Industrial products and systems maker Actuant Corp. (ATU) on Wednesday reported a loss for the third quarter, reflecting loss from discontinued operations and a one-time charge related to the electrical segment that the company plans to divest.
However, adjusted earnings per share from continuing operations for the quarter beat analysts' estimates. Looking ahead, the company lowered its financial outlook for fiscal 2013.
Commenting on the third-quarter results, Robert Arzbaecher, Chairman and CEO of Actuant, said, "Due to weak economic conditions, we continue to experience subdued activity in our global industrial markets and inconsistent demand. However, we did a good job balancing cost reduction actions and growth investments, as evidenced by our 19.6% EBITDA margins."
Industrial segment sales for the third quarter rose 1 percent to $111.31 million. Excluding the 1 percent negative impact of foreign currency translation, core sales increased 2 percent due to the company's ability to execute strategic initiatives including higher global Integrated Solutions, bolting and mining MRO tool sales.
Energy segment sales grew 3 percent to $99.16 million. Excluding the negative 2 percent impact from foreign currency translation, core sales increased 5 percent.
Engineered Solutions segment sales declined 2 percent to $133.74 million. Excluding the 8 percent net benefit from acquisitions/divestitures, year-over-year core sales declined 10 percent.
Actuant's net loss for the third quarter was $92.98 million or $1.24 per share, compared to net income of $34.40 million or $0.45 per share in the year-ago period.
The latest quarter's results include loss from discontinued operations of $139.06 million or $1.86 per share, compared to earnings from discontinued operations of $6.66 million or $0.09 per share in the same period last year.
The discontinued operations for the latest quarter represents the results for the electrical segment that the company plans to divest and includes a non-cash, after-tax charge of $150 million or $2.00 per share from the write-down of the net assets held for sale to their net realizable value.
Earnings per share from continuing operations for the quarter were $0.62, compared to $0.51 per share in the prior-year period that excludes debt refinancing costs of $0.15 per share. On average, 11 analysts polled by Thomson Reuters expected the company to report earnings of $0.59 per share for the quarter. Analysts' estimates typically exclude special items.
Net sales for the quarter edged up slightly to $344.21 million from $343.27 million in the year-ago period. Analysts had a consensus revenue estimate for the quarter of $343.71 million.
Excluding the 3 percent contribution from acquisitions and -1 percent impact from foreign currency, core sales declined 2 percent, with two of the three segments posting core sales growth.
Looking ahead to fiscal 2013, Actuant lowered its earnings and sales outlook, citing current business trends and saying that it expects the inflection in earnings that it saw in the third quarter to continue into the fourth quarter.
The company now forecasts fiscal 2013 earnings per share in a range of $1.85 to $1.90 and sales of $1.275 billion to $1.285 billion. Earlier, the company forecast earnings per share of $2.15 to $2.25 and sales of $1.575 billion to $1.600 billion, including the electrical segment. Analysts expect the company to report earnings of $1.93 per share for the year on revenues of $1.29 billion.
For fiscal 2014, Actuant forecasts earnings from continuing operations in a range of $1.95 to $2.05 per share and sales of $1.315 billion to $1.340 billion. Analysts expect earnings of $2.15 per share for the year on revenues of $1.35 billion.
ATU closed Tuesday's trading at $33.08, up $0.32 on a volume of 524,600 shares.
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