Lydall’s net sales for the second quarter ended June 30, 2015, were $134.6 million compared to $148.8 million in the second quarter of 2014, with the reduction primarily driven by unfavorable foreign currency translation and the divestiture of a non-core business in the first quarter of 2015. Net income was $10.8 million in the second quarter of 2015 compared to $8.2 million in the second quarter of 2014. 
 
Dale Barnhart, president and CEO, says, “I am very pleased with our second quarter results as we reported solid operating margin expansion and delivered earnings of $0.64 per share. Consolidated quarterly operating margin of 12.7% demonstrates our continued measurable progress on driving profitable growth. We reported organic sales growth in all of our segments except for the Performance Materials segment that reported a 10% reduction. Continued weakness in demand in North America and Asia for filtration products and for cryogenic insulation products serving the liquid natural gas market contributed to the decline in Performance Materials. Even with lower consolidated sales, we were able to achieve excellent gross margin expansion of 190 basis points primarily from continued execution of lean initiatives across our businesses and realization of synergy programs in our Industrial Filtration segment.”
 
Barnhart adds, “Looking forward to the remainder of 2015, we expect demand for our automotive products in the Thermal/Acoustical Fibers and Metals segments to continue to be healthy in both North America and Europe. In addition, we expect improved operating results from our new Metals operation in China. In the Industrial Filtration segment, we are seeing solid global order activity in the third quarter and consistent with prior periods, we expect sales for the first half of the year will be stronger than the second half due to normal seasonality. In the Performance Materials segment, we anticipate improved results in the second half of 2015 compared to the first half of 2015.”
 
On July 31, 2015, the company became aware of alleged inaccuracies in the timing of revenue recognition in its Industrial Filtration business in China, which was acquired on February 20, 2014. This China business represented no more than 6% of Lydall’s consolidated net sales and no more than 3% of Lydall’s consolidated gross profit in any quarterly or annual period since the date of acquisition. While the internal investigation is on-going, the company currently believes the outcome will not have a material impact on the company’s consolidated financial results.