UPDATE 2-GrafTech profit doubles, raises 2008 view; shares rise
May 1st, 2008 | by admin |(Adds analyst’s comments, updates share movement)
May 1 (Reuters) - GrafTech International Ltd (GTI.N: Quote, Profile, Research), amaker graphite electrodes, posted a two-fold increase inquarterly profit, beating Wall Street estimates, helped byhigher product prices and reduced expenses, and raised its 2008revenue outlook, sending its shares up to an eight-year high.
“We remain encouraged by global steel industry conditionsand expect solid demand from our steel end markets… in 2008,”CEO Craig Shular said in a statement.
The company makes graphite electrodes primarily used bysteel mills, and sky-high production costs, strong demand andtight supplies have pushed global steel prices to new highs sofar this year.
“They are passing through the higher raw material costs tothe customers,” Mark Parr an analyst with Keybanc CapitalMarkets said.
“Given that over 90 pct of their revenues are long-termcontracts that go from year to year, the visibility of goodpricing should be above average for the remainder of the year,”Parr added.
Parr has a “buy” rating on the stock.
Graftech forecast 2008 sales growth of about 16 percent to18 percent, up from its previous forecast of 12 percent to 14percent.
The company posted a revenue of $1.00 billion for fiscal2007.
