Carlisle Annual Figures Reflect Difficult Times for Industry

Carlisle Companies Incorporated has reported net sales from continuing operations of US$623.5 million for the quarter ended December 31, 2008, a 1 per cent decline in net sales from continuing operations of $631.4 million in the fourth quarter of 2007. The company says that a downturn sales in its Transportation Products segment, which includes Carlisle Wheel and Tire, along with its Construction Materials segment offset growth in other areas of the company’s business. For the full-year ended December 31, 2008, net sales from continuing operations were $2.97 billion, an 11 per cent increase over net sales from continuing operations of $2.68 billion in 2007. Sales increased in all segments, says Carlisle and organic sales growth was 3 per cent.

Net income from continuing operations of $13.8 million in the fourth quarter 2008 compared with $42.2 million, or $0.68 per diluted share, in the fourth quarter of 2007. Again, a decline in unit volume in the Transportation and Construction Materials segments contributed to this decrease in income. Net income from continuing operations for the year ended December 31, 2008 was $149.5 million as compared to $214.4 million reported in 2007.

Company chairman and CEO David A. Roberts commented that “2008 was a very challenging year as we faced unprecedented raw material cost increases which we were never able to completely offset with productivity improvements and price increases. Consequently, our profitability suffered in a record sales year.

“In November and December, we saw a significant slowing in our order rate in nearly all of our businesses as our customers began to slow their purchases in light of the financial crisis,” he added. “To react, we reduced our workforce and temporarily shut down a number of facilities. Tyre, wheel, trailer, and industrial brake plants were closed early for the December holiday season and many of those plants remained closed in early January. We also implemented reduced work weeks at other plants.”

Roberts continued: “During the fourth quarter, our Bowdon, Georgia tyre and wheel facility was destroyed by a fire. Fortunately, no one was injured and our people did an excellent job getting a temporary facility up and running within two weeks of the fire. The loss of the plant is expected to be fully recoverable by insurance.”

The Transportation Products segment itself earned net sales of $170.1 million for the fourth quarter of 2008, a decrease of 8 per cent from the corresponding quarter of 2007. Growth in the agricultural and construction tyre and wheel markets was more than offset by continued softness in the lawn and garden, high speed trailer, styled wheel and construction trailer markets. In the fourth quarter 2008, the Transportation Products segment incurred an operating loss of $3.1 million. This compared to operating income of $14.6 million in the fourth quarter of 2007. Operating income was negatively impacted by reduced production, higher raw material costs as existing higher cost inventory was sold in the quarter, and approximately $0.9 million of restructuring charges.