Thomas & Betts 4Q Net Up 42% On Steel-Structures Growth

    DOW JONES NEWSWIRES 
 

Thomas & Betts Corp.'s (TNB) fourth-quarter earnings rose a better-than-expected 42% as the electrical component maker continued a consistent run of double-digit revenue growth, aided by strong results in its steel-structures segment.

Switzerland's ABB Ltd (ABBN.VX) said Monday it has agreed to pay $3.9 billion in cash for Thomas & Betts to increase its exposure to the U.S. low-voltage electrical equipment market. The power and technology group said it is paying $72 a share for Thomas & Betts, a major North American supplier of power transmission lines and electrical conduits, as well as heating and ventilation products.

The acquisition price represents a 24% premium to Thomas & Betts's closing share price on Friday and a 35% premium to its average stock price over the past 60 trading days, ABB said.

Thomas & Betts's results have been helped in recent quarters by improving demand, particularly from industrial and utility end markets. In 2010, the company shed a nonstrategic communications products business, helping it to place greater focus on its electrical segment.

The company reported a profit of $56.8 million, or $1.08 a share, up from $40 million, or 76 cents a share, a year earlier. Excluding income tax adjustments and facility consolidations, earnings from continuing operations rose to $1 from 77 cents. Revenue rose 13% to $603.6 million.

Analysts polled by Thomson Reuters projected per-shares earnings of 90 cents on revenue of $589 million.

Gross margin improved to 32.1% from 29.8%.

The electrical segment, which accounts for the vast majority of its revenue, reported 7.8% higher sales on strong organic growth. Its smaller steel-structures segment saw sales jump 40% on higher demand and improved pricing as utilities have increased spending on electrical transmission projects.

For the new year, the company forecast earnings of $3.90 to $4.20 a share, in line with expectations of $3.92.

Shares closed Friday at $57.95 and were inactive premarket. The stock is up 11% over the past three months.

--By Ben Fox Rubin, Dow Jones Newswires; 212-416-3108; [e-mail]