By Paulo Trevisani

Graco Inc. said favorable exchange rates helped increase its gross profit margin in the second quarter.

The Minneapolis, Minn., maker of industrial equipment on Wednesday reported adjusted earnings of 62 cents a share in the quarter ended June 25, up 68% from a year earlier, with gross profit of $264 million, up from $183 million a year earlier.

The company, which supplies technology for the management of fluids and coatings and operates in several countries, said its gross profit margin gained two percentage points compared to a year earlier, as increased production volume, favorable product and channel mix and favorable changes in currency translation rates offset higher product costs.

"Changes in currency translation rates increased operating expenses by $3 million (2 percentage points) for the quarter and $5 million (2 percentage points) for the year to date," Graco said.

It also said the exchange rate increased worldwide sales by $12 million for the quarter and $23 million for the first half of the year.

Graco's operating margin fell two percentage points in the quarter versus a year earlier, as gains from favorable exchange rates and increased sales failed to offset higher material, factory and sales costs, the company said.

The WSJ Dollar Index fell 1% in the quarter ended June 25.

Write to Paulo Trevisani at paulo.trevisani@wsj.com

(END) Dow Jones Newswires

07-22-21 0614ET