Albany International Corp.’s growing pains — in the midst of an economic slowdown — led the paper machine clothing manufacturer to report a net loss of $1.5 million for the first quarter Sunday.
Despite a 9 percent net sales increase to $273.2 million over the year, Albany International found its balance sheet hurting. During the quarter, it spent $13.5 million in restructuring charges, idle capacity and performance-improvement initiatives.
Other pain came from paper mills attempting to extend the running life of paper machine cloth longer than usual, partly resulting in a 12.9 percent North American sales decline. Total paper machine cloth sales were up 2.5 percent at $183 million, but down 4.2 percent excluding currency rate change effects.
The Menands-based Albany International primarily makes paper machine fabrics and process belts used to make paper and cardboard. By the close of trading Monday, Albany International’s stock was down 3.31 percent, or $1.22, to $35.66 per share.
With consumers curtailing spending, Albany International’s PrimaLoft arm was hit hard. That division makes insulation for outdoor clothing, gloves, footwear and home furnishings. PrimaLoft sales declined 40.2 percent to $5.9 million compared with a year earlier.
“The economic slowdown in North America, coupled with the possibility of a European slowdown later in the year, adds an element of uncertainty to our short-term outlook. Orders are strong across all of our businesses,” Albany International President and Chief Executive Officer Joseph Morone said.
Albany International also announced Sunday it will sell Albany Filtration Technologies (AFT) to All Filtration Technologies Australia Pty for $45 million. AFT makes filtration products primarily used in power generation and has plants in Gosford, Australia, and Zhangjiagang, China.
Although Morone noted AFT has “very appealing growth prospects” — posting a first-quarter sales spike of 47 percent to $10.5 million — it is “not as tightly connected to Albany’s core competencies as that of our other emerging businesses.”