Webco Industries Inc has announced results for its fiscal 2011 fourth quarter and fiscal year ended July 31st 2011.

For its fiscal 2011 fourth quarter, the company reported net income of USD 5.6 million as compared to net income of USD 1.7 million for the same quarter in fiscal 2010. Net sales for the fourth quarter of fiscal 2011 were USD 130.0 million, a 33.7% YoY increase from the USD 97.2 million of sales in last year's fourth quarter. The current quarter results reflect a USD 2.7 million non cash pre tax loss related to interest swap contracts, whereas the prior year same quarter included a USD 1.5 million pre tax loss on the contracts. The improvement in current quarter results reflects an improved business environment, along with continued productivity gains.

For fiscal year 2011, the company generated net income of USD 24.8 million as compared to net income of USD 3.3 million for fiscal 2010. Net sales for current fiscal year amounted to USD 465.6 million, a 49% YoY increase over the USD 312.6 million in sales for fiscal year 2010. Results for the current fiscal year reflect a USD 1.3 million non cash pre tax loss related to interest swap contracts, whereas the prior year's same period included a USD 2.5 million pre tax loss on the contracts.

Mr Dana S Weber CEO of Webco Industries Inc said that "Our facilities are operating at a high level of productivity, thanks to the efforts of our employees. We continue to deploy capital in pursuit of organic growth opportunities that are consistent with our long term niche strategy."

Gross profit for the fourth quarter of fiscal 2011 was USD 19.7 million as compared to USD 8.7 million for the fourth quarter of fiscal 2010. Gross profit for fiscal 2011 was USD 70.5 million or 15.1% of net sales as compared to USD 28.4 million or 9.1% of net sales in fiscal year 2010. The fiscal year 2011 gross profit percentage increased from fiscal year 2010 because of high productivity in the current periods, as well as the impact of selling high cost inventories in the prior year periods.

Selling, general and administrative expenses in the fourth quarter of fiscal 2011 were USD 6.8 million as compared to USD 3.8 million in the fourth quarter of the prior year. SG&A costs for fiscal year 2011 increased to USD 27.8 million, from the USD 17.1 million reported for fiscal year 2010. SG&A for all current year periods are higher than the prior year periods because improved results have increased company wide incentive compensation and cost reduction strategies that were necessary in the prior year have given way to longer term management objectives.

Interest expense was USD 1.1 million in the current year fourth quarter and USD 1.0 million in prior year fourth quarter. Interest expense totaled USD 4.3 million in fiscal 2011 and USD 3.8 million in fiscal 2010. The company is party to arrangements that swap the variable interest rate for USD 75 million of the company's debt to a fixed rate through May 2017. Monthly swap settlements are included in interest expense. The company records interest swap contracts at fair value and non cash changes in value are reported in gains or losses on interest contracts.

Capital expenditures incurred amounted to USD 10.2 million for the fourth quarter and USD 24.7 million for the full fiscal year 2011. The company has commenced construction of a new manufacturing facility in Oklahoma that will broaden its technical capabilities, enhance quality and increase capacity for carbon steel tubing. Capital spending in fiscal 2012 is expected to be in the range of USD 50 to USD 55 million.