Fuel Systems Solutions (FSYS) Seeing Strong Growth From Conversion Operations

May 13, 2008 3:04 PM EDT

Fuel Systems Solutions, Inc. (Nasdaq: FSYS) Shares spike on positive earnings report and higher guidance for FY08. Q1 EPS was $0.40, 22 cents better than estimates. Revenue for the first quarter jumped to a record $94.6 million from $54.8 million a year earlier. FSYS sees FY08 revenues of $320 million vs. $304.8 million consensus.

The CEO noted that the company's transportation business for Q1 benefited from a more than 50% increase in unit volume output from the previous quarter derived from its delayed original equipment manufacturing conversion operation -- enabling vehicles to operate on compressed natural gas (CNG) or liquefied petroleum gas (LPG). Costamagna added that aftermarket conversions of internal combustion engines to gaseous fuel operation still represent the largest percentage of business in the industry today, with automotive original equipment factory conversions relatively low in output volume.

"The utilization of our capabilities by automobile manufacturers on a delayed basis provides economies of scale, technological advantages and benefits to consumers who desire original equipment warranty protection,'' Costamagna said.

Fuel Systems Solutions, Inc. (Fuel Systems) designs, manufactures and supplies alternative fuel components and systems for use in the transportation, industrial and power generation industries on a global basis. [SM]

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