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Issue Date: Vol. 49, No.7, July 2009, Posted On: 7/28/2009

Crane Q2 Sales, Income Decline As Soft Economy Depresses Demand

by Staff Reporter
Crane Co., Crane Merchandising Systems, Crane National Vendors, vending, vending businesses, vending routes, automatic retailing, vending news, coin-op news

STAMFORD, CT -- Crane Co. reported that 2009 second-quarter net income totaled $27.8 million, or 47¢ per share, compared with $59 million, or 97¢ per share, in the 2008 quarter.

Earnings for the 2009 second quarter were affected adversely by $1.4 million of net after-tax charges (2¢ per share), primarily related to a previously announced restructuring program. And last year's second-quarter earnings had benefited from recoveries of $2.9 million after taxes (5¢ per share) in conjunction with environmental remediation activities.

Sales for the second quarter of 2009 fell $148 million, or 21%, which includes a core sales decline of $146.1 million and unfavorable foreign currency translation of $37.3 million, partially offset by an increase from acquired businesses of $35.4 million.

"Our sales and earnings declined from our record second-quarter 2008 results, and were lower than we expected just three months ago," said Crane president and chief executive officer Eric C. Fast. He noted that the second-quarter 21% sales decline exceeded a 16% decline in the first quarter and the company's full-year guidance of a 7% reduction in sales.

"Year-over-year sales were sharply lower in our short-cycle businesses, specifically at Engineered Materials, Merchandising Systems and Controls, which continue to be impacted by very difficult end-market conditions," Fast continued. The Crane chief added that sales declines in Crane's longer-cycle Aerospace and Fluid Handling businesses were more pronounced than in the first quarter, and that the company expects demand to soften through the balance of the year. Thus, he said, the company anticipates 2009 sales of $2.2 billion, 15% below 2008's $2.6 billion.

Total sales in Merchandising Systems decreased $42.9 million (37%) from the comparable prior-year period, reflecting declines in both Vending Solutions and Payment Solutions sales. Crane reports that it is on track to complete the previously announced consolidation of vending machine production from St. Louis, MO, to the Williston, SC, facility by year's end.

Engineered Materials sales fell 43% from the second quarter of 2008 to this year's quarter, while Controls sales declined 46%. Fluid Handling sales decreased 13%, partially offset by sales from acquired businesses of 12%; and Aerospace and Electronics sales fell 11% from the comparable period last year.

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