Companies Report Solid First-Quarter Sales

May 14, 2004
Several firms reported double-digit increases in sales and earnings for the first quarter of 2004 over first-quarter 2003.

Several firms reported double-digit increases in sales and earnings for the first quarter of 2004 over first-quarter 2003. A sampling of these forecasts follow.

Fastenal net earnings increase tops 47 percent Fastenal Co., Winona, Minn., saw a sales increase of 20.5 percent in the recent quarter that ended March 31. Net earnings increased from $19 million in the first quarter of 2003 to $28 million in the first quarter of 2004. Net sales for the same period also increased to $284 million from net sales of $235.8 million in the first quarter of 2003. Gross profit margins in the first quarter of 2004 and 2003 were 50.3 percent and 49.5 percent, respectively. During the first three months of 2004, Fastenal opened 49 new sites. Rising steel prices had the largest impact on gross profit margins. As a reseller of industrial products, primarily steel-based industrial products, Fastenal has been forced to increase its selling prices. These increases resulted in approximately 2 percent of additional sales dollars in the first quarter of 2004.

Fiberstars reports net loss and 2 percent sales gain in first-quarter Fiberstars Inc., Fremont, Calif., announced that its first-quarter revenues of $6 million were 2 percent over the same quarter a year ago. However, the company reported a net loss of $764,000 versus a loss of $622,000 in the first quarter of 2003. David Ruckert, Fiberstar’s president and CEO, also said although it’s early in the period and the year, the outlook for the second quarter and for 2004 remains positive. As part of the expected growth, two of the company’s customers are expanding their use of EFO to multiple locations, and several other national accounts have authorized initial installations of EFO lighting systems. Gensler, a leading architectural and interior design firm, announced its support of EFO and its strategic partnership with Fiberstars at the recent International Light Fair trade show in Las Vegas.

Belden announces improving sales and earnings Belden Inc., St. Louis, announced that sales from continuing operations were $170.1 million in the quarter ended March 31, an increase of 10.9 percent over sales of $153.3 million in the first quarter of 2003. The $16.8 million increase in sales for the quarter year-over-year was attributed to currency exchange rates ($8.9 million), price increases and increased unit volume. The sequential increase in sales from the fourth quarter of 2003 was $8.4 million, or 5.2 percent. Baker Cunningham, chairman of the board, president and CEO. said that in addition to the effect of exchange rates, the company’s North American electronics business experienced sales improvements across all markets, especially data networking and the industrial business. “Much of this was due to our price increases, which we, like others in the industry, have implemented to recover the rising cost of copper and other materials. But the underlying volume also improved. The boost in volume helps our cost absorption, and we have been able to maintain and improve our margins. This improving trend gives us even more enthusiasm for the planned merger between Belden and Cable Design Technologies Corp., which we expect to complete during this second quarter of 2004.”

Noland reports first-quarter earnings decline At Noland Co., Newport News, Va., sales for the first quarter totaled $122.8 million, 11 percent greater than first-quarter 2003’s $110.2 million. “We are very pleased with our sales performance in the first quarter, especially since it was so widespread.” said Chairman Lloyd U. Noland III. He added an improving economy and good weather fueled strong construction activity, benefiting sales in plumbing, air conditioning and electrical/industrial products. Electrical/industrial sales rose 12 percent. Noland is optimistic about the company’s short-term sales prospects. “We finished the first quarter with a very strong March, and our customer orders for future delivery are much higher than a year ago. Assuming the weather cooperates, we expect to continue our recent sales momentum in the second quarter.”

T&B’s quarterly earnings triple Thomas & Betts Corp., Memphis, Tenn., announced first-quarter 2004 net earnings of $15.6 million, more than triple the $5 million in net earnings reported in the first quarter 2003. Sales in the quarter were $353 million, up $41.5 million or 13.3 percent, from the same period a year ago. Favorable foreign currency accounted for approximately $14 million of the sales increase. “Sales in the quarter — particularly for our core electrical products — were stronger than we had anticipated as we saw strengthening demand across most markets,” said Dominic J. Pileggi, president and chief executive officer. “The result was a substantial increase in earnings as our factories benefited from better absorption, allowing the productivity improvements made over the past two years to drop through to the bottom line.” Earnings from operations were $26.7 million in the first quarter 2004, more than twice the $12.1 million reported in the first quarter 2003. First-quarter sales in the company’s electrical segment rose 15 percent to $276.8 million. Segment earnings more than doubled to $20.9 million. Management noted that rising material costs and the possibility of limited supply — especially for steel — would be a challenge throughout the remainder of 2004, although the adverse impact on first-quarter results was minimal. “We are aggressively managing this very important issue,” said Pileggi, “and believe that we will be largely successful in offsetting rising material costs through a combination of price increases and productivity improvements. We are fortunate to have very strong relationships with our steel suppliers and are working closely with them to avoid any serious disruption to our operations.”

WESCO first-quarter sales up 7.2 percent over first quarter of 2003 WESCO International Inc., Pittsburgh, saw a sales increase of 7.2 percent over the first quarter of 2003. Net sales for the first quarter of 2004 were $847.8 million compared to $790.8 million in 2003. Gross margins for the quarter improved to 19 percent from 18.4 percent for the comparable quarter in 2003. Operating income for the current quarter improved to $26.3 million from $18.5 million in last year’s comparable quarter. Net income in 2004’s first quarter was $9.7 million compared to $4.8 million in 2003. Chairman and CEO Roy W. Haley said he was pleased with WESCO’s performance for the quarter, as both operating profit and net income were at the highest first-quarter levels since 2000. “The combination of higher sales and internal operating efficiencies were the primary reasons for improved performance. Our revenue gain was due in part to strengthened economic conditions, and we benefited from increasing demand in most key market segments. Sales results were better than expected, but we remain cautious about the durability of the recovery and the potential adverse effect of economic and political risks on our customers’ capital spending decisions.”