Welded steel pipe maker -
Northwest Pipe Co.
) reported fourth-quarter 2012 earnings of 48 cents per share,
topping the Zacks Consensus Estimate of 28 cents and surpassing
the year-ago quarter's earnings of 15 cents. Profit propelled
roughly three-fold year over year to $4.5 million on higher
For full-year 2012, earnings of $1.72 per share outpaced the
Zacks Consensus Estimate of $1.52 and were higher than $1.35 a
share recorded a year ago. Profit surged 28% year over year to
$16.2 million as higher sales from Northwest Pipe's Tubular
Products segment offset a decline in the Water Transmission
Revenues jumped nearly 16% year over year to $136.2 million in
the fourth quarter as solid gain in Water Transmission masked a
decline in Tubular Products. Sales topped the Zacks Consensus
Estimate of $117 million. Gross margin rose to 10.7% from 9.5% a
For the full year, sales rose nearly 3% year over year to
$524.5 million, exceeding the Zacks Consensus Estimate of $506
Revenues from the Water Transmission segment surged 43% year
over year to $88.2 million in the reported quarter, partly driven
by the Lake Texoma water pipeline project. Northwest Pipe, in Jul
2012, was awarded a contract to supply welded steel pipe for the
project which will restore North Texas Municipal Water District's
raw water supply. This is the largest project in the company's
However, revenues from the Tubular Products slipped roughly
13% to around $48 million. The division was hurt by competitive
pressure stemming from the imports of energy products, lower
drilling activity and a decline in natural gas prices.
Northwest Pipe ended 2012 with order backlog of roughly $173
million in the Water Transmission division, a 25% year-over-year
Cash and cash equivalents, at the end of 2012, was $46
million, down 74% year over year. Total long-term debt declined
27% year over year to $24.5 million.
Moving ahead, Northwest Pipe expects profitability in the
Water Transmission unit in first-quarter 2013 to be somewhat
similar to the level achieved in the fourth quarter. It, however,
expects the division's sales to decline in the first quarter. In
Tubular Products, Northwest Pipe sees near breakeven results as
the segment's profitability is expected to be impacted by
increasing imports of competing energy products.
Northwest Pipe makes large-diameter steel pipeline systems for
use in water infrastructure applications, mainly in drinking
water systems. The company also makes smaller diameter, electric
resistance welded steel pipes and other similar products for use
in energy, construction, agriculture, commercial and industrial,
and traffic signpost applications.
Northwest Pipe, in Jan 2013, announced the appointment of Duke
Watson as the Vice President of Sales for its Tubular Products
unit. Prior to joining the company, Duke served as the director
of sales and marketing in the Abandonment and Construction
division of oilfield service company
Tetra Technologies Inc.
Northwest Pipe currently retains a Zacks Rank #5 (Strong
Other companies in the metal processing and fabrication
industry with favorable a Zacks Rank are
). Both hold a Zacks Rank #2 (Buy).
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