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Franklin Electric Co Inc, USA
COMPANY PROFILE
Franklin Electric Co Inc, USA Profile
Franklin Electric Co Inc operates through two reportable segments: Water Systems and Fueling Systems. The Water Systems segment designs, manufactures and sells motors, pumps, electronic controls and related parts and equipment mainly for groundwater, wastewater and fuel transfer applications. The Fueling Systems segment designs, manufactures and sells pumps, pipe, sumps, fittings, vapour recovery components, electronic controls, monitoring devices and related parts and equipment primarily for submersible fueling system applications. Franklin Electric’s pump portfolio has been built through a series of acquisitions, including JBD, USA (2004); Little Giant Pump Co, USA (2006); Pump Brands, South Africa (2007); Monarch Industries, Canada (2007); Industrias Schneider, Brazil (2008); CAL Pump and Western Pump, USA (2008); Vertical SpA, Italy (2009); Impo, Turkey (2011); Pioneer Pump, USA (2012); Bombas Leao SA, Brazil (2014) and Pluga Pumps, India (2014). The company employed approximately 4900 people at the end of 2014. Analysis
Franklin Electric’s net sales in 2014 were up 9% to US$1047.8 million, mainly reflecting sales volume and price increases, as well as acquisitions. The incremental impact of sales from acquired businesses was US$23.5 million or about 2%. The sales increases were partially offset by the impact of foreign currency translation as the US dollar strengthened. Water Systems sales were up 8% to US$824.6 million in 2014, while Fueling Systems sales increased about 12% to US$223.2 million.
COMMENT The 2014 acquisitions of India’s Pluga Pumps and Brazil’s Bombas Leao are well timed and placed. India is a key developing market for Franklin Electric’s Water and Fueling Systems businesses. Meanwhile Franklin Electric is building a solid Brazilian base through acquisition, investment and organic growth. ■
Key Figures (US$ million) Franklin Electric Co Inc 2014
2013
Year ended 31.12 2012
2011
2010
1047.8
965.5
891.3
821.1
713.8
824.6 223.2
766.4 199.1
715.0 176.3
654.1 167.0
583.3 130.5
Gross Profit
344.4
331.5
301.7
272.3
230.2
Operating Profit Of Which: Water Systems Fueling Systems
100.1
123.8
113.0
93.4
64.0
103.9 49.7
131.3 42.6
124.1 36.6
105.3 31.3
84.0 17.4
Net Income
70.9
82.7
83.7
63.7
39.9
Net Income Attributable to Franklin Electric
69.8
82.0
82.9
63.1
38.9
Capital Expenditures
42.4
67.2
42.1
21.1
12.8
Research & Development
19.3
16.8
9.9
8.2
7.5
Net Sales Of Which: Water Systems Fueling Systems
Contact Details
Franklin Electric Co Inc President & CEO: Address:
Gregg Sengstack 9255 Coverdale Road Fort Wayne IN 46809 USA
Tel: +1 260 824 2900 Web: www.franklin-electric.com
Recent Events
In August 2014, Franklin Electric took a 70% interest in Pluga Pumps and Motors Private Ltd, based in Vadodara, India (see Pump Industry Analyst, August 2014). Pluga, which had fiscal 2014 revenues of US$13 million, designs, manufactures and distributes groundwater motor and pumping equipment, including submersibles. The company has a newly built facility in Vadodara and 11 branch offices throughout India. Franklin Electric bought the 70% share with cash and is obligated to buy the remaining 30% in 2017. Franklin Electric acquired Brazilian submersible groundwater pumping equipment manufacturer Bombas Leão SA in June 2014 (see Pump Industry Analyst, June 2014). Established in 1964, Bombas Leão supplies groundwater pumps that are used mainly in agriculture, industrial and municipal applications. Bombas Leão has manufacturing facilities in Monte Azul Paulista and Teresina and a distribution facility in Recife. In 2013 Bombas Leão had net revenues of approximately US$30 million. During 2014, Franklin Electric announced plans to close its manufacturing facility in Wittlich, Germany (see Pump Industry Analyst, July 2014). The company will transfer Wittlich manufacturing activity to its Brno facility in the Czech Republic. Franklin Electric will retain its European Water Systems headquarters and distribution centre in Wittlich. The realignment began in the third quarter of 2014 and is expected to be completed by the end of 2016.
