Polypore Intl Earnings: Margins Shrink as Revenue and Net Income Fall

Polypore International Inc. (NYSE:PPO) reported its results for the third quarter. Polypore International is a global technology filtration company that develops, manufactures, and markets specialized microporous membranes used in separation and filtration processes.

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Polypore International Inc. Earnings Cheat Sheet

Results: Net income for Polypore International Inc. fell to $14.2 million (30 cents per share) vs. $23.6 million (50 cents per share) a year earlier. This is a decline of 39.8% from the year-earlier quarter.

Revenue: Fell 6.6% to $177.6 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Polypore International Inc. reported adjusted net income of 37 cents per share. By that measure, the company beat the mean estimate of 33 cents per share. It beat the average revenue estimate of $173.4 million.

Quoting Management: “Performance in the third quarter was consistent with the updated outlook we provided in September,” said Robert B. Toth, President and Chief Executive Officer. “While 2012 continues to be a challenging year, particularly due to the sales rates of certain high-content electric drive vehicles and an ongoing weak economic environment, long-term growth trends remain positive. Given our recent investments, we are well positioned to capitalize on that growth as it occurs and-with the majority of our cash spend for these investments now behind us-we are transitioning into a period of substantial cash generation going forward in 2013.”

Key Stats:

The company has now seen net income fall in each of the last three quarters. In the second quarter, net income fell 30.6% from the year earlier, while the figure fell 26.9% in the first quarter.

Revenue has fallen for the last three quarters in a row. In the second quarter, revenue declined 5.4% to $185.8 million while the figure fell 6.4% in the first quarter from the year earlier.

The company topped expectations last quarter after falling short of forecasts in the second quarter with net income of 45 cents versus a mean estimate of net income of 47 cents per share.

Looking Forward: Analysts appear increasingly negative about the company’s results for the next quarter. The average estimate for the fourth quarter has moved down from 68 cents a share to 51 cents over the last ninety days. For the fiscal year, the average estimate has moved down from $2.13 a share to $1.70 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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