L.B. Foster: Sales, earnings, backlog rise

L.B. Foster Co. reported Tuesday that net income increased by 125.8% to $6.0 million, or 58 cents per share, in the second quarter of 2010, compared to $2.7 million or $0.26 per share in the same period of 2009. Analysts had expected second-quarter 2010 earnings of 33 cents.

Second-quarter sales increased 20.3% to $119.5 million from $99.3 million in the comparable 2009 quarter. The company said gross profit margin was 17.0%, an increase of 410 basis points from the prior-year quarter principally due to negative adjustments totaling $3.7 million made last year related to concrete tie problems encountered during 2009. Additionally,a $2.1 million improvement in manufacturing variances in the current quarter was partially offset by a $1.1 million reduction in favorable LIFO adjustments.

"Sales were up across all segments in the second quarter of 2010 and our backlog continued at a substantially higher level than it was a year ago,” said Stan Hasselbusch, president and CEO. “While business activity continues to be inconsistent, especially in the industrial markets, we continue to see a general strengthening in activity in most of our businesses. Bookings for the quarter were $120.6 million compared to $115.0 million last year, a 4.9% increase and backlog was $207.2 million, up 41.1% from last year.

“With regard to the Portec acquisition,” said Hasselbusch, “we were pleased to learn that the courts had lifted the preliminary injunction that had enjoined the completion of our tender offer. However, after working with the Antitrust Division of the Department of Justice, we believe that the DOJ will seek some type of restructuring ‘solution’ to alleviate their concern that the acquisition, as proposed, would have an anti-competitive effect with respect to the insulated bonded rail joint product.”