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Worthington Industries Reports Fourth Quarter and Fiscal 1999 Results


Worthington Industries Reports Fourth Quarter and Fiscal 1999 Results Fourth Quarter Sales Increased 11% to $495 Million; Continuing EPS Up 19% to $0.31 Per Share Annual Sales Increased 9% to $1.8 Billion; Continuing EPS Up 6% to $0.90 Per Share

Columbus, Ohio, June 24, 1999 -- Worthington Industries, Inc. (Nasdaq:WTHG) today reported increased sales and earnings from continuing operations for the fiscal year ended May 31, 1999 that were in line with expectations.

For the full year, earnings from continuing operations were $84 million, or $0.90 per diluted share, up 6%. This compares with earnings from continuing operations of $82 million, or $0.85 per diluted share, for the same period a year ago. Sales increased 9% to $1.8 billion, from $1.6 billion for fiscal 1998. For the fourth quarter, earnings from continuing operations increased to $28 million, or $0.31 per diluted share, up 19%. This compares with earnings from continuing operations of $25 million, or $0.26 per diluted share, for the fiscal 1998 fourth quarter. Sales were up 11% to $495 million, from $447 million, a year ago. "We had a strong fourth quarter," said John P. McConnell, Chairman and CEO of Worthington. "Our businesses showed improvements during the fourth quarter and our results underscore the strength of our operations. In the midst of lower steel prices, we reported annual sales increases in our processed steel business segment on the strength of the increase in business at our new facilities at Delta, Spartan and Decatur."

"We are pleased that we have accomplished the goals we outlined at the start of fiscal 1999 both financially and organizationally. We completed our divestiture strategy, began the reorganization of our steel group and integrated processes across all functional areas. Our cylinder sales continued to grow as the Heiser acquisition showed immediate positive results. Dietrich Industries' metal framing sales were even with last year, but we saw improved operating margins, due to cost saving measures which provided increased productivity and reduced labor," McConnell said.

In fiscal 1999, Worthington Industries completed its previously announced strategy to divest non-core businesses with the sale of seven business units. Proceeds of approximately $200 million from these transactions were used for share repurchases, to reduce debt and for acquisitions. The Company repurchased 6.8 million shares of Worthington common stock for $94 million during fiscal 1999, with 2.6 million shares repurchased during the fourth quarter for $35 million. The Company also increased its quarterly dividend payment 7% to $0.15 per share of common stock.

"We have worked very hard on our Year 2000 compliance efforts, and have made significant progress," McConnell said. Year 2000 expenditures in fiscal 1999 amounted to approximately $10 million. Remediation, testing and contingency planning continue on-schedule and all critical year 2000 projects should be completed by September 1999.

"We also made some new additions to our management team, including the hiring of John S. Christie as our new President and COO. Our management team is now firmly in place to carry forward our strategy that centers on our steel processing and metal fabricating businesses, making acquisitions and growing our sales and earnings," said McConnell. "The transformation under way at Worthington Steel will strengthen the steel business through enhanced customer service, increased productivity, and better efficiencies," McConnell added.

Worthington Industries is a leading diversified metal processing company with annual sales of approximately $2 billion. The Columbus, Ohio based Company is North America's premier value-added steel processor, a leader in manufactured metal products including: pressure cylinders, metal framing, metal ceiling grid systems and laser welded blanks. The Company employs 7,500 people and operates 53 facilities in 11 countries. Founded in 1955, the Company operates under a long-standing corporate philosophy in the golden rule, with earning money for its shareholders as the first corporate goal. This philosophy, an unwavering commitment to the customer, and one of the strongest employee/employer partnerships in American industry serve as the Company's foundation.

Safe Harbor Statement
The Company wishes to take advantage of the Safe Harbor provisions included in the Private Securities Litigation Reform Act of 1995 (the Act"). Statements by the Company relating to future revenues and growth, stock appreciation, plant start-ups, capabilities, the impact of year 2000 and other statements which are not historical information constitute "forward looking statements" within the meaning of the Act. All forward looking statements are subject to risks and uncertainties which could cause actual results to differ from those projected. Factors that could cause actual results to differ materially include, but are not limited to, the following: general economic conditions; conditions in the Company's major markets; competitive factors and pricing pressures; product demand and changes in product mix; changes in pricing or availability of raw material, particularly steel; delays in construction or equipment supply; year 2000 issues, and other risks described from time to time in the Company's filings with the Securities and Exchange Commission.

THE YEAR 2000 STATEMENTS CONTAINED HEREIN ARE YEAR 2000 READINESS DISCLOSURES (as defined under the Year 2000 Information and Readiness Act) and shall be treated as such for all purposes permissible under such Act. These statements are based on management's analysis of all information obtained to date and use what management believes to be reasonable assumptions in estimating costs, project timing, and the occurrence of future events. There can be no assurance that actual costs will not exceed any stated estimates, that all possible year 2000 issues will be resolved by the stated times, or that there will be no adverse impact on the Company due to system failures caused by either internal or external year 2000 issues.

(in thousands)


May 31, 1999

May 31, 1998

Current Assets


Cash and cash equivalents

$ 7,641

$ 3,788

Accounts receivable, net






Investment in Rouge



Prepaid expenses and other current assets




Total Current Assets




Investment in unconsolidated affiliates



Other assets



Investment in Rouge



Property, plant and equipment, net




Total Assets

$ 1,686,951

$ 1,842,342


May 31, 1999

May 31, 1998

Current Liabilities


Accounts payable

$ 161,264

$ 176,752

Notes payable



Accrued Items



Conventional current maturities



Debt exchangeable for common stock




Total Current Liabilities




Other Liabilities and Minority Interest



Conventional long-term debt



Debt exchangeable for common stock



Deferred income taxes




Shareholders' Equity




Total Liabilities and Shareholders' Equity

$ 1,686,951

$ 1,842,342

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Cathy Mayne Lyttle

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