NORTH CANTON, Ohio - Diebold, Incorporated (NYSE: DBD - News) reported third quarter 2004 net income of $48.3 million and diluted earnings per share of 67 cents, compared to diluted earnings per share of 66 cents in 2003's third quarter of 2003.
Earnings were adversely impacted by the company's electronic voting systems business. Included in the latest quarter were previously disclosed product recertification, legal and other costs related to the pending civil action in the state of California, which adversely impacted quarterly earnings by approximately five cents per share.
According to a Reuters report, Diebold cut its third-quarter and full-year earnings forecast earlier this month, citing problems at its electronic voting machine business. California accused the company in April of using deceptive sales tactics after it installed touch-screen voting systems that were not tested or approved by the state.
Diebold achieved record thir d quarter revenue of $613.4 million, 7.6 percent higher than the third quarter 2003 revenue of $570.2 million. Excluding the election systems business, the company said its third quarter 2004 diluted earnings per share would have increased by 18.3 percent.
Diebold's earnings grew across its other business lines. Sales of financial self-service products and services, including ATMs, were $418.4 million in the latest quarter, up 8.6 percent from $385 million a year ago.
Sales of security products and services were $160.5 million in the latest quarter, up 17 percent from $137 million a year ago.
For the first nine months of the year, Diebold earned $121.2 million, or $1.67 per share, on sales of nearly $1.66 billion. For the same period in 2003, earnings were $115.5 million, or $1.59 per share, on revenue of $1.46 billion.
Diebold is predicting fourth-quarter earnings between 87 and 92 cents per share, including an approximately three-cent reduction related to its election systems business. Wall Street analysts on average expected the company to earn 90 cents per share, according to Reuters.
Diebold also expects fourth-quarter revenue to increase between 9 and 11 percent on a fixed exchange rate basis, with revenue from its financial unit growing 11 to 14 percent.
