Metal alloys maker
Haynes International, Inc.
) posted fourth-quarter fiscal 2013 (ended Sep 30, 2013).
earnings of 32 cents per share, flat with the Zacks Consensus
Estimate, but down 69% from $1.04 in the year ago quarter. Profit
fell roughly 69% year over year to $4 million hurt by a
double-digit fall in sales. Haynes' shares dropped as much as
around 3% in the trading session following the announcement.
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For the full year, Haynes posted earnings of $1.74 per share, a
decline of 57% from $4.07 per share posted a year ago.
Revenues fell 23% year over year to $115.7 million in the fourth
quarter, hit by weak market conditions, lower average selling
prices and reduced sales volume. Sales missed the Zacks Consensus
Estimate of $123 million. For the full year, sales declined 16.7%
year over year to $482.7 million.
Volume contracted 10% year over year to 21 million pounds in
fiscal 2013. Average selling price narrowed 7.4% year over year
to $22.94 per pound in fiscal 2013 on account of reduced raw
material prices, lower volume of conversion sales, increased
competition and weak demand.
Haynes' consolidated backlog was $166.6 million as of Sep 30,
2013, down 25.3% year over year. The reduction in the backlog
stemmed from lower order entry volumes, due to continued
destocking in the supply chain.
Gross margin contracted to 15.3% in fiscal 2013 from 20.9% a year
ago, impacted by pricing competition, higher-cost inventory in
cost of sales and unfavorable absorption of fixed costs.
Operating income fell 58.4% year over year to $32 million in
Haynes exited the year with cash and cash equivalents of $68.3
million, down 46.3% year over year. Long-term debt declined 21.7%
year over year to $0.8 million. Capital expenditure in fiscal
2013 was $41.6 million.
Moving ahead, Haynes remains optimistic about the growth
potential of the aerospace, land-based gas turbine and chemical
processing markets, and will continue to implement its capital
spending projects to meet long-term growth requirements of these
For the first quarter of fiscal 2014, the company does not expect
an increase in demand and thus intends to undergo maintenance at
its manufacturing facilities over the holidays. As a result,
Haynes expects revenues to drop sequentially in the first quarter
and incur a net loss.
The company projects capital spending in fiscal 2014 to be about
Founded in 1912, Haynes makes corrosion-resistant alloys for
aerospace, chemical processing, gas turbine and other industries.
It specializes in manufacturing nickel and cobalt-based alloys in
sheet, coil and plate forms.
Haynes carries a Zacks Rank #3 (Hold).
Companies in the metal fabrication industry having a more
favorable Zacks Rank are
Dynamic Materials Corp.
). All of them hold a Zacks Rank #1 (Strong Buy).