NEW YORK (Thomson Financial) - * Q4 profit beats estimates
* Forecasts weaker first-quarter results
* Says slowing economy impacts industrial sector
(Recasts; adds details)
Oct 21 (Reuters) - Tools and industrial services provider MSC Industrial
Direct Co Inc posted a higher-than-expected quarterly profit, helped by lower
costs, but forecast first-quarter results below Wall Street estimates, sending
its shares down as much as 10 percent. For the first quarter, the company
expects earnings of 68 cents to 72 cents a share on revenue of $436.0 million to
$446.0 million.
Analysts on average were expecting 78 cents a share, before special
items, on revenue of $455.1 million, according to Reuters Estimates.
In the last couple of weeks customer sentiment has turned dramatically
downward, Chief Executive David Sandler said in a conference call.
"These are challenging times, as the deterioration in the credit markets
has exacerbated the effect of a slowing economy on the industrial sector, which
represents about 75 percent of our total sales," he said.
Analyst John Baliotti of FTN Midwest Securities said the recent upheavals
in the credit market has forced some of the company's customers to delay their
orders.
"Given the areas that they serve, the lowering of forecast is not a total
surprise," he added. Baliotti has a "neutral" rating on the stock.
For the fourth quarter ended Aug. 30, net income was $50.5 million, or 80
cents a share, compared with $47.4 million, or 71 cents a share, in the year-ago
period.
The latest quarter's results included other income of $1.6 million
relating to the sale of certain real estate assets, the company said in a
statement.
The company's revenue for the quarter was $448.6 million, compared with
$450.5 million, while its operating margin rose above 17 percent for the period.
Analysts on average were expecting earnings of 75 cents a share, before
special items, on revenue of $447.4 million.
Shares of the Melville, New York-based company were down $2.69 to $36.42
in afternoon trade on the New York Stock Exchange.
(Reporting by Bhaswati Mukhopadhyay in Bangalore; Editing by Anil D'Silva)
Keywords: MSCINDUSTRIAL/
Chuck Mikolajczak
cm
COPYRIGHT
Copyright Thomson Financial News Limited 2007. All rights reserved.
The copying, republication or redistribution of Thomson Financial News Content,
including by framing or similar means, is expressly prohibited without the prior
written consent of Thomson Financial News.
|