impacted by product mix and reduced volume. Pricing and manufacturing improvements mitigated the decline. SG&A improved 4.6% in local currency as a result of cost reduction and efficiency programs. This resulted in a decrease in operating profit margin to 13.9%.