$16m drop in foodservice equipment revenues fails to derail ITW’s profits

Hobart stand

ITW’s foodservice equipment division managed to retain its profitability despite seeing sales fall by $16m during the third quarter of 2019.

Revenues for the business, which is ITW’s second largest division by sales, slipped 3% to $551m for the three months to 30 September.

However, operating income of $152m was $1m more than the previous year.

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ITW counts a number of major foodservice equipment names within its portfolio including Hobart, Traulsen, Baxter and Vulcan.

Foodservice is generally around 15% of its turnover.

Overall third quarter sales at ITW fell almost 4% to $3.5 billion during the quarter, with unfavourable foreign currency translation impact of 1.8% and a decline in organic revenue of 1.7%.

The company’s ongoing Product Line Simplification (PLS) activities reduced organic growth by 60 basis points, it said.

“While the demand environment continued to moderate across a broad cross section of our portfolio, we delivered another solid quarter with excellent operational execution,” said Scott Santi, chairman and CEO.

“Our ability to overcome near-term macro challenges and deliver seven percent earnings per share growth, expand margins to 25%, and grow free cash flow by 12% is a direct result of our high quality business portfolio, the performance power of the ITW Business Model, and focused execution by our team of dedicated ITW professionals around the world,” Mr Santi concluded.

Tags : BaxterfinancialsHobartITWTraulsen
Andrew Seymour

The author Andrew Seymour

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