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Ameron International Reports Steep 1Q Profit Fall

The Associated Press

PASADENA, Calif. (AP) — Ameron International Corp., which makes water transmission lines and other products, posted a steep decline in first-quarter profit due primarily to falling demand for a steel product.

Net income of $3.8 million, or 42 cents per share, was down nearly one-third from $9.7 million, or $1.07 per share in the year-ago period.

Analysts surveyed by Thomson Reuters expected earnings of 47 cents per share on revenue of $136.8 million.

Revenue of $146 million for the quarter ended March 1 was down slightly from $149.8 million in the year-ago period.

The Pasadena, Calif., company said the results were due primarily to a significant fall in demand for steel rebar at the company's 50 percent-owned steel minimill. Ameron said demand fell due to a drop in construction spending in Arizona, California and Nevada.

The minimill posted a net loss of $5.2 million compared with net income of $6.1 million in the first quarter of 2008. Ameron's share of the net loss totaled $2.3 million after taxes in the first quarter compared with net income of $2.8 million in the year-ago period.

"The demand for steel rebar is extremely low and recovery in the short term is not expected," the company said.

Mill operations were shut in December and has instead supplied customers with inventory on hand. It is expected to restart on a limited basis in the second quarter.

Chief executive James S. Marlen said the company could see an improvement with federal stimulus spending as businesses benefit from higher infrastructure spending.