Myers Industries Q3 Net Down, Misses View; Revenue Beats; Ups Sales Outlook

(RTTNews) - Myers Industries, Inc. (MYE), that manufactures polymer products and distributor for the tire, wheel, and under-vehicle service industry, on Thursday reported a decline in its third-quarter earnings whereas revenue surged primarily reflecting recent acquisitions. While revenue beat Street's expectations, earnings missed view.

Net Income for the period was $7.9 million or $0.22 per share down from $8.7 million or $0.24 per share. Adjusted net income for the period was $8.5 million or $0.23 per share as compared to $10.6 million or $0.30 per share in the corresponding quarter of the previous year.

Higher raw material costs, including a $1.0 million increase to the LIFO inventory reserve, and increased labor costs, which were not fully recovered by pricing actions led to an unfavorable price-to-cost relationship for the quarter and a decline in net income from the Material Handling segment. The increased SG&A expenses attributed to higher salaries, benefits, incentive compensation costs and increased selling expenses resulted in a decline in the net income from the Distribution segment.

Two analysts polled by Thomson Reuters were expecting the company to report earnings of $0.26 per share. Analysts typically exclude one-off items.

Net sales increased by $67.8 million, or 51.3 percent to $200.1 million from $132.3 million in the third quarter of 2020. Net sales of $40.8 million, or 30.9 percent was attributed to the Elkhart and Trilogy acquisitions, and the remaining organic sales grew on account of favorable price and higher volume/ mix variance.

Two analysts polled by Thomson Reuters were expecting the company to report revenues of $197.03 million.

Operating Income declined by 10.1 percent to $11.8 million, from $13.1 million in the previous period. Adjusted operating income dipped by 19.5 percent to $12.5 million, from $15.6 million in the year-ago quarter.

The company raised its outlook for net sales growth in fiscal 2021 to the mid-to-high 40% range, with slightly more than half of the increase due to the Elkhart and Trilogy acquisitions. The company earlier expected sales growth in the mid 40 percent range, contributed half due to the acquisitions. Two analysts polled by Thomson Reuters are expecting the revenue for fiscal 2021 to record $743.15 million, implying a 45.6 percent annual growth.

The outlook for EPS for fiscal 2021 was retained in the range of $0.86 to $1.01 and adjusted EPS was retained between $0.90 and $1.05. Two analysts polled by Thomson Reuters are expecting an EPS, excluding one-off items of $0.99.

Shares of Myers Industries are currently trading in pre-market at $20.90, down $0.65 or 3.02 percent from previous close.