The company beat analyst expectations by about 1 cent per share, and Brian Dunham, chief executive, forecast continued growth in Northwest Pipe’s next three months. The company’s stock (NWPX) closed up $2.32 at $40.33 on Wednesday, following the release of financial results.

Profits grew most quickly in the smaller of Northwest Pipe’s two segments, the tubular products group, which makes pipes for energy, fire protection and agriculture markets. Increased demand for those pipes led to a first-quarter gross profits increase of 43.4 percent, to $3.3 million on sales of $30.1 million.

Though steel costs are rising, the company has been generally successful at increasing its prices to reflect those costs, Dunham said.

Although the number of units sold in Northwest Pipe’s water transmission segment fell in the first three months of 2008, stronger operating margins resulted in an overall climb in profitability there as well. Water transmission reported first-quarter gross profits of $13.8 million.

“We expect water transmission volume to strengthen through the year beginning with a small improvement in the second quarter,” Dunham said. He projects significant revenue growth in the second half of 2008.

Northwest Pipe moved from Portland to offices at 5721 S.E. Columbia Way in March. The company has 10 manufacturing sites across the U.S. and Mexico.

COURTNEY SHERWOOD covers Northwest Pipe Co. Reach her at 360-735-4553 or courtney.sherwood@columbian.com.