August 2000 Pump Industry Analyst

UNICON EXPANDS CONCRETE PUMPING BUSINESS

With the acquisition of the assets of Concrete Placement Inc (CPI) in the USA, Unicon America Inc has acquired another major ready-mix concrete pumping business operating in North and South Carolina.

CPI will be integrated into Unicon America’s existing subsidiary, Carolina Concrete Pumping Inc (CCP), making it North and South Carolina’s largest concrete pumping oper- ation with an annual turnover of DKr 125 million.

Umcon Group entered the American concrete pumping market in September 1998 b) acquiring CCP, one of Ameri- ca’s largest concrete pumping businesses. Only about 25% 01‘ all ready-mix concrete sup-. plied in the l!SA is pumped, but this percentage is expect& to rise in the coming years.

GARDNER DENVER EXTENDS WATER JETTING

ACTIVITIES Gardner Denver Inc has acquired 100% of the shares of CRS Power Flow Inc.

CRS. located in Houston, Texas, manufactures aftermar- ket products for the water jetting industry. including pump replacement parts, nozzles. con- trol guns, high pressure hose and fittings. Ross Centanni. chairman, president and CEO of Gardner Denver said CRS was a key niche provider of high qual- ity aftennarket parts and acces- sories for the water jetting industry worldwide. “The acquisition of this highly-prof- itablc operation complements our product offering for the water jetting market. and furthet leverages Gardner Denver’s commitment to being a full ser- vice provider in the water jetting industry.” added Centanni.

INDIA’S PUMP MANUFACTURERS

1 initiatives in the tools and equipment businesses.

URGED TO REFORM

The company is now look- I ing at about US$O.75 in second l MDU Resources Group Inc

quarter EPS and roughly US$3.25 in EPS for the full year 2000, versus the US$O.90 and US$3.66 consensus esti- mate of analysts. The Year 2000 second quarter, however. is expected to reflect a 50% sales and operating income gain, marking Pentair’s 27th consecutive quarter of double- digit earnings improvement.

has acquired The Wagner- Smith Company. a Dayton, Ohio-based dilsersified elec- trical contractor. The Wagner Group includes operations in traffic signal systems: street lighting; equipment manu- facturing, rental and sales; industrial pump distribution and repair; and mechanical construction services. Wagn- er. with approximately 500 employees. will become part of Utility Services Inc (USI), an indirect wholly-owned operating subsidiary of MDU Resources. Founded in I91 7 as a company which sold pumps, Wagner-Smith then diversified into electri- cal work and into the com- mercial, industrial and insti- tutional market.

b A distributor contract was signed at Achema in Gcr- many between Tuthill Pump Group and Sinatec Pumpen und Anlagentech- niek GmbH. Sinatec will sell the complete range of Concord magnetically-dri- \‘en gear pumps and the new range of Tuthill variable flow drives vv hich were offi- cially launched into the European market during Achema.

p Four hundred engineers from \,arious disciplines. including ci\ il. chemical. mechanical and clcctrical engineering. recently pre- dictcd top challenges and inno\alions for the 2 I st cen- tury 111 the ITT Indus- tries/Discover Engineering Survey. According 10 respondents. the greatest L challenges that engineers will face in the 2 1st centurv include finding new energy sources, supplying the world with clean water, designing products that do not harm the en\ Ironment. and plan- ning cities and allocating resources to accommodate the groM mg poptdatmn.

The outgoing president of the Southern India Engineering Manufacturers’ Association (SIEMA) RR Balasund- haram has told Indian pump manufacturers to give serious thought to the challenges they face from multinationals, for- eign brands and assembled kit manufacturers.

Speaking at the 47th annual general meeting of SIEMA, which took place in Coimbatore during June, Balasundharam said only those companies with an efficient marketing network, sound financial backup, a wide product mix and cost effective production would perform well. According to Balasundharam, other Indian pump companies have only two options for sur- rival: to find a suitable partner and form a strategic alliance as a sub-contractor, or face even worse market conditions.

A recent survey of the pump industry in the Southern India region found that while the domestic segment has shown growth, agricultural demand has yet to reach the 1995-96 level. In addition, industry profitabili- ty has been hit by the increase in input costs, while manufactur- ers have been unable to increase prices because of stiff competi- tion. Balasundharam also high- lighted a recent report on the submersible pump market in Andhra Pradesh which showed that only 137 000 branded sub- mersible pumpsets were sold during the last three years com- pared with 245 000 assembled kit pumpsets.

PENTAIR WARNS OF EARNINGS SHORTFALL

Pentair Iuc says its second quarter earnings per share (EPS) will be below the con- sensus of analyst estimates mainly because of delays in

Strong performances by its water and enclosures businesses in the second quarter are expect- ed to largely offset near-term delays in achieving the benefits of cost initiatives in its tool and service equipment businesses. Pentair says it is also establish- ing a reserve to cover the deteri- oration in credit quality of a sig- nificant customer.

Winslow Buxton, Pentair chairman and chief executive officer, said they were taking a prudent look at Year 2001 and now estimate EPS of about US$4.00, which would be in lint with Pentair’s 20% EPS improvement. but below the US$4.28 consensus of analyst estimate\.

“The delay in benefits is isolated to a smgle operating group,” Buxton said. “It is large- ly a product of our ongoing efforts to consolidate the tools and equipment businesses into more efficient units and to expand and add to their capabil- ity. It does not reflect any overall market weakness or the poten- tial of our businesses to meet OUI- expectations for long-term growth and viability. There is significant strength in all of oul core markets. We simply under- estimated the time required to implement a complex program of strategic initiatives.”

The Professional Tools and Equipment Segment is being reorganised to separate tools from service equipment. Lincoln Industrial is being realigned with the service equipment businesses to form a new Equipment segment.