Adhesives firm H.B. Fuller Co. lowered its earnings forecasts for the year after reporting third-quarter results that missed Wall Street expectations.
The company’s stock fell 1.5 percent to close at $33.55 Thursday.
The Vadnais Heights-based maker of glues for food boxes, can labels, books and more saw third-quarter revenue slip 0.5 percent, to $524.1 million.
It reported net income of $26.8 million, or 52 cents a share, compared with $4 million, or 8 cents a share, for the same period a year ago, which included $12.3 million in special charges.
The most recent quarter, ended Aug. 29, had $1.3 million in special charges associated with acquisitions integration costs and factory improvements. Excluding those, adjusted net income was 61 cents a share, 9 cents below analysts expectations.
Currency fluctuations continued to hurt international revenue. European sales, which would have been flat on a constant currency basis, dropped nearly 17 percent.
CEO Jim Owens, in a call with analysts, said North American revenue dropped 8 percent, which he called “disappointing.” Owens also cited a higher tax rate and the final costs associated with last year’s problematic installation of a software system as factors in the earnings shortfall.
With weak global conditions and the higher tax rate “expected to persist into the fourth quarter, we have adjusted our earnings-per-share expectations,” Owens said.
Excluding one-time items, 2015 adjusted earnings are now expected to be $2.23 per share, down from the prior forecast of $2.60.
Full-year revenue is now projected to be $2.08 billion, down from the prior guidance of $2.15 billion. Officials said negative foreign currency translations stemming from the high U.S. dollar are expected to clip 2015 revenue by about $115 million. Those results should be somewhat offset by declining raw material costs.
Officials also predicted fourth-quarter revenue of $540 million and fourth-quarter profit of 70 cents per share.
Owens told analysts that H.B. Fuller is seeing about $25 million in new revenue each quarter after the February acquisition of Tonsan Adhesive, the largest independent adhesives firm in China.
While industrial growth in China is slowing, Owens said H.B. Fuller’s sales there are solid because it provides adhesives for hygiene projects for that market and the rest of Asia.