Milwaukee-based Badger Meter Inc. reported increased sales, earnings and earnings per share for the third quarter.
Badger Meter’s quarterly net earnings grew to $8.9 million, or 62 cents per share, from $6.9 million, or 46 cents per share, in the same period a year ago.
The company’s quarterly net sales jumped 25 percent to $87.1 million from $$69.7 million a year earlier.
“This was a strong quarter for Badger Meter, with all three of our product categories contributing to the improvement. The 25 percent increase in sales, combined with significantly improved profit margins and ongoing cost controls, generated a 77 percent increase in operating earnings, compared to last year’s weak third quarter,” said Richard Meeusen, chairman, president and chief executive officer of Badger Meter.
Meeusen said the increase in third quarter sales reflected the addition of Racine Federated Inc. in January, along with higher sales of the company’s municipal water products. He noted that net earnings for the third quarter of 2011 benefited from recognition of previously unrecognized tax benefits for certain tax deductions taken on prior tax returns amounting to approximately 10 cents per share after tax.
“Badger Meter remains financially strong. Our debt to total capitalization ratio was slightly below 30 percent at the end of the third quarter, even with the purchase of Racine Federated early in the year. We completed a $30 million stock buyback program last quarter and increased our quarterly common stock dividend by 6.25 percent to 17 cents per share in August. Our strong cash flow and balance sheet enable us to return capital to shareholders as well as continue to invest in new product development and marketing initiatives,” Meeusen said. “Our strong third quarter performance gives us a good tailwind into the fourth quarter. However, our fourth quarter is typically softer than the third quarter and we are still seeing some uncertainty in the utility market related to the economy and municipal budgeting. Long term, we remain optimistic about the future of Badger Meter and the fundamentals of the water industry.”
