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 Oct. 19, 2012 Source: Valmont Industries news release To view entire report, click here. Valmont Industries, Inc. (NYSE: VMI), a leading global manufacturer of engineered products for infrastructure, mechanized irrigation equipment for agriculture, and a provider of coating services, reported sales for the third quarter of $729.8 million compared with $672.2 million for the same period of 2011. Third quarter 2012 operating income was $90.4 million versus $72.0 million in 2011. Third quarter 2012 net earnings were $56.7 million, or $2.12 per diluted share, versus third quarter 2011 net earnings of $42.1 million, or $1.59 per diluted share. For the first nine months of 2012, sales were $2,214.5 million versus $1,908.8 million in 2011. Valmont's nine-month net earnings were $169.0 million, or $6.32 per diluted share, compared with 2011 nine-month net earnings of $113.6 million, or $4.28 per diluted share. Third Quarter Review: "While each segment had record third quarter sales, the major contributor was the substantial increase in Utility Support Structures sales," said Mogens C. Bay, Valmont's Chairman and Chief Executive Officer. "Operating income as a percent of sales increased from 10.7% to 12.4%, led by the Utility Support Structures Segment performance and further supported by positive comparisons in the Irrigation, Coatings and Engineered Infrastructure Products Segments," added Mr. Bay. Irrigation Segment (21% of 3rd Quarter Net Sales) Center pivot and linear move mechanized irrigation equipment and parts for agriculture in global markets. Sales rose 4% to $156.5 million exceeding last year's record third quarter. Historically high crop commodity prices supported strong demand for mechanized irrigation equipment. Higher crop prices contribute to higher expectations for farm income, thus increasing purchasing power. Initially, third quarter sales faced a typical seasonal sequential decline, however demand firmed as the quarter drew to a close in response to this summer's extreme drought in the U.S. Sales in international markets rose despite the absence of large project sales during this year's third quarter, supported by demand for feed-grains and historically high crop prices in global markets. In reaction to the drought, we expect many dry-land farmers with access to water to install irrigation equipment to help mitigate the risk of future dry weather. Irrigated agriculture should benefit from good crops and high commodity prices. Consequently, we expect strong demand during the current selling season. Operating income grew 14% to $27.1 million and was 17.3% of segment sales. The improvement in operating income reflects improved profitability in international markets and operational leverage, particularly SG&A, in North American markets. Tweet |
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