Columbus, Ohio, December 22, 1999 --- Worthington Industries, Inc. (NASDAQ: WTHG) today reported results for the three and six month periods ended November 30, 1999. For the quarter, earnings from continuing operations increased 35% from the prior year to $24.7 million, and diluted earnings per share from continuing operations increased 40% to $0.28. Sales increased 8% to $473.3 million from $436.4 million.
For the six month period, earnings from continuing operations increased 36% from the prior year to $49.0 million from $36.0 million, and diluted earnings per share from continuing operations increased 45% to $0.55 from $0.38. Sales increased 11% to $936.2 million from $845.7 million.
Net earnings and diluted net earnings per share, which include the Company's discontinued operations and the effect of an accounting change in the year ago time period, were $24.7 million and $0.28, respectively, compared to $22.3 million and $0.24, respectively, for the quarter. For the six month period, net earnings and diluted net earnings per share were $49.0 million and $0.55, respectively, compared to $30.8 million and $0.33, respectively.
"Earnings were in line with our expectations and reflect an increasing return from the significant capital investments we have made in recent years," said John P. McConnell, Worthington's Chairman and CEO. "Sales were up despite the impact of lower pricing and a divestiture in our metal framing segment. New steel processing facilities and the international acquisitions in Pressure Cylinders are helping drive growth. Improving returns from these investments and our Metal Framing business, as well as continued strong demand in several of our larger customer segments, have favorably impacted results."
"Demand trends in all of our markets remain positive," added John S. Christie, President and Chief Operating Officer. "However, pricing pressures will challenge gross profit margins through the third and fourth quarters."
As expected, the startup processed steel operation at Decatur, Alabama, was dilutive to earnings in the quarter. This project is in the second year of what is expected to be a four year ramp-up. The company estimates that Decatur reduced earnings per share by $0.05 in the second quarter and $0.10 in the six month period ending November 30, 1999.
For the second quarter, Y2K compliance efforts cost $4.0 million or $0.03 in earnings per share compared to $2.0 million or $0.01 for the comparable period last year. The project is 100% complete after comprehensive remediation, testing, contingency planning and independent audits. Total project costs to date, including capitalized expenses, have been $21 million compared to a projection of $27 million.
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 premiere value-added steel processor and a leader in manufactured metal products such as automotive aftermarket stampings, 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 rooted 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 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 startups, 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 purposed 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.
Contact:
Cathy Mayne Lyttle
614-438-3077