Wolverine's sales drop in quarter; shares up
By Eric Fleischauer
firstname.lastname@example.org · 340-2435
Wolverine Tube saw a sharp drop in sales and earnings per share in the second quarter of 2007, both of which were expected after massive restructuring efforts and the issuance of $50 million of convertible preferred stock.
"Second quarter results were solid despite the negative impact of an industrywide reduction in residential air conditioning demand and demand for residential plumbing and refrigeration tube," said Harold M. Karp, president and chief operating officer.
The market reacted favorably to the report. Trading closed Thursday with shares up 12.5 percent to $1.80.
Wolverine employs about 500 at its Decatur plant. Its corporate headquarters are in Huntsville.
A slump in U.S. residential housing construction contributed to reduced demand for many Wolverine products.
Net sales were up slightly, but that increase mainly resulted from increased copper prices that Wolverine passes to its customers.
Pounds shipped for the quarter totaled 63,182, down from 68,453 in the year-ago quarter. The drop reflected, in part, the closing of Wolverine's Quebec plant in late 2006, and the associated discontinuation of rod and bar products.
The company said it expects to complete a common stock rights offering next quarter and use the proceeds to reduce its debt.
Due primarily from the diluting effect of Wolverine's $50 million stock issuance, earnings per share dropped to 17 cents from 42 cents in the year-ago quarter.
Save $84.50 a year off our newsstand price:
Subscribe today for only 38 cents a day!