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What: Shares of engine maker Briggs & Stratton (NYS: BGG) were sputtering today, as they fell as much as 10% in intraday trading after the company reported its fiscal second-quarter results.
So what: On an adjusted basis, Briggs & Stratton's quarterly per-share profit clocked in at $0.06, a penny ahead of analysts' expectations. So at least there was something for investors to cheer.
On the other hand, revenue for the quarter was $447.9 million, down 0.5% from the prior year and lagging the $458.7 million estimate from Wall Street. The soft top line reflects the continued tough operating environment for the company, as Briggs & Stratton CEO Todd Teske pointed out that "levels of consumer spending for outdoor power equipment continues to be challenging in the United States and in Europe."
Now what: To a large extent, it's a waiting game for the company and shareholders as both groups wait for some stronger signs of turnaround in the economy and the lawn-and-garden industry. In the meantime, though, the company is doing what it can to right-size its operations and cut costs. In conjunction with its earnings announcement, Briggs & Stratton announced that it's taking further restructuring actions that include moving operations, shutting down some facilities, and idling others. These aren't encouraging actions for investors that had expected a quicker turnaround, but the hope would be that this helps the company better navigate the tough times still ahead.
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