Precision dispensing equipment maker Nordson Corp. (NDSN) Thursday said its second quarter profit declined from last year, reflecting the continued global economic downturn. However, the company's quarterly earnings as well as sales exceeded the analysts' expectations. In addition, the company provided earnings outlook for the third quarter, indicated to come in above current Street estimates.
The Westlake, Ohio-based company posted net income of $14 million or $0.41 per share for the second quarter, down from $33 million or $0.97 per share in the prior year quarter. On average, 5 analysts polled by Thomson Reuters expected the company to earn $0.26 per share for the second quarter. Analysts' estimate typically excludes special items.
Results for the quarter under review included a charge of $0.10 per share related to cost reduction activities and a gain of $0.07 per share related to a one-time tax benefit.
Second quarter net sales declined 35.8% to $189 million from $294 million in the same quarter of last year. Three analysts had a consensus revenue estimate of $184.29 million for the second quarter.
Nordson's chairman, president and chief executive officer, Edward Campbell, said, "As expected, Nordson's second-quarter results were impacted by the continued global economic downturn. On a positive note, revenue, operating income and earnings per share for the quarter all improved sequentially."
Segment wise, sales from Adhesive dispensing systems dropped 27% to $111.33 million, Advanced technology systems sales slipped 46.7% to $49.97 million, and Industrial coating & automotive systems sales dipped 42.5% to $27.54 million from a year ago.
On a geographic basis, second quarter sales declined 41.0% in Asia Pacific, 36.5% in Europe, 32.4% in the Americas, and 29.5% in Japan from the preceding year quarter. Sales decreased by 34.7% in the United States.
Order rates for the latest quarter, measured in constant currency, decreased 25% over last year. Backlog at the end of the second quarter was about $80 million, down 29% from $113 million at the end of the second quarter last year.
Last month, Nordson CEO Edward Campbell announced his intention to retire in early 2010. The board confirmed that Campbell would remain in his current role until a successor is named and in place, a process expected to take until the end of calendar year 2009.
For the first half of fiscal 2009, Nordson reported net income of $25 million or $0.74 per share, compared to $54 million or $1.59 per share in the previous year period.
Net sales for the year-to-date period decreased 30.3% to $375 million from $539 million in the preceding year period.
For the third quarter of fiscal year 2009, Nordson anticipates earnings in the range of $0.39 to $0.50 per share, including a charge of $0.03 per share associated with restructuring activities. Sales are expected to be in the range of $192 million to $202 million. The Street currently expects the company to report earnings of $0.37 per share on revenue of $206.21 million for the third quarter.
Nordson closed Thursday's regular trading session at $35.25, down $1.19 or 3.27%, on a volume of 0.31 million shares.
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