The Golden Valley company saw sales gain in both its business segments.
Increased investments in new products, expansion in fast-growing markets outside the U.S. and improved productivity helped Pentair Inc. ride the tide of economic recovery in 2010, boosting sales and earnings for the fourth quarter and full year.
The Golden Valley-based manufacturer of water-related and technical products Tuesday reported a 7 percent increase in sales to $753.9 million for the quarter ended Dec. 31. Earnings from continuing operations totaled $48.7 million, or 49 cents a share, compared with $29.2 million, or 20 cents a share, for the same period a year earlier. Adjusting fourth-quarter 2009 results to exclude restructuring and impairment items, year-over-year adjusted earnings per share increased 4 percent.
Analysts had estimated fourth-quarter sales of $738.8 million and earnings per share of 47 cents.
Pentair shares rose about 3 percent Tuesday, closing at $37.28.
Sales for the year were $3 billion vs. $2.7 billion in 2009. Earnings totaled $198.5 million, or $2 a share, up from $115.5 million, or $1.17 a share in 2009. Adjusting 2009 earnings per share to exclude restructuring and impairment items and the impact from the early redemption of bonds, full-year earnings per share increased 36 percent.
Rising costs of raw materials, chiefly copper and steel, took a bite out of profit margins in the fourth quarter. "The company has put through price increases that should mitigate those headwinds in 2011," said James Lucas, an analyst at Janney Capital Markets in Philadelphia.
Organic sales, which don't include price increases, currency effects or contributions from acquisitions, grew 13 percent for the full year.
Research and development spending increased to $67 million, up about $10 million from 2009. In a conference call with analysts, CEO Randall Hogan said 2010 was "a breakthrough year in innovation" with nearly double the number of new products compared with 2009.
The company said it expects 2011 sales of about $3.2 billion and earnings per share of $2.20 to $2.35. First-quarter 2011 earnings per share are expected to be 42 to 45 cents, up 20 to 29 percent from a year earlier.
Susan Feyder • 612-673-1723