27.02.2009

Bronto bucks the trend

Bronto, part of Federal Signal Corporation, has reported a strong year and a strong fourth quarter, sales for the full year increased 23 percent to $146 million, while operating profits climbed over 31 percent to $10.4 million. Full year order intake slipped around six percent from the record levels of 2007, to $162 million.

The fourth quarter 2008, dire for many powered access companies, remained buoyant for Bronto, with revenues up 18 percent to $53 million, although order intake in the quarter was $27 million, down from $42 million in the fourth quarter of 2007.

Fourth quarter operating income nearly quadrupled from $4 million to $15.8 million. At the end of the year Bronto’s order book was $144 million up from $133 at the same stage last year. Due says the company to the recently completed plant expansion enabling higher volume throughput and reduced cost related to products and outsourcing.

The company says that it is evaluating low cost country sourcing of fabricated parts, while seeing “long-term opportunities in the North American wind power market as Bronto Skylift truck mounts become the preferred access tool for the maintenance of wind turbine towers.”

William H. Osborne, president and chief executive officer of Federal Signal said: “Bronto's growth potential in this segment is significant. There are currently over 25,000 installed wind turbine towers in the United States with planned construction of an additional 20,000 towers over the next several years. Additionally, Bronto continues to enjoy a strong backlog which has helped to provide Federal Signal with stable cash flow.”

Federal Signal was not as strong as its Bronto division, revenues were up three percent to $959 million, while pre tax profits were cut in half to $26 million, due to higher costs, higher overheads and a $13 million charge.

Vertikal Comment

Overall this is an exceptional performance from Bronto which has become a star performer for Federal. While order intake has slowed in the fourth quarter, most of this was down to European rental companies holding off on placing orders, with underlying strength in the truck mounted sector, it should bounce back as the situation calms a little,.

In the meantime Bronto has almost a full years backlog in hand to power it through the next six to nine months, by which time the orders ought to be flowing at last years levels again from those sectors in which the company thrives.