Raven Industries Reports Fourth Quarter And Fiscal 2010 Results
"Farm income fell after two very strong years. We believe it will be flat to slightly up in the coming year, as input costs drop and commodity prices stabilize," Moquist commented. "However, the current rate of orders bodes well for the coming year. We expect growth in Applied Technology to come from new products—including our Slingshot™ ag information platform, new customers, international expansion, partnerships and acquisitions. And, while acquisitions are not a critical part of our growth plan, small strategic investments—such as the Ranchview and SST deals we did last year—help to strengthen our market position in systems integration and data management."
Stronger Profit Margins at Engineered Films
The Engineered Films Division posted annual sales of $63.8 million, which were off 29 percent from $89.9 million in the prior year. Operating income, however, was down by only 6 percent, at $10.2 million from $10.9 million in fiscal 2009.
In the fourth quarter, revenues were $16.7 million versus $14.5 million, a 15 percent improvement. Operating earnings, at $2.4 million, improved from an operating loss of $178,000 seen in last year's final three months.Raven's primary markets—energy and construction—suffered during the year. Pit liners sold into the energy market declined 40 percent, and sales to the construction market were down 25 percent. Fourth quarter sales to the energy market rebounded, as distributors sought to replenish inventory levels. "We delivered operating margin improvement," Moquist noted. "Our films business benefited from lower raw material costs, better pricing, greater efficiency and tough cost controls." Electronic Systems Rebounds for Year, Sees Weaker Fourth Quarter For fiscal 2010, Electronic Systems Division sales increased by 2 percent to $63.5 million from $62.0 million in the prior year. Operating income rose by 52 percent, to $9.0 million compared with $5.9 million a year ago. Sales in the fourth quarter were $13.8 million versus $16.1 million for last year's three months, a 14 percent reduction. Operating income fell 13 percent to $2.0 million from $2.2 million in the year-ago quarter. Improved efficiency and a lower cost structure helped Electronic Systems to recover its profit margins during the past fiscal year. The leaner organization allowed all of the division's primary markets to show profit improvement in a volatile environment. "Avionics deliveries started the year strong and then slowed as commercial airlines began cancelling or delaying delivery schedules. This trend will probably continue in the year ahead. Demand levels for secure communication devices for government agencies followed a similar pattern and electronic bed controls were slightly down," explained Moquist.
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