Robbins & Myers to Continue Job Cuts into Third Quarter as Profit Falls on Dwindling Orders

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Researched by Industrial Info Resources (Sugar Land, Texas)--Robbins & Myers Incorporated (NYSE:RBN) (Dayton, Ohio), a manufacturer of engineered equipment for the energy, industrial, chemical and pharmaceutical markets, has posted a second-quarter 2009 net income of $15.06 million, down 7.8% compared with $16.34 million in the same period a year ago. The decline is attributed to a drop in sales, which fell 11.4% to $163.83 million, as orders fell and cancellations rose, the company said. "The market declines experienced during our first quarter continued into the second quarter," President and CEO Peter Wallace said. "We experienced a significant reduction in orders as customers took the opportunity to adjust their requirements for future product shipments, and this resulted in a rise in order cancellations."

Robbins & Myers has begun to cut the number of employees and expects the reductions to continue into the third quarter, the company stated. "Discretionary spending was cut sharply, we reprioritized our capital spending programs and increased our focus on working capital to support cash-flow improvements in the second half of the year," Wallace said.

2Q09 Sales by Business Segment (year over year)

• Fluid Management: $72.32 million, down from $76.51 million
• Process Solutions: $63.06 million, down from $74.95 million
• Romaco: $28.45 million, down from $33.47 million

The company's order backlog dropped nearly 30% to $185.43 million, compared with $263.59 million in the same period a year ago. The largest decline was in the Romaco unit, which experienced a drop in order backlog of 45.42%, from $263.59 million to $185.43 million. The Romaco unit designs, manufactures and markets equipment for the pharmaceutical, cosmetics and food industries.

"Each of our product platforms experienced customer order weakness in the second quarter, causing us to lower our sales and profit expectations for the second half of the year," Wallace said. "We will continue to hone our cost structure for the balance of the year while pursuing key sales and profit initiatives."

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