Hurco Cos. and Financial Results and Public Companies and Manufacturers and Manufacturing & Technology

Hurco suffers loss despite better sales

June 4, 2010

Hurco Cos. Inc. suffered a loss of $1.5 million in its second fiscal quarter although sales improved in Europe and Asia, the Indianapolis-based machine tool maker announced Friday morning.

The loss in the period ended April 30, which translated to 24 cents per share, was much larger than the loss of $281,000, or 4 cents per share, a year earlier. The decrease in profit as a percentage of sales was due to the impact of fixed costs on lower sales and production volume and a higher mix of sales from the Asia Pacific region where competitive pricing pressures remain strong, Hurco said.

Revenue increased 17 percent, to $24 million.

Hurco attributed the loss to an increase in sales and service fees coupled with a weaker U.S. dollar when translating foreign sales for financial reporting purposes.

However, foreign sales in the second fiscal quarter improved in Asia and Europe, where demand for Hurco’s products climbed 131 percent and 18 percent, respectively. Sales in North America dipped 6 percent.

Orders in the second quarter increased 69 percent, to $30.5 million.

Hurco CEO Michael Doar warned in a prepared statement that future sales in Europe may be affected by the economic uncertainty there.

“We are encouraged that orders for the second quarter of fiscal 2010 were up 48 percent compared to the first quarter of this year and were higher than any quarter since the economic recession began,” he said. “However, sales in Europe may be impacted due to continuing weak economic conditions.”

Hurco shares opened trading Friday morning at $17.37 cents each.
 

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