Columbus McKinnon posts lower-than-expected Q3 profit

BANGALORE (Reuters) - Columbus McKinnon Corp (CMCO.O), which makes crane hooks and actuators, posted a lower-than-expected quarterly profit, hurt by higher expenses, sending its shares down as much as 5 percent.

The company, which sees a modest economic improvement, aims to rebound to stronger operating margins through various cost-control initiatives, including headcount reductions.

"While maintaining our output capability at previous levels, we are removing about 500,000 square feet of manufacturing footprint, reducing headcount and other associated costs with our facility consolidations," Chief Executive Timothy Tevens said in a release.

Products from Columbus McKinnon are used to lift, position, and secure loads in hundreds of industries, including food processing, mining, entertainment, trucking and defense.

"Columbus McKinnon's backlog is up, bookings are okay, which is positive and indicates a gradual improvement and the company is making gradual headway," Needham & Co analyst Theodor Kundtz said by phone.

U.S. industrial capacity utilization, which the company uses as a leading market indicator, was 68.9 percent in December 2009 compared with 65.2 percent in June.

"The worst is over as you can see from the industrial capacity utilization number, which has been up six months in a row," said Kundtz, who has a "buy" rating on the stock.

Q3 RESULTS

For the third quarter ended December 31, the company reported net loss of $2.3 million, or 12 cents a share, compared with net income of $3.8 million, or 20 cents a share, a year ago.

Excluding items, it earned 6 cents a share.

Revenue fell 28 percent to $119 million.

Analysts on average were expecting the company to earn 11 cents a share, before special items, on revenue of $116.9 million, according to Thomson Reuters I/B/E/S.

General & administrative (G&A) expenses were up about 10 percent at $9.5 million on continued investments in new products.

Shares of the Amherst, New York-based company were down 57 cents at $14.52 in afternoon trading Thursday on Nasdaq. They had touched a low of $14.27 earlier in the session.

(Reporting by Fareha Khan in Bangalore; Editing by Maju Samuel)