Monday, August 30, 2010

3M to buy Cogent for more than $900 million

Deal is expected to close in fourth quarter

Diversified manufacturer 3M Co said today it is buying Cogent Inc for more than $900 million.

Cogent, based in Pasadena, California, makes automated fingerprint and palm print identification systems that allow its customers to capture fingerprint and palm print images electronically, encode prints into searchable files, and compare sets of prints.

Cogent had about $130 million in revenue in 2009.

The transaction is expected to close during the fourth quarter of the year

3M Chief Executive George Buckley said recently that his company could spend about $2 billion on acquisitions in 2010, double its previous estimate for the year.

Thursday, August 26, 2010

SKF breaks expands aeroengine operations

The company also says it is expanding its bearing, seals operations in Asia and India

SKF will invest around $18 million in a new heat-treat facility in Falconer, N.Y., as part of an expansion to its aeroengine operations in the country. The new 6,100-square-meter facility will house a new high-tech vacuum furnace for the carburizing and hardening of a variety of materials and is a very critical operation in the bearing manufacturing process.

At a groundbreaking ceremony that included dignitaries from the State of New York and the local community, Tom Johnstone, SKF president and CEO, remarked, "We are very pleased to dedicate the construction commencement of this significant investment in SKF's operations in Falconer. This new facility enables us to bring the nearby Jamestown operations to the Falconer campus, and implement a state-of-the-art heat treat operation with cutting edge technology. While SKF is making a significant investment in this project, it would not have been possible without the dedicated support of the State of New York and the various organizations. This is something the local community can take great pride in securing."

The new SKF heat treating facility is expected to commence production in the spring of 2011 and will process parts for four SKF Aerobearing operations in the US, as well as for Venture Aerobearings, SKF's joint venture with GE, in Charleston. The facilities in Falconer and Jamestown have 691 employees.

The SKF Aeroengine North America business unit is a leader in high precision, custom-engineered ball and roller bearings for critical aeroengine and specialty applications, including ball and roller bearings for helicopters, main shaft and gearboxes for jet engines and various types of aircraft power assemblies. Specialty products are custom-designed bearings for technically and environmentally demanding applications such as pumps, motors and power transmission assemblies.

SKF continues to expand in China and is building a factory for medium size bearings, to support the fast growing demand from the local market as well as the rest of Asia. The factory will mainly serve customers within the renewable energy, metalworking, off-highway, electric motors and industrial transmission industries.

The factory will be located in Dalian, close to SKF's existing factory for large size bearings.

"Our business in Asia continues to develop very positively which makes an investment of this kind important to further support our growth in the region. This step strengthens our manufacturing base and reinforces our commitment to this market," says Tom Johnstone, SKF President and CEO.

SKF has decided to expand its present seals manufacturing capacity by building a new factory in Mysore, India. The new factory will serve customers within the automotive, railway and industrial applications segments. The investment amounts to around SEK 160 million.

SKF said that demand is rapidly growing mainly from SKF customers in India but also from customers in other geographical areas. The new Mysore factory will be part of SKF Technologies (India) Pvt Ltd. It will be fully operational by the second half of 2012 and will employ about 600 persons in total.

The company said its rapidly expanding seals business in Asia calls for an increase in its capacity in the region. The factory will further strengthen SKF's position in Asia and especially in India, says Tryggve Sthen, President SKF Automotive Division.

Wednesday, August 25, 2010

Durable goods orders increased slightly in July

Much of the increase was for transportation equipment

The U.S. Commerce Department reported today that durable goods orders increased only 0.3 percent in July, the first increase in durable goods orders in three months but less than what many economists had expected. Much of the increase was due to stronger demand for airplanes.

Excluding a 13.1% gain for transportation equipment, durable orders fell 3.8% in July, the biggest drop since January 2009.

The government reported that orders in June fell an upwardly revised 0.1%, less than the prior estimate of a 1.2% drop.

Orders for machinery fell 15%.

Orders for fabricated metals fell 1.0% while orders for primary metals rose 0.7%.

Orders for electrical equipment fell 5.9%.

