A webcast replay of today’s call will be available at dynamicmaterials.com after the call. In addition, a telephone replay will be made available beginning approximately two hours after the conclusion of this call. Details for listening to today’s replay or webcast are available in today’s news release.With that, I will now turn the call over to Yvon Cariou. Yvon? Yvon Cariou Thanks Geoff. Our third quarter financial performance reflects abilities of the diversified revenue stream we have established in recent years. While sluggish demand from the industrial processing sectors continue to restrain growth at our exclusive metalworking business, the broader economic recovery has led to much improved reserves at both our Oilfield products and AMK Welding segments. We told you during our last call about increased quoting activity for our external welded plates and we have not seen any level in RFQs during the past three past three months. The sales teams at both our US and European quoting businesses continue to track several projects that are percolating in a variety of end markets. The most active of the sectors we participate in continue to be upstream oil and gas, power generation, aluminum and transportation, our US end market, as well as the chemical and petrochemical space. On the operations front, consolidation of our Nitro Metall business in Sweden into our Dynaplat facilities in Germany is proceeding on plan. Our relocation of specialized production equipment will give Dynaplat important new cladding capabilities, and because we are redundant shooting capabilities with France and Germany, we believe our European operations we have more than adequate capacity for the foreseeable future. We expect that consolidation process will be complete by the end of next year’s first quarter, and we lead to enhance efficiency in the operating cost for our overall European cladding business.
As I mentioned, we experienced strong sales growth at our Oilfield product segment during the third quarter, accelerating exploration and production activity combined with wider use of horizontal drilling technologies has increased worldwide demand for our perforating gun systems and related products. In the third quarter sales from our legacy Oilfield products business increased 56% versus the third quarter of last year.When you layer on the incremental revenue from our recent acquisitions in Canada, the United States and Russia, our year-over-year sales were 158% compared with the third quarter of last year. We think the financial and geographic benefits we are getting from this new operations clearly validates our recent acquisition problem. I should note that the two large international order prospects I told you about during our last call were both awarded to our Oilfield products business. Customers in the Middle East and India placed the orders, and deliveries will take place over the next several quarter. Our AMK Welding business also had a very solid third quarter, delivering a 41% year-over-year improvement in sales and a 95% increase in operating income. In spite of the slow speed of recovery at our Explosion Welding business, we are very confident about this segment’s long-range prospects for growth. Clad metals were continued to play an essential role in the build out of the world’s industrial processing infrastructure. As the global economy recovery gains steam, we fully expect demand for our flat sheet products will increase. For more on our third quarter financial performance I will now turn the call over to Rick. Rick Santa Thank you Yvon, good afternoon everyone. Sales during the third quarter 19% to $41.3 million versus the same period last year. Gross margin during the comparable quarters improved to 26% from 25%. Gross margin at our Explosive Welding business declined to 19% from 26% due to less favorable absorption of fixed manufacturing costs and a very competitive pricing environment. However, our Oilfield products business delivered significant expansion in gross margins which increased to 39% from 22% in the third quarter last year.
The improvement is attributable to the segment’s strong sales increase, favorable changes in product and customer mix and the incremental margin we have picked up on inter-company sales to distribution businesses we recently acquired. We are optimistic that over the long-term we will see improvements in consolidated gross margin as market conditions improve for the cladding industry.Read the rest of this transcript for free on seekingalpha.com