Larox Corp, Finland

Larox Corp, Finland

Filtration Industry Analyst December 2002 Calgon Carbon Corp, USA Larox Corp, Finland  million) Key Figures ( Eight months ended 31.8 Key Figure...

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Filtration Industry Analyst

December 2002

Calgon Carbon Corp, USA

Larox Corp, Finland  million) Key Figures ( Eight months ended 31.8

Key Figures (US$ million) Third quarter ended 30.9 2002

2001

Net Sales

64.8

64.7

Net Sales

Cost of Products Sold

45.4

44.4

1.8

3.3





0.6

1.5

Income from Operations Cumulative Effect of Accounting Change

COMPANY WATCH

Net Income

Nine months ended 30.9 2002

2001

Net Sales

195.5

206.6

Cost of Products Sold

135.3

137.6

8.7

15.8

Cumulative Effect of Accounting Change

(30.9)



Net Income/(Loss)

(27.0)

7.7

Income from Operations

2002

2001

39.5

40.0

Operating Profit

0.6

2.0

Net Financing Costs

0.9

0.7

Profit/(Loss) before Extraordinary Items, Provisions and Taxes (0.4)

1.3

Net Profit/(Loss)

(0.5)

0.6

Order Backlog

11.1

21.0

Average Number of Personnel

312

290

COMMENT COMMENT Sales held steady in all of Calgon Carbon’s segments during the third quarter of 2002, although profits slipped as the result of start-up problems with a major Engineered Solutions customer. Total sales for the third quarter were flat with the previous year at US$64.8 million. The smallest segment, Consumer Health, achieved the highest quarterly sales growth. The rise of nearly 12% took the business area’s sales to US$5.5 million. Operating income of US$1.8 million for the quarter was US$1.5 million less than for the comparable period of 2001. The service segment reported a 17% rise in operating income to US$5.2 million,

8

while Engineered Solutions’ operating loss came in at US$1.8 million, a US$1.9 million slump from the same quarter last year. Calgon Carbon explained Engineered Solutions’ cost overruns as “the pains of introducing leading-edge technology to the market.” The year-to-date net loss of US$27.0 million includes an after-tax write down of US$30.9 million of the US$61 million goodwill associated with the 1996 acquisition of Advanced Separation Technologies Inc. Excluding the write off, the net profit for the first nine months of 2002 would have been US$3.9 million – half as much as reported during the same period of 2001. ■

Larox’s business operations during the first eight months of 2002 have been stable, and demand for the company’s products has remained almost level with the previous year. The disappointing order backlog is a result of customers postponing their investment decisions, according to Larox. Larox made a loss before extraordinary items, provisions and taxes of 0.4 million, compared with a 1.3 million profit for the same period last year. Net sales during the first eight months of the fiscal year were 39.5 million, slightly down on the 40.0 million sales recorded the previous year. The order backlog of 11.1 million was 47% down on the 21.0 million backlog as of 31 August 2001. More than 91% of the group’s net sales came from

exports and foreign operations. South America and Europe each accounted for around a quarter of sales, with North and Central America claiming 20%, Africa 5%, Australasia 7% and the rest of Asia 17%. Profitability weakened from the previous year, largely as a result of the delivered product mix and increased fixed costs compared with 2001. Larox expects profitability to improve during the latter part of the year, although net sales and the result for fiscal 2002 are likely to remain at a lower level than in 2001. Larox is to sell its shares of Larox Flowsys Oy, the specialty valve manufacturer, to Capillary Oy. Proceeds from the transaction will be used to finance the purchase of Scheibler Filter shares. ■