Wednesday, electrical components manufacturer Thomas & Betts Corp. (TNB) reported a decline in first-quarter profit that missed analysts' estimates, reflecting weaker demand for electrical products and a stronger US dollar on sales. In addition, the company said it now sees full year 2009 earnings per share to be near the low end of the previously announced guidance range of $3.00 to $3.50.
The Memphis, Tennessee-based company's net income dropped to $26.07 million or $0.49 per share, from $38.25 million or $0.66 per share, in the year-ago quarter. On average, six analysts polled by Thomson Reuters expected the company to earn $0.57 per share for the quarter. Analysts' estimates typically exclude special items.
Quarterly net sales declined 22.8% to $459.84 million from $595.50 million last year, and came in below analysts' estimate of $506.37 million. The decline was attributed to a slump in demand for electrical products used in construction, industrial maintenance and electrical power distribution. In addition, the company noted that the stronger U.S. dollar negatively impacted sales by approximately $35 million compared to the previous year.
Sales for the Electrical segment decreased 27.5% to $368.83 million from $508.77 million in the prior-year quarter. The company noted that lower volumes were seen in nearly all product and geographic markets. Of the sales decline, foreign currency comprised approximately $34 million.
Steel Structures segment sales for the quarter were $61.95 million, up 19.2% from $51.96 million a year ago, attributed to higher year-over-year steel pricing. HVAC segment sales fell 16.4% to $29.06 million from $34.77 million in the prior-year quarter.
Looking ahead to the full year 2009, the company now sees earnings likely to be near the low end of the range provided in February, or $3.00 per share. Analysts expect the company to post earnings of $2.73 per share for the full year. In February, the company announced that it expects consolidated sales for the year to be down 7% to 12%, including a 10% to 15% decline in electrical segment.
Chairman and Chief Executive Officer Dominic Pileggi noted that achieving the aforementioned results continue to depend on the availability of credit in key end markets, volatility in foreign currencies and commodity costs, as well as further deterioration in market conditions.
Thomas & Betts ended the first quarter with $254 million in cash and equivalents and $638 million in total debt. As of March 31, the company had around $262 million of availability under its existing credit agreements.
TNB ended Tuesday's trading at $28.98 on the NYSE.
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