Digging Into Mine Safety: Fool by Numbers

On Nov. 2, health, safety, and defense products maker Mine Safety Appliances (NYSE: MSA  ) released third-quarter earnings for the period ended Sept. 30.

• Sales declined 3.7% to $209.8 million, primarily because of lower sales of Advanced Combat Helmets and related communications systems to the military.
• Net profit dipped 25.9% to $12.6 million.
• Management headlined substantial delays in federal funding for the U.S. Fire Service, which in turn has delayed fire departments from upgrading their equipment.
• High capital expenditures and a 63.1% decline in cash from operations resulted in negative free cash flows for the period.
• This Motley FoolHidden Gems selection is stuck at three-star status in Motley Fool CAPS.

(Figures in millions, except per-share data)

Income Statement Highlights

	Q3 2006	Q3 2005	Change
Sales	$209.8	$217.8	(3.7%)
Net Profit	$12.6	$17.0	(25.9%)
EPS	$0.34	$0.46	(26.1%)
Diluted Shares	36.7	37.3	(1.6%)

Get back to basics with a look at the income statement.

Margin Checkup

	Q3 2006	Q3 2005	Change*
Gross Margin	37.3%	36.6%	0.7
Operating Margin	9.5%	12.6%	(3.0)
Net Margin	6%	7.8%	(1.8)

*Expressed in percentage points.

Margins are the earnings engine. See how they work.

Balance Sheet Highlights

Assets	Q3 2006	Q3 2005	Change
Cash + ST Invest.	$39.7	$65.6	(39.5%)
Accounts Rec.	$170.1	$156.9	8.4%
Inventory	$154.3	$129.4	19.2%

Liabilities	Q3 2006	Q3 2005	Change
Accounts Payable	$52.1	$45.0	15.9%
Long-Term Debt	$53.8	$54.0	(0.2%)

Learn the ways of the balance sheet.

Cash Flow Highlights

	YTD 2006	YTD 2005	Change
Cash From Ops.	$21.9	$59.3	(63.1%)
Capital Expenditures	$46.7	$32.2	45.2%
Free Cash Flow	($24.8)	$27.1	N/A

*Capital expenditure includes acquisitions.

Find out why Fools always follow the money.

Related Companies:

• Lakeland Industries (Nasdaq: LAKE  )
• Abatix (Nasdaq: ABIX  )
• Respironics (Nasdaq: RESP  )
• Honeywell (NYSE: HON  )

Related Foolishness:

• Foolish Forecast: Mine Safety Goes Underground
• Foolish Forecast: Minding Mine Safety
• Foolish Forecast: Navigating Lakeland

Mine Safety Appliances is a Hidden Gems recommendation. You can view the entire Hidden Gems scorecard with yourfree trial.

Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so check Fool.com for more of our in-depth discussion of what the numbers mean. This data has been provided by Netscribes. To provide feedback on this article, please click on the "feedback" button below.