- THE MAGAZINE
Chris Killingstad, Tennant Company's president and chief executive officer, commented: "We had a very solid quarter, especially in light of the tough economic climate. Our third quarter performance reflects sales growth across all of our regions, and particularly in our emerging markets, such as China and Latin America. Further, Tennant’s selling price actions, combined with cost-reduction programs and global sourcing efforts, continued to drive gross margin improvement.”
Contributing to Tennant’s 2008 third quarter earnings were two unusual items that together resulted in a net benefit of $0.19 per diluted share. These included a $2.7 million net foreign currency gain from the settlement of forward contracts, which added $0.09 per diluted share to earnings, and favorable discrete tax items primarily related to U.S. Federal tax settlements, which added $0.10 per diluted share. In addition, the 2008 third quarter results included dilution of $0.01 per share from the acquisitions of Applied and Alfa.
Earnings for the 2007 third quarter included a net tax benefit of $0.19 per diluted share primarily related to the reversal of a tax valuation allowance on foreign net operating loss carryforwards. Also included in the company’s 2007 third quarter results was a workforce restructuring charge of $0.06 per diluted share. The net effect of these two unusual items was a positive $0.13 per diluted share in the 2007 third quarter.
For the nine months ended September 30, 2008, Tennant Company announced net earnings of $27.5 million, or $1.48 per diluted share, on net sales of $548.1 million. The 2008 first nine months included a $0.07 per share dilutive impact related to acquisitions and a net benefit from unusual items of $0.09 per diluted share.
Tennant reported net earnings in the comparable 2007 period of $27.3 million, or $1.42 per diluted share, on net sales of $481.6 million for the first nine months of 2007. For the first nine months of 2007, the net effect of unusual items was a positive $0.13 per diluted share.