{"id":1656,"date":"2015-07-26T16:47:06","date_gmt":"2015-07-26T14:47:06","guid":{"rendered":"http:\/\/www.blog.asmus-puhl.com\/?p=1656"},"modified":"2015-07-26T16:52:19","modified_gmt":"2015-07-26T14:52:19","slug":"colfax-names-new-ceo-when-headwinds-are-strong-for-the-company","status":"publish","type":"post","link":"http:\/\/www.blog.asmus-puhl.com\/?p=1656","title":{"rendered":"Colfax names new CEO when headwinds are strong!"},"content":{"rendered":"

Colfax (NYSE: CFX)\u00a0released its Q2 2015 earnings<\/a> and at the same time announced a new CEO<\/a>!
\nThe edited transcript of the conference call<\/a> was published by Thomson Reuters.<\/p>\n

The second quarter of 2015 was a difficult one for Colfax!<\/p>\n

Adjusted EPS was $0.50 per share, a 4% increase compared to last year.
\nThe increase was driven by continued margin improvement in the gas and fluid handling segment, non-repeating one-time expenses experienced in the prior year and lower interest expense, which were largely offset by continued volume weakness in the markets.<\/p>\n

Net sales were $1.025 billion for the second quarter, a decrease of 15% over the same period last year. This consists of 5% organic volume decline and a negative 12% impact from foreign exchange, partially offset by 2% growth from acquisitions, as explained the outgoing CEO Steve Simms.
\nEspecially weak has been the fabrication technology business, which saw an 8% organic drop in sales. But fluid handling too was hit by a sharp fall off in commercial ship building activity.<\/p>\n

As the company sees a continued weak market environment they lowered guidance for the rest of the year: they now expect revenue between $4.035 billion and $4.11 billion, and adjusted operating profit between $405 million and $423 million. Adjusted earnings per share should come in per between $1.83 and $1.93.<\/p>\n

Given this situation Colfax is aggressively cutting costs, reducing capacity and implements other measures like p.e. increasing the aftermarket share.<\/p>\n

As Steve Simms put it: \u201eWhile we’ve not changed our perspective on the long-term growth of our serve markets, we expect the weakness we are seeing to continue for the near-term.\u201c
\nAnd with regard to acquisitions he added:
\n\u201eIn line with our ongoing plan to strengthen each of our platforms, we’re deeply committed to our strategy of bolt-on acquisitions and remain confident in the strength of our M&A pipeline, especially in the gas and fluid handling space….We’re working on attractive deals that align with our financial discipline, match our organizational capacity to execute and could be announced later this year.\u201c<\/p>\n

The new CEO is Matt Trerotola. He spent most of his career at DuPont, Danaher and McKinsey.
\nSince 2007 he knows well the \u201eDanaher Business System\u201c after which is modeled the \u201eCBS – Colfax Business System\u201c.<\/p>\n

What does this all mean for shareholders?<\/p>\n

After this earnings release and the lowered guidance Colfax stock hit a low of $39.50 not seen since the end of 2012!
\nColfax works in industries like p.e. gas ond oil or equipment for commercial vessels which have other cycles than the economy in general.\u00a0So shareholders clearly need a long term view here.<\/p>\n

Colfax is still a high quality company with outstanding personnel but the new CEO has to demonstrate that he is able to really grow the company by excellent acquisitions which were already announced for a year or so but never materialized (except the small Roots Blowers & Compressors).<\/p>\n

Colfax stock now trades at a p\/e ratio of 21. The stock is a Hold until a significant acquisition will be announced.<\/p>\n","protected":false},"excerpt":{"rendered":"

Colfax (NYSE: CFX)\u00a0released its Q2 2015 earnings and at the same time announced a new CEO! The edited transcript of the conference call was published by Thomson Reuters. The second quarter of 2015 was a difficult one for Colfax! Adjusted EPS was $0.50 per share, a 4% increase compared to last year. The increase was […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[3],"tags":[],"_links":{"self":[{"href":"http:\/\/www.blog.asmus-puhl.com\/index.php?rest_route=\/wp\/v2\/posts\/1656"}],"collection":[{"href":"http:\/\/www.blog.asmus-puhl.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/www.blog.asmus-puhl.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/www.blog.asmus-puhl.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/www.blog.asmus-puhl.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=1656"}],"version-history":[{"count":9,"href":"http:\/\/www.blog.asmus-puhl.com\/index.php?rest_route=\/wp\/v2\/posts\/1656\/revisions"}],"predecessor-version":[{"id":1665,"href":"http:\/\/www.blog.asmus-puhl.com\/index.php?rest_route=\/wp\/v2\/posts\/1656\/revisions\/1665"}],"wp:attachment":[{"href":"http:\/\/www.blog.asmus-puhl.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=1656"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/www.blog.asmus-puhl.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=1656"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/www.blog.asmus-puhl.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=1656"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}