McJunkin Red Man buys Dresser Oil Tools & Supply

Dresser had sales of about $12 million in 2009

McJunkin Red Man Corporation (MRC) today announced the signing of a definitive agreement to acquire operations and assets from Dresser Oil Tools & Supply, as part of its strategic focus to increase its presence in the active shale basins across North America. The operations and assets to be purchased relate to the business of the sale and distribution of pipe, valves and fittings (PVF), oilfield production and drilling supplies and related products. These assets generated net sales of approximately $12 million in 2009. Other details of the transaction were not disclosed. The closing is expected to take place by the end of August.

To support oil and gas exploration and production, as well as the pipeline and transmission infrastructure, MRC plans to expand operations and inventory in active shales both organically and through acquisition, such as the purchase of operations and assets from Dresser Oil Tools & Supply within the Bakken Shale.

Dresser Oil Tools & Supply operates five branch locations in the region of Sidney, MT; Tioga, ND; Williston, ND; Stanley, ND and Mohall, ND, supplying PVF, oilfield and related products to the region since 1993. MRC is acquiring these five new branches to enhance its coverage in the Bakken Shale from its existing branch locations in Williston, ND and Belfield, ND.

Andrew Lane, MRC’s president, chief executive officer and chairman commented, “Following our acquisition of South Texas Supply in the Eagle Ford shale in May, we are pleased to add Dresser Oil Tools & Supply’s locations to our existing North Dakota branches servicing our customers in the active Bakken Shale. We are also pleased to have Dale Sundley, president of Dresser Oil Tools & Supply, join MRC as part of our region management group, and the employees of Dresser Oil Tools & Supply join the MRC team. MRC is committed to be the best provider of PVF products to support our customers’ plans in these major North America shales.”

Headquartered in Houston, Texas with corporate offices in Charleston, West Virginia and Tulsa, Oklahoma and operations centers in Calgary, Alberta, Canada and Bradford, United Kingdom, MRC is the largest global distributor of PVF and related products and services to the energy and industrial sectors, based on sales, and supplies these products and services across each of the upstream, midstream and downstream markets.

Monday, August 23, 2010

Home Depot targets pro customers

Building materials supplier sees weakness in pro segment, however

Home Depot says it plans to be “aggressive and opportunistic” in reaching pro customers despite what it sees as weakness in that segment in the second half of 2010

In an earnings call report with financial analysts last week, Home Depot chairman and CEO Frank Blake said there are reasons for the company to be “cautious” across its business.

“We still see still see weakness in our pro segment. We had anticipated that we would start to see growth in our pro customers as we moved into the second quarter, and based on that we thought we’d see gradual improvement in our average ticket. We’re now forecasting modest to flat improvement on the pro side, which puts pressure on average ticket,” he said.

“We also are anticipating softer housing related activity than we originally thought. Clearly, there was some pull-forward of activity from the home buyer tax credits and foreclosures remain high.”

During the question and answer session, Marvin Ellison, executive vice president for U.S. stores, said the company will be targeting the pro market for growth. These pro customers are remodelers, contractors and those serving the maintenance market.

“We’re going to be aggressive and opportunistic with the pro customers,” he said. “We’re going to focus on staffing and service levels and getting them in and out really quick, which is a mandate that they’ve given us. We have a field team that is out there building relationships, understanding the needs of the pro. We’re working with Craig (Craig Menear, executive vice president merchandising) and his team to make sure we’re merchandised the right way, we’re priced the right way. So we’re going to fight as hard as we can to take care of the customers. But again, as Frank said, we just don’t anticipate robust growth in the second half, ”Ellison said.

Wednesday, August 18, 2010

Emerson sells motor business to Japanese firm

Two Emerson Motor Company businesses included in sale

Emerson has agreed to sell its Motors and Appliance Controls businesses to Nidec Corporation of Kyoto, Japan. The agreement reached with Nidec will provide a new U.S./North American presence for Nidec’s global motor and motor-related business. Nidec said it intends to retain existing facilities and current management and employees.

“Emerson was committed in this process to assuring that if the businesses were sold, they would end up in the hands of a strong company that would create a successful environment for its employees and customers,” said Craig Ashmore, Executive Vice President, Planning and Development, Emerson. “While there was considerable interest from many solid companies, Nidec Corporation’s proposal provided overwhelming value for everyone: our customers, employees and shareholders."

