Proliance Reports Increase in Third Quarter Profits - aftermarketNews

Proliance Reports Increase in Third Quarter Profits

For the quarter, net income increased to $1.4 million, or 7 cents per diluted share, compared to $129,000, or 1 cent per diluted share, in the same period last year.

NEW HAVEN, Conn. — Proliance International has announced results for the third quarter and nine months ended Sept. 30.

For the quarter, net income increased to $1.4 million, or 7 cents per diluted share, compared to $129,000, or 1 cent per diluted share, in the same period last year. Net sales in the 2008 third quarter were $95.4 million compared to $115.3 million in the prior year period, the variance reflecting the company’s change in strategy away from direct sales through branches, and toward sales through wholesalers for certain products, and the adverse effects of the Southaven casualty event, which also impacted first and second quarter sales this year.

Operating income increased 35 percent, to $8.4 million in the third quarter of 2008 compared to $6.2 million in the prior year period. The 2008 third quarter benefited from the Company’s continuing cost reduction program, partially offset by costs net of insurance proceeds related to lost sales, lower margins due to higher product related costs and higher operating expenses, all attributable to the Southaven casualty event. The 2007 third quarter included $1.9 million of restructuring costs associated with the Company’s change in distribution strategy.

The third quarters of 2008 and 2007 also included debt extinguishment costs of $2.2 million and $0.9 million, respectively. In 2008, these costs represented the write-down of deferred debt costs and prepayment penalties associated with the Company’s credit agreement. The agreement required Proliance to apply a significant portion of the Southaven casualty event insurance proceeds to pay down borrowings. As a result, total debt of $47.8 million at Sept. 30 was $19.7 million less than at Dec. 31, 2007.

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