Sales Soar at Ecolab

Powered by its acquisition of Nalco, Ecolab reported sales soared 85% to $2.8 billion in Q1. However, net income fell 47% to $49.7 million.

“The ‘new’ Ecolab is off to an excellent start. Our team did a great job successfully managing the business and simultaneously made great progress against our integration and synergy objectives, exceeding both. Most impressively, our team also delivered record new business gains,” said Douglas M. Baker, Jr., Ecolab’s chairman and chief executive officer. “As a result, our top line momentum remains very strong. Sales grew in every segment and in every region. Our new Global Energy business led the way with a truly standout quarter, and we also saw solid results in our Global Water, U.S. Institutional and worldwide Food & Beverage businesses. Regionally, both North America and Latin America strengthened compared with recent trends.

“Our focus going forward is more of the same: excellent marketplace execution and excellent integration progress. We are well positioned to deliver both. We have a great team and we have great opportunities. While the current mixed economies and cost headwinds present challenges, we believe we are well situated to overcome both and deliver a strong year.”

By segment, U.S. Cleaning & Sanitizing operations rose 4% to $709 million. Adjusted for the transfer of certain water treatment-related business from the U.S. Cleaning and Sanitizing segment to the Global Water segment, sales increased 7% when compared with first quarter 2011 pro forma sales; excluding acquisitions, sales increased 6%. Institutional and Food & Beverage led the growth. U.S. Cleaning & Sanitizing operating income increased 15% to $128 million compared with the year ago period; U.S. Cleaning & Sanitizing operating income increased 11% when compared with first quarter 2011 pro forma operating income; excluding acquisitions, operating income increased 6%.

U.S. Other Services sales increased 4% to $111 million in the first quarter. Operating income declined 6% to $14 million as continued improvement in our Equipment Care business profitability was offset by investments made in the EcoSure quality assurance field sales organization.

Sales for International Cleaning, Sanitizing and Other Services operations, when measured at fixed currency rates, grew 3% to $733 million in the first quarter. Sales increased 5% in fixed currencies when compared with first quarter 2011 pro forma fixed currency sales, led by strong growth in Latin America operations. International Cleaning, Sanitizing and Other Services fixed currency operating income increased 10% to $48 million in the first quarter when compared with a year ago; fixed currency operating income increased 12% when compared with first quarter 2011 pro forma fixed currency operating income. When measured at public currency rates, International Cleaning, Sanitizing and Other Services sales were $746 million and operating income was $49 million.

Global Water sales, when measured at fixed currency rates, were $498 million, increasing 6% when compared with first quarter 2011 pro forma fixed currency sales. Adjusted for acquisitions and divestitures, fixed currency sales increased 8% compared with pro forma fixed currency sales in the first quarter of 2011. Strong growth in sales to mining, metals and food and beverage customers led the quarter. Fixed currency operating income was $43 million in the first quarter, representing an 11% increase when compared with pro forma fixed currency operating income in the first quarter 2011. Adjusted for divestitures, fixed currency operating income rose 27% when compared with pro forma fixed currency operating income in the first quarter 2011. When measured at public currency rates, Global Water sales were $504 million and operating income was $43 million.

Global Paper sales, when measured at fixed currency rates, grew 2% to $199 million in the first quarter when compared with first quarter 2011 pro forma fixed currency sales. Fixed currency operating income declined 9% to $18 million in the first quarter when compared with pro forma fixed currency operating income in the first quarter 2011. When measured at public currency rates, Global Paper sales were $200 million and operating income was $19 million.

Global Energy sales, when measured at fixed currency rates, grew 29% to $537 million in the first quarter when compared with first quarter 2011 pro forma fixed currency sales, with strong growth in all business segments. Fixed currency operating income increased 53% to $84 million in the first quarter when compared with pro forma fixed currency operating income in the first quarter 2011. When measured at public currency rates, Global Energy sales were $539 million and operating income was $84 million.