Worthington Industries, Inc. has reported net sales of $703.4m and net earnings of $35.9m for its fiscal 2017 Q3 ended 28th February 2017. For the third quarter of fiscal 2016, the company reported net sales of $647.1m and net earnings of $29.8m.
Pressure Cylinders’ net sales of $198.4m were down 1%, or $2.3m, from the comparable prior year quarter on declines in the industrial products and oil and gas equipment businesses, partially offset by improvements in consumer products. Operating income of $10.1m was $1.1m higher than the prior year quarter, driven by higher profitability in the consumer products business, partially offset by higher restructuring charges.
Chairman and CEO John McConnell said, “In Pressure Cylinders, demand improved for our helium and camping cylinders, while oil and gas markets remained soft, however, volumes have stabilised and certain markets are showing some increased demand.”
“The Company’s joint ventures also contributed steady earnings,” McConnell added.
Net sales for the Q3 of fiscal 2017 were $703.4m, up 9% from the comparable quarter in the prior year, when net sales were $647.1m. The increase was partly due to higher tolling volume due to the consolidation of the Worthington Specialty Processing (WSP) joint venture.
Operating income for the current quarter was $34.3m, an increase of $9.2m from the prior year quarter, as the improvement in gross margin was partially offset by higher Selling, General and Administrative (SG&A) expense, up $5.1m from the prior year quarter on higher profit sharing and bonus expense and the consolidation of WSP.
Equity income from unconsolidated joint ventures decreased $2.3m from the prior year quarter to $22.7m and the company received cash distributions of $21.4m from unconsolidated joint ventures during the quarter, a cash conversion rate of 94% on equity income.
At quarter-end, total debt was $577.0m, down $0.4m from the 30th November 2016, due to lower short-term borrowings. The Company had $227.3m of cash at quarter-end.
McConnell said, “There is great energy around our Lean Transformation efforts as we accelerate the deployment of more teams, expanding our abilities, moving more quickly and reaching deeper in our Company.”
“We believe the economy continues to strengthen though unevenly, with certain markets not as robust as others. After a record first and second quarter and a strong third, we anticipate finishing our fiscal year well.”