The Eastern Co. on Wednesday reported a 78 percent surge in second-quarter profits, as all three of its business segments registered increases in both sales and operating earnings.
The Naugatuck-based industrial conglomerate reported net income of $2.6 million, or 42 cents per diluted share, compared with $1.5 million, or 24 cents per diluted share, for the second quarter of 2011.
The earnings came on quarterly net sales of $41.6 million, a 17 percent increase from $35.5 million in the same quarter last year. It was the 10th straight quarter in which the company has reported improved sales on a year-over-year basis.
Eastern is a 154-year-old company that makes vehicular and industrial hardware, locks, metal castings, and coin-vending and smart card products in 10 manufacturing plants in the United States, Canada, Mexico, Taiwan and China.
Leonard F. Leganza, Eastern's chairman, president and CEO, said the company's Metal Products division continued to benefit from strong demand for products that serve the coal-mining industry. Sales in the division's contract-casting business, which provides products for various industrial markets, also increased from the year-ago quarter, driven primarily by sales to the railroad and solar panel industries, he said.
Increased orders for latching hardware used in the military's Family of Medium Tactical Vehicles program helped boost revenue in the company's Industrial Hardware segment, Leganza said. The military's Humvee program, an important market for the company's latching systems, will be discontinued later this year, but that the company hopes to participate in a new program, currently in the design phase, for a new Joint Light Tactical Vehicle, he said.
The Industrial Hardware segment's results were also helped by a "robust Class 8 truck market," where the demand for its engineered hardware products and lightweight composite panels used in manufacturing sleeper cabs and truck bodies increased, Leganza said. Eastern is launching a new product line of two-way air vents used on Class 8 trucks that Leganza hopes will create "additional opportunities for sales of related hardware into that market."
Eastern's Security Products division reported increased revenue with both its traditional commercial laundry products and its locking products, Leganza said. Sales to commercial laundry markets were driven by increased orders for meter cases installed on commercial washers and dryers. Increased sales of locks to the cash management and computer markets in the first half of the year helped offset some of the softness in several of the markets Eastern serves, he said.
"We are pleased with the progress the company is experiencing as we recover from the current recession," Leganza said. "The focus and emphasis we have placed and are continuing to place on cash flow control during the current economic uncertainties have positioned the company in solid financial condition."
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