Green Tree based LB Foster Co reported a 43% boost in sales in the first quarter; however, profits slid 61% YoY due primarily to costs associated with the company’s acquisition of Portec Rail Products Inc late last year.

For the quarter ended March 31st LB Foster had net income of USD 679,000 as compared with USD 1.8 million a year ago. Sales for the quarter were up to USD 117.1 million, compared with USD 82 million a year ago, driven by strong results in Portec’s business.

Charges related to the Portec deal included a non-recurring expense of USD 2.5 million to gross profit margin based on a write up to fair market value of Portec inventory that increased the company’s costs of goods sold. Additionally, the company had a first quarter charge related to plant costs for the closing of its Grand Island, Neb facility.

Mr Stan Hasselbusch president and CEO said the company’s margins were not to the level he wanted and were affected by the Grand Island shut down, traditional seasonality of business and weak performance of precast buildings business. However, he noted the company is moving forward with its integration of Portec and sees promising opportunities in that business' product lines for LB Foster.

Mr Hasselbusch said that “As we move through 2011, we expect to continue to experience a highly competitive market environment and we also anticipate significantly extended delays before a new transportation bill is passed, but we are optimistic that the overall economy is improving. Our bookings and backlog are very strong and we expect this strength to be reflected in our results for the remainder of this year.”

(Sourced from Pittsburgh Business Times)