The strong dollar and a slowing global economy led to an 8 percent drop in Columbus McKinnon’s third-quarter profits – the third straight quarter that earnings by the Amherst-based material handling equipment manufacturer have fallen short of analyst forecasts.
President and CEO Timothy T. Tevens said Columbus McKinnon is facing head winds that have slowed sales at its existing businesses, which are being hurt by forces ranging from a strengthening dollar that makes U.S. exports more expensive to slower growth in China and plunging oil prices that have hurt some of the company’s markets.
That weakness, however, was partly offset by what Tevens described as a solid contribution from its September acquisition of Magnetek, of Menomonee Falls, Wis., a manufacturer of digital power and motion control systems.
“The Magnetek acquisition is certainly a very good one for our company and is producing good revenue and earnings growth more than offset the economic head winds we’re now facing,” Tevens said during a conference call Thursday.
Columbus McKinnon’s profits fell to $20.3 million, or 36 cents per share, from $20.2 million, or 39 cents per share, a year ago.
Excluding costs associated with the Magnetek acquisition and other accounting-related adjustments, the company’s adjusted earnings fell by less than 1 percent, to $6.6 million, or 32 cents per share, from $6.7 million, or 33 cents per share, a year earlier. Analysts had expected the company to earn 39 cents per share.
The company’s sales rose by 14 percent, to $159.7 million, from $140.8 million a year ago. The acquisitions of Magnetek and German manufacturer STB accounted for all of the increase. Excluding those acquisitions, sales from Columbus McKinnon’s existing business fell by 9 percent.