Company remains “cautiously optimistic” about economic conditions
Anixter International Inc. a global distributor of communication and security products, electrical and electronic wire & cable, fasteners and other small parts, yesterday reported sales of $1.37 billion, a increase of 12 percent compared to the year ago quarter.
Major items affecting current quarter sales comparisons versus the prior year include:
$12.9 million of favorable foreign exchange effects versus prior year were:
$19.6 million of favorable copper price effects versus prior year
$33.0 million of unfavorable effects from exiting a major customer contract in 2009
Exclusive of the effects of those items, sales increased by 12 percent organically.
Second quarter operating income of $70.1 million compares to a loss of $58.7 million in the prior year quarter, which included a $100.0 million goodwill impairment charge and a $5.7 million severance charge.
Commenting on second quarter sales trends, Robert Eck, President and CEO, stated, “Three months ago we were cautiously optimistic as we saw improving daily sales trends in late March moving into early April. These improving trends accelerated through the current quarter and helped fuel growth in most of our businesses around the world. Improvement in our day-to-day business was supplemented by higher levels of project activity in both our enterprise cabling and industrial wire and cable businesses. These growth trends are even more encouraging considering sales were negatively affected in the current quarter and first half of the year by $33.0 million and $64.7 million, respectively, as a result of the exit of a major customer contract.”
“We are very pleased with the company’s strong organic sales increase of 12 percent in the current quarter,” continued Eck. “Equally as positive is the fact that this was the first quarter since the third quarter of 2008 that we have delivered a year-on-year sales increase in all three geographic segments, as well as all three of our end markets. We are encouraged by the rate and breadth of the company’s sales rebound despite the uncertain macroeconomic conditions that continue to exist.”
Eck added: “The improved economic conditions that we saw around the world in the second quarter give us more confidence in our ability to generate year-on-year sales growth in 2010 However, the uncertainty that still remains in Europe and more recent concerns about a moderating growth rate in the U.S. cause us to remain cautiously optimistic. Accelerating daily sales rates that we saw through much of the second quarter began to level off in June and have continued at that pace through the first three weeks of July."