Providence, R.I. -
, the parent of multiple residential- and commercial-system suppliers, posted its second consecutive quarterly net profit in its fiscal third quarter and cited strength in its residential markets for a quarterly sales gain of almost 10 percent.
Companywide sales grew by 9.9 percent to $496.6 million in the quarter ending Oct. 2, compared with the year-ago period, and by 4.2 percent for the nine-month period to $1.44 billion.
Third-quarter net earnings hit $9.8 million compared with a year-ago loss of $12.4 million, although for the nine-month period, the company posted a net loss of $3.3 million because of a first-quarter $13.4 million loss. The $3.3 million net loss, however, paled in comparison to the year-ago loss of $290.5 million.
Operating profits hit $26.7 million in the third quarter, down slightly from a year-ago $27.7 million, but operating earnings rose to $58 million for the nine-month period compared with a year-ago loss of $173.4 million. The company posted operating profits in its first and second quarters as well.
Despite "the economic challenges that continue to impact the majority of the markets we serve," said chairman/CEO Richard Bready, "we are encouraged by sales of products geared toward the residential new construction, remodeling and replacement markets, which drove increased revenue for the quarter." Nortek's "solid financial performance" in 2010 "also reflects the company's ongoing, dedicated focus on working capital and cost-reduction initiatives," he added.
"Although there are some recent positive signs in new and existing home sales, we expect the residential housing markets will remain weak into 2011 due to expirations of tax initiatives, the impact of continued high unemployment levels, low consumer confidence and continued high levels of foreclosures," bready continued in a prepared statement. "Conditions in the non-residential construction market remain challenged but are beginning to show signs of life, and banks appear to be more willing to make financing available. However, we expect that there will be no significant impact on Nortek's business until 2011."
Nortek's residential brands include Niles Audio, Xantech, Elan, Gefen, Omnimount, Panamax, SpeakerCraft and others.