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Matt Marquez/MEDILL

JBT Corp. broke off from FMC Technologies Inc. on July 31.

JBT Corp. posts fourth-quarter decline, blames downturn on recession

by Matt Marquez
March 04, 2009

John Bean Technologies Corp., a recent spinoff of FMC Technologies Inc., said its fourth-quarter income fell $2.6 million, or more than 20 percent, outperforming analysts’ expectations despite sluggish sales of its aircraft ground support equipment.

The Chicago-based food-processor manufacturer, which also builds air transportation equipment such as baggage loaders, late Tuesday reported a net profit of $10.1 million, or 37 cents per diluted share, in the fourth quarter ended Dec. 31, compared with earnings of $12.7 million, or 53 cents per diluted share, in the same period the year before.

Analysts polled by Zacks Investment Research Inc. expected to see a profit of 22 cents.

The company said its earnings-per-share results were based on the number of shares distributed to FMC shareholders on July 31 – the last day the company operated under FMC Technologies, a machinery manufacturer that builds sub-sea production systems and drill technologies.

JBT brought in $234.5 million in revenue, a 19 percent drop from $290.6 million in the fourth quarter of 2007.

Chairman and CEO Charlie Cannon said in a conference call Wednesday that recession-weakened demand for food-processing technology and services in Western Europe and Latin America led to a 22 percent fall in JBT FoodTech’s revenue. Fourth-quarter sales were $132.9 million compared with $170.2 million for the same period last year.

Ground support equipment, however, was the division hardest hit by the recession, Cannon said. The AeroTech business reported a drop of more than 15 percent in revenue, down to $103 million. Backlog orders in the business, which includes equipment such as airport passenger bridges, fell 38 percent from $230.7 million to $142.6 million.

Despite the lower year-over-year earnings, analysts said JBT’s strong core businesses and cost-cutting measures will keep it well positioned for the future.

Analyst Liam Burke of Janney Montgomery Scott LLC wrote in a research note that “trends within the food processing industry including the need for higher-quality standards and new food products and packaging” offer opportunities for JBT to grow.

Burke lowered his 2009 forecast for the company to 96 cents per diluted share from $1.11, although he maintained his buy rating and noted that “the company has aggressively addressed expenses in light of lower orders and back log” while still improving revenue margins in fields such as spare parts and services.

Arnold Ursaner, an analyst with CJS Securities Inc., said JBT will continue to see benefits from its split with FMC Technologies.

“Under FMC, their growth was stifled. They couldn’t go after acquisitions they wanted,” said Ursaner, who added that JBT has already starting buying companies that complement its own technologies.

“It looks like they’re definitely holding their own in a severe economic downturn,” he said.

Citing an uncertain global market, JBT declined to offer a guidance forecast. Analysts surveyed by Zacks expect the company to earn $1.05 per diluted share this year.

Last year, the company earned $40.2 million, or $1.44 per diluted share, compared with a profit of $29.5 million, or $1.20 per share, in 2007. The annual figures were reported with non-GAAP numbers to account for one-time expenses accrued in the company's break from FMC.

Annual revenue in 2008 edged up to $1 billion from $978 million.

Shares of JBT closed Wednesday at $9.18 a share, up 15 cents or 1.7 percent from its Tuesday closing price of $9.03.