Milwaukee-based A.O. Smith reported gains in revenue and earnings in the fourth quarter, helping the company close out a year that saw records on both measures.
Net income for the quarter was $82.7 million, up 3.6 percent from the previous year. Earnings increased from 45 cents to 47 cents per diluted share. For the full year, the company reported $326.5 million in net income, a 15.4 percent jump over 2015. Earnings increased from $1.58 to $1.85 per diluted share.
“A. O. Smith had another excellent year, setting sales and earnings records thanks to continued healthy end markets for our consumer products in China and for boilers and commercial water heaters in the U.S.,” said Ajita G. Rajendra, A.O. Smith chairman and chief executive officer.
Revenue for the year was up 5.9 percent to $2.69 billion, including $698.1 million in the fourth quarter, a 9.2 percent increase.
The company’s North American segment reported $435.6 million in sales for the quarter. The 5 percent increase was primarily due to higher volumes of commercial water heaters and boilers, while residential water heaters were down slightly.
The rest of world segment increased sales by 16 percent to $268.1 million. Sales in China were up 24 percent in local currency and the company experienced strong demand for its consumer products in the region.
“We believe our sales in China will continue to grow at a rate of approximately 15 percent in local currency led by continued strong growth of water treatment and air purification products. We believe our sales in the U.S. will be driven by residential water heater growth, as well as continued growth of boilers and water treatment products,” Rajendra said.
The company set its 2017 earnings guidance at $1.98 to $2.08 per share, representing a 10 percent increase over 2016 at the midpoint.
