Actuant Q2 Profit Rises, Announces New Seven Mln Share Buy-back Program

(RTTNews) - Actuant Corp. (ATU), a manufacturer of industrial products, Wednesday said second-quarter profit increased from the prior year, amid growth in sales. Earnings from continuing operations, however, declined. Actuant's Board of Directors also approved a new seven million share buy-back program.

Net earnings increased to $41.39 million or $0.56 per share from $28.44 million or $0.38 per share in the previous year.

Earnings from continuing operations decreased to $0.30 per share from $0.35 per share in the previous year, amid a higher effective income tax rate.

The company completed the sale of the Electrical business segment on December 13, 2013.

On average, 12 analysts polled by Thomson Reuters expected the company to report earnings per share of $0.32 for the quarter. Analysts' estimates typically exclude special items.

Net sales increased to $327.77 million from $300.47 million. Analysts expected revenue of $333.74 million for the quarter.

Core sales increased 4 percent while acquisitions contributed 5 percent to total sales. The net foreign currency translation impact on a consolidated basis was negligible due to a stronger Euro and British pound.

Mark Goldstein, CEO, said, "On a consolidated basis, results in the quarter were generally in line with our forecast and reflected the normal seasonal slowdown. The 4% core sales growth includes significantly improved activity in Energy and continued solid growth in Engineered Solutions.''

Industrial segment sales slid 5 percent to $94 million, as a result of lower global Integrated Solutions activity as well as continued tepid Industrial Tool demand.

Energy segment sales increased 31 percent to $106 million. Excluding a 21 percent benefit from acquisitions and an unfavorable 1 percent foreign currency exchange rate change impact, core sales increased 11 percent.

In the Engineered Solutions segment, sales increased 6 percent to $128 million. Excluding a 1 percent drop from product line divestitures, core sales increased 7 percent.

The company expects its third-quarter sales to be in the $370 million-$380 million range, with earnings per share of $0.60-$0.65. Analysts expect the company to report third-quarter earnings per share of $0.69 on revenue of $385.69 million.

Further, Actuant said full year earnings per share is expected to be at the lower end of its $2.00-2.10 forecast, based on current visibility.

The company maintained its expectation for full year core sales growth of 3-5 percent and revenue of $1.410 billion-$1.450 billion. Analysts expect the company to report earnings per share of $2.02 on revenue of $1.42 billion.

Goldstein said the firm sees modestly improving order activity and trends. This, coupled with the progress of its businesses, provides optimism for stronger financial performance in the second half of the fiscal year, he added.

The company repurchased 2.6 million shares of common stock for $94 million in the quarter, completing the previous seven million share repurchase authorization. Actuant's Board of Directors also approved a new seven million share buy-back program.

ATU closed at $33.28 on Tuesday.