Manufacturers report earnings
Kennametal, RBC Bearings, SKF Group and Dover Corporation are among industrial manufacturers to report quarterly earnings.
Kennametal
Kennametal Inc. reported fiscal 2010 second quarter sales of $443 million, compared with $546 million in the same quarter last year. Sales decreased by 19 percent, driven by an organic decline of 23 percent, partially offset by a 4 percent favorable impact from foreign currency effects. Sales for the December quarter improved sequentially by 8 percent, representing the second consecutive quarter of sequential sales growth.
Earnings per diluted share were 7 cents, compared with 21 cents in the prior year quarter.
"In the December quarter, we have achieved sequential sales growth for the past two quarters driven by the gradual economic recovery, increased industrial activity in certain geographies and end markets, and higher demand from customers replenishing their inventories," said chairman, president and CEO Carlos Cardoso.
Metalworking Solutions & Services Group (MSSG) sales decreased by 19 percent from the prior year quarter. Sequentially, sales increased by 13 percent for the second consecutive quarter as global industrial production continued to improve modestly. On a regional basis, India had a year-over-year organic sales increase of 5 percent. Europe and North America reported organic sales declines of 30 percent and 24 percent, respectively, compared with the prior year December quarter. Latin America and Asia Pacific also experienced year-over-year organic sales declines of 17 percent and 1 percent, respectively.
RBC Bearings
RBC Bearings said its net sales for the third quarter of fiscal 2010 were $67.5 million, a decrease of 20.9% from $85.3 million in the third quarter of fiscal 2009 and a 6.0% increase over the second quarter of fiscal 2010. The decrease of 20.9% was driven by a decrease of 16.6% in the industrial business and by a 23.8% decrease in net sales in aerospace and defense business. Gross margin for the third quarter was $20.4 million compared to $28.5 million for the same period last year.
Operating income decreased 36.4% to $8.1 million for the third quarter of fiscal 2010 compared to $12.8 million for the same period last year. The company reported net income of $5.2 million compared to net income of $7.7 million in the same period last year.
SKF Group
Swedish bearing manufacturer SKF said its fourth quarter sales were down 14% to SEK 13,887 million (about $1,905 million US).
The demand for SKF products and services is expected to be slightly higher for the Group in 2010. In Europe and North America it is expected to be slightly lower and in Asia and Latin America significantly higher.
"SKF delivered a strong cash flow in the quarter and a record cash flow for the year. Our operating margin was 7.2% in the quarter, supported by the major cost reduction activities in the operations," said Tom Johnstone, president and CEO.
Demand for the Group improved slightly in the quarter but was still significantly lower than a year ago. Additional steps were taken to further adapt manufacturing structure and costs to meet a lower level of demand. "Going forward into 2010 we see a slightly higher demand in the first quarter both sequentially and compared to the first quarter 2009. However, as the demand outlook is still uncertain we will continue to adapt our cost structure while stepping up our activities in the faster growing areas of our business and in developing new environmental offerings," Johnstone said.
Dover Corporation
Dover Corporation announced that its earnings from continuing operations decreased 40% to $102.4 million, or 55 cents per share, compared to $169.6 million, or 91 cents, in the prior-year period. Revenue was $1.5 billion, a decrease of 12.7% over the prior year period. Dover's 19.3% decline in organic revenue was partially offset by net growth from acquisitions of 4.4% and a favorable foreign exchange impact of 2.2%.
"Looking forward, we expect full year 2010 revenue growth of 7% - 9%, representing organic revenue growth of 4% - 6%, plus growth of 3% from acquisitions completed in 2009," said president and CEO Robert A. Livingston.
INDUSTRIAL SUPPLY MAGAZINE
The May/June issue of Industrial Supply magazine features an in-depth cover story about GHX Industrial. Plus, we're featuring articles by contributing writers Dr. Bharani Nagarathnam and Frank Hurtte, as well as interviews with numerous product and distribution industry experts.
