Several Electrical Companies See Increase in Quarterly Earnings

July 24, 2008
Several electrical companies reported second- and third-quarter financial results.

Several electrical companies reported second- and third-quarter financial results. Following are financial snapshots of the earnings reports of some industry players.

Anixter posts strong quarter. Anixter International, Glenview, Ill., reported a 4 percent increase in net income for the second quarter compared to the same quarter last year, earning $66.9 million on sales of $1.62 billion. The company reported a slightly lower gross margin due to lower supplier volume growth incentives and continuing pressure from rising prices for steel and specialty metals in the OEM supply side of the business. “In the North American electrical wire and cable market, we saw strong levels of project activity that produced sales of $395.6 million in the current quarter,” said Eck in the company’s quarterly report. “This reflects an increase of 8 percent versus the year ago quarter despite a difficult comparison against exceptionally strong second-quarter sales in 2007.”

Thomas & Betts Corp. sees rise in second-quarter earnings

Thomas & Betts Corp. (T&B), Memphis, Tenn., reported second-quarter earnings of $147.8 million, up from $46.6 million, a year ago. The most recent quarter includes a gain of $1.74 a share from the sale of the company’s stake in privately held Leviton Manufacturing (See Electrical Marketing, June 27 issue). Total sales rose 26 percent to $641.3 million.

Second quarter electrical segment sales increased $132.8 million, or 31.8 percent, to $550.8 million compared to the second quarter 2007. Acquisitions contributed $114.1 million or 27.3 percent to sales. Commodity- and energy-related price increases offset lower underlying sales volumes in markets affected by the slowdown in residential construction such as retail, utility distribution and light commercial construction.

Second quarter 2008 electrical segment earnings were $110.8 million or 20.1 percent of sales. This compares to $84.9 million or 20.3 percent of sales last year. Acquisitions contributed $21.8 million of the $25.9 million earnings increase and had a dampening impact on electrical segment earnings as a percent of sales, the company said.

Dominic Pileggi, T&B’s chairman and chief executive officer, believes that current market conditions will continue in the second half and that demand in industrial markets will help offset weakness in residential construction-related markets. He said commodity and energy-related price increases will be more significant in the second half.

Rockwell Automation Inc.’s third-quarter sales up

Rockwell Automation, Milwaukee, reported a 7 percent drop in fiscal third-quarter earnings. Third-quarter sales for the company rose 15 percent to $1.48 billion from 1.28 billion in 2007.

Keith D. Nosbusch, chairman and chief executive officer, said, “We delivered solid top-line results despite slower than expected growth in Europe and the U.S. Revenue growth was particularly strong in Asia-Pacific, Latin America and our solutions businesses, demonstrating strength in the on-going diversification of our revenue base.”

Sales for the company’s Control Products & Solutions group in the third quarter were $849.3 million, an increase of 22 percent compared to sales of $698.1 million in the third quarter of 2007. Nosbusch said Rockwell Automation expects to see continued strength in Asia-Pacific and Latin America as well as in resource-based industries. However, macro-economic conditions in Europe and the U.S. are weakening, he said.

Philips Electronics sees jump in quarterly earnings

Philips Electronics, Amsterdam, said its second-quarter earnings rose 7 percent, mainly driven by its lighting business. The company reported second quarter sales had increased to $10.3 billion globally, up 7 percent compared to the same period in 2007. Sales for North America were $3.24 billion, an increase of 23 percent compared to the second quarter of 2007, and representing more than 30 percent of Philips’ global sales.

Lighting sales increased by approximately $436 million compared to second quarter 2007, driven by the solid performance of Genlyte, the company said.