Pittsburgh, Pennsylvania-based L.B. Foster Company reported Q2 net sales of $149.9 million decreased by $13.2 million or 8.1 percent compared to the prior year quarter due to a 10.3 percent decline in Rail segment sales and an 8.7 percent reduction in Construction segment sales, partially offset by a 10 percent increase in Tubular segment sales. Q2 income from continuing operations was $7.3 million, compared to a loss from continuing operations of $3.3 million last year.
Robert P. Bauer, L.B. Foster Company's President and Chief Executive Officer noted: "Construction segment orders turned positive, after the prolonged weakness in the construction market, and Tubular segment orders declined after what had been very strong activity for several quarters. These patterns have caused us to change our outlook for the year, particularly in light of the declining Tubular segment products orders which have above average profit margins. We expect to see a choppy order environment from quarter to quarter as customers react to changing market conditions and the swings in steel pricing that are occurring."
Rail sales decreased 10.3 percent due to sales reductions in the concrete tie and rail technology businesses, partially offset by stronger sales in the transit products division. Construction sales declined 8.7 percent in the quarter due to reductions in the fabricated bridge business as well as the piling product line. Tubular product sales remained strong in Q2 as end markets in oil and gas and water well applications are driven by energy and agriculture. The favorable year over year comparisons in the energy business are expected to turn negative in the second half of the year, given a significantly reduced backlog.
Income from continuing operations for the first half of the year was $12.2 million compared to a loss of $0.3 million in 2012.