Reuters: Global Markets: Gardner Denver forecasts 2013 below estimates

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Gardner Denver forecasts 2013 below estimates Feb 22nd 2013, 18:26 Fri Feb 22, 2013 1:26pm EST (Reuters) - Gardner Denver Inc (GDI.N), which has put itself up for sale, forecast 2013 results well below analysts' expectations as demand for its petroleum and industrial pumps remained weak. "Based on the backlog that we have today, petroleum and industrial pump business will decline by 30 to 40 percent," Chief Executive Michael Larsen said on a post-earnings conference call. The petroleum and industrial pumps business accounted for $450 million in annual sales, Larsen said, or about 20 percent of overall revenue in 2012. Gardner Denver said the drilling pumps business in particular would be weak for the first half of 2013 as orders it booked in January would only be shipped in the second half of the year. Gardner Denver said it expects adjusted first-quarter earnings of between 94 cents and $1.04 per share, below analysts' expectations of $1.16 per share. "The fact that they haven't had these orders since the last half of 2012 is the reason why we have a lower-than-expected forecast," Maxim Group analyst William Bremer said. However, Bremer expects the back half of the year to be better. Gardner Denver forecast adjusted full-year earnings of $5.00 to $5.25 per share. Wall Street was expecting earnings of $5.31 per share, according to Thomson Reuters I/B/E/S. Net income attributable to the company fell 11 percent in the fourth quarter to $69.1 million, or $1.40 per share. Excluding items, the company earned $1.54 per share, above analysts' expectations of $1.33 per share, helped by a restructuring it undertook in its European industrial products business. The restructuring will generate $10 million to $15 million in savings in 2013, CEO Larsen said on the call. Revenue fell 4 percent to $589.7 million, but came in ahead of analysts' expectation of $558.1 million. TAKEOVER BID Shares of Wayne, Pennsylvania-based Gardner Denver were trading 6 percent higher at $71.25 on the New York Stock Exchange on Friday, a day after bidding closed on an auction to sell the company. "If it wasn't for the potential bid for the company, we believe the stock would have been materially down today," Bremer said. KKR & Co LP (KKR.N) submitted a $75 per share bid late on Thursday, two people familiar with the matter told Reuters. The takeover offer, which values Gardner Denver at $3.7 billion, puts KKR in the pole position to buy the company after sources told Reuters that other private equity bidders have abandoned the process. Advent International and the team of TPG Capital and Onex Corp (OCX.TO), pulled out after considering a bid as they became more concerned about declining orders at the company, the people added. Orders at the engineered products business, which includes drilling pumps, fell 28 percent in the fourth quarter ended December 31. They have now fallen for three consecutive quarter. The company did not address the sale process on its conference call on Friday but sources told Reuters that the board would meet on February 25 to consider KKR's offer. (Reporting by Mridhula Raghavan in Bangalore; Editing by Supriya Kurane) Link this Share this Digg this Email Reprints

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