Ingersoll-Rand PLC IR
Q2 2013 Earnings Call Transcript

Transcript Call Date 07/19/2013

Operator: Good day, ladies and gentlemen, and welcome to the Ingersoll-Rand Second Quarter 2013 Earnings Conference Call. At this time all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will be given at that time. As a reminder, today's conference call is being recorded.

I would now like to turn the conference over to your host Janet Pfeffer, Vice President, Strategy Business Development and Investor Relations. Please proceed.

Janet Pfeffer - VP, Business Development and IR: Good morning, Thank you, Sean. Welcome to our second quarter 2013 conference call. We released earnings at 7 o'clock this morning and the release is posted on our website. We'll be broadcasting in addition to this call through our website at where you can find the slide presentation that we'll be referring to this morning. This call be recorded and archived on our website. If you'd please go to Slide 2, statements made in today's call that are not historical facts are considered forward-looking and are made pursuant to the Safe Harbor Provisions of federal securities laws. Please see our SEC filings for a description of some of the factors that may cause actual results to vary materially from anticipated. This release also includes non-GAAP measures which are explained in the financial tables attached to our news release.

A couple of things to note before I turn it over to Mike, similar to last quarter, we will be talking to adjusted margins during our commentary, which excludes restructuring and spin-related costs. Our news release and tables give you a reconciliation of GAAP to adjusted margins. This is consistent with how we gave guidance in both February and in April.

And to remind everyone, also, earlier this year, we transferred a business line from Security Technologies to Residential Security. That was about $20 million of revenue in the first quarter and it's about $80 million for the full year 2013. There's no impact at the consolidated level. In the charts and comments, we'll focus on year-over-year change in revenue and orders for those businesses on a comparable basis, so as to best represent the underlying performance.

Now, to introduce the participants on this mornings' call, Mike Lamach, Chairman and CEO; Steve Shawley, Senior Vice President and CFO; and Joe Fimbianti, Director of Investor Relations.

With that, please go to Slide 3 and I'll turn it over to Mike.

Michael W. Lamach - Chairman and CEO: Okay. Thanks Janet. Good morning and thanks for joining us on today's call. We delivered growth and profitability above our earnings commitment in the second quarter with solid operational execution across the Company. On top of this, we completed several key milestones related to the securities spin as well as a successful debt offering. I'm proud of all the great people in our Company for this accomplishments and thank them for their personal and collective commitment for the success of Ingersoll-Rand and ultimately in the successful launch of a new security company, Allegion.

Our revenues for the second quarter were up 3% versus last year, both on a reported basis and excluding foreign exchange, reflecting topline performance just above the top of our guidance range. Revenues were up in Climate, Residential and Security technologies but we saw a decline in Industrial. Orders were up 2%.

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