Northwest Pipe posts loss in first quarter

Vancouver-based firm expects improvement after sales, acquisitions

By Aaron Corvin, Columbian Port & Economy Reporter



After selling off some assets and making recent acquisitions, Vancouver-based Northwest Pipe Co. said Thursday it’s poised to improve its financial results in the months ahead.

Still, it’s not getting there without some turbulence first.

The company, which manufactures steel pipe primarily for drinking water systems, recorded a net loss of $9.9 million in the first quarter. That compares with a profit of $9.5 million in the January-to-March period in 2013.

During its earnings conference call Thursday, Northwest Pipe also said it posted net sales of $82.6 million, a year-over-year decrease of 23 percent.

“Our first quarter was significantly affected by a series of charges related to our recent acquisitions, divestitures and scheduled downtime,” Scott Montross, president and CEO of Northwest Pipe, said. “We believe the second quarter of 2014 will improve.”

His optimism is based, in part, on the company’s expectation that its water transmission division — which builds pipeline systems for use in water and energy systems — will soon experience higher net sales. In fact, the company anticipates launching production on a project to supply 81,958 feet of 108-inch diameter welded pipe to boost the volume of water delivered from East Texas lakes to the Dallas-Fort Worth area.

Northwest Pipe will supply the material to Kansas City, Mo.-based Garney Construction. Work on the Integrated Pipeline Project, Montross said, will begin in the second quarter and is expected to “run through the fourth quarter” of this year.

The company’s earnings report Thursday followed several major announcements during the first quarter of 2014. At the end of March, for example, Northwest Pipe said it had sold nearly all of its oil country tubular goods assets to Centric Pipe LLC, an affiliate of Dallas-based supplier SB International Inc., for $42.7 million. Northwest Pipe said the divestiture would allow it to concentrate on its core water transmission business.

In January, Northwest Pipe said it had acquired Permalok Corp., a fabricator of steel piping. The company said Permalok’s patented interlocking pipe-joining system “complements and expands” its product line and also bolsters its water transmission business. Terms of the deal were not disclosed.

Northwest Pipe’s stock, which trades as NWPX, closed down 53 cents Thursday, at $35.10 per share. The company’s shares have traded between $26.02 and $39.62 in the past 52 weeks.