Included in the sale are two Emerson Motor Company businesses – Emerson’s Commercial and Industrial Motors (CIM) and Emerson Appliance Motors and Controls (EAMC).

Emerson will continue to operate its hermetic motors business, which serves Emerson Climate Technologies’ Copeland Scroll compressors, and also will continue to operate the large motor business based in Europe (Leroy-Somer) as well as Emerson Air Comfort Products in the U.S., which makes their Emerson Ceiling Fan.

Nidec, based in Kyoto, Japan, is about an $8 billion precision manufacturer of small and medium-size motors and fans for IT/consumer electronics, automobiles, home appliances, and industrial applications. The company also manufactures electronic/optical components and machinery.

The affected Emerson divisions reported more than $800 million in combined sales in fiscal 2009 and employ 6,000 people, including 1,700 in the U.S. and several hundred in St. Louis.

Nidec plans to open a U.S. headquarters on Emerson's St. Louis campus and lease space from Emerson Motor Technology Center, keeping all the local jobs here at substantially the same wages and benefits, said Mark Polzin, an Emerson spokesman, according to the St. Louis Business Journal. Patrick Murphy, president of Emerson motors and appliance controls, will join Nidec to lead the business locally.

The newspaper estimated the selling price to be about $700 million.

Nidec’s opening a U.S. headquarters in St. Louis could eventually lead to more jobs in the region. “These businesses of motors and control technologies will be key to our long-term business strategy as we invest and further strengthen our capabilities in the North American market,” Shigenobu Nagamori, founder and CEO of Nidec, said in a statement Tuesday evening, according to the Journal.

The Commercial & Industrial Motors are used in water treatment, mining, oil and gas, power generation, air conditioning condensers, rooftop cooling towers and commercial refrigeration.

Home Depot’s second-quarter sales up 1.8%

Earnings beat analysts’ expectations, but sales fall short of forecasts; in other news, Graybar reports a slight sales increase for Q2

The nation’s largest home improvement retailer reported earnings that beat analysts’ expectations this week, but the company’s sales fell short of forecasts.

Home Depot reported net earnings of $1.19 billion, or 72 cents a share, for its fiscal second quarter, ended August 1, compared with $1.12 billion, or 66 cents a share, in the same period a year ago.

The company’s sales rose 1.8% to $19.41 billion, on a 1.7% same-store sales increase.
“Our second-quarter sales reflect the third consecutive quarter of positive same-store sales. We delivered solid results as we continue to build momentum with our merchandising transformation, supply chain enhancements and customer service initiatives,” chairman and CEO Frank Blake said in a statement announcing the results.

In other earnings news, electrical and communications products distributor Graybar reported a “slight increase in sales” and a 14% rise in earnings in its second quarter compared to the same period last year. For the first six months of the year, Graybar said its income rose 20%.

“Our second-quarter results show that business is gaining momentum,” said Graybar’s chairman, president and CEO Robert A. Reynolds, Jr. “Because of the company’s strong financial position, we can continue to focus on working to the advantage of our customers and expanding our presence in key markets.”

An employee-owned company, Graybar is based in St. Louis and has nearly 240 locations across North America.

Monday, August 16, 2010

Manufacturing grows slowly in New York region

Weaker numbers than many economists had expected; six month outlook weakens

The Empire State Manufacturing Survey indicates that conditions improved modestly in August for New York manufacturers. The general business conditions index rose 2 points from its July level, to 7.1. The new orders and shipments indexes both dipped below zero for the first time in more than a year, indicating that orders and shipments declined on balance; the unfilled orders index was also negative. The indexes for both prices paid and prices received inched down, while employment indexes were positive and higher than last month. The six-month outlook weakened; though future indexes were generally still positive, many fell in August, with the notable exceptions of the future employment and capital expenditures indexes, which climbed after falling last month.

The numbers were lower than many economists had expected. Some surveys indicated the index would rise up to 8. Readings greater than zero signal expansion in the so-called Empire State Index that covers New York, northern New Jersey and southern Connecticut.

