North American Galvanizing & Coatings Reports Record 2007 Earnings
02/14/2008 - North American Galvanizing & Coatings, Inc. announced record net income of $2.2 million on sales of $20.2 million for the fourth quarter, and record net income of $9.2 million on revenues of $88.4 million for the year ended December 31, 2007.
North American Galvanizing & Coatings, Inc. announced record net income of $2.2 million on sales of $20.2 million for the fourth quarter, and record net income of $9.2 million on revenues of $88.4 million for the year ended December 31, 2007.
Fourth Quarter Results—Record net income of $2.2 million ($.17 per share) compares to net income of net income of $1 million ($.08 per share) for the fourth quarter of 2006. Sales of $20.2 million compare to sales of $20.3 million for the fourth quarter of 2006.
Full Year Results—Consolidated net earnings of $9.2 million ($.72 per share*)—the highest in the company's fifty-year history—compare with net income of $4.5 million ($.39 per share) in 2006, representing a 104% increase in net earnings and an 85% increase in earnings per share. Cash flow from operating activities was $14.5 million compared to $6.6 million in 2006.
Revenues of $88.4 million reflect a 19% increase compared to revenues of $74.1 million in 2006. The company attributed the increase to rising sales prices in response to increases in zinc costs. Although the price of zinc and galvanizing declined in the second half of 2007, the company's ability to capitalize on high-quality, timely customer service and the generally high demand for galvanizing services have provided for steady profitability.
Volumes were 2.8% lower than 2006 primarily as a result of the company's review and acceptance of customer orders only at adequate margin levels. Volumes were also reduced because of a scheduled shutdown at the Canton plant for replacement of the kettle and furnace during July 2007.
Management Comments—"The overall hot dip galvanizing market strength experienced for the first three quarters continued through year end,” said Ronald J. Evans, President and CEO, commenting on the results for the fourth quarter of 2007. “We continue to practice disciplined cost control and focus on margin management which resulted in a record positive cash flow for the year. We paid down all outstanding bank debt during 2007, a significant milestone for the company."
* All per-share data are reported on a fully-diluted basis and have been adjusted to reflect the effect of the June 2007 three-for-two stock split effected by a stock dividend.
North American Galvanizing is a leading provider of hot-dip galvanizing and coatings for corrosion protection of fabricated steel products. The company conducts its galvanizing and coating business through a network of plants located in Canton, Ohio; Denver, Hurst (Dallas/Forth Worth), Houston, Kansas City, Louisville, Nashville, St. Louis, and the Tulsa area.
