Ingersoll Rand:Swung to a profit in the fourth quarter as the year-earlier period contained huge write-downs on the company's Trane heating and air-conditioning business. In addition, the company's revenue drop in the latest quarter was softened by improved margins.Ingersoll-Rand, whose other brands include Hussmann commercial refrigerators, Club Car golf carts and Schlage door locks—also boosted its 2010 earnings target by 20 cents to $2.20 to $2.60 a share while giving a revenue target bracketing analysts' expectations.
But Ingersoll-Rand projected a first-quarter profit of 15 cents to 20 cents excluding restructuring expenses on revenue of $3 billion to $3.1 billion. Analysts polled by Thomson Reuters anticipated 38 cents and $3.02 billion, respectively.
Chief Executive Michael Lamach said Friday that Ingeroll-Rand is now "beginning to see improvement in markets that lead the recovery," although challenges remain in some major markets. He added the company will continue to focus on productivity and innovation to drive growth.
Construction stagnation damped demand for Ingersoll-Rand's products. U.S. commercial construction activity fell in every month of the fourth quarter, according to the Commerce Department, but some international markets have begun to rebound, such as China. Indeed, in the most recent period, the revenue decline in the U.S. was steeper than that internationally.
Ingersoll-Rand posted a profit of $139.4 million, or 42 cents a share, compared with a year-earlier loss of $3.29 billion, or $10.27 a share. Excluding items such as the Trane write-down, earnings from continuing operations fell to 48 cents from 53 cents.
Revenue decreased 9.9% to $3.31 billion and the drop was about 13% excluding currency effects.
In October, the company projected earnings of 44 cents to 54 cents on revenue of $3.2 billion to $3.4 billion.
Gross margin rose to 27% from 23.7% amid the company's cost-cutting.
