Timken Sales Grow 28% in 2011

The Timken Company (NYSE: TKR), Canton, OH, reported sales of $5.2 billion for 2011, up 28 percent from the prior year on strong demand from diverse industrial markets.

The increase primarily reflects growth from the energy, heavy truck, mining, rail and industrial distribution sectors, as well as favorable pricing, material surcharges and acquisitions.

In 2011, Timken had $454.3 million in income from continuing operations.

"Our financial results tell the story of a transformed Timken Company," said James W. Griffith, Timken president and chief executive officer.  "We've successfully repositioned the company, focusing our efforts on those industries and applications where we bring significant value and can make a difference in our customers' performance. As a result of this and our improved operating model, we have increased our earning power, serving Timken customers across a multitude of high-performance applications in industrial markets."

In 2011, Timken:

• Completed two acquisitions to diversify its portfolio, including Philadelphia Gear for $200 million and Drives for $92 million in October.
• Expanded bearing capacity, with $50 million invested in 2011 to serve global growth in industrial markets.
• Began collaborating with the University of Akron to establish a new laboratory focused on surface-engineering technologies and formed a new alliance with Stark State College to construct a large bearing test center in Canton.\
• In the fourth quarter ended Dec. 31, 2011, Timken reported sales of $1.3 billion, an increase of 18 percent from the year-ago period. Growth across most of the company’s end markets, higher surcharges, pricing and acquisitions contributed to the improvement. Acquisitions accounted for one-third of the growth.

By Segment
Mobile Industries' 2011 sales were $1.8 billion, up 13 percent. Higher demand in the off-highway, rail and heavy-truck sectors drove most of the increase, along with favorable pricing and currency.

In the fourth quarter, Mobile Industries' sales were $419.6 million, up 8 percent from the prior year's fourth-quarter sales of $388.6 million. Higher demand in the off-highway and rail sectors drove most of the increase, along with acquisitions, favorable pricing and surcharges.  Excluding acquisitions, fourth-quarter sales were up 5 percent in the segment.

Sales for the Process Industries segment were $1.2 billion in 2011, an increase of 38 percent from $903.4 million a year ago. Stronger distribution demand, acquisitions, growth in Asia, new-product sales and pricing accounted for the increase. Excluding acquisitions, sales were up 26 percent.

Process Industries' fourth-quarter sales grew to $322.4 million, compared with $250.7 million in the same period a year ago. The 29 percent increase reflects stronger demand from industrial distribution and acquisitions.  Excluding acquisitions, fourth-quarter sales were up 9 percent.

For the full year 2011, Aerospace and Defense sales were $324.1 million, down 4 percent from the same period a year ago. The decrease primarily reflects lower demand for defense-related products.  

Aerospace sales in the fourth quarter were $79.7 million, compared with $82.5 million in 2010, primarily driven by lower demand for defense-related products.

Sales for Steel, including inter-segment sales, were $2 billion in 2011, an increase of 44 percent from $1.4 billion in 2010. Demand from the energy and industrial sectors drove the improvement, as well as favorable pricing and an increase in raw-material surcharges of approximately $210 million.

For the quarter, Steel segment sales were $468.4 million, up 23 percent from the fourth quarter of 2010. Strong demand from the energy sector, pricing and an increase in surcharges of approximately $35 million, drove sales higher.