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Ecolab Pricing, Efficiencies Lead to Eight Percent Earnings Growth

Print Article Contributed by BSM Staff

ST. PAUL, MN -- Better pricing, new business gains, product innovation and cost efficiencies offset investments in the business and a healthcare product recall to yield an 8 percent increase in fourth quarter 2019 earnings per share.

The company posted a fourth quarter profit of $429 million, or $1.47 per share, on sales of $3.8 billion, compared to $395 million, or $1.35 a share, on sales of $3.76 billion in the same period last year.

“We accomplished a great deal in 2019 that we expect will benefit us going forward,” said Douglas M. Baker, Jr., Ecolab’s chairman and CEO. “We successfully completed a major North American ERP implementation, separated our Upstream Energy business (ChampionX) to facilitate a merger with Apergy Corporation, continued to build and develop both our management team and our global operations, expanded our sustainability commitments and performance, continued our digital investments and drove record new business results in the second half.”

Further, the company delivered solid earnings growth in the fourth quarter while re-starting its volume momentum build. Margins continued to expand, as expected reflecting the strong pricing and efficiency work over the last two years.

“As we look to 2020, we expect another strong earnings year despite a challenging environment,” said Baker. “We have assumed a $0.05 impact in the first quarter for the coronavirus outbreak; we are not yet able to estimate and forecast the impact for the second quarter through fourth quarter. We also face an estimated $0.12 per share from pension and currency headwinds for the year. However, we have strong underlying new business momentum and our innovation pipeline is strong, including our multiple-year digital investments.”

Additionally, the North American ERP system work completed in 2019 enables Ecolab to more fully leverage its scale, driving further efficiencies.

“Therefore, we see our sales trends improving throughout the year, and coupled with continued margin expansion, driving another year of strong adjusted earnings growth,” said Baker. “Importantly, we plan to continue our significant but high value investments in digital technology and product innovation, which along with our focus on talent, are key to our continued success long term.”

The company has assets of $20.8 billion, and liabilities of $12.1 billion.

Ecolab delivers comprehensive solutions, data-driven insights and on-site service to advance food safety, protect public health, optimize water and energy use, and improve operational efficiencies for customers in the food, healthcare, energy, hospitality and industrial markets in more than 170 countries around the world.

For more, go to www.ecolab.com.






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