Rockwell Automation Inc. (NYSE:ROK) Q1 2018 Earnings Conference Call - Final Transcript

Jan 24, 2018 • 08:30 am ET


Rockwell Automation Inc. (NYSE:ROK) Q1 2018 Earnings Conference Call - Final Transcript


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Thank you for holding, and welcome to Rockwell Automation's Quarterly Conference Call. [Operator Instructions]

At this time, I would like to turn the call over to Steve Etzel, Vice President of Investor Relations and Treasurer. Mr. Etzel, please go ahead.

Steven W. Etzel

Good morning, and thank you for joining us for Rockwell Automation's first quarter fiscal 2018 earnings release conference call. With me today is Blake Moret, our Chairman and CEO; and Patrick Goris, our CFO. Our results were released earlier this morning, and the press release and charts have been posted to our website. Both the press release and charts include reconciliations to non-GAAP measures. A webcast of this call will be available at that website for replay for the next 30 days.

Before we get started, I need to remind you that our comments will include statements related to the expected future results of our Company and are, therefore, forward-looking statements. Our actual results may differ materially from our projections due to a wide range of risks and uncertainties that are described in our earnings release and detailed in all of our SEC filings.

So with that, I'll hand the call over to Blake.

Blake Moret

Thanks, Steve, and good morning, everyone. Thank you for joining us on the call today. I'll start with some key points for the quarter, so please turn to Page 3 in the slide deck.

We had a good start to fiscal 2018. Organic growth was just above 5%, which was in line with our expectations. Continuing the trend we saw last quarter, growth was again broad-based across the regions. From a vertical perspective, heavy industries performed well and were up high single digits in the quarter, including good growth in oil and gas, chemicals, semiconductor and metals. Consumer was about flat. Transportation was weaker than we expected with automotive down about 5%.

From a regional perspective, the US, our largest market, grew over 5% organically. We saw good growth in heavy industries, partially offset by softness in the automotive and consumer verticals. Oil and gas grew double digits. EMEA was up 5%, a continuation of the good growth we saw in the fourth quarter. Sales to OEM machine builders remained strong. In Asia, we saw a double-digit growth in China, India was about flat, and Japan and Korea were down. Recall that Asia was up 20% in Q1 last year, so certainly a tough comparison. Latin America grew 8.5%, led by heavy industries and consumer.

I'll make a few additional comments about the quarter. Logix was up 6% compared to last year. Our process business continues to do well and was up 12% year-over-year organically. This includes the results of our MAVERICK acquisition, which is now included in organic sales. Adjusted EPS was up 12%, reflecting solid operating performance. Patrick will elaborate on our first quarter financial performance in his remarks.

Let's move on now to our outlook for the balance of fiscal 2018. Global macroeconomic conditions remain solid based on PMI measures and the latest forecast