The Gorman-Rupp Company (NYSE Amex: GRC) reports net sales and earnings for the fourth quarter and twelve months ended December 31, 2010.
Net sales during the fourth quarter ended December 31, 2010 increased 36.1% to a record $84,689,000 compared to $62,203,000 during the same period in 2009. Net income increased 159.6% to a record $9,655,000 compared to $3,719,000 in 2009’s fourth quarter. Earnings per share were $0.57 and $0.22 for the respective periods.
Net sales during the quarter continued to be positively impacted by the slowly improving global economy. Primary increases were in sales to the international, municipal, construction, rental and industrial markets, partially offset by decreased sales in the OEM market. The fourth quarter also includes sales of National Pump Company acquired October 1, 2010.
The increase in earnings for the quarter principally reflects improved operating leverage on the higher volume of sales. Earnings include $0.05 per share due to the partial liquidation of LIFO quantities as a result of reduced inventory levels at two operating units. The Company does not expect this inventory trend to continue. Fourth quarter earnings also benefited $0.04 per share from adjustments of inventory standard costs at two operating units and $0.03 per share from the 2010 research and development tax credit and the addition of National Pump Company.Net sales during 2010 increased 11.5% to $296,808,000 compared to $266,242,000 during 2009. Net income increased 42.1% to $25,963,000 compared to $18,269,000 in 2009. Earnings per share were $1.55 and $1.09 for the respective periods. Sales to most markets increased in 2010 when compared to depressed 2009 levels, while the OEM market continued to be weak due to decreased sales of power generation equipment. The Company’s backlog of orders increased 14.6% to $107.4 million at December 31, 2010 compared to $93.7 million a year ago. The increase from December 31, 2009 was largely due to orders arising from the construction, rental, and custom pump markets along with the inclusion of National Pump Company. Partially offsetting these backlog increases were declines in the municipal and OEM markets.