Acquisition cuts into Douglas Dynamics profit

Additional revenue to be realized in later quarters

snow plow
Douglas Dynamics makes vehicle attachments such as plows.

Milwaukee-based Douglas Dynamics Inc. reported a 53 percent drop in net income during the third quarter as the acquisition of Dejana Truck & Utility Equipment Co. negatively impacted profits.

snow plow
Douglas Dynamics makes vehicle attachments such as plows.

Earnings for the quarter were down from 68 cents to 32 cents per diluted share, including 17 cents lost on shipments to Dejana that will not be recognized as revenue until the items are sold to end users.

Revenue was up 2.5 percent during the quarter to $123.6 million. The topline result benefited from the acquisition, which closed on July 17.

“This was a very important quarter in our company’s history,” said James Janik, Douglas Dynamics chairman, president and chief executive officer. He noted that the company had introduced a new reporting segment as a result of the Dejana deal and was also continuing to implement its new proprietary management system.

“We are focused on further reducing their already industry leading lead times and driving productivity improvements and expect to achieve great results in the years ahead,” Janik said.

He said the performance was generally within expectations following record performance last year and limited snowfall this past winter.

“While we are diversifying and expanding our portfolio, the snow and ice management business will always be the core of our company. The levels of quality and service we have consistently produced means we have set a very high bar not just for our competitors, but the other business units within our company,” Janik said.

Sign up for BizTimes Daily Alerts

Stay up-to-date on the people, companies and issues that impact business in Milwaukee and Southeast Wisconsin

Arthur covers banking and finance and the economy at BizTimes while also leading special projects as an associate editor. He also spent five years covering manufacturing at BizTimes. He previously was managing editor at The Waukesha Freeman. He is a graduate of Carroll University and did graduate coursework at Marquette. A native of southeastern Wisconsin, he is also a nationally certified gymnastics judge and enjoys golf on the weekends.

No posts to display