Dipping: Lufkin was hit by a fall in demand for its oilfield pumps
Weak pump demand leaves Lufkin flat
Texas equipment maker Lufkin Industries reported flat earnings in the second quarter as softening demand for its pumping units and truck trailers in North America was offset by increasing international demand.
Lufkin reported flat second quarter net earnings of $17.5 million year on year. Earnings per share edged down to $1.15 from $1.16 over the same period as sales slipped to $144.5 million from $147.7 million previously.
For the first half of 2007, Lufkin reported net earnings of $35.2 million, or $2.23 per share, compared with $32.6 million, or $2.16 per share, in the first half of 2006. Sales for the half year rose to $292.6 million from $281.1 million.
Sales of oilfield equipment slipped to $93.2 million from $101.3 million previously. Canadian pump sales were hit hard by poor weather and a general slowdown in the Canadian drilling sector. However, Lufkin said its efforts to penetrate the Middle East and Latin American markets had been boosted by higher oil and gas prices. It expected business to pick up in the remainder of 2007 and 2008, particularly in the US, due to continuing high oil prices.
The company said it was enjoying increased demand for its power transmission products and services, while the fall in trailer earnings reflected its decision to cease its van trailer business in the third quarter of last year.