Federal Signal Swings to Loss

The stock rises, though.
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Federal Signal

(FSS) - Get Report

said it swung to a loss in the fourth quarter, hurt by restructuring charges.

The Oak Brook, Ill.-based company lost $25.9 million, or 54 cents a share, for the quarter, compared with a profit of $6.1 million, or 13 cents a share, a year ago. Fourth-quarter results reflect the decision to exit the refuse truck body business and the closure of a small Brazilian subsidiary that produced parking systems.

Income from continuing operations was $13.5 million, or 28 cents a share, in the latest quarter. Analysts polled by Thomson First Call were estimating earnings of 15 cents a share in the most recent quarter.

Fourth-quarter revenue rose 2% from a year ago to $306.8 million, led by a 15% increase in revenue from environmental products to $88.5 million. Analysts polled by Thomson First Call were estimating revenue of $310 million.

For the coming year, the company expects its earnings to grow 10% to 15%, excluding tax and divesture gains, on revenue growth of 6% to 8%.

Gross margin for the fourth quarter increased 640 basis points to 26.1% due to improvements in the Fire, Rescue and Tool business.

"We had a strong fourth quarter, continuing the upward trend in operating earnings and margin performance that we have seen throughout the year," said CEO Robert D. Welding. "In strategic actions, we strengthened core businesses, and exited non- core businesses. We consolidated and sold four facilities, and divested two non-strategic industrial lighting product lines, generating more than $20 million of additional cash flow."

On Tuesday, Federal Signal rose 61 cents to $18.09.

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