Modine to close Kentucky facility; Generac plans stock offering; Briggs & Stratton lost $8.7 million in quarter; Twin Disc still feeling recession’s pain
Modine to close Kentucky facility
Racine-based Modine Manufacturing Co., has announced its intention to close its manufacturing facility in Harrodsburg, Kentucky. The closure is expected to impact approximately 110 employees.
Modine will transfer production from the 253,452 square-foot plant to other facilities in North America to consolidate regional production. The Harrodsburg plant makes radiators, round tube plate fin heat exchangers and HVAC modules for the commercial vehicle and off-highway markets.
Plans call for the plant to close over an approximate six- to nine-month period.
“Closing operations is never easy,” said Scott Bowser, Modine regional vice president – Americas. “The difficult decision to close Harrodsburg was based upon our ongoing review and analysis of Modine’s global product lines. This analysis resulted in our decision to strategically de-emphasize our vehicular HVAC presence, which has been a core product line in Harrodsburg. Closing the plant will help us rationalize production, achieve the scale we need in our manufacturing operations and improve our overall profitability and competitiveness.”
Generac plans stock offering
Privately held Generac Holdings Inc. intends to become a publicly traded company.
The Waukesha-based manfucturer of portable residential generators announced last week that it has filed a registration statement for a public offiering of its common stock with the U.S. Securities and Exchange Commission.
Generac intends to sell its stock on the New York Stock Exchange under the ticker symbol "GNRC."
Generac was founded in 1959 in entrepreneur Robert Kern’s Waukesha garage. Kern, who sold a controlling stake of the company in 2006 to CCMP Capital Advisors LLC, a Manhattan-based private equity firm, received the BizTimes Bravo! Entrepreneur Award in 2006.
J.P. Morgan Securities Inc. and Goldman, Sachs & Co. will be joint book running managers of the stock offering.
The offering will be made only by means of a prospectus. When available, copies of the preliminary prospectus relating to the offering may be obtained from: J.P. Morgan Securities at National Statement Processing, Prospectus Library, 4 Chase Metrotech Center, CS Level, Brooklyn, New York, NY, 11245, Phone: (718) 242-8002; or Goldman, Sachs & Co., Attn: Prospectus Department, 85 Broad Street, New York, NY 10004, Phone (866) 471-2526 or Prospectus-ny@ny.email.gs.com.
Briggs & Stratton lost $8.7 million in quarter
Declining consumer demand for portable generators and products with small engines prompted Briggs & Stratton Corp. to incur a net loss of $8.7 million, or 18 cents per share, in its fiscal first quarter, which was worse than a net loss of $2.0 million, or 4 cents per share, in the same period a year ago.
The Milwaukee-based manufacturer’s quarterly net sales declined to $324.6 million from $458.1 million a year earlier.
The company said the increase in its net loss of $6.7 million was primarily the result of lower sales volumes in both reportable segments and a less favorable effective tax rate, partially offset by lower production costs and operating expenses.
The reduction in engine unit volume was attributable to consumer demand for lawn and garden equipment that was softer than that experienced in the same period a year ago and the decrease in demand for engines for portable generators due to the lack of landed hurricanes this year compared with the activity experienced in the first quarter last year.
The company continues to project that its fiscal 2010 net income will be in the range of $40 million to $50 million, or 80 cents to $1.01 per diluted share. Consolidated net sales are projected to be lower between years primarily due to the absence of hurricane-related sales of portable generators and selected price reductions to reflect projected lower commodity costs.
The company’s production levels for substantially all products are planned to be lower in fiscal 2010 due to a decrease in its investment in working capital.
Twin Disc still feeling recession’s pain
Twin Disc Inc. recorded a fiscal first quarter net loss of $2.4 million, or 22 per share, compared with net earnings of $2.5 million, or 22 cents per share, in the same period a year ago.
The Racine-based company’s sales for the latest quarter fell to $47.1 million from $72.7 million a year ago.
The decline in sales was due to the continued impact the global recession is having on the company’s markets, the seasonally weak first quarter and shutdowns at the company’s Italian, Belgian and Racine manufacturing facilities.
Twin Disc designs, manufactures and sells marine and heavy-duty off-highway power transmission equipment. Products offered include: marine transmissions, surface drives, propellers and boat management systems, as well as power-shift transmissions, hydraulic torque converters, power take-offs, industrial clutches and control systems.
Shipments to the mega yacht, industrial, and oil and gas markets remained weak during the fiscal 2010 first quarter.
Michael Batten, chairman and chief executive officer, said, "The global recession that we began to experience in the second half of fiscal 2009 continued to impact our results in the first quarter. As announced previously, we implemented temporary plant shutdowns along with government sponsored layoffs, in addition to normal seasonal actions, to adjust production levels to near term demand, which had a negative impact on absorption rates. Tight controls on spending and other cost reduction initiatives helped offset the impact of the decline in volume."
Twin Disc’s stock dropped this morning by $1.54 to trade at $13.08.
