Actuant Shares Fall on Wary Outlook

Fueled by new acquisitions that helped offset some of the turbulence in Europe, Actuant (NYSE:ATU) revealed on Wednesday a better-than-expected third-quarter profit.

However, the company expressed worries about macroeconomic conditions in Europe and China that could weigh on earnings over the next two years, sending its shares down more than 4.75% early in the session.

Actuant said it's optimistic it can continue to grow and pursue opportunities in the coming quarters to strengthen its portfolio, but notes that European macroeconomic headwinds “create uncertainty.”

The diversified manufacturer forecasts fiscal 2012 sales of $1.60 billion to $1.61 billion on earnings in the $2.03 to $2.08 a share range. Analysts are looking for a profit of $2.08 a share on slightly higher sales of $1.62 billion.

For 2013, Actuant says it expects to see more uneven demand in Europe and China with sales growth of 3% to 5%. Total sales are forecast to be between $1.665 billion and $1.7 billion with earnings in the range of $2.15 to $2.30 a share.

Analysts are looking for a full-year profit in 2013 of $2.27 a share on revenue of $1.71 billion.

The Menomonee Falls, Wisc.-based diversified industrial manufacturer said it earned $34.4 million, or 45 cents a share, in its latest quarter, compared with a year-earlier $36.3 million, or 51 cents.

Excluding one-time items, Actuant said it earned 60 cents, a penny above average analyst estimates in a Thomson Reuters poll.

Revenue for the three months ended May 31 was $429.2 million, up from $392.7 million a year ago, matching the Street’s view.

While sales improved in all of its major categories, especially in its energy division where sales jumped 24% to $96 million, Actuant said growth rates slowed during the period from the strong pace of the past nine quarters but still met the high end of its guidance.

“Solid results in the U.S. and in our later-cycle businesses such as energy more than offset some end market softness in Europe and China, highlighting the benefit of our diversity,” Actuant CEO Robert Arzbaecher said in a statement.