DOW JONES NEWSWIRES Cooper Industries Inc. (CBE) cut its fourth-quarter forecast, citing lower retail orders, project delays by customers and volatility in commodity prices.
Shares fell 6.1% to $22.65 in after-hours trading.
The electrical products and tools manufacturer, saying it has seen business conditions worsen in the past few weeks, now expects earnings to be below its October guidance of 83 cents to 92 cents a share, excluding charges for its previously announced cut of 1,000 jobs. That view was below analyst estimates at the time.
The company said it could not issue new guidance until it knows more about customer commitments and sees "a more stabilized economic environment."
"Retail orders in certain businesses have declined significantly, as has quoting and shipping activity in light commercial and certain utility products. We also have seen some customers delay or requote projects and we anticipate further destocking of customer inventory levels as the quarter progresses," said Chief Executive Kirk S. Hachigian.
The commodity price volatility could hurt the company's margins, he added.
Hachigian said Cooper is reducing production levels to manage inventory and will cut costs through planned production shutdowns during the rest of the year, in addition to the job cuts.
"Looking beyond the current business environment, we remain very positive on the prospects for Cooper," he said, pointing to the company's strong balance sheet and portfolio of businesses.
In addition, Cooper should benefit from long-term trends, such as the need for utilities to provide better reliability and productivity through energy-demand management, the increasing need for electrical products to become more energy-efficient and the global infrastructure build-out.
Last month, Cooper said third-quarter net income rose 20% due to strong electrical-products sales, but the company lowered its year earnings guidance.
-By Kathy Shwiff, Dow Jones Newswires; 201-938-5975; Kathy.Shwiff@dowjones.com
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(END) Dow Jones Newswires
November 21, 2008 17:54 ET (22:54 GMT)

Publié le 21 novembre 2008 Copyright © 2008 Dowjones