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Columbus McKinnon's net income nearly quadruples in 4th quarter

Columbus McKinnon reported net income nearly quadrupled and operating income soared 46 percent in its fiscal fourth quarter, hoisted by a 20 percent rise in U.S. sales and a big rise in its profit margin.

The Amherst-based maker of cranes, riggings, hoists and other material-handling products reported net income of $9 million, or 46 cents per share, up from $2.5 million, or 13 cents per share, in the same quarter a year ago. The company's fiscal year ended March 31.

"Our diverse product offering, brand strength and market status have afforded us the leading position in hoists and other products in the U.S. and western Europe," said President and CEO Timothy T. Tevens, in a release. "Given the current strength of our markets, we are capitalizing on this leadership and growing our revenues around the world, primarily in developing economies."

Tevens said the company is also boosting its "presence in key markets such as oil and gas, power generation, mining and entertainment."

Net sales rose 10.8 percent to $159.6 million, driven by a 20 percent increase in U.S. sales to $90.4 million. Sales outside the United States were flat at $69.2 million, but rose 4.2 percent when excluding the impact of foreign currency exchange.

Gross profit rose 18 percent to $44.2 million, or 27.7 percent of sales, up from $37.4 million, or 26 percent of sales, a year ago. The profit margin rose 2 percentage points to 8.5 percent, led by the higher sales volume, which accounted for 87 percent of the increase in gross profit.

Tevens said the company's long-term goal is to achieve operating margins of 12 percent to 14 percent.

"We believe that our strategy to further penetrate emerging economies, while expanding market share where we have a strong presence, enables us to grow at a solid rate," Tevens said. "And, our focus on lean manufacturing processes and continuous improvement provides significant operating leverage on increasing volume."

The company's backlog rose 28 percent to $114.2 million from $89.4 million a year ago, and was up from $110.3 million at Dec. 31. About $28.4 million of that was scheduled to ship beyond June 30.

Selling expenses rose 3.9 percent to $17.3 million, and represented 10.9 percent of revenues. General and administrative costs rose 18.5 percent to $12.7 million, and represented 8 percent of revenues.

"The leverage we have built into the business through our lean processes and restructuring activities becomes evident as sales expand even as the costs of doing business continue to rise," Tevens said.

For the full year ended March 31, net income swung to a profit of $27 million, or $1.38 per share, from a loss of $36 million, or $1.89 per share, in fiscal 2011. Net sales rose 13 percent to $591.9 million, while selling expenses rose 3.1 percent and general and administrative costs rose 15 percent. Income from operations more than doubled to $45.1 million, or 7.6 percent of sales.