Manufacturing and industrial equipments supplier SPX Corp. (SPW) Wednesday reported a sharp decline in net profit for the third quarter of fiscal 2009, hurt mainly by lower revenues across all business segments. The company also lowered its earnings guidance for full year 2009.
For the third quarter, net income attributable to shareholders was $46 million or $0.94 per share compared to $117 million or $2.16 per share in the prior-year quarter. SPX's attributable income from continuing operations plummeted to $48.5 million or $0.98 per share from $110.2 million or $2.00 per share a year earlier.
On an adjusted basis, earnings from continuing operations were $0.98 per share, down from $1.64 per share in 2008. Adjusted results exclude special charges amounting to $19.3 million or $0.25 per share, with regard to restructuring actions, compared to $4.8 million or $0.06 per share in the year-ago quarter.
During the period, the Charlotte, North Carolina-based company incurred a loss from discontinued operations totaling $2.5 million or $0.05 per share versus a profit of $6.8 million or $0.12 per share in the 2008-year period.
In October 2009, SPX had completed sale of its interest in automotive filtration solutions product line, as planned during the fourth quarter of 2008. Further, in the prior quarter, the company committed to a plan to divest a product line, anticipating the sale to be completed during the next twelve months. The anticipated losses from sale of the product lines are reported as discontinued operations.
On average, 11 analysts polled by Thomson Reuters expected SPX to earn $0.82 per share for the quarter. Analysts' estimates typically exclude special items.
Revenues for the quarter declined 20.8% to $1.17 billion from $1.48 billion in the third quarter of fiscal 2008. The company stated that organic revenues for the three-month period fell 18.6%. Completed acquisitions increased revenues by 0.1%, and impact of currency fluctuations decreased revenues by 2.3%, SPX added. Analysts' expected the company to generate revenues of $1.17 billion during the quarter.
On a segmental basis, flow technology division generated revenues of $406 million versus $493 million, revenues from test and measurement slumped to $187.6 million from $260 million last year. Revenues from thermal equipment and services declined to $401.4 million from $436.8 million, and industrial products and services segment generated revenues of $178.6 million versus $292.1 million in the 2008-year period.
In the preceding second quarter, net income attributable to shareholders had dropped to $33.4 million or $0.68 per share from $94.8 million or $1.73 per share in the previous year. SPX's revenues for the second quarter had dipped 20.7% to $1.19 billion from $1.50 billion in the second quarter of fiscal 2008.
For the nine-month period, attributable net income plunged to $103.8 million or $2.10 per share from $273.2 million or $5.09 per share in the same period last year. The company's income from continuing operations was $126.8 million or $2.55 per share versus $263 million or $4.81 per share in fiscal 2008. On a per share basis, adjusted earnings from continuing operations were down to $2.55 from $4.45 in the prior year.
Loss from discontinued operations was $23 million or $0.46 per share compared with a profit of $10.2 million or $0.19 per share in the corresponding period prior year. Year-to-date revenues dropped to $3.53 billion from $4.33 billion a year ago.
Looking ahead, Chairman, President and Chief Executive Officer Chris Kearney said even though some macroeconomic trends appear to be pointing toward a recovery, SPX anticipates recovery to lag the broader economy.
"While orders in many of our short-cycle businesses are showing signs of stabilization, demand in our key end markets remains depressed. We continue to experience customer-driven delays on certain large projects, particularly in our late-cycle infrastructure businesses, with orders or execution moving into 2010," added Kearney.
As a result, the company lowered it full year 2009 earnings guidance to a range of $3.80 to $4.00 per share from its previous view of $4.00 to $4.30 per share. SPX added that the lowering of earnings guidance has reduced outstanding debt by more than $200 million in the third quarter. For full year 2009, analysts currently expect the company to earn $3.96 per share on revenues of $4.85 billion.
Further, SPX has also raised its full year 2009 cash flow guidance range to $270 million to $290 million from its previous view of $230 million to $270 million.
SPW closed Tuesday's regular trading session at $60.70 per share on the New York Stock Exchange.
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June 12, 2026 17:14 ET Major central bank action was the focus this week in economic news. The European Central Bank became the first major central bank to move in response to the rising inflationary pressures in the backdrop of the conflict in the Middle East. In North America, the U.S. inflation and trade data as well as Canada’s central bank decision gained attention. The Chinese trade data was the main news in Asia.