OVERVIEW
The Company is a leading worldwide diversified manufacturer of motion and control technologies and systems, providing precision engineered solutions for a wide variety of mobile, industrial and aerospace markets. Our order rates provide a near-term perspective of the Company's outlook particularly when viewed in the context of prior and future order rates. The Company publishes its order rates on a quarterly basis. The lead time between the time an order is received and revenue is realized generally ranges from one day to 12 weeks for mobile and industrial orders and from one day to 18 months for aerospace orders. We believe the leading economic indicators of these markets that have a strong correlation to the Company's future order rates are as follows:
• Purchasing Managers Index ("PMI") on manufacturing activity specific to regions around the world with respect to most mobile and industrial markets; • Global aircraft miles flown and global revenue passenger miles for commercial aerospace markets andU.S. Department of Defense spending for military aerospace markets; and • Housing starts with respect to the North American residential air conditioning market and certain mobile construction markets.
A PMI above 50 indicates that the manufacturing activity specific to a region of the world in the mobile and industrial markets is expanding. A PMI below 50 indicates the opposite. Recent PMI levels for some regions around the world were as follows:
December 31, 2019 June 30, 2019 December 31, 2018 United States 52.4 50.6 54.1 Eurozone countries 46.3 47.6 51.4 China 51.5 49.4 49.7 Brazil 50.2 51.0 52.6
Global aircraft miles flown and available revenue passenger miles each increased
by approximately four percent from their comparable fiscal 2019 levels. The
Company anticipates that
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We believe many opportunities for profitable growth are available. The Company intends to focus primarily on business opportunities in the areas of energy, water, food, environment, defense, life sciences, infrastructure and transportation. We believe we can meet our strategic objectives by:
• Serving the customer and continuously enhancing its experience with the Company; • Successfully executing The Win Strategy initiatives relating to engaged people, premier customer experience, profitable growth and financial performance;
• Maintaining a decentralized division and sales company structure;
• Fostering a safety first and entrepreneurial culture;
• Engineering innovative systems and products to provide superior customer value through improved service, efficiency and productivity; • Delivering products, systems and services that have demonstrable savings to customers and are priced by the value they deliver;
• Acquiring strategic businesses;
• Organizing around targeted regions, technologies and markets;
• Driving efficiency by implementing lean enterprise principles; and
• Creating a culture of empowerment through our values, inclusion and diversity, accountability and teamwork. Acquisitions will be considered from time to time to the extent there is a strong strategic fit, while at the same time maintaining the Company's strong financial position. DuringOctober 2019 , we completed the acquisition ofLORD Corporation ("Lord") for approximately$3,453 million in cash, including the assumption of debt. We also completed the acquisition ofEMFCO Holdings Incorporated , parent company ofExotic Metals Forming Company LLC ("Exotic") for approximately$1,706 million in cash duringSeptember 2019 . Refer to Note 4 to the Consolidated Financial Statements for further discussion of the acquisitions. We continue to assess our existing businesses and may initiate efforts to divest businesses that are not considered to be a good long-term strategic fit for the Company. Future business divestitures could have a negative effect on the Company's results of operations. The discussion below is structured to separately discuss the Consolidated Statement of Income, Business Segment Information, Consolidated Balance Sheet and Consolidated Statement of Cash Flows. As used in this Quarterly Report on Form 10-Q, unless the context otherwise requires, the terms "Company", "Parker", "we" or "us" refer toParker-Hannifin Corporation and its subsidiaries.
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