Fabricated metal products maker Valmont Industries Inc. (VMI) on Thursday reported a profit for the first quarter that doubled from last, reflecting higher sales of irrigation equipment and utility structures. Both earnings and revenue beat analysts' estimates. Buoyed by the results, the company lifted its earnings outlook for fiscal year 2012, sending its shares up by more than 5 percent in after-hours trading.
Valmont has been reporting higher profits in recent quarters amid strong demand for its irrigation equipment and contributions from the acquired Delta businesses. In addition to fabricated metal products, the company makes pole and tower structures as well as mechanized irrigation systems.
Mogens Bay, Valmont's Chairman and Chief Executive Officer said in a statement, "Record first quarter sales of both irrigation equipment and utility structures were the primary drivers of first quarter results. This, combined with favorable weather conditions, stable input costs and double-digit sales growth in all of our segments resulted in a record first quarter performance."
Sales at the irrigation segment rose 30 percent from last year to $196.3 million, reflecting favorable drivers in the agricultural economy.
Sales at the utility support structures segment grew 52 percent to $191.2 million, reflects large project demand to upgrade the North American transmission grid. In addition, unseasonably mild weather in North America contributed to a favorable environment for production and shipping during the quarter.
Valmont's first-quarter net income was $52.33 million or $1.96 per share, up from $25.61 million or $0.97 per share in the year-ago period. On average, nine analysts polled by Thomson Reuters expected the company to report earnings of $1.53 per share for the quarter. Analysts' estimates typically exclude special items.
Net sales for the quarter grew 26 percent to $717.35 million from $567.95 million in the same period last year and topped analysts consensus estimate of $669.56 million.
Looking ahead to fiscal 2012, Valmont raised its earnings outlook for the year and now expect earnings to exceed $8.00 per share. Earlier, the company had expected full year earnings of $7.30 to $7.60 per share. Analysts now expect earnings of $7.53 per share for the year.
VMI closed Thursday's trading at $118.34, down $1.96 or 1.63 percent on a volume of 192,800 shares. In after-hours, the stock gained $6.35 or 5.37 percent to $124.69.
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