Shares of Quality Distribution (QLTY - Get Report) tumbled 19% Monday after the provider of bulk transportation services slashed its fourth-quarter profit projections and withdrew its guidance for 2007.
The company, citing softer-than-anticipated demand and a charge related to legacy environmental remediation projects, said it now expects fourth-quarter earnings of 3 cents to 7 cents a share. Its prior forecast called for earnings per share of 17 cents to 19 cents.
Analysts polled by Thomson Financial project earnings of 21 cents a share.
Quality Distribution estimates revenue, excluding fuel surcharges, of $640 million to $645 million, compared with its prior forecast of $645 million of $650 million.For the full year, Quality Distribution cut its earnings estimate to a range of 59 cents to 63 cents a share from its prior view of 74 cents to 76 cents. Analysts, on average, expected earnings of 79 cents a share. The company said demand remains weaker than expected, and it has experienced several recent events that may increase its insurance-related costs in 2007. As a result, the company withdrew its prior forecast for 2007 earnings of 95 cents to $1.05 a share. Quality Distribution said it will reassess issuing guidance when it has better visibility on industry trends and other factors affecting profits. The company will release fourth-quarter results Feb. 27. Shares recently were down $2.19 to $9.24.