Ametek Inc. (NYSE:AME) Q4 2014 Earnings Conference Call - Final Transcript
Jan 28, 2015 • 08:30 am ET
Ladies and gentlemen, thank you for standing by, and welcome to the AMETEK Q4 2014 Earnings Conference Call. During the presentation all participants will be in the listen-only mode. Afterwards we will conduct a question-and-answer session. (Operator Instructions)
As a reminder, this conference is being recorded on Wednesday, January 28, 2015. I would now like to turn the conference over to the Vice President of Investor Relations, Mr. Kevin Coleman. Please go ahead, sir.
Great. Thank you Frank. Good morning, everyone. Welcome to AMETEK's fourth quarter earnings conference call. Joining me this morning are Frank Hermance, Chairman and CEO; Bob Mandos, Executive Vice Presidentof and Chief Financial Officer; and David Zapico, Executive Vice President and Chief Operating Officer.
AMETEK's fourth quarter results were released earlier this morning. These results are available electronically on market systems, and on our website at the Investors section of ametek.com. A tape of today's call can be accessed until February 11 by calling (800) 633-8284, and entering the confirmation code number 21758655.
This call is also webcasted, can be accessed at ametek.com and streetevents.com. The call will be archived on both of these sites.
(Forward-looking Cautionary Statements)
(Forward-looking cautionary statements)
We'll begin with prepared remarks and then we'll open it up for questions.
I'll now turn the meeting over to Frank.
Thank you, Kevin and good morning everyone. AMETEK had a strong fourth quarter to complete another excellent year in the quarter on an adjusted basis, we established records for operating income, net income, diluted earnings per share and operating cash flow. In the fourth quarter, we incurred additional Zygo integration costs of approximately $0.01 per diluted share. Including the cost from the third quarter total Zygo integration costs in 2014 are approximately $0.05 per diluted share.
The additional fourth quarter ended integration cost increases the expected Zygo synergy benefit from $15 million to $20 million. All financial results and commentary on the call today will be on an adjusted basis excluding these integration costs.
Now on to the full year and fourth quarter results. For the full year 2014 we established records for essentially all key financial metrics, including orders, sales, operating income, operating margin, net income, diluted earnings per share and operating cash flow. Sales were up 12% for the year. Orders were up 13%, operating income was up 13%, operating margins were 22.8% and diluted earnings per share ended at $2.42, a 15% increase over 2013's diluted EPS.
In the fourth quarter sales increased 9% to $1.02 billion. Organic growth was up 2% against a very difficult comparison in the fourth quarter of 2013, while acquisitions added 9% and foreign currency was a 2% headwind. Organic growth in the fourth quarter was excellent with broad based strength across our businesses. Overall orders were up 10% and organic sales were very strong, up 7% on orders.
Operating income for the fourth quarter was very strong. It increased 10% to a record $232.3 million. Operating income margin in the quarter was also very strong at