Actuant's revenues fall, but company eyes rebound

Thomas Content

Milwaukee Journal Sentinel

Randy Baker, president and chief executive of Actuant Corp.,Friday announced the acquisition of one business and divestiture of another.

Actuant Corp. said net income and sales fell again in its fiscal first quarter, but said it’s optimistic about a rebound in the months ahead.

The Menomonee Falls-based industrial company has been in the midst of a large restructuring initiative to close plants and cut costs given the persistent downturn in its energy-related and industrial end markets.

The company isn’t expecting a quick rebound in its markets and is forecasting sales to fall again in its fiscal second quarter that started Dec. 1.

However, sales are expected to rebound beginning in the quarter that starts March 1, and that, combined with cost-cutting moves, prompted Actuant to increase its earnings outlook for the full fiscal year by a dime, to a range of $1.10 to $1.30 per share.

Actuant is a diversified industrial company that sells hydraulic tools as well as highly engineered position and motion control systems for large construction projects and maintenance and repair services for energy markets.

The company's sales have been sliding for more than two years given weakness in its markets.

Actuant hired former Joy Global chief operating officer Randy Baker as its new CEO in April.

In the first quarter, sales totaled $265.8 million, down 13% from $305 million in the same three-month period a year ago. Net income fell to $5 million, or 8 cents a share, from $15.5 million, or 26 cents a share, last year.

The sales drop was expected because Actuant’s energy business completed a sizable project in the Middle East in the prior year and saw demand fall off because of moves by oil and gas customers to cut spending.

But the company’s other businesses “experienced tepid but stable demand in the industrial, agriculture and off-highway markets,” Baker said in a statement.

Actuant said it met its financial targets thanks to cost-cutting initiatives, and that more restructuring activities are planned. Those actions should add 10 cents a share to full-year earnings, the company said.