Lamson & Sessions Co., Cleveland, said profit and sales will come in above expectations during the fourth quarter due to price increases.
The company is raising fourth-quarter profit to a range of $10.5 million to $11.3 million. The guidance is more than double the company’s previous estimate of between $4.6 million to $5 million — and up from last year’s results of $1.3 million.
Sales are expected between $125 million to $130 million, well above its prior estimate of $110 million to $115 million. In the year-ago period, the company reported sales of $97.1 million.
Lamson & Sessions said it has benefited from several factors. The company has incurred substantial cost increases in its primary raw materials — polyvinyl chloride and polyethylene resins — due to the Gulf Coast hurricanes’ impact on the resin manufacturers’ facilities, and it has been able to pass these cost increases to its electrical conduit customers in the form of higher selling prices. Also, many customers have been increasing their order rates due to concern over material availability and continuing price escalation for resin-based products. Lamson & Sessions expects that current demand conditions in its key end markets will continue into 2006, but is unable to predict how long these conditions will last. The availability of PVC resin remains tight as the resin manufacturers are still operating under force majeure conditions due to the Gulf Coast hurricanes.