Now, the meeting will be turned over to Mr Edward F Crawford, Chairman and Chief Executive Officer. Gentleman, you may begin.Edward Crawford Welcome ladies and gentlemen to the Park-Ohio’s first quarter 2010 review of operations. Let us begin today by introducing Matthew Crawford the COO and President of the company. Matthew? Matthew Crawford Great, thank you very much. We are pleased with our first quarter performance, which not only exceeded our internal expectations, but also demonstrated improving trends in our businesses. Sales increased almost 6% versus last year to $192 million, which is the highest quarterly revenue number since 2008. EBITDA, as defined in the release, reached over $13 million, an improvement of 69% while earnings per share increased from $0.02 last year during the first quarter to $0.18 this quarter. We also continued to reduce long-term debt by decreasing our net debt position during the quarter by an additional almost $10 million. Looking at the business units, first Supply Technologies, Supply Technologies enjoyed an improving demand environment as sales increased by just under 14%, end markets which showed particular improvement including consumer electronics, semiconductor, automotive, agriculture and construction equipment as well as other industrial equipment. New business opportunities also continue to be very robust. The profitability trended meaningfully up from last year’s performance of near breakeven so an EBIT of $4.5 million and a margin of 4.8%. Our results benefitted from the significant strategic restructuring accomplished last year, which rationalized underperforming customers, and permanently reduced our operating footprint by over 275,000 square feet. We will continue to enjoy substantial operating leverage due to these changes as the demand trends improve. Aluminum Products also continued to enjoy a rebounding auto supply market as most industry analysts continue to increase 2010 OEM production expectations. Revenue increased 39% versus last year as we expect the second quarter to enjoy similar revenue strength augmented by new business efforts. Profitability at the Aluminum Products segment actually transitioned from a 2009 first quarter loss to a positive EBIT performance of over $1.9 million. As discussed on several prior conference calls, General Aluminum has significant operating leverage in place with utilization still at approximately 50%, OEM build strengthening modestly, and it improved competitive landscape, we are guardedly optimistic.
Manufactured Products revenue was down 20% during the quarter versus what was a very strong first quarter of 2009, having said that there are signs of improvement. Specifically, our industrial equipment group is seeing improving trends in new orders for global major equipment. In fact, April bookings exceeded all of last year’s second quarter. The aftermarket is improving as well with particular strength in the oil and gas end markets. This demand combined with a strong quoting activity and customer interest in accelerating the delivery of their products make us optimistic for continued improvement. Profitability also fell from last year’s EBIT level by 36% to about $5 million due to the revenue softness. Somewhat more indicative of the current environment though is the sequential profitability increase from the fourth quarter of 2009 by 66%. Despite some headwinds in the locomotive supply portion of forged and machined products, we expect this trend of improved results to continue.Looking at the balance sheet, as we previously discussed, we are pleased to announce that we caused our net debt to come down by almost $10 million particularly in light of the growth in our topline, and the almost $4 million in cash expenses caused by the refinancing of the line of credit. Increased profitability combined with CapEx discipline and ongoing opportunity to support the business with lower inventories helped to accomplish this important goal. Liquidity under our recently signed three plus year bank agreement stated around $36 million. CapEx for the quarter was under $500,000. Read the rest of this transcript for free on seekingalpha.com