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Diebold 3rd-quarter profit falls 9.4 percent

October 27, 2011

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NEW YORK—Diebold Inc., a maker of ATMs and bank vaults, said Thursday its third-quarter net income fell 9.4 percent as revenue declined, but it raised its full-year profit guidance because of lower costs.

The North Canton, Ohio, company said earnings fell to $41.8 million, or 65 cents per share, from $46.1 million, or 69 cents per share, a year ago. Excluding one-time items and discontinued operations, earnings per share fell to 69 cents from 73 cents.

Revenue slipped 5.2 percent to $709.3 million from $748.6 million, with improved service revenue failing to offset lower product sales. Geographically, growth in North America and Asia Pacific was more than offset by revenue declines in Europe, the Middle East and Africa and in Latin America.

Analysts surveyed by FactSet forecast, on average, quarterly earnings per share of 60 cents and revenue of $767.3 million.

Diebold said its gross margins improved by 1.5 percentage points to 27.4 percent year over year due to more favorable customer and geographic mix. It repurchased 1.7 million shares during the quarter, benefiting its earnings per share.

Looking ahead, Diebold expects to earn $2.15 to $2.25 per share on an adjusted basis for the year, up from prior guidance of $2 to $2.20 per share. The company expects flat revenue for the year, down from a growth forecast of 3 to 5 percent, as the stronger dollar is expected to hurt financial self-service revenue in Europe and Brazil.

Analysts expect annual income of $2.09 per share and revenue of $2.93 billion.

Shares of Diebold rose $1.09, or 3.4 percent, to $33.16 in morning trading.