Financial news
MGIC lost $151.7 million in quarter
Milwaukee-based MGIC Investment Corp. reported a second quarter loss of $151.7 million, or 75 cents per share, compared with net income of $24.6 million, or 13 cents per share, in the same period a year ago.
The nation’s leading provider of private mortgage insurance coverage reported that its delinquencies exceeded cures, or mortgages that have become current in their payments.
MGIC’s net loss for the first six months of 2011 was $185.4 million, compared with a net loss of $125.5 million for the same period last year.
The company’s total revenues for the second quarter were $367.0 million, down from $406.4 million in the second quarter last year.
As of June 30, 2011, the percentage of loans that were delinquent, excluding bulk loans, was 13.40 percent, compared with 14.94 percent at December 31, 2010, and 14.97 percent at June 30, 2010.
Associated Banc-Corp gained $25.6 million
Green Bay-based Associated Banc-Corp reported a net income of $25.6 million, or 15 cents per share, in the second quarter. At the same time a year ago, the bank reported a net loss of $10.2 million, or 6 cents per share.
Associated reported a net income of $15.4 million, or 9 cents per share, in the first quarter.
In addition, potential problem loans were 23 percent lower than first quarter, at $699 million. Total deposits and customer funding were up $184 million at $16.1 billion.
“We are pleased with our performance this quarter as we continue to execute on our strategic priorities,” said President and CEO Philip B. Flynn. “We are beginning to see results from the steps we are taking to drive loan growth and earnings expansion.”
Harley reports robust quarter
Milwaukee-based Harley-Davidson Inc.’s stock rose as the company reported broad performance improvements in the second quarter, with strong earnings growth, increased shipments and growth in its dealers’ new motorcycle sales both in the U.S. and globally.
Harley-Davidson reported quarterly net income of $190.6 million, or 81 cents per share, up from $71.2 million, or 30 cents per share, in the same period a year ago.
Retail sales of new Harley-Davidson motorcycles grew 7.5 percent in the U.S. and 5.6 percent worldwide in the second quarter.
The company raised its shipment forecast for 2011 and now expects to ship between 228,000 and 235,000 new Harley-Davidson motorcycles to dealers and distributors worldwide, an increase of 8 percent to 12 percent compared to 2010 shipments.
"Harley-Davidson continues to make great progress as we transform our business and take our iconic brand to the many roads of the world," said Keith Wandell, president and chief executive officer of Harley-Davidson.
"While we are pleased by Harley-Davidson’s second-quarter results, including the strong jump at retail in the U.S., our focus remains squarely on sustaining this progress through the ongoing implementation of our business strategy,” Wandell said. “Through the transformation to best-in-class manufacturing, product development and retail capabilities, we are positioning Harley-Davidson to be customer-led in all we do. Our employees, dealers and suppliers deserve tremendous credit for their dedication to making customers’ dreams a reality by delivering remarkable products and extraordinary customer experiences. We also believe the continued improvement in our results in the face of ongoing consumer and economic uncertainty speaks to the power of the Harley-Davidson brand globally.”
Harley-Davidson’s quarterly earnings exceeded the expectations of Wall Street analysts, including Craig Kennison of Milwaukee-based Robert W. Baird & Co. Inc.
“We expect shares to trade higher on a strong quarter led by solid retail and upside shipment guidance. Harley is operating in an uncertain macro environment, but management has meaningful internal opportunities to create value, leaving us confident in our more bullish outlook,” Kennison wrote in a research note. “Our estimates show U.S. dealer inventory down 24 percent from last year. We note that Harley announced plans to ship some 2012 bikes early, a sign that dealer inventory is too low in the context of growing retail demand.”
Johnson Controls on track for record year
Bolstered by a rejuvenated automotive industry, Glendale-based Johnson Controls Inc. is on pace to record its best year ever.
For the fiscal third quarter, Johnson Controls reported a 21 percent increase in revenues with double-digit sales increases in each of its three businesses.
The company’s quarterly net income grew to $383 million, or 56 cents per share, from $367 million, or 54 cents per share, in the same period a year ago.
The company said sales in the 2011 quarter were negatively impacted by approximately $400 million due to disruptions in automotive production resulting from the March 2011 earthquake in Japan.
Still, the company’s Automotive Experience sales in the quarter increased 21 percent to $5.1 billion from $4.2 billion last year due primarily to higher production volumes, new program launches and incremental sales from recent acquisitions.
