CHICAGO Timken Co.s earnings slumped in the third quarter due in part to weaker demand from its broad end markets, as well as lower volume and manufacturing utilization.
The Canton, Ohio-based steelmaker and bearings producer reported net income of $52.2 million for the three months ended Sept. 30, down 35.5 percent from $80.9 million in the same period last year, on sales that fell 7.1 percent to $1.06 billion from $1.14 billion.
The loss was partially offset by lower raw material and plant closure costs, as well as favorable pricing, the company said.
Timkens steel business recorded sales of $350.5 million in the quarter, down 7 percent from the same year-ago period, due in part to reduced shipments to industrial sectors. Earnings before interest and taxes (Ebit) slumped 41.2 percent to $29.2 million, reflecting an unfavorable sales mix, lower volume and higher manufacturing costs, including scheduled maintenance.
Raw material surcharges decreased $4 million year on year during the period, the company said.
Timkens steel sales for the first nine months of 2013 totaled $1.05 billion, down 25.6 percent from the same period last year, while Ebit shrank 52.6 percent to $107.3 million in the same comparison.
"On a macro basis, economic growth across the world has been much slower than we and our customers envisioned, and our third-quarter results were below our expectations," Timken president and chief executive officer James W. Griffith said in a statement Oct. 24.
"As a result, weve implemented and are continuing to take additional actions to allow us to enhance margins despite the lower demand," such as rationalizing capacity, he said.
The company is still pursuing a plan to separate its steel business from its bearings and power transmission business through a tax-free spinoff, creating an independent, publicly traded steel company next year (amm.com, Sept. 6).