RBC Reports Third Quarter 2006 Results

RBC Bearings Inc. (USA, NASDAQ: ROLL) reported fiscal third quarter 2006 results, for the period ended December 31, 2005. Sales in the quarter were $67.4 million, up 16% from 2005's $58.1 million. Operating income was $10.8 million, from $8.4 million the previous year. Net income for the period was $5.1 million, or 7.5% of sales, from $2.5 million, or 4.3% of sales, in 2005. RBC reports results as four segments: Plain Bearing Segment Third quarter sales were $28.5 million, up from $22.7 million a year ago. Roller Bearing Segment Third quarter sales were $23.4 million, up from $21.0 million in 2005. Ball Bearing Segment Sales were $11.4 million, up from $10.3 million in 2005. Other Sales reached $4.1 million, flat from 2005. A few key balance sheet items as of the end of the quarter are: Inventory -- $105.1 million, or 2.6 turns at the current run rate Accounts Receivable -- $46.7 million Accounts Payable -- $17.7 million RBC President, Chairman and CEO, Michael Hartnett, commented: "We are pleased with our results in the third quarter of the year. While we continue to benefit from strength in our end markets, we remain focused on driving performance improvements across our operations. Both manufacturing efficiency and cost control were key contributors to our strong gross margin growth in the quarter. We believe that this focus on efficiency is important to our long-term success and strengthens our ability to compete successfully at every stage in the cycle." As far at the future is concerned, Dr. Hartnett offered: "Looking toward the last quarter of fiscal 2006, we see strong opportunities in the marketplace. Continued focus on growing customer relationships and our ability to capitalize on the operational momentum we have built will fuel both top-line growth and gross margin improvements. RBC operates 19 facilities in 3 countries. It manufactures plain bearings, roller bearings, ball bearings, and related specialty products which include precision ball screws and machine tool collets. While RBC bearings cover a wide variety of designs and applications, the company's business units focus on, "highly technical or regulated bearing products for specialized markets that require sophisticated design, testing and manufacturing capabilities." RBC has been intentionally moving away from its traditional reliance on industrial bearing sales to a stronger presence in the aerospace and defense market. What had been a sales mix 60% industrial and 40% aerospace/defense is now moving toward the 50% / 50% split it achieved in this most recent quarter.