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Actuant Q1 sales rise 23%, shares up

Last updated: 01:52 22 Dec 2011 AEDT, First published: 02:52 22 Dec 2011 AEDT

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Actuant Corp. (NYSE:ATU) posted better-than-expected first quarter revenues as the industrial manufacturer reported gains in all four of its segments, triggering the company to raise its full-year guidance.

Consolidated revenues grew 23 percent to $392 million for the latest quarter ended November 30, versus $318.4 million in the prior year.

For the quarter, net income from continuing operations was $37.2 million. That compares to $26.7 million, a year ago.

On a per share basis, earnings were 39 percent higher reaching 50 cents per share from 36 cents a share.

Analysts, on average, expected the company to earn 43 cents a share, with revenue of $376 million, according to Bloomberg.

Shares of Actuant climbed 10.25 percent reaching $22.91 apiece after the bell today in New York, as investors were content with the news.

Actuant's chief executive, Robert Arzbaecher, said: "Actuant delivered another strong quarter with sales, and we were pleased with the first quarter’s double digit core sales growth in both the Industrial and Energy segments.

"We continue to benefit from our diversity with solid demand across the majority of our end markets and geographies. At the same time, we are successfully executing on our continuous improvement initiatives focused on both growth and margin expansion."

Sales in the electrical segment rose 50 percent to $83 million, with most of the company's gains coming from its Mastervolt acquisition. Operating profit margin fell 80 basis points to six percent resulting from plant closure costs.

The industrial segment – which makes branded hydraulic and mechanical tools for the automation markets – saw sales rise 15 percent to $100 million. Actuant noted new products continue to gain traction in this unit. Operating profit rose 27.9 percent to $27.9 million driven by higher volumes. 

Revenue in the energy business, a supplier of cable solutions to the oil and gas market, rose 14 percent to $80.4 million, as continued penetration into emerging markets and higher activity within the oil and gas markets aided results. Operating profit margins declined to 16.4 percent.

Its engineered solutions unit rose 23 percent capturing revenues of $129 million, as the demand for products in agriculture and construction remained strong.

Quarterly gross margin rose to 38.9 percent from 38.3 percent.

Looking ahead, the company raised its full-year earnings guidance. It now expects profits of $1.85 to $2.05 per share. Actuant increased its guidance by five cents, and maintained its revenue forecast of $1.6 billion to $1.65 billion.

Analysts are looking for $1.88 per share, with revenues of $1.6 billion.

For the second quarter, the company expects income of 35 cents to 40 cents a share on revenue of $360 million to $370 million.

Analysts are expecting earnings of 36 cents a share, with revenues of $372 million.

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