Declines in North American automotive production are expected to negatively impact the Timken Company’s overall third-quarter and full-year 2006 results, which otherwise continue to benefit from the strength of global industrial markets, the supplier said on Friday.
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It added it is taking additional actions – including job cuts – to improve the performance of its business in the face of worsening conditions in the North American auto industry.
Timken has revised its earnings estimate for the third quarter, excluding special items, to an estimated $US0.50 to $0.55 per share. For the year, the company now anticipates estimated earnings per share of $2.60 to $2.75, excluding special items.
Timken had previously estimated earnings of $0.70 to $0.75 per share for the third quarter and $3.00 to $3.15 per share for the full year, excluding special items.
Earnings per share, excluding special items, in 2005 were $0.58 in the third quarter and $2.53 for the full year.
“The widening decline in North American auto industry production has had a significant impact on our performance,” said Timken’s president and chief executive officer James Griffith. “This structural auto industry shift reinforces our resolve to diversify our corporate portfolio and customer mix.
“In addition to our previously announced restructuring, we are taking new steps to offset the impact of the further decline in sales, including a workforce reduction of approximately 700 positions, or about 5% of our automotive group employment.
“Moreover, we continue to advance our strategy to expand in global industrial markets, which is contributing to the strong overall performance of the company in 2006.”
