West Bend, Wis.-based Gehl Co. last week reported record third quarter net sales from continuing operations of $121 million for the quarter ended Sept. 30, 2006, an increase of 13 percent from 2005 third quarter net sales from continuing operations of $107.3 million. Income from continuing operations was $7.4 million, or 59 cents per diluted share, for the third quarter of 2006 compared with income from continuing operations of $5.7 million, or 52 cents per diluted share, for the third quarter of 2005.
Income from operations was $12.1 million, or 10 percent of net sales, in the third quarter of 2006 compared to $9.4 million, or 8.8 percent of net sales, in the third quarter of 2005. The improvement in operating profit as a percentage of net sales was due to the increase in gross margin to 21.8 percent in the third quarter of 2006 compared to 20.6 percent in the third quarter of 2005. The increase in gross margin was primarily the result of improved product price realization in the third quarter of 2006 as well as the favorable impact of on-going cost reduction initiatives.
“Our record third quarter results showed continuous progress as we achieved solid revenue growth and improved gross margins,” said William Gehl, chairman and
CEO. “Notwithstanding the weakening U.S. housing market, the fundamentals of our global markets remain solid and we are on track to achieve our full-year 2006 sales and earnings outlook.”
For the first nine months of 2006, Gehl reported net sales from continuing operations of $382.6 million, an increase of 11 percent from 2005 first nine months net sales from continuing operations of $344.5 million. Income from continuing operations was $23.1 million, or $1.86 per diluted share, for the first nine months of 2006 compared to
$16.4 million, or $1.54 per diluted share, for the first nine months of 2005.
On April 3, 2006, the company announced the discontinuation of its agricultural implement product lines. Net income for the first nine months of 2006 includes an aftertax charge of $7.8 million, or 62 cents per diluted share, that the company recorded related to the discontinuance of these product lines.
The company reaffirmed its 2006 full-year outlook with net sales from continuing operations in the range of $485 million to $495 million and earnings per diluted share from continuing operations of $2.20 to $2.30.
Gehl Co. is a manufacturer of compact equipment used worldwide in construction and agricultural markets. The company markets its products under the Gehl and Mustang brand names.
