With news from Briggs & Stratton, Koss, more layoffs across the state, and an acquisition by Environment Systems Inc.
Briggs reports flat quarter
Briggs & Stratton Corp. has reported fiscal second quarter net income of $3.2 million, or 6 cents per share, which was down from $4.1 million, or 8 cents per share, in the same period a year ago.
The Milwaukee-based manufacturer’s quarterly net sales were flat at $477.5 million.
The company’s engines segment sales were greater than last year, but its power products segment sales were lower.
The prior year’s second quarter results included two significant items: a $37.0 million gain resulting from the sale of an investment in preferred stock including the final dividend paid on the preferred stock; and a $17.7 million warranty expense for a snow engine recall.
The company continues to estimate net income in a range from $40 million to $50 million for the full year.
"This range reflects our belief that channel inventories of lawn and garden products are at normal levels after the 2008 season and our projections related to our product placement for fiscal 2009 are still valid. The forecast continues to reflect the uncertainty of the upcoming spring selling season for outdoor power equipment given the current economic conditions. The company also projects that the third quarter’s results will lag the comparable period from a year ago because major retailers will control their working capital commitment to the category and be more comfortable with chasing demand this year while they assess the strength of consumer demand during the spring," the company said today.
Koss remains stout against recession
Although Koss Corp. is facing declines in net income and revenues, the company does not plan to reduce its workforce or cut back on research and development.
The Glendale manufacturer of high-fidelity stereophones recently reported that its fiscal second quarter net income fell to $322,454, or 9 cents per share, from $1.2 million, or 34 cents per share, in the same period a year ago. The company’s quarterly sales dropped by 15 percent to $10.3 million from $12.1 million a year earlier.
"We are disappointed with the slowdown in sales for the quarter," said Michael Koss, president and chief executive officer. "We believe that most of the reduction can be traced to retailers reducing their inventory levels by restricting ‘open-to-buys’ on several product categories. When this happens, inventory is not replenished at the rate of sale and out of stocks can take place."
Koss said the company decided against making sudden cuts in operating expenses in response to the economic downturn.
"We are continuing to spend money on engineering, research, development and marketing despite the current worldwide economic slowdown," Koss said. "This commitment will set back our profitability in the short term. However, any move to postpone this initiative would hamper the long-term success of the company."
Koss said the company will continue to invest in its future, despite current market conditions.
"Without an investment in new products, the company will not be prepared to fully participate in the marketplace once the worldwide recession has come to an end," Koss said.
Three more Wisconsin manufacturing plants to close
Three more manufacturing plants in Wisconsin will close, eliminating nearly 500 more jobs, it was announced last week.
Alcoa Wheel Products has informed the Wisconsin Department of Workforce Development (DWD) that it will close its plant in Beloit, eliminating 293 jobs in March. Many of the affected employees are members of the United Auto Workers, Local 95.
The plant’s parent company, Pittsburgh, Pa.-based Alcoa Inc., announced it lost $1.2 billion in the fourth quarter and will cut its global workforce by 4 percent, or 13,500 jobs.
"These are extraordinary times, requiring speed and decisiveness to address the current economic downturn, and flexibility and foresight to be prepared for future uncertainties in our markets," said Klaus Kleinfeld, president and chief executive officer of Alcoa Inc. "We are taking a wide-ranging set of aggressive, but prudent, measures to ensure that Alcoa maintains its competitive lead in today’s challenging markets while also emerging even stronger when the economy recovers."
Meanwhile, Hutchinson Technology Inc. (HTI) filed notice that it will close its photo etching plant in Eau Claire, eliminating 100 jobs in March. The company is based in Hutchinson, Minn.
The DWD Dislocated Worker Unit is working with its local partners to coordinate services to affected Hutchinson employees.
In Plover, near Stevens Point, Basic American Foods Inc. announced it will close its plant, eliminating 106 jobs, in September.
Environmental Systems Inc. acquires ECC Controls Inc.
Waukesha-based Environmental Systems Inc. (ESI) has acquired ECC Controls Inc. of Milwaukee in a strategic growth move that expands ESI’s technology offerings and its Midwest presence.
ECC’s employees and operations have been integrated into ESI. The ECC Milwaukee office has moved to the ESI facility in Waukesha, located at W223 N603 Saratoga Drive.
ESI provides a range of technology and services in the areas of building automation, systems integration, networking and IT infrastructure, security, life safety, building operations and software applications in Wisconsin, Illinois and Michigan.
ECC provides temperature controls, building automation, energy management and security systems in Wisconsin and Upper Michigan.
"The acquisition of ECC Controls results in a powerful strategic synergy between the two companies," said Paul Oswald, president of ESI. "ECC Controls is a respected supplier in the building automation and management field. ECC brings a premier technology brand, T.A.C Andover, to ESI, which adds to ESI’s existing role as a T.A.C I/A partner. In addition, ECC provides an expanded customer base and an important regional location in Eau Claire, Wis., that will allow us to serve our customers in Western Wisconsin. “
ESI has facilities in Waukesha, Chicago, and Houghton, Mich.
