Noland Co. (Newport News, Va.) reported net income of $9.3 million, or $2.55 per diluted share, for the fiscal year ended Dec. 31, an increase of 14.2% compared with $8.1 million, or $2.20 per share for 1999. However, lower sales and margins and higher operating costs led to a 41.8% decline in fourth-quarter net income to $2.4 million, or 67 cents per share, vs. $4.1 million, or $1.11 per share in 1999.
The slowing economy that began hampering sales in the third quarter worsened in the final three months of the year, resulting in a 2.4% drop in fourth-quarter sales and lower gross margins. Sales of $488.7 million for the year were 1.2% above $482.8 million for 1999.
"Plumbing sales, which represent the largest department of our business, rose 5.6%, reflecting reasonably healthy construction activity, especially in the first half of the year," said Lloyd U. Noland III, chairman, in a statement. He credited a series of plumbing promotions conducted during the year with contributing to the increase, as well as record sales by the company's drilling equipment operations.
However, electrical/industrial sales declined 5.1% for the year, caused by softening demand for its products used in manufacturing plants. Air conditioning sales were down by 3.2% vs. the prior year, due mostly to unusually wet and cool weather that weakened demand for residential replacement equipment.