Oct 4 2007
Gibraltar Industries, Inc. today announced it will sell the assets and cease the operations of its Hubbell Steel subsidiary. Hubbell’s results, including losses resulting from the differences between the carrying value and the net realizable value of its assets including goodwill, will be reported as discontinued operations when Gibraltar reports its earnings for the quarter ended September 30, 2007. Gibraltar expects to incur a charge in the range of $13 million to $16 million as a result of this action. The Company will provide additional detail when it reports its third-quarter earnings on October 31.
Hubbell Steel, a service center specializing in coated and painted products, was acquired by Gibraltar in 1995. It has annualized sales of approximately $45 million, operates two facilities (one near Chicago and another in Birmingham, Alabama), and employs approximately 40 people. Gibraltar expects to complete the Hubbell shutdown and the sale of its assets before the end of this year.
“This decision is part of our plan to sell non-core assets and businesses, and it is consistent with earlier actions to improve the performance of our Processed Metal Products segment, including last year’s sale of our strapping operations, the elimination of our Duferco Farrell joint venture earlier this year, and the consolidation of two Buffalo-area steel processing facilities into a single location. We will continue to focus our resources and capital on those areas that provide the best strategic fit and which will produce the highest returns for our shareholders,” said Brian J. Lipke, Gibraltar’s Chairman and Chief Executive Officer.
“Our decision to exit this business – together with our recent acquisitions and ongoing efforts to improve our existing operations – are all steps we are taking to strengthen the performance characteristics of Gibraltar. We expect that this shutdown will positively impact our financial performance on an ongoing basis,” said Henning N. Kornbrekke, Gibraltar’s President and Chief Operating Officer.