Samuel Manu-Tech Reports Q2 2010 Results
08/04/2010 - Samuel Manu-Tech Inc. reported sales of $184.9 million for the three months ended June 30, 2010, an increase of 17.3% compared to Q2 2009 due to higher volumes and selling prices partially offset by the negative impact of the stronger Canadian dollar on U.S.-based sales.
Samuel Manu-Tech Inc. reported sales of $184.9 million for the three months ended June 30, 2010, an increase of $27.3 million or 17.3% compared to Q2 2009 due to higher volumes and selling prices partially offset by the negative impact of the stronger Canadian dollar on U.S. based sales.
An operating profit of $3.6 million for the quarter (vs. an operating loss of $14.0 million last year) reflected a gradual recovery in economic and market conditions. The Packaging segment reported an operating profit of $2.7 million compared to an operating loss of $5.7 million last year. Compared to the first quarter of this year, the Packaging segment operating profit increased 48.5%.
The Metal Processing segment generated an operating profit of $3.7 million compared to an operating loss of $8.0 million last year, with all groups reporting operating profits. Profitability from steel pickling operations showed strong improvement in the quarter, reflecting higher overall volumes in both Canada and the U.S. and the positive impact of prior year downsizing.
Roll formed products operations returned to profitability in the quarter. Profitability in the U.S. operations exceeded operating losses experienced in the Canadian operations. Costs relating to consolidation initiatives had a negative impact on Canadian operational results in the quarter. Carbon steel tubular operations were profitable in the quarter with both Tube.tec and Tubular Products Co. reporting profitable results.
Steel pressure vessel operations were profitable despite continued weakness in demand and unfavorable product mix. Stainless steel tubular operations achieved a small profit in the second quarter compared to losses incurred in the prior year; the improvement is attributed to higher sales and pricing levels.
Compared to the first quarter of this year, operating profit for the Metal Processing segment was up 114%.
Net income for the second quarter was $1.0 million, or $0.03 per share, compared to a net loss of $10.0 million, or $0.31 per share, in the comparable quarter of last year.
"We are pleased with the gradual recovery that we have experienced in terms of sales and profitability this quarter. Following an extended period of under performance, all of our operating units have now returned to profitability," said Mark C. Samuel, Chairman and CEO. "Our outlook remains cautious, however, as ongoing margin pressure and the sustainability of the recovery in the North American economy remain uncertain."
Samuel Manu-Tech pointed out that this marks its first profitable quarter after six consecutive quarters of losses. Based on the current economic forecast, the company expects to perform slightly better in the third quarter with another profitable result. Concerns for a double-dip recession remain, however, the company notes.
Samuel Manu-Tech Inc. is a leading North American industrial products and technology company producing and distributing a wide range of steel, plastic, and related industrial products and services from locations in Canada, United States, and Mexico.
