Tight municipal budgets slow down Badger Meter

Milwaukee-based Badger Meter Inc. reported fourth quarter net earnings of $1.2 million, or 8 cents per share, which was down from a record$6.3 million, or 42 cents per share, in the same period a year ago.
The company’s quarterly net sales dipped 6.4 percent to $60.7 million from $64.8 million a year earlier.
For the full year, Badger Meter reported net sales of $262.9 million, down from $276.6 million in the previous year.
"As we anticipated, the slowdown in spending by customers in the municipal water market that has been impacting our results since the beginning of 2011 continued in the fourth quarter. Water utilities are taking longer to make purchasing decisions because of uncertainties about the economy and potential budget reductions," said Richard Meeusen, chairman, president and chief executive officer of Badger Meter. "The lower municipal water market sales are an industry-wide phenomenon and as a result, we believe our market share has not changed significantly."
Meeusen said higher sales of the majority of the company’s specialty and industrial products somewhat offset the decline in sales to municipal water utilities.
"While we were clearly disappointed with last year’s results, we believe that 2011 was an unusual year in an otherwise strong and growing industry. We have seen some strength going into the first quarter. We have received increased bookings with higher margins from many of our municipal water utility customers, and bookings for our specialty metering products remain strong. Although we are only one month into the quarter, we are optimistic about the year ahead. The fundamental forces driving our business, including water conservation and our customers’ need for accurate information that enables them to better manage their operations, have not changed. We believe the long-term trends are positive and we are positioned for continued growth," Meeusen said.