Release time : 2015-06-12 09:19:44
Timken Co. (NYSE: TKR) reported a third-quarter loss Thursday but said it was forecasting less of a loss for the full financial year than it previously expected.
The Canton bearings and specialty steel maker said it lost $50.1 million, or 52 cents a share, for the quarter ending Sept. 30. That includes a loss of $30.8 million, or 32 cents a share, related to the pending sale of its Needle Roller Bearings unit. The company took a one-time $25 million impairment charge on the upcoming sale.
Excluding special items, Timken said its net income in the quarter was $5.2 million, or 5 cents a share.
Income from what the company termed continuing operations was $7.5 million, or 8 cents a share.
The quarterly results for 2009 compare with income of $129.2 million, or $1.34 a share, for the 2008 quarter, Timken said.
Sales for the quarter totaled $763.6 million, down 43 percent from a year earlier, the company added.
Shares rose $2.05, or 9.8 percent, to $22.95. Shares are up 20 percent, including reinvested dividends, since Jan. 1 and are up 41 percent from a year ago.
Timken performed strongly and did better than in the second quarter, its top executive said.
''This improvement in Timken's performance is a result of our aggressive management plan rather than an upturn in the economy,'' Timken President and Chief Executive Officer James W. Griffith said in a conference call with industry analysts and investors.
Griffith said in a prepared statement that in an environment where sales are down, the company is ''yielding better results from structural changes we've made . . . and portfolio management initiatives.''
Timken has cut its workforce by 25 percent, or 6,300 people, this year in ''rightsizing the company to deal with the realities of today's market,'' Griffith said.
Timken projected that for the year, sales excluding discontinued operations are expected to be down approximately 35 to 40 percent from a year ago. The company blamed the lower totals on ''weak end-market demand.''
Timken is forecasting it will lose 10 cents to 30 cents a share for the full year. The company earlier projected a full-year loss of 40 cents to 90 cents a share.
Timken noted that it reacted to the deep global recession by:
? Selling the needle bearings unit for about $330 million.
? Consolidating a Bucyrus distribution operation with another facility in South Carolina.
? Replacing a June 2010 debt offering with a three-year, $500 million issue.
? Completing a separate $250 million debt offering, using proceeds to repay another issue.
? Expanding what it called ''collaboration'' with Daido Steel Co. Ltd. in its Asian steel business.
? Reaching a tentative four-year labor agreement with the United Steelworkers union covering about 2,300 workers in Canton. The ratification vote is scheduled for Sunday.
Griffith said Timken executives are planning for a slow, gradual economic recovery globally but can respond more quickly if demand rises more rapidly.
For the first nine months of 2009, Timken said it had a loss of 56 cents a share from continuing operations. That compared with earnings of $2.87 per share for the same period a year ago.
Nine-month sales totaled $2.37 billion, down 40 percent from 2008 results.
Excluding special items, Timken said year-to-date income from continuing operations was 22 cents a share, compared with $2.91 a share a year earlier.
Timken said it believed its balance sheet is strong with ''ample liquidity.''
Total debt was $800.9 million as of Sept. 30. The company generated $170.9 million in cash from operations during the quarter.