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Gibraltar Reports 2nd Quarter Earnings
08/11/2008 - Gibraltar Industries reports net income of $20.1 million on net sales of $379.2 million for the second quarter, and net income of $26.8 million on net sales of $704.8 million for the six months ended June 30, 2008.
Gibraltar Industries, Inc. reported net income of $20.1 million on net sales of $379.2 million for the second quarter, and net income of $26.8 million on net sales of $704.8 million for the six months ended June 30, 2008.
Second Quarter Results— Income from continuing operations increased by 56% to $20.3 million ($0.67 per diluted share), as compared to income of $13.0 million ($0.43 per diluted share) in the second quarter of 2007.
Sales from continuing operations were $379 million, an increase of 6% compared to $356 million in the second quarter of 2007.
Six Month Results— Income from continuing operations increased by 36% to $27.4 million ($0.91 per diluted share) as compared to income of $20.1 million ($0.67 per diluted share) in the first six months of 2007. Sales from continuing operations were $705 million, up 7% from $661 million in the first half of 2007.
Gibraltar’s 2007 acquisition activity allowed it to increase sales despite significantly weaker market conditions in 2008 compared to a year earlier, as these acquisitions added sales of $22 million in the second quarter and $59 million in the first six months of 2008.
Management Comments—“During the second quarter, we built on the progress achieved in the first three months of the year,” said Brian J. Lipke, Gibraltar’s Chairman and CEO. “We continued to reduce cost, generated higher sales, drove strong earnings growth, and further strengthened our balance sheet. All of this was accomplished in spite of additional weakening in two of our primary markets, with housing starts off 32% and the North American auto build down 16% compared to the second quarter of 2007.”
“Our many initiatives to reduce costs, consolidate and streamline our operations, reduce working capital, and lower our debt allowed us to produce much stronger second-quarter results, even in an extremely difficult operating environment,” added Henning N. Kornbrekke, Gibraltar’s President and Chief Operating Officer. “In the last 18 months, we have closed or consolidated 18 facilities, including four in the second quarter. Over that same time, our operational efficiencies have resulted in improvements in margins, improved our customer service, and helped to reduce working capital, resulting in reductions in debt of $24 million during the second quarter, $50 million in the first six months of 2008, and approximately $115 million in the last nine months.”
“We have continued to strategically transform Gibraltar, broadening and diversifying our business portfolio by increasing our participation in the commercial building, industrial, and international markets and strengthening our product leadership positions in targeted niche markets, all of which have improved our core operating characteristics and enhanced our ability to generate stronger and more consistent results,” said Lipke.
“By aggressively lowering Gibraltar’s cost structure and continuing to improve our margins, we have been able to offset lower volumes in two of our primary markets. As these markets stabilize and begin to move back toward more normal activity levels, we are positioned to generate even stronger results,” added Kornbrekke.
Outlook—Looking ahead, Kornbrekke said that the company expects the normal seasonal slowing in the second half of the year. In light of the company’s strong performance in the first six months of the year and the momentum from its many operational improvements, Kornbrekke said its 2008 earnings per share from continuing operations are now expected to be in the range of $1.50 to $1.65 per share. This compares to previous guidance of $1.05 to $1.25, and $1.03 in 2007, barring a significant change in current business conditions.
Gibraltar Industries is a leading manufacturer, processor, and distributor of products for the building, industrial, and vehicular markets. The company serves customers in a variety of industries in all 50 states and throughout the world. It has approximately 3800 employees and operates 71 facilities in 27 states, Canada, China, England, Germany, and Poland.
