H.B. Fuller Co., St.
Paul, MN, has reported
financial results for its third quarter, which ended August 29.
Net Income for the third
quarter of 2009 was $35.4 million, or $0.72 per diluted share, versus $21.7
million, or $0.44 per diluted share, in last year’s third quarter. This year’s
third quarter net income included a significant one-time gain related to the
settlement of a lawsuit filed against the former owners of the Roanoke
Companies Group, a business acquired by H.B. Fuller in 2006. The settlement
totaled $18.8 million on a pre-tax basis and $11.8 million after taxes, or $0.24
per diluted share. Excluding this settlement, net income would have been $0.48
per diluted share versus the reported results of $0.72 per diluted share.
During the third quarter,
the North America region announced a
restructuring of one of its manufacturing facilities. This realignment of
production capacity will result in charges of approximately $3.3 million, of
which $1.1 million was expensed during the third quarter. The balance will be
expensed in the fourth quarter of 2009 and is largely related to accelerated
depreciation. In addition, a discrete tax benefit of $1.3 million was
recognized in the third quarter. This discrete tax item reduced the effective
tax rate for the quarter by 2.7 percentage points. H.B. Fuller expects its
effective tax rate for the fourth quarter to be approximately 34.5%, excluding
any significant discrete items. Last year’s third quarter included a discrete
tax benefit of $4.3 million related to the valuation of deferred tax assets in Brazil.
Net revenue for the third
quarter of 2009 was $315.3 million, down 12.9% versus the third quarter of
2008. Higher average selling prices and acquisitions positively impacted net
revenue growth by 2.8 and 0.9 percentage points, respectively. Lower volume and
unfavorable foreign currency translation adversely impacted net revenue growth
by 12.4 and 4.2 percentage points, respectively.
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