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Actuant Corp. Reports Operating Results (10-Q)
Posted by: gurufocus (IP Logged)
Date: April 8, 2011 12:15PM

Actuant Corp. (ATU) filed Quarterly Report for the period ended 2011-02-28. Actuant Corp. has a market cap of $1.96 billion; its shares were traded at around $28.65 with a P/E ratio of 22.3 and P/S ratio of 1.7. The dividend yield of Actuant Corp. stocks is 0.1%. Actuant Corp. had an annual average earning growth of 3.1% over the past 10 years.



Highlight of Business Operations:

Operating profit was $37 million and $79 million for the three and six months ended February 28, 2011, compared to $18 million and $44 million in the respective prior year periods. This year-over-year improvement was mainly driven by increased sales and production levels, favorable product mix as well as an improved cost structure. In addition, the three and six month periods ended February 28, 2010 included restructuring charges of $9 million and $11 million, respectively. The changes in operating profit at the segment level are discussed in further detail below.

Compared to the prior year, fiscal 2011 second quarter Industrial segment net sales increased by $20 million (28%) to $89 million, while year-to-date net sales increased by $42 million (31%) to $176 million. Acquisitions of Integrated Solutions businesses contributed $9 million and $17 million of net sales in the three and six month periods ended February 28, 2011. Excluding sales from these acquired businesses and the negative impact of foreign currency rate changes, core sales growth for the second quarter and first half of fiscal 2011 was 15% and 19%, respectively. The improved sales levels results from robust demand across most markets and geographies, reflecting improved global economic conditions.

Electrical segment net sales increased by $15 million (28%) from $55 million for the three months ended February 28, 2010 to $70 million for the three months ended February 28, 2011. During the six months ended February 28, 2011, Electrical segment net sales increased by $17 million (15%) to $126 million. Mastervolt sales were $17 million for the three and six months ended February 28, 2011. Excluding sales from this acquisition and favorable changes in foreign currency exchange rates, core sales declined 2% for the three months ended February 28, 2011, the result of lower demand from retail electrical customers and construction markets, both reflecting continued weak consumer confidence.

Engineered Solutions segment net sales increased by $21 million (23%), from $89 million for the three months ended February 28, 2010 to $110 million for the three months ended February 28, 2011. During the six months ended February 28, 2011, Engineered Solutions net sales also increased by $36 million (20%) from $179 million for the six months ended February 28, 2010 to $215 million in fiscal 2011. Foreign currency rate changes negatively impacted sales comparisons for the three and six months ended February 28, 2011 by $1 million and $4 million, respectively. Excluding foreign currency rate changes, core sales growth was 25% and 23%, respectively, for the second quarter and first half of fiscal 2011. This core sales improvement reflects strong demand from global vehicle OEMs serving the heavy-duty truck, agriculture, construction equipment and defense markets.

Industrial segment results for the three and six months ended February 28, 2010 included $5 million of restructuring costs. Excluding restructuring costs, Industrial segment operating profit increased by $4 million (27%) to $20 million for the second quarter of fiscal 2011 from $16 million in the prior year period, while first half operating profit increased by $11 million (36%) to $40 million. This growth reflects increased sales levels as well as restructuring related savings, which were partially offset by unfavorable acquisition mix and higher incentive compensation.

Electrical segment operating profit for the three and six months ended February 28, 2011 increased $1 million and $2 million, respectively, primarily as a result of prior year periods including restructuring charges. Excluding the $1 million and $3 million of restructuring costs in the second quarter and first half of fiscal 2010, operating profits declined as a result of expedited freight costs, commodity cost inflation, investments in growth initiatives and temporary inefficiencies as we completed facility consolidations. Mastervolt, which was acquired during the quarter, did not meaningfully impact second quarter operating profit.

Read the The complete Report



Stocks Discussed: ATU,
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