CHICAGO, Nov. 3 /PRNewswire-FirstCall/ -- JBT Corporation (NYSE: JBT), a leading global technology solutions provider to the food processing and air transportation industries, today reported third quarter 2009 results.
Third quarter inbound orders of $202.1 million and backlog of $272.0 million increased sequentially from the second quarter of 2009. Total revenue of $196.4 million for the quarter declined 23 percent from the third quarter of 2008. Third quarter gross profit margin of 27.5 percent included foreign exchange gains of $4.0 million primarily related to JBT FoodTech's operations. Segment operating profit was $15.9 million, down 35 percent from the year-ago period. During the quarter, the company incurred $0.4 million of restructuring charges in response to continued challenges facing some of JBT AeroTech's product lines. Diluted earnings per share from continuing operations for the quarter were $0.29, flat compared to pro forma diluted earnings per share reported in third quarter of 2008 (calculated on a pro forma basis to include comparable debt and interest expense) and were down 6 percent from the GAAP diluted earnings per share of $0.31 for the same period. Debt, net of cash, was $132.8 million unchanged from second quarter of 2009.
"We are pleased with our third quarter results," said Charlie Cannon, Chairman and Chief Executive Officer. "As expected, the quarter reflected the normal seasonal pattern of JBT FoodTech and continued weak demand in the ground support equipment product line of the JBT AeroTech segment. We are seeing increased activity in many of our markets, but projects are smaller and take longer to finalize than what we experienced in pre-recession periods. As a result of our year-to-date performance and increased market activity, we are raising the lower end of our 2009 earnings per share guidance range."
JBT FoodTech
JBT FoodTech's third quarter revenue of $114.0 million declined 20 percent versus the same period last year. In constant currencies, revenue was down 16 percent due to continued weakness in Western Europe and Latin America, reflecting lower order activity since the onset of the financial crisis in the latter part of 2008. JBT FoodTech's operating profit was $10.4 million. Operating margin was 9.1 percent, largely unchanged from the same period last year. Inbound orders totaled $129.8 million for the quarter, a decline of 6 percent from the same period a year ago and essentially flat in constant currencies. Inbound orders were 14 percent higher sequentially versus the second quarter of 2009, reflecting a slight improvement in Europe and the Middle East and continued strength in Asia Pacific. Backlog of $141.2 million was down 6 percent from the prior-year quarter and up 13 percent sequentially from the second quarter 2009.
JBT AeroTech
JBT AeroTech's third quarter revenue of $78.6 million decreased 32 percent from the same period in 2008, reflecting the continued severe downturn in the airline and airfreight industries which has had the most significant impact in demand for JBT AeroTech's ground support equipment product line. JBT AeroTech's operating profit of $5.5 million for the quarter declined 52 percent compared to the year-ago period primarily due to the impact of lower revenue. Lower expenses from cost reduction initiatives and improved margin from favorable product mix partially offset the profit decline. Excluding restructuring charges of $0.4 million incurred in the quarter, operating margin of 7.5 percent declined 250 basis points from the third quarter of 2008. Inbound orders totaled $72.6 million, down 26 percent from the same period last year. However, inbound orders increased 6 percent sequentially from the second quarter 2009, reflecting a slight pickup in order activity for the ground support equipment product line. Backlog of $136.6 million was down 20 percent from the prior-year quarter and down 4 percent sequentially.
Corporate Items
Corporate expense in the quarter was $4.0 million, down $0.2 million from the third quarter of 2008.
Other income, net of $2.8 million was $8.6 million favorable versus the prior-year quarter due primarily to favorable foreign exchange impacts. The company hedges its foreign exchange transactions and has elected not to apply hedge accounting for a majority of its foreign currency exposures. As a result, mark-to-market gains or losses from currency fluctuations are recognized in earnings each period. During the current quarter, the company recorded $4.0 million in mark-to-market gains primarily related to JBT FoodTech operations due to the recent weakening of the U.S. dollar. In the third quarter of 2008, the company incurred foreign exchange losses of $3.1 million associated with the spin-off from FMC Technologies and a $1.4 million mark-to-market loss again primarily related to JBT FoodTech due to the significant strengthening of the U.S. dollar in the third quarter of 2008.
Cash generated from operating activities in the quarter was $5.3 million after the company funded a $12.0 million contribution to its U.S. pension plans. In September, the company announced it was freezing its U.S. defined benefit plan for non-union employees as of December 31, 2009. The company ended the quarter with debt, net of cash, of $132.8 million, unchanged from the second quarter of 2009. Net interest expense was $2.1 million in the third quarter of 2009.
The year-to-date effective tax rate from continuing operations was 33.9 percent, reflecting a slight decline from the rate reported at the end of the second quarter of 2009.
Year-to-date capital expenditures totaled $14.5 million and depreciation and amortization totaled $16.5 million.
2009 Outlook
The company is updating its full-year 2009 earnings guidance from $0.95 - $1.15 to $1.07 - $1.15 per share reflecting favorable year-to-date performance and modest improvement in JBT FoodTech's European markets.
Third Quarter Earnings Conference Call
The company will hold a conference call at 9:00 AM EST Wednesday, November 4, 2009, to discuss the third quarter 2009 results. The call can be accessed live by dialing (877) 235-3250 or (706) 643-5005 and using conference ID 31475346, or through the Investor Relations link on JBT Corporation's website at http://ir.jbtcorporation.com. A replay of the call will be available through November 11, 2009 and can be accessed by dialing (800) 642-1687 or (706) 645-9291 and referencing passcode 31475346. A rebroadcast also will available on the company's Investor Relations website.
