LIMERICK, Pa. – Marine steering, control and electronics components manufacturer Teleflex Inc., has lowered its earnings outlook for the third and fourth quarter of 2004, the company said in a press release today.
However, the company confirmed that its marine product lines are performing well.
“Our Medical and Aerospace segments and the Marine and Industrial product lines in our Commercial segment are on track and are performing well,” said Jeffrey P. Black, president and CEO of Teleflex. “We expect continued strength in these businesses to somewhat offset continued weakness in the automotive pedal systems business and Industrial Gas Turbine Services product line.”
Teleflex now expects diluted earnings per share in the range of 38 cents to 40 cents for the 2004 third quarter, which represents earnings per share for the full year of $2.60 to $2.70.
Wall Street analysts had been expecting the company to earn 56 cents in the third quarter and $2.85 for the year, the Reuters news service reported.
Teleflex said its new estimates reflected:
– An anticipated decline of $5-7 million per quarter in the operating profits of the company’s Tier 1 automotive businesses, predominantly the pedal systems business.
– Lower-than-expected sales volume in the Industrial Gas Turbine Services product line, which is expected to reduce operating income by approximately $1 – $1.5 million during both the third and fourth quarters.
– Costs of approximately $1.5 – $3.0 million per quarter associated with actions underway to improve the financial results of underperforming businesses.
“Businesses representing approximately 10 percent of our annual revenues are generating operating losses and have been an increasing drag on Teleflex earnings this year,” said Black. “The combined operating losses from these three businesses are expected to be approximately $30 million in 2004. We have several initiatives underway which should drive improved results going forward.”
Teleflex held a conference call this morning to discuss its third and fourth quarter outlook. An audio replay will be available from Sept. 20 – 25 by calling 877-519-4471 (U.S./Canada) or 973-341-3080 (International) and enter Pin #5203159.
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