So, the volume story was quite favorable, but the commodity cost pricing dynamic has been a challenge while price increases added to sales in the quarter, they were somewhat below our expectations. Price realization proved to be more difficult in certain pockets of our business most notably the construction markets.
Also materials remain above last year’s levels and did not moderate quite as much as we anticipated. We will continue to adjust pricing to recover commodity cost increases and have raised prices in certain businesses in September.
In summary, I’m extremely pleased with the organization’s ability to produce these impressive results in both the third quarter and for the year.
Let me hand it over to Dave to provide more details on the results, Dave.Dave NordOkay. Thanks, Tim. Good morning, everybody. Let me jump into the results, I’ll start on page 4, you know, first on the sales side, we’re reporting sales of $764.3 million up 12%. As Tim mentioned really broad based improvement through all of our businesses particularly strong, we’ll talk more about our utility business. In that 12%, there is some price and currency that combined are about 4%, so our core volume grew up 8%. I think price and FX in that 4% are about equally split. So, good results there.On the gross margin side, 33% gross margin in the quarter, now that’s down from last year’s third quarter, for a couple of reasons. One, our commodity cost still in excess of price realization, we had forecasted and we’ve been working toward getting the parity in the third and maybe some improvement in the fourth. But, as Tim mentioned, the pricing environment turned out to be unfortunately a little more challenging than we expected.The other big driver to that decline is this less favorable mix and you recall we talked about that in the third quarter of last year, some very strong project business coming out of our industrial sector, particularly our high voltage in telecom. I think that had a significant, we would estimate that’s close to almost 1.5 of margin impact last year.Read the rest of this transcript for free on seekingalpha.com
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