Mine Safety (NYSE:MSA) returned to form last quarter, missing analyst consensus earnings targets rather badly. Can the hazmat equipment manufacturer find a way to repeat its stunning reversal of fortune of two quarters back, when it reports its Q2 numbers Tuesday morning?

What analysts say:

  • Buy, sell, or waffle? Five analysts follow Mine Safety, up one from last quarter. Three say to buy it, and two say to hold.
  • Revenues. On average, they expect to see 6% sales growth to $231.7 million.
  • Earnings. Profits, however, are predicted to leap 19% to $0.51 per share.

What management says:
The biggest news out of Mine Safety this quarter came in May, when the company announced a major management move to divide the firm into two distinct businesses: domestic and international.

MSA Europe will be led by Roberto Canizares, who has worked for Mine Safety for only four years, but put in 27 years at American Standard's (NYSE:ASD) Trane unit before that. Meanwhile, Joseph Bigler, a 35-year Mine Safety veteran, will head up MSA North America. The company also announced three new "global" department heads, for Global Operational Excellence, Global Product Leadership, and Global Human Resources, respectively. The execs manning these posts have a combined 74 years of experience with the company.

What management does:
Execs doing the management shuffle doesn't ordinarily impress me in and of itself. What we'll really want to see is whether the streamlining of how decisions get made, and business gets done, improves the numbers we're seeing in the table below. Gross margins have fallen for three quarters straight, and operating margins even longer. This is where changes really need to be made.

Margins

12/05

3/06

6/06

9/06

12/06

3/07

Gross

38.4%

38.5%

39.5%

39.4%

37.8%

37.5%

Operating

14.0%

13.9%

13.8%

12.9%

11.8%

11.1%

Net

9.0%

8.4%

8.1%

7.7%

7.0%

7.1%

All data courtesy of Capital IQ, a division of Standard & Poor's. Data reflects trailing-12-month performance for the quarters ended in the named months.

One Fool says:
Mine Safety announced yesterday that the firm is selling more than half of the land at its "Cranberry Woods" campus in Pennsylvania to Wells Real Estate Investment Trust for use as the new corporate headquarters of Westinghouse Electric (co-owned by Japan's Toshiba and America's Shaw Group (NYSE:SGR)). While this REIT sounds like it should belong to Wells Fargo (NYSE:WFC), I have been unable to confirm any connection to the bank. What I was able to figure out is that the REIT owns the Aon (NYSE:AOC) Center in Chicago, as well as headquarters for Nestle USA and US Bancorp (NYSE:USB).

Of course, what's of most importance to investors is how much money Mine Safety will get out of the deal, and whether the company is closing up shop. First off, Mine Safety is keeping mum on the sales price. But I'd expect we'll see it book a profit, considering how much land prices have run up on the Atlantic Coast in recent years.

Second, Mine Safety retains 80 acres of the Cranberry Woods campus, so my guess is it has plenty of room left to keep making stuff -- especially now that it's outsourcing some of its production overseas.

What did we expect out of Mine Safety last quarter, and what did it produce? Find out in:

Fool contributor Rich Smith does not own shares of any company named above. US Bancorp is an Income Investor pick. The Motley Fool's disclosure policy is above ground, and totally aboveboard.