PORTLAND, Ore. (AP) — Precision Castparts Corp.'s net income increased steadily in the fiscal fourth quarter as the economic recovery boosted demand for cast and forged metal products used by aerospace and other industries.
The metal component manufacturer, based in Portland, Ore., said Thursday that two of its three business segments made more money, and the third should recover by late in the next fiscal year.
Precision increased its net income in the quarter ended April 3 by 12 percent, to $271 million, or $1.87 per share, from $241.2 million, or $1.69 per share in the same quarter a year earlier.
Operating income increased strongly in its two larger segments, Investment Cast Products and Forged Products. Income edged down in the smaller Fastener Products business.
Overall revenue increased 17 percent, to $1.68 billion from $1.43 billion. Revenue from both Investment Cast Products and Forged Products increased by about 20 percent.
Fastener Products revenue gained 6 percent, but that was absorbed by higher costs related to product mix. The company is transitioning from core aerospace products to lower-margin fasteners, Precision said.
The net income result fell just short of expectations, while revenue was slightly higher. Analysts surveyed by FactSet expected net income of $1.91 on revenue of $1.64 billion.
Analysts say companies such as Precision are poised to grow as the economic recovery gains strength, boosting industrial activity and the production of heavy products and equipment.
For example, Boeing Co.'s new 747-8 and 787 aircraft are scheduled to go into service this summer. If the rollouts are successful, equipment makers such as Precision will sell more parts used to build and repair airplanes.
Precision manufactures specialized metal components and products, including investment casings, forgings and fasteners used in the aerospace industry and in industrial gas turbines. Its products also serve general industrial, military and medical uses and are used in businesses ranging from automotive to paper to infrastructure.
Precision shares rose $1.23 to close Thursday at $157.43.