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Quarter and full-year guidance adjusted to reflect adverse impacts of recent strike, additional investments in the AP1000 program, delays in the Oil and Gas business and modest softening of new orders;
Company lowers FY2012 diluted EPS from continuing operations range to $2.05 - $2.15.
PARSIPPANY, N.J., Oct. 5, 2012 (GLOBE NEWSWIRE) -- Curtiss-Wright Corporation (NYSE:CW) today lowered its third quarter and full year financial guidance to reflect the combined impacts of a recent labor strike, additional investments in the AP1000
® program, continued delays in the large project oil and gas business, and modest softening in new orders. The combined impact of these changes, the majority of which will impact the third quarter, will reduce full-year diluted EPS to $2.05 - $2.15, down from the Company's previously issued full-year diluted EPS guidance of $2.50 - $2.60.
Martin R. Benante, Chairman and Chief Executive Officer of Curtiss-Wright commented, "The majority of the financial impact relates to a walkout that shut down the plant that produces highly specialized nuclear cooling pumps and to unforeseen additional efforts identified during the final preparation and shipment of the first two AP1000 pumps. Other contributors were continued delays in the start of large oil & gas projects, and modest softening of new orders."
As previously announced, the August 24
th decision by the 300 members of Local Union 1914 of the International Brotherhood of Electrical Workers (IBEW) to strike at the Flow Control segment's Electro-Mechanical Division (EMD) facility in Cheswick, PA was expected to have a significant adverse impact on the company's financial performance for 2012. The parties subsequently ratified a new contract on September 21
st and we expect the plant to be at 100% utilization by mid-October.
As a result of the strike, the Company's current estimate of the direct impact, which will occur in the third quarter, is as follows:
Under absorption of overhead costs
Shift of milestones on long-term contracts to 2013
The $6 million operating income associated with the milestone shift will be recoverable in 2013; however the $5 million under absorption of overhead costs are not recoverable.