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Barnes Group Inc. Reports Second Quarter 2011 Earnings per Diluted Share of $0.40, up 54%

Dépèche transmise le 29 juillet 2011 par Business Wire

Barnes Group Inc. Reports Second Quarter 2011 Earnings per Diluted Share of $0.40, up 54%

Barnes Group Inc. Reports Second Quarter 2011 Earnings per Diluted Share of $0.40, up 54%

BRISTOL, Conn.--(BUSINESS WIRE)--Barnes Group Inc. (NYSE: B), a diversified global manufacturer and logistical services company, today reported financial results for the second quarter 2011. Net sales grew 16 percent to $328.0 million, up from $281.9 million in the second quarter of 2010. Excluding the favorable impact of foreign exchange, net sales were up 12 percent. Net income for the second quarter grew 51 percent to $22.3 million, or $0.40 per diluted share, from $14.8 million, or $0.26 per diluted share, a year earlier.

“Barnes Group’s strong financial performance during the second quarter reflects the ongoing benefit of our focus on profitable growth and operating productivity”

                     

($ millions; except

     

Three months ended June 30,

         

Six months ended June 30,

per share data)

 

2011

       

2010

     

Change

 

2011

       

2010

     

Change

           
Net Sales $ 328.0 $ 281.9 $ 46.1 16.3% $ 646.7 $ 560.0 $ 86.7 15.5%
Operating Income $ 33.5 $ 23.7 $ 9.8 41.6% $ 63.0 $ 43.3 $ 19.6 45.3%
% of Sales 10.2% 8.4% 1.8 pts. 9.7% 7.7% 2.0 pts.
Net Income $ 22.3 $ 14.8 $ 7.5 50.6% $ 41.4 $ 26.7 $ 14.8 55.4%
% of Sales 6.8% 5.3% 1.5 pts.

 

6.4% 4.8% 1.6 pts.
 
Net Income Per Diluted Share       $ 0.40       $ 0.26       $ 0.14       53.8%           $ 0.74       $ 0.47       $ 0.27       57.4%
 

“Barnes Group’s strong financial performance during the second quarter reflects the ongoing benefit of our focus on profitable growth and operating productivity,” said Gregory F. Milzcik, President and Chief Executive Officer. “Double-digit sales growth drove solid operating profit improvement in both of our business segments this quarter, and we expect to see further profitability leverage from incremental sales as our end-markets continue their rebound.”

Logistics and Manufacturing Services

  • The Logistics and Manufacturing Services segment recorded sales of $155.3 million in the second quarter of 2011, up $16.8 million or 12 percent from last year’s second quarter. This segment achieved $11.6 million of organic sales growth primarily from aerospace aftermarket and North American distribution businesses. Foreign currency translation positively affected second quarter 2011 net sales by approximately $5.2 million.
  • Operating profit at Logistics and Manufacturing Services increased 65 percent to $16.8 million, from $10.2 million in the second quarter of 2010. The increase in profitability was positively impacted by higher sales, improved customer sales mix and further productivity improvements in the North American distribution businesses. The aerospace aftermarket business likewise benefited from operating profit flow-through on higher sales. Operating profit for the segment was partially offset by costs associated with strategic initiatives.

Precision Components

  • The Precision Components segment recorded sales of $175.8 million in the second quarter of 2011, up $29.2 million, a 20 percent increase from last year’s second quarter. Organic sales grew $21.0 million in the quarter as a result of increases in the North American and European industrial manufacturing businesses and from better performance in the transportation industry, including automotive. Net sales in the aerospace OEM business also achieved double-digit growth. Foreign currency translation positively affected second quarter 2011 net sales by approximately $8.2 million.
  • Operating profit at Precision Components was $16.7 million, an increase of 24 percent. The operating profit improvement resulted from the beneficial impact of higher sales levels combined with lower cost structures resulting from previous actions and lean initiatives. These improvements were offset in part by incremental expense from higher production levels, unfavorable foreign exchange, and added costs for strategic initiatives.

Additional Information

  • Interest expense decreased $2.6 million from last year’s second quarter to $2.4 million. The decrease was a result of a lower average effective interest rate combined with a reduction in debt discount amortization and the maturity of interest rate swap agreements. The lower average interest rate reflects the significant shift from fixed rate debt to lower variable rate debt due to the retirement of senior notes and redemption of the 3.75% convertible notes. Both were funded using the Company’s low cost variable rate credit facility.
  • The Company’s effective tax rate for the second quarter of 2011 was 27.6 percent, compared to 16.0 percent in the second quarter last year. The increase in the second quarter 2011 effective tax rate was primarily driven by a projected shift in the mix of earnings attributable to higher-taxing jurisdictions, the recognition of a discrete tax expense of $1.8 million related to tax adjustments for prior years, and the effect of an increase in the planned repatriation of a portion of current year earnings to the U.S.

Revised 2011 Outlook

The Company now expects 2011 revenue to grow 12 to 14 percent from 2010, and earnings per diluted share to be in the range of $1.35 to $1.45, up 42 to 53 percent from 2010. Milzcik continued, “Looking forward, we anticipate continued improvement in our end-markets, especially in the aerospace businesses. Coupling a positive demand environment with the ongoing benefits of our focus on profitable growth, we now expect to deliver a higher level of performance for the year.”

