Sluggish economic conditions took a toll on Gibraltar Industries during the third quarter, pushing the Hamburg building products manufacturer’s profits down by 5 percent, the company said today.
The lower profits, along with sales that were down 7 percent from a year ago, both were lower than analysts were expecting and are a sign that Gibraltar’s key construction and building products markets remain weak.
“We continued to experience sluggish economic conditions,” said Brian J. Lipke, Gibraltar’s chairman and chief executive officer, in a statement.
While the recovery has been uneven across different regions in Gibraltar’s North American markets, Lipke said its European markets “showed continuing weakness” during the third quarter.
That weakness is painful for Gibraltar because it delays the anticipated rebound in the housing and construction markets that it now depends on following a radical reshaping of its business since the recession hit five years ago that saw the company sell off its steel processing business to focus solely on its building products markets.
While Lipke has long said the restructuring, which also has greatly reduced Gibraltar’s cost structure and eliminated dozens of facilities, will make the company more profitable than ever once its markets rebound, that turnaround has been evasive.
Gibraltar’s profits slid to $7 million, or 23 cents per share, from $7.4 million, or 24 cents per share, a year ago. Excluding restructuring and acquisition-related expenses, Gibraltar’s earnings slid to $7.4 million, or 24 cents per share, from $7.8 million, or 26 cents per share, a year earlier, falling short of analyst forecasts of 29 cents per share.
Gibraltar’s sales also were weaker than expected, sliding by 7 percent to $205.5 million from $220.1 million, which was less than the $221.7 million that analysts had forecast.
Gibraltar’s residential repair and remodeling market was slow during the summer quarter, while non-residential construction moderated, said Henning Kornbrekke, the company’s president and chief operating officer. The company’s public infrastructure business did well during the quarter, with funding for road and highway construction projects continuing to grow, he said.