UPDATE 2-Carlisle Q2 profit misses Wall Street; shares fall

Tue Jul 27, 2010 1:50pm EDT

* Q2 EPS $0.62 vs est $0.65

* Rise in raw material costs continues

* Shares down as much as 12 pct (Adds details, analyst comments; updates share movement)

BANGALORE, July 27 (Reuters) - Diversified manufacturer Carlisle Cos Inc (CSL.N) posted a quarterly profit below market estimates, due to higher raw material costs, and said it continues to face higher input costs, sending shares down as much as 12 percent.

"Our most significant EBIT challenge will be the uncertainty regarding raw material costs," CEO David Roberts said in a statement. "The impact of raw materials is the largest unknown."

He added the company had not seen any relief on the horizon and was implementing cost cuts and price increases to offset these costs.

FBR Capital Markets said higher raw material costs, charges related to tire capacity restructuring in China and weak pricing hurt margins during the quarter.

"If the raw material pricing spread does not improve, it could be a challenge for the company to maintain margins at last year's level," the brokerage said in a note.

Carlisle's total EBIT margin for the quarter fell to 9 percent from the year-ago 13 percent.

FBR, which rates the company's stock "underperform," expects its commercial construction market -- that contributes more than 57 percent to Carlisle's total sales -- to perform negatively in fiscal 2011.

For the second quarter, Carlisle net income was $38.6 million, or 62 cents a share, compared with $55.5 million, or 90 cents a share, a year ago.

Revenue rose 11 percent to $709.4 million.

Analysts on average were expecting the company to earn 65 cents a share, before special items, on revenue of $666.1 million, according to Thomson Reuters I/B/E/S.

Shares of the Charlotte, North Carolina-based company were down $4.35 at $34.80 Tuesday afternoon on the New York Stock Exchange. They touched a low of $34.49 earlier in the session. (Reporting by Swati Chitnis and Fareha Khan in Bangalore; Editing by Vyas Mohan and Don Sebastian)