March 2015
Pump Industry Analyst
5
Franklin Electric Co Inc, USA Profile
Franklin Electric Co Inc operates through two reportable segments: Water Systems and Fueling Systems. The Water Systems segment designs, manufactures and sells motors, pumps, electronic controls and related parts and equipment mainly for groundwater, wastewater and fuel transfer applications. The Fueling Systems segment designs, manufactures and sells pumps, pipe, sumps, fittings, vapour recovery components, electronic controls, monitoring devices and related parts and equipment primarily for submersible fueling system applications. Franklin Electric’s pump portfolio has been built through a series of acquisitions, including JBD, USA (2004); Little Giant Pump Co, USA (2006); Pump Brands, South Africa (2007); Monarch Industries, Canada (2007); Industrias Schneider, Brazil (2008); CAL Pump and Western Pump, USA (2008); Vertical SpA, Italy (2009); Impo, Turkey (2011); Pioneer Pump, USA (2012); Bombas Leao SA, Brazil (2014) and Pluga Pumps, India (2014). The company employed approximately 4900 people at the end of 2014. Analysis
Franklin Electric’s net sales in 2014 were up 9% to US$1047.8 million, mainly reflecting sales volume and price increases, as well as acquisitions. The incremental impact of sales from acquired businesses was US$23.5 million or about 2%. The sales increases were partially offset by the impact of foreign currency translation as the US dollar strengthened. Water Systems sales were up 8% to US$824.6 million in 2014, while Fueling Systems sales increased about 12% to US$223.2 million.
COMMENT The 2014 acquisitions of India’s Pluga Pumps and Brazil’s Bombas Leao are well timed and placed. India is a key developing market for Franklin Electric’s Water and Fueling Systems businesses. Meanwhile Franklin Electric is building a solid Brazilian base through acquisition, investment and organic growth. ■
Key Figures (US$ million) Franklin Electric Co Inc 2014
2013
Year ended 31.12 2012
2011
2010
1047.8
965.5
891.3
821.1
713.8
824.6 223.2
766.4 199.1
715.0 176.3
654.1 167.0
583.3 130.5
Gross Profit
344.4
331.5
301.7
272.3
230.2
Operating Profit Of Which: Water Systems Fueling Systems
100.1
123.8
113.0
93.4
64.0
103.9 49.7
131.3 42.6
124.1 36.6
105.3 31.3
84.0 17.4
Net Income
70.9
82.7
83.7
63.7
39.9
Net Income Attributable to Franklin Electric
69.8
82.0
82.9
63.1
38.9
Capital Expenditures
42.4
67.2
42.1
21.1
12.8
Research & Development
19.3
16.8
9.9
8.2
7.5
Net Sales Of Which: Water Systems Fueling Systems
Contact Details
Franklin Electric Co Inc President & CEO: Address:
Gregg Sengstack 9255 Coverdale Road Fort Wayne IN 46809 USA
Tel: +1 260 824 2900 Web: www.franklin-electric.com
Recent Events
In August 2014, Franklin Electric took a 70% interest in Pluga Pumps and Motors Private Ltd, based in Vadodara, India (see Pump Industry Analyst, August 2014). Pluga, which had fiscal 2014 revenues of US$13 million, designs, manufactures and distributes groundwater motor and pumping equipment, including submersibles. The company has a newly built facility in Vadodara and 11 branch offices throughout India. Franklin Electric bought the 70% share with cash and is obligated to buy the remaining 30% in 2017. Franklin Electric acquired Brazilian submersible groundwater pumping equipment manufacturer Bombas Leão SA in June 2014 (see Pump Industry Analyst, June 2014). Established in 1964, Bombas Leão supplies groundwater pumps that are used mainly in agriculture, industrial and municipal applications. Bombas Leão has manufacturing facilities in Monte Azul Paulista and Teresina and a distribution facility in Recife. In 2013 Bombas Leão had net revenues of approximately US$30 million. During 2014, Franklin Electric announced plans to close its manufacturing facility in Wittlich, Germany (see Pump Industry Analyst, July 2014). The company will transfer Wittlich manufacturing activity to its Brno facility in the Czech Republic. Franklin Electric will retain its European Water Systems headquarters and distribution centre in Wittlich. The realignment began in the third quarter of 2014 and is expected to be completed by the end of 2016.
March 2015
Pump Industry Analyst
5