A. O. Smith reports strong Q3
Water technology company A. O. Smith Corp. reported third-quarter earnings from continuing operations of $37.0 million, up 38% from $26.9 million in the prior-year third quarter.
Sales for the three-month period ended Sept. 30 were $462.2 million, up 12% from third-quarter 2011 sales of $412.0 million, driven by incremental Lochinvar sales and strong organic growth in China.
The company’s third-quarter performance included a full quarter of Lochinvar’s results, which was acquired in late August last year, as well as a non-cash, pre-tax gain of $6.4 million from a change to the company’s estimate of the Lochinvar earn-out, which is based on revenue targets.
“The factors that have been influencing our business throughout 2012 continued during the third quarter,” said chairman and CEO Paul Jones. “Our A. O. Smith-branded sales in China grew over 20% in the quarter, driven by new distribution, market share gains and new products, despite the slowdown in that country’s economy.
“The Lochinvar acquisition continues to meet the high end of our profit expectations,” he added. “Lochinvar’s new line of CREST ® high-efficiency, higher BTU input condensing boilers, which was introduced last year, has received excellent market acceptance; and we plan to launch new, larger input models of this product later this year.”
Third-quarter sales of the North America segment, which includes U. S. and Canadian water heaters and boilers, increased to $335.7 million compared with third-quarter 2011 sales of $310.2 million.
Operating earnings from the segment of $50.7 million included a gain of $6.4 million related to the adjustment to the company’s estimate of the Lochinvar earn-out, compared with $30.9 million earned during the third quarter of 2011.
Third-quarter sales from the rest of the world, which includes China, India and Europe, increased more than $23 million to $133.8 million compared with sales of $110.5 million in the third quarter of 2011.
Nexxus Lighting announces distributor agreement with PolyBrite
Nexxus Lighting has executed a distributor agreement with PolyBrite International. Under the agreement, Nexxus will begin offering all of PolyBrite’s Borealis LED lighting solutions to Nexxus’ customers.
Naperville, Ill.-based PolyBrite International has spent more than 17 years developing the LEDs. Key components of the expanded product line are indoor and outdoor lighting fixtures, including LED recessed flat panels, low-bay and canopy lighting systems, and area site and roadway luminaires. In addition, Charlotte, N.C.-based Nexxus will feature Borealis’ new LED T8 tubes, A19, R20, R30, candelabra and other decorative lamp products, along with its premier Array line of LED replacement lamps.
"Part of our strategy with Nexxus is to provide leading edge products and superior service," said Robert LaPenta , founder of Aston Capital and board chairman for Nexxus Lighting. "Research shows the growth for LED fixtures is expected to rise faster than that of other light source replacements. The market share for new LED fixture installations is estimated to rise from approximately 7% in 2011 to more than 45% in 2016 and approximately 70% in 2020."
"This agreement allows Nexxus to provide a broader range of lighting solutions to the commercial, industrial, institutional and municipal markets," added Mike Bauer, president and CEO of Nexxus Lighting. "By partnering with PolyBrite, we quickly and efficiently added a full assortment of complementary bulbs and new luminaires with new technology that is clearly differentiated."
NPD: More consumers to spend same or more this holiday versus last year
The majority of consumers intend to spend the same (67%) this holiday season than last year, and 10% plan to spend more while fewer that say they plan to spend less, according to the NPD Group’s 11th Annual Holiday Survey.
“Looking at this year’s responses, I see a light at the end of the tunnel with more consumers telling us they plan to ‘spend about the same’ and less planning to ‘spend less’,” said Marshal Cohen, chief industry analyst, The NPD Group, Inc. “While consumer confidence seems to be up retailers will still face some challenges. They will need to develop creative ways to lure shoppers into the stores.”
Owing to the upcoming election, overall the holiday shopping season will be off to a late start, the report said. While more consumers last year started already by this time, this year there will be an increase in the number of consumers who will begin their shopping before Thanksgiving.
“Consumers and the media will be thinking about the election more than shopping, but when the election is over consumers will get into the holiday spirit,” Cohen said,
There is an increase of 1% to 2% in the number of consumers planning to shop at Off-Price Retailers, Drug Stores, and Specialty Stores this year versus last. Off-Price Retailers and Specialty Stores also did better than Catalogs/Mail Order on the list.
“Retailers at all levels are likely to be challenged this year with the channel lines increasingly becoming blurred. Among the competition for traditional retailers this year are Drug Stores and Supermarkets,” said Cohen. “Now that consumers are less attracted to sale prices and more attracted to selection as well as convenience, stocking the right items will be essential to drive foot traffic.”