Fuel Systems Solutions Inc. Q2 2009 Earnings Call Transcript

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2009-08-07 13:27:20.0

Tags: Operating Margin, Call Transcript, Business, Earnings, Integration, Fuel Systems Solutions Inc., Asset Management, Operational Planning, Business Operations, Seeking Alpha

Question-and-Answer Session

Operator

(Operator Instructions). Your first question comes from Rob Brown – Craig-Hallum Capital.

Robert Brown – Craig-Hallum Capital

Could you provide some more detail on the Teleflex acquisition? How long will it take you to kind of get this integrated and in general, do you think you can get that business up to the operating margins you see in your industrial business, which I think is low double digit operating margin?

Matthew Beale

As it relates to the business, we have – there's three market segments there. There's three business units if you will, two of which are businesses in which we currently participate and which are complementary. Having said that, we think that will obviously facilitate the integration, allow us to move forward quite quickly.

A third business line which as a manufacturing matter is very much akin to what we're doing in the compressor market, so we believe as a production question that is something that we'll be able to integrate as well quite quickly. We're looking – I think the time horizon we're looking at is around six months. Again we think that the transaction will contribute or make a positive contribution to the balance of the year, if to a lesser degree than in 2010. We hope to see the full benefits of the integration.

Robert Brown – Craig-Hallum Capital

On your FuelMaker, now that you've had some time to look it, could you give us some color on your strategy there. How do – do you know yet how you plan to go market and what should we look for for contribution? Is that a 2010 contribution?

Matthew Beale

Yes, I think it really is a 2010 contribution. Remember that there we acquired assets and technology not an existing operating business. So that there is a process of integrating those assets and technology with our existing facilities which we've made significant progress in doing.

In fact, we're – by the end of this quarter we'll have made very important strides in getting production up and running. We have integrated the main production parts with our existing compressor production facilities in Italy, and we also are maintaining and building upon what was a servicing infrastructure in North America.

So that's moving at a pace as much as we expected. I think towards the end of the year we'll feel that that integration in our go forward strategy have the ability to move forward. So it's really more of a 2010, I suspect, revenue type of question.

 

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