Actuant Misses Q2 Expectations, Issues Downbeat Outlook

reported weaker-than-expected results for the fiscal second quarter on Wednesday. The Menomonee Falls, Wisconsin-based company posted a quarterly loss of $64.8 million, or $1.05 per share, versus a year-ago profit of $41.4 million, or $0.56 per share. Excluding impairment charges, the company's earnings dropped to $0.28 per share from $0.30 per share. Its revenue fell 8% to $301 million from $328 million. However, analysts were expecting earnings of $0.30 per share on revenue of $308.58 million. Second quarter industrial segment sales rose 3% to $96 million, while energy segment sales dropped 5% to $100 million. Engineered Solutions segment sales dipped 19% to $104 million in the quarter. During the quarter, the company repurchased 2.9 million shares of common stock for $76 million. Actuant's board approved a new 7 million share buyback plan. Mark E. Goldstein, President and CEO of Actuant said, "In addition to normal seasonality, the second quarter proved challenging given the further strengthening of the US dollar, low oil & gas prices and weak conditions across a number of end markets." For the current quarter, Actuant projects earnings of $0.52 to $0.57 per share, on revenue of $315 million to $325 million. Analysts had expected earnings of $0.60 per share on revenue of $352.4 million. Actuant expects FY15 earnings of $1.65 to $1.75 per share, on revenue of $1.245 billion to $1.265 billion. Analysts had estimated earnings of $1.80 per share on revenue of $1.33 billion. Goldstein added, "We have seen a dramatic strengthening of the US dollar, as well as increased headwinds in the oil & gas, mining, and agriculture markets, and lack of momentum in general industrial end markets since we provided guidance to investors in December. The currency impact to the December guidance reduces sales by approximately $55-65 million and EPS by $0.15-0.18 per share, based on our current foreign exchange rate assumptions. Additionally, the lack of visibility around future oil prices and related capital spending has caused us to increase cautiousness in our outlook, despite the fact that our Energy segment met performance expectations in the second quarter." Actuant shares slipped 1.22% to $24.25 in pre-market trading.