The company’s North American revenues increased to $1.8 billion from $1.7 billion last year.
"These record revenues mark our seventh consecutive quarter of double-digit growth. All of our businesses are continuing to grow faster than their underlying industries as a result of share gains and our strong position in the emerging markets," said Stephen Roell, Johnson Controls chairman and chief executive officer. "Automotive Experience in particular exceeded the expectations set as we entered the third quarter due to faster-than-expected market recovery following the Japan earthquake and higher production levels in some markets."
Looking forward, Roell said, “As we enter the final quarter of our fiscal year, we remain on track to generate record sales and earnings in 2011. We expect to see higher European automotive margins in our fourth quarter as the recent acquisitions become more accretive and as operational efficiencies improve. We will continue to make strategic investments that will help us create new competitive advantages and further outpace the growth rates of our markets. Our strong backlogs and continued market share gains should provide good momentum as we enter 2012. We believe we are positioned to deliver sustainable, profitable growth."
Goodwill impairment takes toll on Bank Mutual earnings
Milwaukee-based Bank Mutual Corp. reported a second quarter net loss of $51.4 million, or $1.12 per share, compared with a net profit of $893 million, or 2 cents per share, in the same period a year ago.
The most recent quarter included a non-cash goodwill impairment of $52.6 million. The goodwill impairment had no effect on the liquidity, operations, tangible capital or regulatory capital of Bank Mutual or its subsidiary bank. The impairment was primarily the result of a continued decline in Bank Mutual’s stock price and market capitalization.
Excluding the impact of the impairment, earnings during the second quarter of 2011 were $1.2 million or 3 cents per share, compared with $731,000 or 2 cents per share during the same quarter in 2010.
Bank Mutual also announced that its non-performing assets declined by $14.1 million or nearly 10 percent during the recently completed quarter.
Michael Crowley Jr., chairman and chief executive officer of Bank Mutual, said, "We are pleased that our earnings before goodwill impairment continued to show quarter-over-quarter improvement despite a difficult economic environment."
David Baumgarten, president of Bank Mutual, said, "We are also pleased that we are ahead of our own expectations for reducing non-performing assets and we remain confident in the strategies we have developed for dealing with the level of our non-performing assets in upcoming periods. In recent months we’ve implemented several procedures and processes that will further enhance our ability to stay on track with our number one goal of reducing non-performing assets."
Bank Mutual’s net interest income increased by $3.7 million or 29.9 percent during the second quarter of 2011, compared with the same quarter of 2010.
Looking forward, Baumgarten added, "We believe our product and service offerings, as well as changes in the competitive landscape for Wisconsin banking, will continue to create opportunities for Bank Mutual to capture additional commercial and retail market share."
Smartphone revenues propel Verizon
Bolstered by rising smartphone sales and the rollout of its LTE 4G network, Verizon Communications Inc. reported accelerated revenue growth and improved margins across its business groups in the second quarter.
Verizon reported second quarter net income of $1.6 billion, or 57 cents per share, up from a net loss of $1.2 billion, or 42 cents per share, in the same period a year ago.
in EPS in the quarter, compared with a second-quarter 2010 loss of 42 cents per share.
Service revenues for Verizon Wireless in the quarter totaled $14.7 billion, up 6.6 percent year over year. During the quarter, Verizon Wireless sold 1.2 million 4G LTE smartphones and Internet data devices.
Verizon Wireless launched its 4G network in Wisconsin during the quarter.
“In terms of earnings growth and the acceleration of revenue growth, this has been one of Verizon’s best quarters since the 2008 economic downturn,” said chairman and chief executive officer Ivan Seidenberg. “We expanded sequential margins in both our wireline and wireless businesses, and in the second half of the year we expect Verizon to build on this strong, positive momentum to continue to drive profitable, sustainable growth. We expect Verizon Wireless to gain share in the retail postpaid market and widen its network-quality lead throughout 2011. We also continue to see strong customer demand for FiOS Internet and TV, and for cloud and other strategic services. At the same time, we remain focused on our cost structure, as we deliver improvements in wireline margins quarter after quarter.”
ManpowerGroup doubles quarterly profits
Milwaukee-based ManpowerGroup’s second-quarter profits more than doubled on strong worldwide growth, with especially strong demand for staffing services in Italy, France and the Asia Pacific region.
