Albany experiences strong operating results

09 Nov '11

4 min read

Albany International Corp. reported third-quarter 2011 net income of $16.7 million ($0.53 per share). Net income was decreased by restructuring charges of $2.7 million ($0.06 per share), and by unfavorable income tax adjustments of $0.3 million ($0.01 per share). Net income was increased by foreign currency revaluation gains, principally resulting from the weaker euro, totaling $6.5 million ($0.14 per share).

For the third quarter of 2010, net income was $3.6 million ($0.12 per share), and included restructuring charges of $0.8 million ($0.02 per share), foreign currency revaluation losses of $7.6 million ($0.16 per share), a gain on the sale of a building of $2.5 million ($0.05 per share), and unfavorable income tax adjustments of $1.1 million ($0.03 per share).

Net sales for Q3 2011 were $250.0 million, an increase of 9.5 percent compared to the third quarter of 2010.

Gross profit was 38.3 percent of net sales in the third quarter of 2011, compared to 37.9 percent in the same period of 2010. Q3 2010 gross profit was negatively affected by equipment relocation costs associated with restructuring activities of $1.7 million.

Selling, technical, general, and research (STG&R) expenses were $62.5 million, or 25.0 percent of net sales, in the third quarter of 2011. STG&R expenses included gains of $5.8 million related to the revaluation of non-functional-currency assets and liabilities. Incentive compensation linked to the value of the Company's common stock was $0.1 million for Q3 2011, including a reduction of $1.5 million that resulted from a share price decrease during the quarter.

In the third quarter of 2010, STG&R expenses were $67.5 million, or 29.6 percent of net sales, including losses of $2.8 million related to the revaluation of non-functional-currency assets and liabilities. STG&R also included a gain of $2.5 million related to the sale of a former manufacturing facility. Incentive compensation linked to the value of the Company's common stock was $2.0 million for Q3 2010, including an increase of $0.7 million that resulted from a share price increase during the quarter.

Q3 2011 Other income/expense, net, was expense of $0.4 million, including a gain of $0.6 million related to the revaluation of non-functional-currency intercompany balances. Other income/expense, net, in Q3 2010 was expense of $5.9 million, including expense of $4.8 million related to the revaluation of non-functional-currency intercompany balances.

Interest expense, net, was $4.4 million in Q3 2011 compared to $4.8 million in Q3 2010. The decrease was primarily due to $30 million of lower average debt in 2011.

The Company's effective income tax rate, exclusive of income tax adjustments, was 34.0 percent for the third quarter of 2011. Q3 2011 income tax expense was increased by $0.3 million, principally resulting from an increase in the estimated income tax rate. The income tax rate, exclusive of income tax adjustments, was 36.0 percent for Q3 2010. Q3 2010 income tax adjustments increased income tax expense $1.1 million, also principally resulting from an increase in the estimated income tax rate.

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