Conference Call

Barnes Group Inc. will conduct a conference call with investors to discuss second-quarter 2011 results at 8:30 a.m. EST today, July 29, 2011. A webcast of the live call and an archived replay will be available on the Barnes Group investor relations link at www.BGInc.com.

Barnes Group Inc. (NYSE:B) is a diversified global manufacturer and logistical services company focused on providing precision component manufacturing and operating service support. Founded in 1857, more than 4,800 dedicated employees at more than 67 locations worldwide are committed to achieving consistent and sustainable profitable growth. For more information, visit www.BGInc.com. Barnes Group, the Critical Components People.

This release may contain certain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are made based upon management's good faith expectations and beliefs concerning future developments and their potential effect upon the Company and can be identified by the use of words such as "anticipated," "believe," "expect," "plans," "strategy," "estimate," "project," and other words of similar meaning in connection with a discussion of future operating or financial performance. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those expressed in the forward-looking statements. The risks and uncertainties, which are described in our periodic filings with the Securities and Exchange Commission, include, among others, uncertainties arising from the behavior of financial markets, including any associated impact in the event of a failure to reach agreement on the U.S. federal debt ceiling, such as a debt rating downgrade; future financial performance of the industries or customers that we serve; changes in market demand for our products and services; integration of acquired businesses; restructuring costs or savings; the impact of any future strategic actions, including acquisitions, joint ventures, divestitures, restructurings, or strategic business realignments, and our ability to achieve the financial and operational targets set in connection with any such actions; introduction or development of new products or transfer of work; changes in raw material or product prices and availability; foreign currency exposure; our dependence upon revenues and earnings from a small number of significant customers; a major loss of customers; the outcome of pending and future claims or litigation or governmental, regulatory proceedings, investigations, inquiries, and audits; uninsured claims and litigation; outcome of contingencies; future repurchases of common stock; future levels of indebtedness; and numerous other matters of global, regional or national scale, including those of a political, economic, business, competitive, environmental, regulatory and public health nature. The Company assumes no obligation to update our forward-looking statements.

 

             
BARNES GROUP INC.
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share data)
Unaudited
 
Three months ended June 30, Six months ended June 30,
  2011     2010     % Change     2011     2010   % Change  
 
Net sales $ 327,950 $ 281,892 16.3 $ 646,703 $ 560,029 15.5
 
Cost of sales 207,361 177,821 16.6 410,537 355,844 15.4
Selling and administrative expenses   87,067     80,389   8.3   173,196     160,836   7.7
 
  294,428     258,210   14.0   583,733     516,680   13.0
 
Operating income 33,522 23,682 41.6 62,970 43,349 45.3
 
Operating margin 10.2 % 8.4 % 9.7 % 7.7 %
 
Interest expense 2,364 4,978 (52.5 ) 6,032 10,097 (40.3 )
Other expense (income), net   298     1,065   (72.0 )   802     1,387   (42.2 )
 
Income before income taxes 30,860 17,639 75.0 56,136 31,865 76.2
 
Income taxes   8,528     2,815   NM   14,732     5,213   NM
 
Net income $ 22,332   $ 14,824   50.6 $ 41,404   $ 26,652   55.4
 
Common dividends $ 4,414   $ 4,390   0.5 $ 8,765   $ 8,787   (0.3 )
 
Per common share:
Net income:
Basic $ 0.40 $ 0.27 48.1 $ 0.75 $ 0.48 56.3
Diluted 0.40 0.26 53.8 0.74 0.47 57.4
Dividends 0.08 0.08 - 0.16 0.16 -
 
Weighted average common shares outstanding:
Basic 55,414,347 55,546,969 (0.2 ) 55,067,079 55,470,721 (0.7 )
Diluted 56,288,447 56,339,770 (0.1 ) 55,948,098 56,152,953 (0.4 )
 
 
BARNES GROUP INC.
OPERATIONS BY REPORTABLE BUSINESS SEGMENT
(Dollars in thousands)
Unaudited
 
Three months ended June 30, Six months ended June 30,
  2011     2010     % Change     2011     2010   % Change  
Net sales
 
Logistics and Manufacturing Services $ 155,291 $ 138,460 12.2 $ 305,310 $ 273,742 11.5
 
Precision Components 175,804 146,604 19.9 347,376 292,385 18.8
 
Intersegment sales   (3,145 )   (3,172 ) 0.9   (5,983 )   (6,098 ) 1.9
 
Total net sales $ 327,950   $ 281,892   16.3 $ 646,703   $ 560,029   15.5
 
Operating profit
 
Logistics and Manufacturing Services $ 16,793 $ 10,173 65.1 $ 29,803 $ 18,497 61.1
 
Precision Components   16,729     13,509   23.8   33,167     24,852   33.5
 
Total operating profit 33,522 23,682 41.6 62,970 43,349 45.3
 
Interest expense 2,364 4,978 (52.5 ) 6,032 10,097 (40.3 )
 
Other expense (income), net   298     1,065  

Business Wire

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