Middleby (MIDD) reported third-quarter earnings earlier this month of 83 cents a share, 4 cents better than Wall Street projections, but still 19% down from the year-ago period.

Revenue fell 7.5% from the third quarter of 2008, and at $154 million, was about $10 million below the Wall Street consensus.

If you used a magnifying glass, you could find signs of improvement in the revenue number. In the second quarter of 2009, revenue was down 8.6% from the second quarter of 2008. In the third quarter, the year-to-year decline was just 7.2%. 

The earnings looked slightly better, too: Gross margin climbed to 40.3% in the quarter from 38.9% in the third quarter of 2008.

Food-service and food-processing equipment maker Middleby continues to do what it has always done: acquire companies to increase market share; put acquisitions and continuing operations under the cost-cutting knife; fund acquisitions out of cash flow, and pay down debt. 

In the quarter, Middleby paid down $26 million in debt, which helped trim interest costs by $371,000.

The company projects that conditions in commercial kitchen equipment/cooking unit business will remain “challenging” (their word, not mine) into the first half of 2010.

I think this is a well-run company that is positioned to take advantage of any economic recovery and the resulting upturn in store openings among restaurant chains, as well as any increase in those companies' spending on new equipment from Middleby that can reduce their operating costs. (For more on why you would want to own a cost-cutting growth company like Middleby in a recovering economy in 2010, see my post here).

As of Nov. 23, I'm keeping my target price at $65 a share, but stretching out the time table to November 2010 from July 2010. The stock traded above $46 Monday.

At the time of this writing, Jim Jubak owned shares of Middleby in his personal portfolio.