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Powell Industries Inc. Reports Operating Results (10-Q)

February 02, 2011 | About:
10qk

10qk

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Powell Industries Inc. (POWL) filed Quarterly Report for the period ended 2010-12-31.

Powell Inds has a market cap of $453.8 million; its shares were traded at around $38.82 with a P/E ratio of 13.2 and P/S ratio of 0.8. Powell Inds had an annual average earning growth of 16% over the past 10 years.Hedge Fund Gurus that owns POWL: Jim Simons of Renaissance Technologies LLC. Mutual Fund and Other Gurus that owns POWL: Chuck Royce of Royce& Associates, Arnold Van Den Berg of Century Management.

Highlight of Business Operations:

Consolidated revenues decreased $11.2 million to $124.7 million in the first quarter of fiscal 2011 compared to $135.9 million in the first quarter of fiscal 2010. This decrease in revenues is a result of reduced backlog discussed above. For the first quarter of fiscal 2011, domestic revenues decreased by 22.3% to $82.7 million compared to the first quarter of 2010. Total international revenues were $42.0 million in the first quarter of 2011 compared to $29.5 million in the first quarter of 2010, primarily resulting from the operations of Powell Canada for the entire first quarter of 2011 compared to a partial first quarter of fiscal 2010. Gross profit for the first quarter of fiscal 2011 decreased by approximately $11.9 million, to $25.9 million, as a result of the reduction in volume and pressure on margins, as discussed above offset in part by the addition of a full quarter of performance by Powell Canada. Gross profit in fiscal 2010 benefitted from the favorable execution of large projects, as well as cancellation fees and the successful negotiation of change

Our Electrical Power Products business segment recorded revenues of $117.1 million in the first quarter of fiscal 2011, compared to $128.1 million for the first quarter of fiscal 2010. This decrease in revenues is a result of reduced volume related to the reduction in orders and backlog discussed above. In the first quarter of fiscal 2011, revenues from public and private utilities were approximately $33.2 million, compared to $30.4 million in the first quarter of fiscal 2010. Revenues from commercial and industrial customers totaled $77.4 million in the first quarter of fiscal 2011, an increase of $1.8 million compared to the first quarter of fiscal 2010. Municipal and transit projects generated revenues of $6.5 million in the first quarter of fiscal 2011 compared to $22.1 million in the first quarter of fiscal 2010.

Selling, general and administrative expenses were $20.9 million for the first quarter of fiscal 2011 compared to $21.8 million for the first quarter of fiscal 2010. Selling, general and administrative expenses decreased primarily due to the decrease in acquisition expenses of $1.6 million and the decrease in bad debt expense of $1.0 million, partially offset by the inclusion of a full quarter of costs related to Powell Canada included in the first quarter of fiscal 2011. Consolidated selling, general and administrative expenses increased to 16.8% of revenues in the first quarter of fiscal 2011 compared to 16.0% of revenues in the first quarter of fiscal 2010, primarily as a result of the decrease in revenue.

In the first quarter of fiscal 2011, we recorded net income attributable to Powell Industries, Inc. of $2.4 million, or $0.21 per diluted share, compared to $9.6 million, or $0.83 per diluted share, in the first quarter of fiscal 2010.

The order backlog at December 31, 2010, was $344.1 million, compared to $282.3 million at September 30, 2010 and $341.7 million at the end of the first quarter of fiscal 2010. New orders placed during the first quarter of fiscal 2011 totaled $185.9 million compared to $107.7 million in the first quarter of fiscal 2010. The increase in backlog since September 30, 2010, of approximately $61.8 million is primarily related to one large order.

At December 31, 2010, we had cash and cash equivalents of $120.9 million, compared to $115.4 million at September 30, 2010. We have a $58.5 million revolving credit facility in the U.S. and an additional £4.0 million (approximately $6.2 million) revolving credit facility in the United Kingdom, both of which expire in December 2012. As of December 31, 2010, there were no amounts borrowed under these lines of credit. We also have a $20.0 million revolving credit facility and a $2.5 million single advance term loan in Canada. At December 31, 2010, $0.3 million was outstanding under the Canadian revolving credit facility, subject to certain limitations as defined in the credit agreement. There was no balance outstanding under the Canadian term loan. Total long-term debt and capital lease obligations, including current maturities, totaled $6.4 million at December 31, 2010, compared to $6.9 million at September 30, 2010. Letters of credit outstanding were $14.5 million at December 31, 2010, compared to $15.2 million at September 30, 2010, which reduce our availability under our credit facilities. Amounts available under the U.S. revolving credit facility and the revolving credit facility in the United Kingdom were approximately $44.0 million and $6.2 million, respectively, at December 31, 2010. Amounts available under the Canadian revolving credit facility were approximately $16.6 million at December 31, 2010. For further information regarding our debt, see Notes H and J of Notes to Condensed Consolidated Financial Statements.

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