Graco Inc. said Wednesday that its third-quarter profit grew 51 percent, helped by reduced taxes and other expenses.
The Minneapolis maker of pumps and industrial equipment, which is experiencing one of the biggest gains in stock price among Minnesota companies this year, said its results were helped by the recovery of the U.S. housing market. Executives said that one difficulty Graco experienced, a decline in revenue from Asia, would be short-lived.
“We expect to achieve growth in every region in the fourth quarter,” Patrick McHale, the company’s chief executive, said in a statement.
Net profit was $56.1 million, or 89 cents a share, exceeding analysts’ forecasts of 83 cents a share. In the same period a year ago, the company earned $37.1 million, or 60 cents a share.
Revenue was $277 million, up 8 percent from $256.5 million a year ago, and the ninth consecutive time that it set a record for quarterly sales.
Sales were driven by a 24 percent jump in its contractor segment and smaller gains in its industrial and lubrication businesses. Revenue grew fastest in the United States, more slowly in Europe and fell slightly in Asia. McHale said he didn’t see a single “catalyst” to boost sales in Europe and Asia but was confident they would experience “modest growth” in the October-to-December period.
Graco’s bottom line benefited from reduced operating expenses as well as a reduction in the company’s effective tax rate to 24 percent from 27 percent, thanks in part to a research-related federal tax credit.
Graco reported the results after the close of stock market trading. Its shares, which are up about 45 percent this year, finished Wednesday down 4 cents to $77.27 on the New York Stock Exchange.
Evan Ramstad • 612-673-4241