Altra Holdings, Inc. ( AIMC ) reported improved year-over-year results for second-quarter 2014. Adjusted earnings per share of 48 cents increased 17.1% year over year, but missed the Zacks Consensus Estimate of 49 cents by a penny.
On a GAAP basis, the company reported earnings per share of 46 cents, up from the year-ago quarter figure of 40 cents.
Altra Holdings Inc - Earnings Surprise | FindTheBest
Net sales grew 18.8% year over year to $215.2 million. Reported revenues beat the Zacks Consensus Estimate of $207.0 million by 4.0%. The improvement in revenues was primarily attributable to contribution from the Svendborg acquisition. Excluding the acquisition impact, the company's revenues climbed 6.4% year over year to $192.7 million.
Altra Holdings recorded a gross profit margin of 30.9%, increasing 90 basis points (bps) year over year. Selling, general and administrative (SG&A) expenses were $40.5 million, up 24.1% year over year. Adjusted income from operations was $22.4 million, against $18.6 million in the second quarter of 2013.
Balance Sheet/Cash Flow
Cash and cash equivalents at the end of the second quarter came in at $69.2 million, compared with $61.8 million at the end of the preceding quarter. Long-term debt stood at $248.0 million, against $249.1 million in the first quarter.
In the six months ended Jun 30, 2014, Altra Holdings generated cash of $37.7 million from operating activities, compared with $33.0 million generated in the year-ago comparable period. The company incurred capital expenditure of $10.9 million in the reported period, as against $10.0 million in the six months ended Jun 29, 2013.
The company foresees a negative impact from the suppliers' issues faced in the second quarter. Along with that, steeper healthcare costs and dilutive effects of the convertible notes are expected to reduce earnings in 2014. Based on this, management has lowered adjusted earnings per share to a range of $1.75 to $1.85 from the previous band of $1.85 to $2.00. However, Altra Holdings has maintained its previous revenue guidance for 2014 in the range of $800.0 to $825.0 million. Also, Tax rate in 2014 is expected within 31% to 33%.
Additionalsly, capital expenditure expectations in 2014 stood stable in the range of $28.0 to $30.0 million. Depreciation and amortization expenses were reduced to a range of $32.0 to $34.0 million from the previous projection of $34.0 to $36.0 million.
Other Stocks to Consider
With a market capitalization of $978.5 million, Altra currently holds a Zacks Rank #3 (Hold). Some better-ranked stocks worth a look in the industry include Blount International Inc. ( BLT ), EnPro Industries, Inc. ( NPO ) and IDEX Corporation ( IEX ). While Blount International and EnPro Industries sport a Zacks Rank #1 (Strong Buy), IDEX Corp. has a Zacks Rank #2 (Buy).
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