Alamo Group Inc. today reported results for the third quarter ended September 30, 2013.
Highlights for the Quarter
Record net income of $11.3 million
Record net sales of $174.7 million
North American Industrial Division up 16%
North American Agricultural Division up 13% o European Division up 4%
Net sales for the third quarter of 2013 were $174.7 million compared to net sales of $156.1 million for the third quarter of 2012, an increase of 12%. Net income for the quarter was $11.3 million, or $0.93 per diluted share, versus net income of $8.6 million, or $0.71 per diluted share, for the same period of 2012, an increase of 32%.
Nine Month Results
For the first nine months of 2013, net sales increased 7% to $511.2 million compared to net sales of $479.0 million during the same period in 2012. Net income for the first nine months of 2013 was $30.1 million, or $2.47 per diluted share, versus $24.7 million, or $2.05 per diluted share for the comparable period in 2012, an increase of 22%.
Net sales and net income for both the quarter and nine months of 2013 were records for Alamo Group.
Sales by Division
Net sales for the Company’s North American Industrial Division in the third quarter of 2013 were $71.9 million, an increase of 16% compared to the $62.0 million in the prior year’s third quarter. For the nine month period ended September 30, 2013, net sales were $218.9 compared to $196.8 million in 2012, an increase of 11%. Nearly all units within the division showed improvements in the third quarter as demand for infrastructure maintenance equipment continued to improve.
Alamo’s North American Agricultural Division net sales were $61.2 million in the third quarter of 2013, versus $54.1 million in the 2012 comparable period, an increase of 13%. For the first nine months of 2013, net sales in the Division were $168.0 million, an increase of 8% compared to net sales of $155.5 million in 2012. Despite indications of weakening overall agriculture conditions, demand for the Company’s products was strong during the quarter.
Alamo Group’s European Division net sales were $41.7 in the third quarter of 2013 compared to net sales of $40.0 million in the third quarter of 2012, an increase of 4%. For the first nine months of 2013 net sales were $124.3 million compared to $126.7 million in the same period of 2012, a decrease of 2%. The increase in the quarter is an indication that the markets for the Division’s products in Europe may be bottoming out from the weak economy experienced in the last few years.
Ron Robinson, Alamo Group’s President and Chief Executive Officer, commented, “We are pleased by our continued strong results and, once again, we were able to turn a solid sales increase into an even better earnings increase. Additionally, we were pleased to see some sales growth in our European Division which we hope is an indicator this sector is beginning to recover.
“Our strongest results came from our Industrial Division, which again exceeded our expectations. We continue to believe this performance is being driven by pent up demand for infrastructure maintenance equipment, though demand from other markets showed improvement as well.
“The Company’s agricultural products also exhibited strong sales increases in the quarter. This was achieved despite weaker demand for equipment in the North American market. While we believe softer market conditions will continue for the rest of this year and into 2014, we feel our products have the potential to outperform the overall market with the help of improved backlogs and new product introductions.
“As mentioned earlier, our European operations are seeing signs of market improvement for the first time in several years, which we hope is the start of a new trend. Certainly the overall economic conditions in Europe remain weak but, as in North America, we feel demand for our types of products have the potential to benefit from any improvements in the market.
“As a result of our performance in the third quarter we continue to feel positive about the outlook for Alamo Group for the remainder of 2013 and into 2014. While we do not feel our markets are strong enough to sustain the levels of double digit growth we experienced in the third quarter, we remain optimistic about the outlook for the demand for our type of products. And, we believe our ongoing focus on operational execution will continue to enhance our results.”
Earnings Conference Call
The Company will host a conference call to discuss third quarter 2013 financial results on Friday, November 8, 2013, at 11:00 a.m. Eastern (10 a.m. Central, 9:00 a.m. Mountain and 8:00 a.m. Pacific). Hosting the call will be members of senior management.
Individuals wishing to participate in the conference call should dial 877-941-6009 (domestic) or 480-629-9866 (internationally). For interested individuals unable to join the call, a replay will be available until Friday, November 15, 2013 by dialing 800-406-7325 (domestic) or 303-590-3030 (internationally), passcode 4646067.
The live broadcast of Alamo Group Inc.’s quarterly conference call will be available online at the Company's web site, www.alamo-group.com (under “Investor Relations/Events & Presentations”) on Friday, November 8, 2013, beginning at 11:00 a.m. ET. The online replay will follow shortly after the call ends and will be archived on the Company’s website for 60 days.