In a series of supplementary questions, manufacturers were asked about their capital spending plans. Looking ahead to the next six to twelve months, 37 percent of respondents indicated that they expected to increase capital spending relative to its level in the past six to twelve months, while just 13 percent planned reductions. Of those predicting increased capital spending, 27 percent noted that "a considerable fraction" of the increase reflected investment that had been postponed because of the recession; 41 percent of respondents had given this same response in a similar survey back in January.

Another 46 percent of those surveyed this month attributed "some" of the spending increase to the recession. The most commonly cited factors behind increased investment were high expected growth in sales and a need to replace capital goods other than IT (information technology) equipment. The most widely cited factors behind steady or decreased capital investment in the current survey were low expected sales growth, low capacity utilization, and limited need to replace non-IT capital goods.

Thursday, August 12, 2010

Distribution survey shows business conditions improving

M&A activity may be on the rise

McGladrey, an assurance, tax, consulting and professional services firm, has released its 2010 McGladrey Distribution Industry Report which shows, among other things, that for the first time in three years, business conditions for distributors are improving.

Conducted in the spring, McGladrey’s 2010 Manufacturing and Wholesale Distribution National Survey asked leaders of U.S.-based manufacturing and wholesale distribution enterprises to provide perspectives on the current state of their companies and industry and the strategies they are implementing to sustain or grow profitability in the coming year. Participants responded to questions pertaining to current business conditions, domestic and global business strategies, cost structure, technology initiatives, operations and other issues. The Distribution Industry Report focuses on responses from leaders in the distribution business.

“Of the 1,061 respondents included in the final survey analysis, 343 were leaders of distribution businesses,” said Bob Jirsa, managing director and manufacturing and wholesale distribution practice leader in McGladrey’s Mid-Atlantic practice. “Twenty-three percent of this year’s distribution respondents indicated that their companies are ‘thriving and growing’ – a 14-percentage point uptick from last year.”

Segments represented by distributors in the survey include machinery, building materials, food and beverage, and paper and related industries. McGladrey’s survey found the rate of recovery is not uniform, but dependent on the industry segment in which the distributor focuses. In almost all industries, however, inventory levels were severely impacted by the recession. “In the recovering economy, with historically low inventory levels, distributors will play a key role in sourcing and delivering often scarce products through a lean supply chain,” says Jirsa.

Among the findings from this year's respondents:
• While 45 percent of distributors say they expect their companies to recover this year, 31 percent say recovery will not start until 2011. Another six percent do not expect a rebound until 2012 or beyond.
• Mergers and acquisitions might be making a comeback; 28 percent of distributors said they will participate in such activity.
• An impediment to increasing sales opportunities is historically low inventory levels, which are requiring longer lead times to fill orders and replenish stock
• While international business is a proven strategic hedge against lower U.S.-based sales, this year’s survey shows distributors area relying more heavily on domestic sales growth. Only 29 percent of distributors are relying on non-U.S. sales as a growth strategy.
• Domestic employment in distribution is slowly recovering. Of the 336 companies reporting their intent, 149 (44 percent) are hiring workers this, with only 6 percent expecting to expand their workforce by more than 10 percent.
• On the cost side, 71 percent of distributors expect employee expenses to rise this year. The increase, leaders say, is largely due to health care cost increases.

McGladrey is the brand under which RSM McGladrey, Inc., and McGladrey & Pullen, LLP, serve clients’ business needs. Together, they rank as the fifth largest U.S. provider of assurance, tax and consulting services, with 7,000 professionals and associates in nearly 90 offices.

Wednesday, August 11, 2010

PT/motion control sales rose 2.4% in June

Sales in the U.S. increased 4.9% in first half of year

Sales of power transmission/motion control (PT/MC) products by U.S. manufacturers rose 2.4 percent compared to the previous months and Canadian manufacturers’ sales rose 25.4 percent according to June 2010 sales data released by the Power Transmission Distributors Association (PTDA) in its Market Outlook Report.

Year-to-date sales in the first half of the year are up in both the U.S. and Canada. In the U.S., year-to-date sales rose 4.9 percent compared to the same period in 2009 while Canadian sales rose 9.7 percent.

For the second consecutive month, confidence in the market by U.S. manufacturers holds a neutral position of 5.0, while Canadian manufacturers’ confidence rose from 4.9 to 5.2 on a scale of 1 (very pessimistic) to 10 (outstanding).