Manpower reported a profit of $72.7 million, or 87 cents per share, compared with $32.7 million, or 40 cents per share, in the same period a year ago. The company’s quarterly revenue climbed 24 percent to $5.67 billion.
ManpowerGroup chairman and chief executive officer Jeffrey Joerres said, "We continued to drive solid revenue growth with all geographies participating; Mexico, France and Italy all grew in excess of 15 percent in constant currency. Our emerging markets grew in excess of that. Experis, our professional resourcing brand, performed well, with global revenue increasing 12 percent in constant currency. These solid revenue gains clearly contributed to very good operational leverage. In the latter part of June certain markets experienced softening, however, we continue to be optimistic that we will achieve good year-over-year growth.”
Looking forward, Joerres added, “We are anticipating the third quarter of 2011 diluted earnings per share to be in the range of 90 cents to $1.00, which includes an estimated favorable currency impact of 10 cents.”
Theatres drive profits for Marcus Corp.
The Marcus Corp. reported strong fiscal fourth quarter results due to increased revenues and operating income from Marcus Theatres.
The Milwaukee company’s quarterly net earnings grew to $3.5 million, or 12 cents per share, up from $3.0 million, or 10 cents per share, in the same period a year ago.
The company’s quarterly revenues climbed to $92.3 million from $89.1 million a year earlier.
"We are pleased with our fourth quarter results, particularly the double-digit increases in operating income and net earnings. Marcus Theatres bounced back from a very disappointing third quarter that was the primary contributor to the division’s reduced revenues and operating income for the full year. Marcus Hotels and Resorts achieved significant increases in revenues and operating income for fiscal 2011 as the lodging industry continues to recover from a very difficult past two years," said Gregory Marcus, president and chief executive officer of The Marcus Corp.
"While fiscal 2011 was a challenging year for Marcus Theatres, we ended the year with an excellent fourth quarter. After a very weak film slate over the typically busy holiday season and a difficult comparison to the prior year which included the record-breaking performance of Avatar, strong box office performance in April and May enabled us to finish the year on a high note," Marcus said.
Badger Meter reports record quarterly sales
Badger Meter Inc. reported record sales and, excluding a one-time settlement gain in 2010, increased earnings for the second quarter.
The Milwaukee-based company’s net sales were a record $75.1 million, up 1.2 percent from $74.3 million in the same period a year ago.
The company’s net earnings were $7.8 million, or 52 cents per share, down from $8.0 million, or 53 cents per share, a year earlier.
"We performed very well in the second quarter. Our sales set a new record for the quarter and earnings were at a near-record level. Excluding a one-time gain received in a settlement related to the company’s plant in Mexico in 2010, earnings increased over last year," said Richard Meeusen, chairman, president and chief executive officer of Badger Meter.
Meeusen said the record sales were driven by a significant increase in sales of specialty products, including Badger ORION radio transmitters for natural gas meters and Research Control valves. The second quarter also included sales from Remag AG, which was acquired in January 2011.
"Sales in the municipal water market were down in the second quarter over the prior year, reflecting the continuation of many of the same conditions we saw in the first quarter. Concerns about potential spending reductions have slowed the decision-making process for some municipalities and housing starts remain low. In addition, we believe some customers are waiting for the release of the Badger ORION SE two-way advanced metering analytics (AMA) system, which is scheduled for full rollout in the third quarter. ORION SE is a major new technology advancement that takes the industry to a new level. We believe some customers are taking time to evaluate this new technology in advance of the full rollout. Our experience has been that once a thorough analysis is completed, customers move ahead with orders," Meeusen said.
Growth continues for Pinstripe
Brookfield-based Pinstripe Inc., one of the nation’s leading recruitment process outsourcing (RPO) firms, announced record growth during 2010 and the first two quarters of 2011.
The company said its results are a product of the organization’s strategic investments in top talent and an exclusive technology platform that will continue to enhance service to its client base by fostering a more strategically customized candidate and client experience.
“Last year’s analyst predictions for strong RPO growth in 2011 are coming to fruition, and I’m pleased to report that we continue to outpace this rapid market growth,” Pinstripe chief executive officer Sue Marks said. “Since January of 2011, Pinstripe has won or extended 15 contracts with current clients and organizations in the technology, advanced manufacturing, financial services and healthcare segments.”
