FRANKLIN, Tenn. (AFX) - Filtration systems maker Clarcor Inc. said Wednesday that profits dipped slightly during the second quarter primarily because of $3 million payment dispute.
The company, which makes filtration systems for oils, air and fuels, earned $16.8 million, or 32 cents a share, during the second quarter, compared with $17.3 million, or 33 cents a share, last year. Sales increased to $227 million from $220 million.
Operating profit also dipped slightly, moving down to $26.2 million from $27.6 million.
On average, analysts polled by Thomson Financial expected higher earnings of 38 cents a share.
In a statement, the company said the major driver of lower earnings was a $3 million charge recorded because Electronic Data Systems refused to pay Clarcor's Total Filtration Systems unit for products supplied under an agreement with former EDS subsidiary AT Kearney. Clarcor filed a lawsuit in Tennessee state court seeking $3.6 million, plus expenses and punitive damages.
Other factors include a $400,000 restructuring of the company's European manufacturing operation, which merged two facilities. The company plans on spending more this year on restructuring facilities, it said in a statement.
Shares of Clarcor rose 72 cents, or 2.4 percent, to close at $30.81 on the New York Stock Exchange. After-hours the stock gave back those gains, sliding down 91 cents, or 3 percent, to $29.90 on the INET.
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