Ameron International Corp. reports net income for Q3

Friday, 24 September 2010 02:56:08 (GMT+3)   |  
       

Pasadena, California-based Ameron International Corporation Wednesday reported net income of $8.9 million, or $.96 per diluted share, in the quarter ended August 29, 2010, compared to net income of $5.9 million, or $.64 per diluted share, in the quarter ended August 30, 2009. Consolidated sales increased to $134.2 million in the third quarter of 2010, compared to $131.4 million in the third quarter of 2009.

James S. Marlen, Ameron's Chairman, CEO and President stated, "We are pleased by the third-quarter profitability, especially given difficult market conditions."

Year-to-date net income totaled $19.5 million, or $2.11 per diluted share, in 2010, compared to $19.2 million, or $2.08 per diluted share, in 2009. Sales for the first nine months of 2010 totaled $379.8 million, compared to $410.3 million in 2009.

In the third quarter of 2010, Water Transmission Group's sales and profits were higher, compared to the same period in 2009. The profitability of the water pipe business improved, while the profitability of the wind tower business was flat. The Group's combined sales increased $1.7 million, or 4 percent, due to higher pipe sales than in the third quarter of 2009. Due to several large projects in Northern California, water pipe sales also improved in the third quarter. On the other hand, wind tower sales declined in the third quarter of 2010, compared to the third quarter of 2009. New tower orders remain elusive due to weak wind energy markets and the inability of wind farm developers to obtain project financing. The wind tower business is not expected to recover in the near term. The water pipe business was also affected by the low bid activity due to tight municipal and state budgets, the lack of available project financing and the timing of construction of major water transmission pipelines. While a number of wind tower and pipe projects are being followed and planning activities have increased, it remains uncertain when owners, water agencies and municipalities will proceed with these projects.

Recently-sold Ameron affiliate TAMCO's sales increased in the third quarter of 2010, compared to the same period in 2009. Shipments in 2010 remained well below TAMCO's production capacity. TAMCO's net loss in the third quarter of 2010 totaled $.4 million, compared to a loss of $.7 million in 2009. Ameron's share of TAMCO's net loss was $.2 million after taxes in 2010, compared to a loss of $.3 million in 2009. On September 15, 2010, the Company announced an agreement to sell its 50% ownership of TAMCO to Gerdau Ameristeel US Inc.

"While 2010 continues to be challenging, we are pleased with third-quarter results and are cautiously optimistic for the balance of the year," Marlen said. "The Company will be led by the Fiberglass-Composite Pipe Group and constrained by the cyclical, construction-related businesses. We are focusing on controlling costs to maximize profits in spite of weak markets and are actively reviewing all operations for improvements. Likewise, we are investing in expanding and enhancing the Company's capabilities and markets. Additionally, the Company will be reviewing cash deployment strategies for the TAMCO sale proceeds, including pursuing acquisitions within its core business units or in closely-related businesses and other financial options. While forecasting visibility remains limited, recovery in the Company's markets appears to be slower than anticipated. We remain optimistic that as the global economy recovers and stabilizes, the Company will capitalize on its strong market positions and achieve superior long-term results."

Ameron International Corporation is a multinational manufacturer of highly-engineered products and materials for the chemical, industrial, energy, transportation and infrastructure markets. Ameron is a leading producer of water transmission lines and fabricated steel products. Ameron's businesses operate in North America, South America, Europe and Asia. The Company also has partial ownership in several unconsolidated affiliates in the US and the Middle East.


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