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20 | 2015 Annual Report
NET SALES
Net sales for 2015 were $22.3 billion, a decrease of
$2,233 million, or 9 percent compared with 2014.
Underlying sales, which exclude foreign currency
translation, acquisitions and divestitures, decreased
2 percent ($511 million) on volume declines.
Foreign currency translation subtracted 5 percent
($1,123 million), divestitures subtracted 2 percent
($628 million) and acquisitions added $29 million.
Underlying sales decreased 2 percent in both the U.S.
and internationally. Sales in Process Management
decreased $673 million, Industrial Automation
decreased $869 million, Network Power decreased
$632 million and Climate Technologies decreased
$98 million. Commercial & Residential Solutions
sales were flat.
Net sales for 2014 were $24.5 billion, a decrease of
$132 million, or 1 percent compared with 2013, due to
the divestitures of the embedded computing and power
(now Artesyn Embedded Technologies or “Artesyn”)
and connectivity solutions businesses. Consolidated
results reflect a 3 percent ($729 million) increase in
underlying sales driven by volume gains. Divestitures
subtracted 5 percent ($1,112 million), acquisitions
added 1 percent ($328 million), and foreign currency
translation subtracted $77 million. Underlying sales
grew 4 percent in the U.S. and 2 percent internationally.
Reported sales growth was led by Process Management,
which increased $579 million including acquisitions, and
Climate Technologies, which increased $233 million.
Sales in Industrial Automation and Commercial &
Residential Solutions increased $105 million and
$59 million, respectively. Network Power decreased
$1,082 million due to divestitures.
2015 SALES BY GEOGRAPHIC DESTINATION
Asia
22%
Latin America
6%
United States
and Canada
48%
Europe
18%
Middle East/Africa
6%
INTERNATIONAL SALES
Emerson is a global business with international sales
representing 56 percent of total sales, including U.S.
exports. Although economic conditions are currently
soft worldwide, the Company generally expects faster
economic growth in emerging markets in Asia,
Latin America, Eastern Europe and Middle East/Africa
in the future.
International destination sales, including U.S. exports,
decreased 12 percent, to $12.5 billion in 2015,
primarily reflecting decreases in Process Management
and Industrial Automation, partially due to the power
transmission solutions divestiture, and prior year
divestitures in Network Power. These decreases were
partially offset by growth in Climate Technologies and
Commercial & Residential Solutions. U.S. exports of
$1.3 billion were down 5 percent compared with 2014.
Underlying international destination sales declined
2 percent on lower volume, as foreign currency
translation and divestitures had an 8 and 2 percent
unfavorable impact, respectively, on the comparison.
Underlying sales were flat in Europe, decreased
5 percent in Asia (China down 10 percent) and 9 percent
in Latin America, and increased 2 percent in Canada
and 3 percent in Middle East/Africa. The slowdown in
industrial capital spending, particularly in oil and gas,
has hampered growth in these areas. Origin sales by
international subsidiaries, including shipments to the
U.S., totaled $11.3 billion in 2015, down 12 percent
compared with 2014, reflecting the slowdown in
industrial capital spending, unfavorable foreign
currency translation and divestitures.
International destination sales, including U.S. exports,
decreased 3 percent, to $14.2 billion in 2014, primarily
reflecting the divestitures in Network Power, partially
offset by increases in Process Management, Climate
Technologies and Commercial & Residential Solutions.
U.S. exports of $1.4 billion were down 13 percent
compared with 2013 primarily due to the Artesyn
divestiture. Underlying international destination sales
grew 2 percent on volume, as divestitures, acquisitions
and foreign currency translation had a 5 percent
unfavorable impact on the comparison. Underlying
sales increased 1 percent in Europe, 4 percent in Asia
(China up 7 percent), 2 percent in Latin America and
1 percent in Canada, and declined 1 percent in Middle
East/Africa. Origin sales by international subsidiaries,
including shipments to the U.S., totaled $12.9 billion
in 2014, down 2 percent compared with 2013 due
to divestitures.