By Zacks.com, Contributor
Valmont Industries (VMI) is primarily engaged in the production of fabricated metal products, metal and concrete pole and tower structures, and mechanized irrigation systems in the U.S. and abroad. Customers and end-users of Valmont’s products include state and federal governments, contractors, utility and telecommunication companies, manufacturers of commercial lighting fixtures and large farms, as well as the general manufacturing sector. Roughly 45% of total sales last year were either achieved in markets or produced by manufacturing plants outside of North America. The company has diversified geographically to more than 100 countries. In Valmont’s fourth-quarter 2012 earnings report last week, it posted EPS of $2.43 per share, outstripping the Zacks Consensus Estimate of $2.24 while declining from the prior-year quarter’s earnings of $4.33 per share. While profit slid roughly 43% year-over-year to $65 million in the reported quarter, the year-ago quarter’s profit was boosted by one-time benefits associated with the reorganization of the company’s legal structure. Barring that benefit, earnings were $1.83 per share a year ago. For full-year 2012, earnings came in at $8.75 per share, also topping the Zacks Consensus Estimate of $8.56. Valmont posted revenues of $815 million in the fourth quarter, up 8% year-over-year. It exceeded the Zacks Consensus Estimate of $792 million. Sales were driven by double-digit gains across Valmont’s utility support structures and irrigation segments. Valmont’s irrigation and coatings segments are witnessing strong momentum recently. In the irrigation segment, improving North American equipment demand amid the ongoing drought conditions and higher farm income is boosting sales and profitability. The coatings segment is benefiting from moderating zinc prices and declining energy costs. Valmont is also poised to see incremental opportunity in the utility market. The global transmission and distribution markets are seen as major long-term growth opportunities. VMI is actively pursuing capacity expansion through new constructions and extension of existing facilities to meet the increasing demand from utility customers in North America. The engineered infrastructure products segment, while remaining challenged by the soft market conditions in Europe and weak government spending, is expected to post sales gains in 2013. The passage of a two year highway bill and improvement across the wireless communications and commercial lighting markets represents positives for the infrastructure business. Moreover, infrastructure build-outs by wireless carriers to support the roll out of 4G network is supporting the results of the company s wireless communication structures business. Valmont has a long history of acquisitions. In 2008, it acquired Penn Summit LLC, a manufacturer of steel utility and wireless communication poles in Pennsylvania. It also acquired 70% of Canada’s West Coast Engineering Group, a manufacturer of steel and aluminum structures. In the same year, Valmont acquired Site Pro 1, a distributor of wireless communication components in the U.S. market. In November 2008, Valmont fully acquired Stainton Metal Co., a manufacturer of steel structures for the lighting, transportation and wireless communication industries in the U.K. Special Offer: This special report zeroes in on some huge money-making opportunities as well as some urgent sell alerts that could save …read more
Source: FULL ARTICLE at Forbes Latest
