Today before the market opened, Rockwell Automation Inc. (ROK) reported better-than-expected results for the fourth quarter for the fiscal year 2009. Revenue was $1,074.4 million, down 28% versus $1,484.3 million in the fourth quarter of fiscal year 2008. Currency translation contributed 3% points to the decline.
Revenue for the fiscal year 2009 was $4,332.5 million, down 24% compared to $5,697.8 million in fiscal 2008. Foreign currency translation contributed 5% points to the decline.
Excluding restructuring charges from 2009 and special items from 2008, fourth quarter net income was $53.1 million or $0.37 per share, compared to $156.0 million or $1.08 per share in the fourth quarter of fiscal 2008. Income from continuing operations was $217.9 million or $1.53 per share, compared to $3.90 per share in fiscal 2008.
The company took decisive actions throughout the year to right-size the cost structure to current business conditions, including cost actions in the fourth quarter, which is expected to create additional tailwinds for fiscal 2010.
Based on improving macroeconomic indicators and stabilization in the demand trends, management expects a year-over-year revenue to be lower in the first half of fiscal 2010, with growth turning positive in the second half of the year. Based on a revenue outlook of $4.1 to $4.4 billion, the company is providing fiscal 2010 earnings per share guidance of $1.25 to $1.75.
We believe the company is well positioned for long-term growth. Rockwell has a strong global market presence. The company also aims to broaden its portfolio of products, services and solutions as it enters new markets.
Successful diversification of its revenue base through expanded portfolio of products, solutions and services, as well as applications, will enhance the Rockwell’s market accessibility and make it less dependent on any particular industry or geographical region. We maintain a Neutral recommendation on the stock.
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