No Ascent for Avery Dennison: Fool by Numbers

On Tuesday, office-products maker Avery Dennison (NYSE: AVY  ) released Q3 2006 earnings for the period ending Sept. 30, 2006.

  • Restructuring and asset impairment charges, as well as a reserve for environmental remediation, cost Avery Dennison $0.13 a share. Without those items, the firm booked $0.98 in per-share earnings, beating the Street consensus by $0.02.

  • Organic sales grew 4%, which management attributed to higher volume and a better pricing and product mix.

  • Free cash flow was up more than 45% year over year.

(Figures in millions, except per-share data)

Income Statement Highlights

Avg. Est.

Q3 2006

Q3 2005

Change

Sales

$1,400

$1,418

$1,355

4.6%

Net Profit

--

$85

$86

(1.4%)

EPS

$0.96

$0.85

$0.86

(1.2%)

Diluted Shares

101

101

(0.1%)



Get back to basics with a look at the income statement.

Margin Checkup

Q3 2006

Q3 2005

Change*

Gross Margin

27.56%

26.39%

1.17

Operating Margin

6.02%

6.35%

(0.33)

Net Margin

6.00%

6.36%

(0.36)

* Expressed in percentage points.

Margins are the earnings engine. See how they work.

Balance Sheet Highlights

Assets

Q3 2006

Q3 2005

Change

Cash + ST Invest.

$51

$76

(32.7%)

Accounts Rec.

$887

$875

1.3%

Inventory

$490

$438

11.7%



Liabilities

Q3 2006

Q3 2005

Change

Accounts Payable

$619

$565

9.6%

Long-Term Debt**

$908

$1,098

(17.3%)

** Includes short-term debt and current portion of long-term debt.

Learn the ways of the balance sheet.

Cash Flow Checkup

Q3 2006

Q3 2005

Change

Cash From Ops.

$360

$289

24.7%

Capital Expenditures

$111

$117

(5.6%)

Free Cash Flow

$249

$171

45.4%



Find out why Fools always follow the money.

Related companies:

  • Bemis (NYSE: BMS  )
  • Newell Rubbermaid (NYSE: NWL  )
  • 3M (NYSE: MMM  )

Related Foolishness:

Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so check Fool.com for more of our in-depth discussion of what the numbers mean.

3M is aMotley Fool Inside Valuepick. Newell Rubbermaid is aMotley Fool Income Investorselection. Get 30 days of free access to either service by clicking on the appropriate link.

Fool contributor Tim Beyers didn't own shares in any of the companies mentioned in this story at the time of publication. You can find out which stocks he owns by checking Tim's Fool profile. The Motley Fool's disclosure policy always adds up.


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