KENOSHA, Wis. -- Snap-on has announced operating results for the first quarter of 2011.

Sales of $693.7 million increased $72.1 million, or 11.6 percent, from 2010 levels; excluding $9.1 million of favorable foreign currency translation, organic sales increased 10 percent.

Gross profit of $330.6 million improved to 47.7 percent of sales compared with 46.3 percent a year ago.

Operating earnings before financial services of $87.3 million increased $15.6 million from 2010 levels and, as a percentage of sales, improved to 12.6 percent from 11.6 percent a year ago.

Financial services operating earnings of $12.5 million increased $14.2 million from 2010 levels primarily due to continued growth in the company’s on-book finance portfolio.

Consolidated operating earnings of $99.8 million increased $29.8 million, or 42.6 percent, from 2010 levels; as a percentage of revenues, operating earnings improved to 13.9 percent from 11.1 percent a year ago.

Net earnings of $56.2 million, or 96 cents per diluted share, increased from $36.8 million, or 63 cents per diluted share, a year ago.

“We are very encouraged by Snap-on’s first quarter performance,” said Nick Pinchuk, Snap-on chairman and CEO, “and by the continued strengthening of our strategic position along each of our runways for growth. We believe the progress being made in enhancing the franchise network, expanding in the vehicle repair garage, extending in critical industries and building in emerging markets, coupled with our ongoing commitment to the Snap-on Value Creation Processes and the ramp-up of our on-book finance portfolio, positions Snap-on quite strongly for continued growth going forward. Overall, our first quarter reflects significant effort and achievement across the company. In that regard, I thank our franchisees and associates worldwide for their continued contributions and commitment.”

Snap-on anticipates continuing with its planned strategic investments in 2011, including further expansion in emerging markets. As a result, the company now expects that capital expenditures in 2011 will approximate $65 million, of which $18.6 million was spent in the first quarter. Snap-on also expects to incur $11 million of higher year-over-year pension expense in 2011 largely due to the amortization of investment losses incurred in 2008 related to its domestic pension plan assets. Interest expense on the $250 million of senior notes issued in December 2010 will approximate $2.7 million per quarter in 2011. Snap-on anticipates that its full year 2011 effective income tax rate will approximate 33 percent.