Valmont Sells Bilston - Analyst Blog
February 21 2013 - 1:07PM
Zacks
Valmont Industries, Inc. (VMI) has announced
the sale of Bilston Investments Proprietary Limited, a South
African holding company, which it purchased as part of the Delta
plc acquisition. The shares of Bilston were bought by three South
African purchasers for $30 million.
Bilston, which was the South African holding company of Delta Plc,
held a 49% stake in Manganese Metal Company, a non-consolidated
subsidiary. Valmont expects to realize certain deferred tax
benefits of about $3 million associated with the sale in 2013.
Valmont recently released its fourth-quarter 2012 results. Earnings
of $2.43 per share for the quarter outpaced the Zacks Consensus
Estimate of $2.24, but declined from the prior-year quarter
earnings of $4.33 per share.
Profit slid roughly 43% year over year to $65 million in the
reported quarter. The year-ago quarter’s profit was boosted by
one-time benefits associated with the reorganization of the
company's legal structure. Barring that benefit, earnings were
$1.83 per share a year ago.
Valmont, which is among the prominent steel-pipe and tube companies
along with MRC Global Inc. (MRC), Synalloy
Corp. (SYNL) and Tenaris SA (TS), posted
revenues of $815 million in the fourth quarter, up 8% year over
year. It exceeded the Zacks Consensus Estimate of $792 million.
Sales were driven by double-digit gains across the company’s
Utility Support Structures and Irrigation segments.
Moving ahead, Valmont expects continued strength in its utility
business in 2013, manifested by healthy order backlogs. It also
expects a strong first half in the Irrigation division.
Valmont expects healthy demand for the Coatings segment. Moreover,
it envisions modest sales gains in the Engineered Infrastructure
Products unit despite the government spending constraint. The
company foresees low-teens revenue increase and high-teens earnings
gain in 2013.
Valmont currently retains a Zacks Rank #1 (Strong Buy).
MRC GLOBAL INC (MRC): Free Stock Analysis Report
SYNALLOY CORP (SYNL): Free Stock Analysis Report
TENARIS SA-ADR (TS): Free Stock Analysis Report
VALMONT INDS (VMI): Free Stock Analysis Report
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