Wednesday, Lufkin Industries Inc. (LUFK), a provider of Oil and Gas Equipments, announced an increase in second quarter profit on 30.6% increase in sales. The company raised its earnings per share outlook from continuing operations for 2008. In the morning hours, shares climbed more than 10% on Nasdaq.
The company reported a net income of $21.23 million or $1.42 per share, compared to $17.52 million or $1.15 per share in the previous year. Earnings from continuing operations increased 24% to $21.2 million from $17.1 million last year. Earnings per share from continuing operations were up 26.8% at $1.42 compared to $1.12 in the equivalent quarter a year ago.
On average, three analysts polled by First Call/Thomson Financial expected the company to report earnings for the quarter of $1.36 per share.
Quarterly sales rose 30.6% to $174.5 million from $133.6 million in the same period last year. The company noted that fundamental demand for energy, especially in view of record high prices of oil created demand for its oil field pumping units, automation products and field services. North America recorded a stronger demand.
Commenting on the results, John Glick, president and chief executive officer of Lufkin said, "Oil field sales for the second quarter of 2008 increased 35.8% to $126.5 million from $93.2 million for the second quarter of 2007 and increased 25.4% from $100.9 million for the first quarter 2008. The high demand from the North American market, coupled with a change in buying practices that resulted in larger quantity orders from U.S. customers with staged deliveries for the balance of 2008, resulted in very strong new orders during the quarter."
The company also noted that its backlog for oil field products surged to $170.9 million from the previous year. For the balance of the year, Lufkin expects the pace of volume of orders to slow but to remain well above last year's levels.
Looking ahead to 2008, the company raised its forecast for earnings from continuing operations to a range of $5.50 to $5.70 per share from the previous range of $5.10 to $5.30 per share.
For the third quarter, Lufkin continues to expect earnings from continuing operations of $1.55 to $1.65 per share. Analysts are looking for $1.41 per share for the third quarter and $5.28 per share for full-year.
LUFK is currently trading at $91.79, up $8.89 or 10.72% on more than average volume of 274K shares.
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