Allison Transmission Holdings Inc. raised its full-year sales guidance because of stronger-than-expected first-quarter results.
The Indianapolis-based transmission maker on Wednesday reported quarterly revenue of $499 million, up 8 percent over the same period a year ago.
Most of the increase was credited to improved North American demand in Allison’s service parts and support equipment business. Sales in that division totaled $118 million, up 39 percent compared with sales a year ago.
The company reported first-quarter profit of $83 million, or 52 cents per share, up from $48 million, or 28 cents per share, in the same quarter of 2016.
The results exceeded Wall Street expectations. The average estimate of eight analysts surveyed by Zacks Investment Research was for earnings of 35 cents per share and revenue of $463.4 million.
In February, the company said it expected its full-year 2017 sales to rise between 1.5 percent and 4.5 percent compared with 2016.
“Given first quarter 2017 results and current end markets conditions, we are updating our full year net sales guidance to an increase in the range of 7.5 to 10.5 percent,” Chairman and CEO Lawrence Dewey said in the earnings report.
The company said its revised guidance is based on several factors: stronger North American demand for both off-highway service parts and on-highway products; price increases on certain products; and “a modest recovery” in global off-highway end markets.
Shares of Allison closed at $37.47 Wednesday, up 1.4 percent. Over the past 52 weeks, shares have traded between $26.36 and $38.17.