×

UPDATE 2-Emerson sees 2018 profit up 4-12 pct as oil, gas markets stabilize

* Sees FY 2018 adj. EPS $2.75-$2.95

* Expects full year net sales to rise 8-10 pct (Adds details on orders, background)

Nov 7 (Reuters) - U.S. factory automation equipment maker Emerson Electric Co on Tuesday said fiscal 2018 operating profit will rise 4 percent to 12 percent, benefiting partly from stabilizing demand in the oil and gas industries.

Emerson also expects net sales to increase 8 percent to 10 percent, as the company's Chief Executive Officer David Farr said market conditions improved in the second half of 2017 and he sees 2018 going in the same direction.

Emerson said adjusted net earnings per share for fiscal year ending September, 2018 is expected to be $2.75-$2.95, compared with $2.64 in fiscal 2017.

Analysts on average were expecting fiscal 2018 earnings of $2.90 per share and revenue to rise 11.8 percent, according to Thomson Reuters I/B/E/S.

Emerson said September trailing three-month orders were up 15 percent in its automation solutions business, its largest, helped by momentum across end markets and regions. Sales in the unit improved 18 percent.

The business makes products including measurement instrumentation, valves and regulators for the oil and gas sectors. The unit had been struggling as customers curtailed spending due to a slump in oil prices.

Orders in its commercial and residential solutions unit, which makes air conditioning compressors and Wi-Fi thermostats, rose 5 percent. But Emerson said cooler weather and the disruption from hurricanes weighed on the unit's sales.

Overall, September trailing three-month orders rose 11 percent, Emerson said.

In October, Emerson made an unsolicited acquisition bid for smaller rival Rockwell Automation Inc for more than $27 billion, as it looked to diversify its businesses and reduce exposure to volatile energy prices.

Rockwell, however, rejected the bid arguing that the offer undervalued the company.

Shares of Emerson were unchanged in pre-market trade. (Reporting by Ankit Ajmera in Bengaluru; Editing by Maju Samuel)