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The Omaha, Nebraska-based company reported net income for the third quarter of $40.5 million or $1.53 per share, compared to $37.0 million or $1.40 per share in the year-ago quarter.
On average, eight analysts polled by Thomson Reuters expected the company to earn $1.07 per share, for the quarter. Analysts estimates typically exclude special items.
Revenues for the quarter decreased to $434.0 million from $494.8 million in the prior-year quarter, and missed the analysts' estimate of $436.41 million for the third quarter.
In the preceding second quarter, Valmont posted net earnings of $44.2 million or $1.69 per share from $37.3 million or $1.41 per share in the same quarter a year ago. Revenues for the second quarter increased marginally to $498.8 million from $497.1 million in the same quarter a year ago.
Segment wise, revenues from the Utility Support Structures segment for the third quarter rose 33.4% to $150.7 million from $113.0 million in the same quarter a year ago, about 35% of the total quarterly revenues. The increase in sales reflects higher volumes and shipments to fulfill project orders that were in backlog.
Profitability in the Utility Support Structures segment was indicated to be exceptionally strong due to excellent factory fixed cost and SG&A expense leverage, as well as the benefit of falling steel costs.
The Engineered Support Structures segment recorded 1.8% growth in quarterly revenues. Operating income for the segment improved 12% to $18.2 million or 9.6% of segment sales, due to improved results in international markets, operational improvements and the impact of acquisitions.
Revenue growth in the Utility Support Structures and the Engineered Support Structures segments were, however, offset by lower revenues in the Irrigation and coatings segments. Irrigation segment recorded a 50% drop in third-quarter revenues. Revenues from the Coatings segment for the third quarter declined 17.3% from a year ago.
Mogens Bay, Valmont's chairman and chief executive officer observed, "Outstanding results in the Utility Support Structures Segment along with a slight improvement in the Engineered Support Structures Segment more than offset significant sales and earnings declines in our other segments."
Cost of sales for the quarter totaled $297.65 million from $359.80 million in the same quarter last year.
Operating income for the quarter improved 1.4% to $62.73 million and was 14.5% of sales, primarily due to the strong earnings contribution from the Utility Support Structures Segment.
For the nine-month period, the company's net income increased to $120.6 million or $4.59 per share from $103.9 million or $3.95 per share in the comparable period of 2008.
Net revenues for the period decreased to $1.39 billion from $1.41 billion in the same period last year.
Looking ahead to the fourth quarter, the company expects lower sales with earnings similar to last year's earnings of $1.09 per share. Analysts currently anticipate the company to earn $1.11 per share for the quarter. The company further said that the backlog in the utility business was significantly below last year's levels. Additionally, the continued global economic recession and the lack of a multi-year U.S. highway bill constrain growth in its Engineered Support Structures and Coatings segments.
VMI closed Thursday's trading at $88.50, up $0.88 or 1.00%, on a volume of 347,375 shares. However, the stock lost $1.70 or 1.92%, to trade at $86.80 in after hours.
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