In the U.S., all tracked categories showed month-to-month gains, with the exception of standard industrial motors. Canadian manufacturers’ product sales also rose in all but one category: clutches & brakes. Month-to-month sales for product categories between May 2010 and June 2010 for U.S. and Canadian manufacturers are reported below.

The Market Outlook Report is published monthly by the Power Transmission Distributors Association. The full report includes U.S. and Canadian manufacturer data for sales and order trends for mounted bearings, unmounted bearings, standard industrial motors (U.S. only), variable speed drives, positioning systems/linear motion products, gear products, clutches and brakes, shaft couplings and mechanical drive systems and other PT products.

Avnet reports record sales in Q4

Sales surge 38.5 percent for electronics distributor; sales grew 18 percent for fiscal year

Electronics distributor Avnet today reported that sales surged 38.5 percent to a record $5.21 billion for the fourth quarter ended July 3.Adjusted operating income increased 154.6 percent, four times faster than revenue growth to $217.1 million, up 190 basis points year over year.

Sales for the full year ended July 3, 2010 increased 18.1% year over year to $19.16 billion and increased 17.5% year over year adjusted for the impact of changes in foreign currency exchange rates; pro forma revenue was up 15.5% year over year.

Roy Vallee, Chairman and Chief Executive Officer, commented, “The ‘V’shaped cyclical recovery in the technology markets we serve continued this quarter with strong top line performance across both groups and all regions, resulting in 38.5% year-over-year growth and record revenue. The combination of record revenue, gross profit margin expansion and productivity gains drove operating income margin up sequentially and year over year at both operating groups with the EMEA region delivering the most significant improvement. Our value-based management discipline, which connects margins with working capital velocity throughout our business, resulted in return on working capital (ROWC) and return on capital employed (ROCE) above our stated financial targets. We enter fiscal 2011 prepared to build on our performance in fiscal 2010 as we begin to integrate the three acquisitions completed in July that we expect will produce at least a 12.5% return on capital employed and create shareholder value.”

Avnet, Inc. (NYSE:AVT) is one of the largest distributors of electronic components, computer products and embedded technology serving customers in more than 70 countries worldwide

Grainger's sales rose 21 percent in July

Sales in the U.S. increased 17 percent

Broad-line MRO industrial distributor W.W. Grainger today reported that its daily sales last month increased 21 percent versus July 2009. Results for the month included a 5 percentage point positive contribution from acquisitions and a 1 percentage point contribution from foreign exchange. Excluding acquisitions and foreign exchange, daily sales for the company increased 15 percent.

In the United Sates, sales increased 17 percent while in Canada sales rose 21 percent.

Tuesday, August 10, 2010

Manufacturing technology consumption up 36%

Foreign investment and a doubling of orders in aerospace and construction equipment offset anticipated slowdown

U.S. manufacturing technology consumption rose nearly 36% in June, a sign of growth in the manufacturing sector as companies invest in capital metalworking equipment to increase capacity and improve productivity.

Manufacturing technology consumption totaled $241.47 million in June, according to the latest United States Manufacturing Technology Consumption report, released this week by AMT-The Association for Manufacturing Technology and AMTDA, the American Machine Tool Distributor’s Assn. While up 35.8% compared to May, the total was more than 70% higher than June 2009. And with a year-to-date total of more than $1.2 billion, U.S. manufacturing technology consumption is up 56% over last year.

The numbers are higher than expected at this time of year, as order rates generally slow down in the months leading up to the International Manufacturing Technology Show (IMTS) in September, said AMT president Douglas K. Woods in announcing the monthly report. IMTS, the largest production technology show in the Americas, will be held Sept. 13-18 at McCormick Place in Chicago.

Woods said increased foreign direct investment and a doubling of orders in aerospace and construction equipment through the first half of 2010 offset the typical show slow down.

Regionally, manufacturing technology consumption rose the most in the Midwest, where it was up nearly 70% compared to May, followed by the Northeast (up 52% compared to May), the West (up 37.5% compared to May), the South (up 18.5% compared with May), and the Central Region (up just 7.1% compared to May).

