Worthington Industries, Inc.
) earnings of 45 cents a share for second-quarter fiscal 2013
(ended November 30) exceeded the year-ago earnings of 17 cents.
The prior-year quarter's earnings included a charge of $9.7
million associated with the voluntary recall of propylene
cylinders. Excluding inventory holding losses and the impact of
product recall, earnings were 49 cents a share for the reported
quarter, topping the Zacks Consensus Estimate of 41
Profit, as reported, shot up more than two-and-a-half fold
year over year in the second quarter to $31.8 million riding on a
strong performance of the company's pressure cylinder
Revenue climbed 10% year over year to $622.6 million but
missed the Zacks Consensus Estimate of $638 million. Higher
volumes aided by acquisitions boosted the top line in the
quarter. However, this was partly offset by lower average selling
prices due to falling market price of steel.
Gross margin increased to 15.2% from 10% a year ago.
Acquisitions and better product mix contributed to the
Revenues in the core Steel Processing segment clipped 9% year
over year to $339.3 million on lower volumes and pricing. Volumes
fell 8% to 626 units on account of the wind down of unprofitable
customer accounts from the MISA Metals buyout.
The company's Pressure Cylinders division had a healthy
quarter with revenues jumping 17% year over year to $207.5
million, thanks to acquisitions. Volumes surged roughly 34% to
19,496 units. Worthington acquired leading atmospheric tanks and
pressure vessels maker Westerman Companies in September 2012. It
is now a part of the Pressure Cylinders unit.
The Engineered Cabs segment, which consists the operations of
Angus Industries Inc. (acquired in late 2011), posted revenues of
$57.8 million in the quarter. The division was hurt by lower
volumes due to production delays.
The company exited the quarter with cash and cash equivalents
of $32.9 million, down 39% year over year. Long-term debt
increased 63% year over year to $408 million. Operating cash
flows increased 37% year over year to $88.4 million.
Moving ahead, the company expects normal seasonality in its
traditional markets in the third quarter and envisions continued
strong performance in its cylinder operations. It will continue
to explore additional opportunities for growth both organically
and through new businesses.
Worthington is engaged in processing steel for application in
the automotive, construction, hardware, agricultural, aerospace
and other industries. The company makes a range of processed
steel items, pressure cylinders (including oxygen and helium
tanks and hand torches), metal framing products, racks, shipping
pallets, airbrake tanks and consumer products. The company
operates 80 facilities throughout 12 nations.
Worthington, which competes with
AK Steel Holding Corporation
) among others, currently retains a short-term Zacks #2 Rank
AK STEEL HLDG (AKS): Free Stock Analysis
WORTHINGTON IND (WOR): Free Stock Analysis
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