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Atlanta, GA-based Zep Inc. (NYSE: ZEP), a producer of a wide range of cleaning and maintenance solutions, reported sales for the third quarter ended May 31, 2011, were $168 million, an increase of 9.7 percent over the same period a year ago. Profit increased 19.3 percent to $6.2 million.
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Fiscal year-to-date, sales were $472.2 million, up 16 percent in a year-over-year comparison. Profit increased 16.7 percent to $13.3 million.
“Like most manufacturers, we have been experiencing rising costs of raw materials, which we attempt to offset as much as possible through improved efficiencies and fixed cost reductions; however, the magnitude of commodity cost increases necessitated price increases to our customers,” said John K. Morgan, president and CEO. “Price increases enacted in the direct sales and service channel were successful in offsetting the impact of rising costs of raw materials on gross profit this quarter. However, we will not begin realizing the benefit from price increases initiated in the retail and distribution channels until the fourth quarter of fiscal 2011."