Business optimism drops again

Small business owners concerned about conditions for next six months

The National Federation of Independent Business Index of Small Business Optimism lost 0.9 points in July and reached 88.1 following a sharp decline in June. The Index has been below 93 every month since January 2008 (31 months), and below 90 for 24 of those months, all readings typical of a weak or recession-mired economy. Ninety percent of the decline this month resulted from deterioration in the outlook for business conditions in the next six months.

“The recovery in optimism that we are currently experiencing is very weak compared to recoveries after the 1982 and 1975 recessions,” said Bill Dunkelberg, NFIB’s chief economist. “The small business sector is not on a sustained positive trajectory, and with this half of the private sector missing in action, the economy’s poor growth performance is not surprising.”

The net percent of all owners (seasonally adjusted) reporting higher nominal sales in the past three months lost one point, falling to a net-negative 16 percent, 18 points better than June 2009 but indicative of very weak customer activity. Unadjusted, 26 percent of all owners reported higher sales (last three months compared to prior three months, up three points) while 33 percent reported lower sales (down two points). Widespread price cutting continued to contribute to reports of lower nominal sales.

The net percent of owners expecting real sales gains improved one point over June, rising to a net-negative 4 percent of all owners (seasonally adjusted), still quite dismal. Not seasonally adjusted, 26 percent expect improvement over the next three months, 28 percent expect declines.

A net-negative 19 percent of all owners reported gains in inventories (more firms cut stocks than added to them, seasonally adjusted), two points better than June but a very weak number. July 2010 is the 28th negative double-digit month in a row for inventory gains, and the 38th negative month in a row.
Business optimism

Friday, August 6, 2010

July jobless rate remains unchanged at 9.5%

Manufacturing sector continues to expand, however, adding 36,000 jobs during the month

The U.S. jobless rate remained unchanged at 9.5% in July as employers continued to add workers at a slow pace, the Labor Department reported Friday.

Private-sector employers added a net total of 71,000 jobs in July. But overall, the economy lost a net total of 131,000 jobs during the month, as 143,000 temporary census jobs ended. In all, 14.6 million people were looking for work in July, roughly double the figure in December 2007, when the recession began.

So far in 2010, private sector employment has risen by 630,000, although nearly two-thirds of that growth occurred in March and April.

The manufacturing sector continued to grow, however, as employers added 36,000 jobs during the month. Most of the gains were in motor vehicles and parts, which experienced fewer seasonal layoffs than normal in July, adding 21,000 jobs. During the first six months of the year, motor vehicles and parts added 32,000 jobs. In addition, the fabricated metals industry added 9,000 jobs in July. Overall, manufacturing employment has expanded by 183,000 since December 2009.

Construction employment changed little in July, down 11,000 jobs; 10,000 construction workers were off payrolls due to strike activity, the Labor Department reported.

Employment in the wholesale trade sector grew by about 8,000 jobs in July.

Thursday, August 5, 2010

Fastenal’s July sales rise 19%

Gains follow positive quarterly sales and earnings news from other large distributors earlier this week

Fastener and industrial supplies distributor Fastenal reported an 18.8% net sales increase in July compared with July 2009. Daily sales in July grew 24.4%, with a 0.4% gain due to the change in foreign currencies (primarily Canada). During the month, Fastenal said sales to manufacturing customers grew 35.9% and non-residential construction customers grew 3.8%.

The news follows positive sales and earnings news from other large distributors earlier this week:

Interline Brands
MRO distributor Interline Brands reported a slight sales increase for the second quarter of 2010—0.1% to $270.2 million, compared to $269.9 million in the same period a year ago. Earnings per share rose 35% to 27 cents compared with 20 cents in the same period a year ago.

Looking at end markets, Interline’s sales to professional contractors saw the greatest growth in the quarter, increasing 15%. Sales to facilities maintenance customers fell 0.7%, while sales to specialty distributors rose 3.2%

Interline's gross profit increased $3.3 million, or 3.3%, to $101.6 million for the second quarter of 2010. Sales fell 2.2% for the six months ended June 25, however, to $515.4 million compared with $526.7 million in the same period last year.

Smith International
Smith International, the parent company of pipe, valves and fittings distributor Wilson, reported an 18% sales increase in the second quarter compared to the same period last year, and a 7% sales gain compared to the first quarter. Smith doubled its earnings in the second quarter, reporting net income of $65.1 million, or 26 cents per share, compared with $32.1 million in the second quarter of 2009.

