Tennant Co. reported third-quarter earnings that missed analyst expectations due in part to costs associated with the acquisition of IPC Group.
Tennant earned $3.6 million, or 20 cents per share, on record third-quarter revenue of $262 million.
Earnings included special charges related to the $433 million acquisition in April of the Italian-based IPC Group. In the same quarter a year ago, the company earned $11.5 million, or 64 cents per share, on revenue of $200.1 million.
Adjusted for costs associated with the merger and other nonrecurring costs the company posted adjusted earnings of 32 cents per share, lower than the 63 cents per share analysts expected.
“Our third-quarter results reflect slower growth in North America attributed to timing of key strategic account deals, the restructuring of our field service team, continued manufacturing inefficiencies and raw material inflation, matters we continue to address,” said Chris Killingstad, Tennant Co.’s president and chief executive.
This is the first full-quarter results that include IPC, which expands Tennant’s presence in Europe and a complementary portfolio of products. Killingstad who made trips during the quarter to visit IPC locations in Europe told analysts on the company’s earnings conference call that integration efforts are on track and respectful of the IPC culture.
Looking through the end of the year, the company still expects revenue to be in the range of $960 million to $990 million, but lowered its guidance for adjusted earnings to a range of $1.50 to $1.70 per share. The company previously said 2017 full-year adjusted earnings would be in the range of $2.20 to $2.40 per diluted share.
Tennant’s shares closed Thursday at $64.05, down more than 6 percent. Over the past 52 weeks, Tennant’s shares have been trading in the range of $60.05 to $76.80 per share.