) has signed a contract with Pomerania Gas Company, one of six
gas distribution companies in Poland for the supply of nearly
200,000 residential and commercial gas meters in Poland.
The Itron meters will be deployed over the next three years by
the gas company. North Poland-based Pomerania Gas Company serves
approximately 764,000 customers.
Following a formal tender process, Itron was chosen over other
bidders given its market knowledge, industry expertise and
reliable gas meters. Itron offered the best product with the
right technical specifications and according to the gas company's
Itron's third quarter 2012 adjusted earnings were 97 cents per
share compared with 92 cents in the year-earlier quarter.
Adjusted earnings surpassed the Zacks Consensus Estimate of 94
cents per share.
Total revenues during the quarter fell 18.1% to $504.1
million, lagging behind the Zacks Consensus Estimate of $525
million. The decline in revenues stemmed mainly from an
unfavorable $35 million impact from foreign currency translation
and a further $76 million from the completion of many OpenWay
projects in North America. Moreover, the Water segment's higher
revenues were offset by lower gas module shipments in North
America and lesser shipments of Energy products in Asia
Itron aims at upgrading its smart meter platform in the global
arena. Recently, the company won the nation's largest gas
metering contract from Southern California Gas Company, a
subsidiary of Sempra Energy (SRE).
The company is undertaking restructuring initiatives to
increase its efficiency and lower manufacturing costs. It
anticipates annualized cost savings of $15 million in 2012, which
is expected to further increase to $30 million in 2013.
But at the same time, Itron expects to book associated pre-tax
charges in the range of $75-$80 million, a major portion of which
will be incurred in the fourth quarter of 202. Therefore, higher
operating expenses are likely to create margin headwinds in
fiscal 2012 and first half of 2013. Moreover, the competition of
the OpenWay projects is expected to impact revenues negatively in
the next three quarters.
Itron currently retains a short-term Zacks Rank #4. (Sell).
Stocks in the same industry that are expected to perform strongly
National Instruments Corporation
) which hold a Zacks Rank #2 (Buy).
Liberty Lake, Washington-based Itron Inc., along with its
subsidiaries, is one of the principal technology providers to the
energy and water industries worldwide. It produces electricity,
gas, water, and heat meters, data collection and utility software
solutions along with various other associated metering products
for residential, commercial and industrial and transmission and
ITRON INC (ITRI): Free Stock Analysis Report
NATL INSTRS CP (NATI): Free Stock Analysis
TERADYNE INC (TER): Free Stock Analysis
To read this article on Zacks.com click here.