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Friday, Oct 7, 2022
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Ameron’s Profit Falls 90 Percent on Weaker Markets

Ameron International Corp., which earlier this week agreed to sell itself to a Houston company, on Friday said that its earnings plunged 90 percent in the second quarter due to weaker U.S. construction activity and lower demand in Asia.

The Pasadena pipe manufacturer, which serves the chemical, industrial, energy, transportation and infrastructure markets, reported net income of $989,000 (11 cents a share) for the quarter ended May 29, compared with net income of $9.5 million ($1.03) a year earlier.

Revenue fell 1.3 percent to less than $135 million, with infrastructure product sales down 3 percent due to fewer sales to contractors.

“Operations improved compared to the first quarter when weather was a major factor,” Chief Executive James Marlen said in a statement. “However, the company’s businesses continued to suffer from margin pressure related to weak construction markets and a lull, which is expected to be temporary, in Asian fiberglass pipe markets.”

The company in early May warned that it likely would be only marginally profitable in the second quarter. In addition to slower sales, the company had larger than usual legal expenses. The company’s management earlier this year fought a proxy battle with a large hedge fund, which was able to gain a seat on the board.

In addition, the company had expenses related to its decision to be acquired by oilfield equipment maker National Oilwell Varco Inc. for $772 million, which was announced Tuesday.

Shares were down 20 cents, or less than 1 percent, to $85.20 in midday trading on the New York Stock Exchange.

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