10-year

10-Year Anniversary Promotion (20% off)

Join GuruFocus Premium Membership Now for Only $279/Year

Once a decade discount

Save up to $500 on Global Membership.

Don't Miss It !

Free 7-day Trial
All Articles and Columns »

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

February 09, 2009 | About:

Powell Industries Inc. (POWL) filed Quarterly Report for the period ended 2008-12-31.

Powell Industries Inc. sells designs develops manufactures packages and services systems and equipment for the distribution control and management of electrical energy and other dynamic processes. The principal products are switchgear and related equipment bus duct and process control systems. These products and systems are utilized primarily byrefineries petrochemical plants utilities paper mills offshore platforms commuter railways vehicular transportation and numerous other industrial commercial and governmental facilities. Powell Industries Inc. has a market cap of $272.33 million; its shares were traded at around $28.38 with a P/E ratio of 11.3 and P/S ratio of 0.43.

Highlight of Business Operations:

Consolidated revenues increased $23.4 million to $170.5 million in the first quarter of fiscal 2009 compared to $147.1 million in the first quarter of fiscal 2008. Revenues increased as the Company has responded to strong market demand by increasing our capacity and throughput. For the first quarter of fiscal 2009, domestic revenues increased by 27.3% to $134.3 million compared to the first quarter of 2008. Total international revenues were $36.2 million in the first quarter of 2009 compared to $41.6 million in the first quarter of 2008. International revenues are primarily related to energy related investments, principally oil and gas projects. Gross profit for the first quarter of fiscal 2009 increased by approximately $7.8 million, to $34.5 million, as a result of improved pricing and productivity. Gross profit as a percentage of revenues increased to 20.2% in the first quarter of fiscal 2009, compared to 18.1% in the first quarter of fiscal 2008.

Our Electrical Power Products business segment recorded revenues of $163.9 million in the first quarter of fiscal 2009, compared to $141.1 million for the first quarter of fiscal 2008. In the first quarter of fiscal 2009, revenues from public and private utilities were approximately $38.5 million, compared to $43.7 million in the first quarter of fiscal 2008. Revenues from commercial and industrial customers totaled $114.1 million in the first quarter of fiscal 2009, an increase of $27.9 million compared to the first quarter of fiscal 2008. Municipal and transit projects generated revenues of $11.3 million in the first quarter of fiscal 2009 compared to $11.2 million in the first quarter of fiscal 2008.

The order backlog at December 31, 2008, was $509.4 million, compared to $518.6 million at September 30, 2008 and $501.7 million at the end of the first quarter of fiscal 2008. New orders placed during the first quarter of fiscal 2009 totaled $172.2 million compared to $185.1 million in the first quarter of fiscal 2008.

Cash flow provided by operations was approximately $38.0 million for the first quarter of fiscal 2009 primarily as a result of a decrease in working capital to $131.4 million at December 31, 2008, compared to $150.7 million at September 30, 2008. As of December 31, 2008, current assets exceeded current liabilities by 1.7 times and our debt to total capitalization ratio was 8.9%. This decrease in working capital resulted from our efforts to manage inventory and billings to customers. The cash flow generated from operations in the first quarter of fiscal 2009 was primarily used to repay the $19.0 million outstanding on the US Revolver at September 30, 2008.

At December 31, 2008, we had cash, cash equivalents and marketable securities of $25.0 million, compared to $10.1 million at September 30, 2008. We have an $83.5 million revolving credit facility in the U.S. and an additional £4.0 million (approximately $5.8 million) revolving credit facility in the United Kingdom, both of which expire in December 2012. As of December 31, 2008, there was approximately $2.2 million borrowed under these lines of credit. Total long-term debt and capital lease obligations, including current maturities, totaled $20.4 million at December 31, 2008, compared to $41.8 million at September 30, 2008. Letters of credit outstanding were $17.1 million at December 31, 2008, compared to $22.2 million at September 30, 2008, which reduced 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 $66.4 million and $3.6 million, respectively, at December 31, 2008. For further information regarding our debt, see Notes F and G of Notes to Condensed Consolidated Financial Statements.

In December 2008, the Company further amended its Amended Credit Agreement to provide additional working capital support for the Company for 180 days, expiring June 1, 2009. The availability under the US Revolver was increased by $25 million, to $83.5 million, through February 28, 2009 to provide additional capacity to the Company to support working capital needs due to increased operations in the second half of fiscal 2008. This additional capacity is then reduced by $12.5 million through June 1, 2009. On June 1, 2009, the amount available under the US Revolver will be reduced to its previous limit of $58.5 million. This amendment also increases the applicable interest rate by 25 to 50 basis points. The amendment also raised the baseline amount for the minimum tangible net worth covenant to $172.5 million from $120 million. Additionally, this amendment extends the expiration of the Amended Credit Agreement by one year, to December 31, 2012.

Read the The complete Report

Rating: 3.5/5 (2 votes)

Comments

Please leave your comment:


Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK