|
|
The Suburbanite
  • Diebold cautions for rest of ’12

  • Diebold reported good second-quarter earnings and sales on Monday, but cautious comments about the rest of the year rocked the company’s stock value.

     

    • email print
  •  Diebold reported good second-quarter earnings and sales on Monday, but cautious comments about the rest of the year rocked the company’s stock value.
    Changes made by the Brazilian government regarding voting machines and lottery equipment might nick sales through the rest of the year. Diebold also might suffer because of a negative shift in currency changes in Brazil and India.
    Those factors have Diebold recalculating its projected earnings to a range of $2.50 to $2.60 per share, instead of $2.50 to $2.70 per share. Revenue is projected to rise 6 percent to 8 percent, instead of 7 percent to 10 percent.
    Diebold posted second quarter net income of $26.5 million, or 41 cents per share, compared with $20.3 million, or 31 cents per share, for the 2011 second quarter. Revenue came in at $743.2 million, a 12.2 percent gain compared with $662.4 million last year.
    Through the first six months, earnings are
    $71.7 million, or $1.14 per share, compared with $23.3 million, or 35 cents per share last year. Revenue increased 12.9 percent to $1.44 billion from $1.28 billion in the 2011 first half.
    Thomas W. Swidarski, Diebold president and chief executive officer, said the company saw 30 percent revenue growth in the Latin American and Brazilian region. But because of a “significantly negative shift in currency exchange rates — primarily in Brazil — and a delay of anticipated additional revenue from Brazil election systems into 2013, we are tightening our guidance for 2012,” he said.
    That news didn’t sit well with some investors. Diebold’s stock closed at $33.01 per share, down $3.31. More than 2.55 million shares traded compared with an average of 569,000 shares.
    “Aside from these two items, our outlook remains the same,” Swidarski said. “I am confident in our ability to execute on the many opportunities on the horizon for Diebold and deliver profitable growth led by our services capabilities — both in the near term and beyond.”
    Swidarski said the company is “encouraged by the significant growth” in deposit automation in North America, along with restructuring efforts in the Europe, Middle East, Africa markets. Both are “clearly having a positive impact on our profitability there.”
    The company saw a sizable shift in revenue mix from regional to national accounts in North America and a much higher tax rate, which led to in a sequential drop in earnings from the first quarter, Swidarski said.
    “Strong financial self-service growth in deposit automation with national account customers, and the previously anticipated reduction in regional account activity with the passing of the Americans with Disabilities Act compliance deadline, resulted in a less profitable mix of business,” he said.