The strong commercial truck market has helped Accuride Corp., Evansville, Ind., to a second profitable quarter in a row, with a number of analysts upgrading their advice on the company's stock.
Third quarter 2014 net sales from continuing operations were $184 million, compared with $155.3 million in the same period in 2013, an increase of 18.5%.
Net income from continuing operations was $1.2 million, or $0.02 per share, compared to a 2013 third quarter net loss of $8.4 million, or $0.18 per share. Net income in the third quarter of 2014 included a tax benefit adjustment of $1 million.
“Accuride delivered strong results for yet another quarter in 2014, as each of our business units achieved sustained organic growth and year-over-year improvements in operating income, net income and Adjusted EBITDA," said President and CEO Rick Dauch. "Our results were supported by continued strength in all sectors of the North American commercial vehicle industry. Achieving consecutive quarters of positive net income further demonstrates our ability to generate higher profitability as we grow sales across our leaner, more cost-efficient North American production assets.”
Accuride Wheels segment net sales were $106.7 million, up $18.7 million, or 21.3%, from the same period in 2013, primarily due to stronger OEM truck and trailer demand and stronger aluminum wheel aftermarket revenue, partially offset by lower OEM military demand.
Gunite segment net sales were $42.4 million, up $1.6 million, or 3.9%, from the third quarter of 2013, primarily due to stronger aftermarket demand for brake drums.
“Our sustained improvement over the past four quarters demonstrates that our ‘Fix & Grow’ strategy has repositioned Accuride as a more disciplined supplier, with a lean cost structure capable of generating higher levels of profitability,” Dauch said.
Accuride now expects 2014 net sales to be in the range of $690 million to $700 million, based on projected North American Class 8 production levels in the range of 290,000 to 295,000 units for the year, North American Class 5-7 production levels in the range of 210,000 to 215,000 units and North American trailer production in the range of 255,000 to 265,000 units.
In March of 2010, Accuride announced it had successfully completed a reorganization plan and emerged from Chapter 11 bankruptcy after five months.
In early 2012, it announced a restructuring and significant investments in capacity and capability.
By that fall, Accuride was cutting staff and production as it continued to restructure but also battled soft Class 8 truck orders and a loss of standard equipment position at Navistar and Paccar.
By January 2013, however, Dauch reported that the company was nearly done fixing and was ready to grow.
By this year's second quarter, Accuride was showing positive results, and was net income positive on a year-to-date basis through June for the first time since the onset of the industry recession in 2007.