Kaydon Reports String of Records

Thursday was a "record'' day for Kaydon Corp., as the Ann Arbor-based specialty bearing maker reported record first-quarter sales, a record number of new orders and record product backlog volume. Kaydon's sales of $107 million drove the company to an $18.2 million profit for the first three months of 2007, nearly 10 percent higher than its earnings a year ago. "We are very pleased with our first-quarter results,'' President and Chief Executive Officer James O'Leary said Thursday during a conference call with investors and analysts. "We've seen broad strength across most of our segments - more is going right than not which resulted in increased sales.'' Kaydon matched analyst estimates by earning 57 cents a share in the quarter ended March 31, compared to 52 cents a share in the first quarter of 2006. Kaydon's primary business is designing and making bearings, industrial shock absorbers and sealing products for industrial, aerospace, medical, electronic, alternative energy and aftermarket customers. The volume of new orders Kaydon booked in the first quarter hit $141.7 million, driven by a significant demand for wind turbine bearings. A year ago, new orders totaled $95.9 million. This year's strength in new orders meant Kaydon ended the first quarter with a record backlog of $186.3 million, which is a measure of products that Kaydon customers have ordered but that have not yet shipped. Kaydon said it's investing $60 million to grow its capacity to make products for the wind energy, medical and security equipment market. O'Leary called 2007 "an important investment year.'' The company ended the first quarter with $375 million in cash and $200 million in long-term debt. Kaydon employs 22 at its Ann Arbor headquarters and 1,900 at other facilities worldwide, including in England, Mexico, Germany, the Carolinas and Maryland. O'Leary was named president and chief executive in March, succeeding Brian Campbell. O'Leary had been on Kaydon's board since 2005 and most recently was executive vice president and chief financial officer of home-building company Beazer Homes USA Inc. "We view O'Leary as a solid replacement who knows (Kaydon's) operations well ... and who could potentially be more aggressive than Campbell in pursuing acquisitions,'' analysts who follow Kaydon at Robert W. Baird & Co. wrote in a research note Thursday.