The Tensolite aerospace and high-speed communications cable division is a major success story, with record sales and earnings and increased operating margins. Backlog continues to grow, despite the addition of capacity for Tensolite. Along with other Carlisle companies, Tensolite is in the early stages of developing a Mexican campus of focused manufacturing facilities to increase capacities and lower costs. Tensolite has more than tripled its sales in three years. During the quarter, Carlisle added to Tensolite's capacity and range of product offerings through the acquisition of Vermont Electromagnetics, a manufacturer of specialty coaxial cable assemblies and connectors serving the computer, medical electronics, and telecommunications markets.
Backlogs are healthy, and inventories are well-controlled.
Carlisle does not intend to be one of those companies that expands in the boom times and lays off people in the bad times. The company intends to be predictable and focused in managing its sales and administrative expense and its capital investment. The capital budget for 1998 is projected to be unusually high to accommodate essential capacity increases in areas of the business that are operating at or beyond capacity and are causing backlogs to increase to undesirably high levels. That said, management believes that the very good start to 1998 should enable Carlisle to meet its goals for 1998. A Fool conference call synopsis represents an effort to highlight the salient points of a conference call and should not be taken as an authoritative accounting or transcription of the entire event.