Oak Brook-based Federal Signal Corporation sales and income were up in the first quarter to 2012 as the company benefitted from increased demand and internal restructuring.
The company reported first quarter operating income of $12 million, up 17 percent over the same period last year. The increase was the result of improved gross margins in the company's environmental solutions group, as well $900,000 of restructuring costs incurred last year in the in the safety and security systems group that did not repeat in 2013.
Sales during the quarter were $200 million, an increase of 2 percent, primarily from higher municipal sewer cleaner shipments associated with strong opening backlog and improved volume and pricing in the safety and security systems group, the company said in a release. The increase was partially offset by weaker demand in the Asia Pacific and Mexico markets within the environmental solutions group and unfavorable volumes and product mix in the fire rescue group.
"Our long-term trend of expanding margins continued in the first quarter as the company delivered 6.1 percent operating income margin, led by the environmental solutions group," said Dennis J. Martin, president and chief executive officer. "This performance marked a significant improvement over the prior year period. We are pleased with the 12 percent reduction in interest expense during the first quarter versus the prior year period, and the increased interest savings we will experience throughout 2013 and beyond as a result of our successfully completed refinancing."
New orders were down 14 percent for the quarter, at $192.2 million compared to $223.1 million a year earlier. The company said it was due to to weaker international demand, and was affected from a high level of orders for industrial vacuum trucks during the first quarter in 2012, including a large order from an international customer.
"Despite an uncertain global economic environment, our performance during the first quarter and our outlook through midyear position us to reaffirm our guidance of adjusted earnings from continuing operations of 20 cents to 25 cents per share for the first half of the year, excluding the effects of debt settlement charges," Martin said.