Though NN Inc. called 2011’s third quarter its weakest of the year, the Johnson City-based manufacturer still recorded $101.1 million in net sales and earned $3.3 million in net income, according to financial results released this week.
The company said its net sales, which were up $10.1 million or 11.2 percent compared to the same time in 2010, were impacted by weak demand in the European automotive market; however, revenues were shored up by higher sales volume at U.S. and China operations, foreign currency translation and raw material pass though and price increases.
“As expected, our third quarter was the weakest of the year, due to normal seasonality in our business, especially in Europe. This year’s revenues were further negatively impacted in Europe due to weak demand in the automotive industry,” said Roderick R. Baty, chairman and CEO. “Demand for our products in the North America automotive and industrial, European industrial markets and the Asian automotive and industrial markets remained relatively strong.”
Year to date, NN Inc. has posted net sales of $328.4 million, an increase of $59.3 million or 22.1 percent compared to net sales of $269 million for the first nine months of 2010. The company attributed about $34 million of that increase to “recovering demand for NN’s products, particularly in industrial and automotive end markets and the addition of new sales programs at Whirlaway.”
The local manufacturer took in $3.3 million of net income for the third quarter, up from $2.8 million in the third quarter of 2010. Year to date net income is $15 million, compared to $8.5 million in the first nine months of 2010.
With its third quarter results, the company also said it revised its full year revenue estimates downward, from between $435 million and $440 million to between $425 million and $430 million, due to economic uncertainty and the strengthening dollar.
“Uncertainty in the global economic markets is expected to continue for the remainder of the year. We are anticipating good levels of demand to continue for the North American automotive and industrial markets, the European industrial markets and the Asian markets with somewhat weaker demand in the European automotive industry. Last quarter we increased our revenue guidance for the full year to a range of $435 million to $440 million from $420 million to $425 million based on customer orders and forecasts,” Baty said. “However, we now expect our fourth quarter revenues to be flat to slightly down sequentially to our third quarter revenues. Accordingly, we now feel our full year revenues for 2011 will be closer to a range of $425 million to $430 million. This lower forecast still exceeds our original revenue guidance provided at the beginning of the year of $405 million to $415 million and represents a significant improvement over full year revenues of $365 million in 2010.”
The company’s stock closed at $7.29 on Wednesday, up 61 cents or 9.13 percent from the previous day.