Polypore Shares Tumble As Q3 Profit More Than Halves, Misses View

(RTTNews) - Shares of Polypore International Inc. (PPO) tumbled more than 13 percent in extended trades Monday after the battery technology company reported a profit for the third quarter that more than halved from last year on lower sales and missed analysts' estimates.

Looking ahead, Polypore said that ongoing supply discussions in its Electronics and Electric Drive Vehicle segment could impact order flow as well as quarterly results due to the size and scale of certain customers.

The Charlotte, North Carolina-based technology filtration company's third-quarter net income was $7.0 million or $0.15 per share, down from $14.2 million or $0.30 per share in the same period last year.

Excluding items, adjusted net income for the quarter was $10.7 million or $0.24 per share, compared to $17.4 million or $0.37 per share in the year-ago period. Adjusted earnings from continuing operations were $8.0 million or $0.18 per share, compared with $15.5 million or $0.33 per share in the previous-year quarter.

On average, 11 analysts polled by Thomson Reuters expected the company to earn $0.31 per share for the quarter. Analysts' estimates typically exclude special items.

Earnings from continuing operations exclude the results of the company's Microporous business, which is being divested.

Sales for the quarter declined 6 percent to $152.0 million from $161.4 million in the same period last year. Analysts had a consensus revenue estimate of $167.30 million.

Excluding the effect of foreign currency translation, sales for the quarter declined $11.7 million.

Robert Toth, President and Chief Executive Officer, said, "During the third quarter our Transportation and Industrial and Separations Media segments, which represent the majority of our Company, delivered solid performance, and the Company continued to generate substantial free cash flow."

Sales of lead-acid battery separators in the third quarter were $27.8 million. Meanwhile, lithium battery separator sales decreased 36 percent from the year-ago quarter due to lower volumes in consumer electronics-related sales. However, sales at the company's separations media segment increased 16 percent in the quarter.

Toth added, "In the Electronics and EDVs segment, consumer electronics orders remained weak and EDV volumes declined sequentially as we are active in supply discussions. These ongoing discussions can impact order flow and quarterly results given the size and scale of certain customers."

Polypore has entered into a deal to sell its Microporous business to Seven Mile Capital Partners for a purchase price of $120 million. The sale is subject to approval by the Federal Trade Commission and is expected to close in the fourth quarter of 2013.

In a separate statement, Polypore said it will make a presentation to the investment community on Wednesday, November 6, 2013, at the Robert W. Baird 2013 Industrial Conference in Chicago, Illinois.

PPO closed Monday's regular trading session at $43.90, up $0.06 or 0.14 percent on a volume of 1.08 million shares. However, in after-hours, the stock declined $5.88 or 13.39 percent to $38.02.