Second-quarter revenues for Wilson (its distribution segment) were $490.3 million, 9% above the March 2010 quarter and 19% higher than the same period last year. Project spending in the United States for line pipe rose more than 50% from the prior quarter and, together with higher energy sector volumes, more than offset the impact of lower seasonal activity levels from the company's Canadian operations, Smith executives said.

Barnes Group
Manufacturer and logistics services provider Barnes Group reported net income of $14.8 million, or 26 cents per diluted share, compared to $10.4 million, or 19 cents per share, in the second quarter of 2009.

Second-quarter 2010 sales rose 10.5% to $281.9 million compared with $255.2 million in the second quarter of 2009.

Sales in Barnes’ Logistics and Manufacturing Services segment, which includes its North American and European distribution businesses, rose 1% to $138.5 million. The increase was driven primarily by revenue growth in the North American distribution businesses as macro-economic conditions, including industrial production, continued to improve, the company said.

"We continue to benefit from improved economic conditions, particularly within our industrial and automotive manufacturing businesses," said Gregory F. Milzcik, president and chief executive officer of Barnes Group Inc. "Double-digit sales growth coupled with a continued focus on an efficient cost structure through lean initiatives has provided a 67 percent improvement to our operating profit this quarter."

Wednesday, August 4, 2010

Graybar expands Southern California facility

Electrical distributor adds 70,000 square feet of warehouse space to existing facility to form new service center

Electrical distributor Graybar will open an expanded service center in Southern California this month.

St. Louis-based Graybar announced an expansion to its City of Industry, Calif., warehouse, adding 70,000 square feet of space to form a new service center that will support the distributor’s Southern California branches and complement its Northern California service center.

The expanded facility will have roughly 157,000 square feet of warehouse space and provide customers with fast access to extensive local inventory supported by state-of-the-art warehouse management technology and responsive delivery service, Graybar said in a statement announcing the expansion.

The expansion follows Graybar’s purchase of Canadian distributor AVAD Industrial Sales earlier this summer.

Monday, August 2, 2010

Applied Industrial acquires UZ Engineered Products

Deal expands distributor’s business with government sector nationwide

Applied Industrial Technologies has acquired specialty MRO products distributor UZ Engineered Products from Cleveland-based State Industrial Products Corp.

Terms of the deal were not disclosed.

UZ sells MRO supplies to a broad range of customers, with a focus on the government sector. The Cleveland-based distributor’s products include fasteners, fittings, lubricants, electrical components, welding supplies, cutting tools, and other specialty maintenance products.

“UZ is an important addition to our government business sector,” said Todd A. Barlett, vice president--acquisitions and global business development for Applied. “Their product mix, experience and geographic coverage will enhance our existing support for this important market and help us expand our reach across North America. We’re very pleased to welcome their employees to the Applied family.”

UZ Engineered Products has 170 employees and annual sales of approximately $23 million, Applied said in a statement announcing the deal.

UZ’s president, David DeBord, will remain in that role, reporting to Michael L. Coticchia, Applied’s vice president of government business.

Manufacturing growth slows in July

But despite a slower growth rate, economic activity in the nation’s manufacturing sector expands for the 12th straight month

Economic activity in the manufacturing sector expanded in July for the 12th consecutive month while the overall economy grew for the 15th straight month, according to the latest manufacturing Report on Business, released today by the Institute for Supply Management.

Manufacturing growth in July declined 0.7% compared to June, registering a PMI of 55.5%. A reading above 50 indicates growth in the sector.

The report also showed improvement in employment, supply deliveries and inventories, which helped reduce the impact of a month-over-month deceleration in new orders and production, according to Norbert J. Ore, ISM’s Manufacturing Business Survey Committee chairman. New orders fell 5% in July and production fell 4.4%.

ISM’s July report also showed strong demand in 10 of 18 manufacturing industries surveyed: plastics and rubber products; miscellaneous manufacturing; paper products; electrical equipment, appliances and components; transportation equipment; primary metals; textile mills; computer and electronic products; fabricated metal products; and chemical products.