Natco Group Inc. (NTG), an oil and gas equipment and service provider, Friday said its profit for the second quarter increased from a year ago, notwithstanding a decline in revenues, on improved gross margins. The company also indicated withdrawing its full year guidance in view of its proposed merger with Cameron International Corp. (CAM)
Houston, Texas-based Natco reported second quarter net income available to common stockholders of $6.4 million or $0.32 per share, an increase from $6.2 million or $0.31 per share in the prior year quarter.
Excluding charges, second quarter net income available to common stockholders would have been $0.44 per share, compared to $0.47 per share in the second quarter of 2008.
On average, four analysts polled by Thomson Reuters expected the company to report earnings of $0.42 per share for the quarter. Analysts' estimates typically exclude special items.
Results for the quarter included about $1.7 million of costs associated with the proposed acquisition of the company by Cameron International Corporation and $0.6 million of costs associated with the company's UK subsidiary's cancellation of certain contracts. The year-ago second quarter results included $3.2 million of legal and compliance review costs incurred.
Revenue for the second quarter was $155.5 million, compared to $160.4 million in the corresponding quarter last year.
Segment-wise, revenue from the Integrated Engineered Solutions for the quarter increased to $73.9 million, from $51.5 million in the year ago quarter. Standard & Traditional segment revenues decreased to $65.9 million from $85.2 million recorded in the year-ago second quarter. Revenue from the Automation & Controls segment for the quarter was $17.4 million, compared with $25.0 million last year.
Total cost of goods sold and services for the quarter decreased to $109.6 million from $116.3 million in the corresponding quarter last year. Total gross profit as a percentage of revenue increased to 29.5% from 27.5% in the comparable quarter last year.
Bookings for the quarter plummeted to $88.2 million from $238.5 million in the second quarter last year. At June 30, 2009, the company had a backlog of $246.7 million, compared with backlog of $273.1 million at June 30, 2008.
For the six-month period, net income available to common stockholders was $15.1 million or $0.75 per share, a decline from $15.8 million or $0.80 per share reported last year.
For the year-to-date period, revenue totaled $317.4 million, a 1.6% increase from $312.4 million in the prior year period.
In June, Cameron International Corp. (CAM) agreed to acquire Natco Group in an all-stock deal for about $780 million, which is expected to close during the third quarter of 2009. In light of the proposed merger, Natco said it was withdrawing 2009 guidance.
NTG closed Friday's regular trading at 39.65, down $0.43 or 1.07%, on a volume of 0.13 million shares on the NYSE. In after-hours, the stock gained $0.01 or 0.03%, trading at $39.66.
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