Albany International Reports Second-Quarter Results
ROCHESTER, N.H.--(BUSINESS WIRE)--Aug 6, 2018--Albany International Corp. (NYSE:AIN) reported that Q2 2018 Net income attributable to the Company was $30.4 million, including a net benefit of $4.2 million from income tax adjustments. Net income attributable to the Company was increased by $1.4 million as a result of adopting ASC 606. Q2 2017 Net income attributable to the Company was $1.1 million, including a net charge of $0.8 million from income tax adjustments.
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Q2 2018 Income before income taxes was $37.3 million, including $2.6 million of restructuring charges and $2.4 million of gains from foreign currency revaluation. Q2 2017 Income before income taxes was $3.0 million, including restructuring charges of $2.0 million and losses of $3.5 million from foreign currency revaluation. Q2 2017 Income before income taxes also included a $15.8 million charge to Cost of goods sold related to revisions in the estimated profitability of two contracts in the Albany Engineered Composites segment.
Effective January 1, 2018, the Company adopted the provisions of ASC 606, Revenue from Contracts with Customers, using the modified retrospective method for transition. Under this transition method, periods prior to 2018 are not restated. Table 1 summarizes the effect on various operational metrics that resulted from the adoption of the new standard:
Table 2 summarizes Net sales and the effect of changes in currency translation rates:
Table 3 summarizes Q2 Net sales excluding the impact of ASC 606 and currency translation effects:
In Machine Clothing, when excluding the impact of ASC 606 and currency translation effects, Net sales increased 8.2% compared to Q2 2017. The increase was principally due to global growth in sales for the packaging and tissue grades, more than offsetting a continuing but small decline in publication grade sales.
AEC Net sales grew 35.7% compared to Q2 2017, when excluding the impact of ASC 606 and currency translation effects, primarily driven by growth in the LEAP, Boeing 787, F-35 and CH-53K programs.
Table 4 summarizes Gross profit by segment:
Second-quarter MC Gross profit as a percentage of sales improved to 48.9% as a result of higher sales and strong capacity utilization. AEC’s negative gross profit in Q2 2017 was principally due to the $15.8 million charge related to revisions in the estimated profitability of two contracts, as described above. The additional improvement in AEC Gross profit as a percentage of sales was driven by higher sales and improved labor productivity.
Table 5 summarizes selling, technical, general and research (STG&R) expenses by segment:
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