Cooper Industries Second-Quarter Sales Fall 26%

Manufacturer Cooper Industries, Houston, TX, reported second quarter 2009 sales were down 26% to $1.27 billion, compared with $1.72 billion in the prior-year period. Profit was $89.3 million, down from $161.9 million reported in the 2008 second quarter.

In the first six months of 2009, sales were $2.53 billion, a 23% decrease from the prior-year period. Profit was $189.4 million, down from $315.3 million in the prior-year first six months.

"In the second quarter, while our book-to-bill ratio stabilized, we did not experience the normal seasonal increase in revenues. As a result, our revenue for the quarter was at the low end of our forecast; however, our intense cost management across the company allowed us to deliver earnings per share at the top end of the forecast," said Cooper Industries' CEO Kirk S. Hachigian.

Segment Results
Electrical Products segment revenues for the second quarter of 2009 decreased 25% to $1.13 billion, compared with $1.51 billion in the second quarter 2008. Core revenues were 21.9% lower than comparable prior-year periods with currency translation reducing reported results 3.2% for the second quarter. Segment operating earnings, excluding the impact of restructuring charges, were $153.5 million, a decrease of 41% from the $259 million in the prior year's second quarter. Segment operating margin, excluding the unusual items, decreased 360 basis points to 13.6% for the second quarter of 2009, compared to the second quarter of 2008.

Revenues for the first six months of 2009 decreased 21% to $2.26 billion, compared to $2.87 billion for the same period last year. Segment operating earnings for the first half of 2009 declined to $293.5 million excluding restructuring charges, compared to $482.5 million in the prior-year period.

Tools segment revenues for the second quarter of 2009 were $138.7 million, down 35% from 2008 second quarter revenues of $214.3 million. Excluding the effects of currency translation, which reduced reported revenues in the quarter by 5.8%, core revenues for the quarter were 29.5% lower than 2008 second quarter on substantially lower industrial, retail and automotive demand. Segment operating earnings, excluding restructuring charges, was a profit of $2.9 million, compared to the second quarter 2008 earnings of $22.3 million, also excluding restructuring charges.

Segment operating margin, excluding restructuring charges, for the second quarter 2009 was 2.1% compared to 10.4% for the comparable prior year period. Tools segment production was significantly curtailed to adjust to the lower volumes in the quarter and reduce inventory levels to reflect market conditions which negatively impacted the Tools segment performance for the quarter.

Revenues for the first six months of 2009 decreased 34% to $265.0 million, compared to $398.8 million for the same period last year. Segment operating earnings for the first six months of 2009 was a loss of $1 million, compared to an operating profit of $39.5 million in the prior-year period.