Columbus,
Ohio, September 20, 2000 – Worthington Industries, Inc. (NYSE:
WOR) today reported results for the three months ended August 31, 2000. For the quarter, earnings per diluted share
were $0.15 compared to $0.27 last year.
Sales were $484 million, an increase of 5% from $463 million last year.
For
the fiscal 2001 first quarter, net income was $12.5 million compared to $24.3
million for the same period a year ago.
Earnings decreased 49% and, on a per share basis, fell 44%. The decline in earnings was seen in each
business segment but the vast majority of it occurred in Processed Steel
Products where the inability to pass along the cost of higher priced steel in a
declining market, as well as reduced tolling volumes, negatively impacted
results.
When
fiscal year-end results were released in June, the Company cautioned that the
three raw material price increases incurred since October 1999 would have a
negative impact on margins. The Company
expected to be able to pass along some of the higher steel costs to customers
during the first quarter. As the
quarter unfolded, however, raw material prices fell more steeply and more
rapidly than expected. This made it
difficult to obtain anticipated customer pricing levels, especially in the
Processed Steel segment.
“The
results of first quarter 2001 are disappointing,” said John P. McConnell,
Chairman and Chief Executive Officer of Worthington Industries, “even though we
knew that it would be difficult to duplicate the exceptional results reported
last year at this time. Since
production in this quarter utilized much of the higher priced steel, we expect
to see a significant improvement in margins going forward. Benefits from declining raw material costs
and various growth initiatives should favorably impact profitability during the
balance of the year. Despite the slow
start to the year and some evidence of slackening demand, we expect fiscal 2001
to be another year of growth.”
In
just the last quarter, the Company has announced the formation of a new
business, Steelpac Systems, which produces steel shipping pallets; a letter of
intent to acquire MetalTech, NexTech and GalvTech (collectively, “The Techs”);
and a letter of intent to establish a joint venture with the Bing Group, a
leading minority owned steel processor.
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 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 8,000 people and operates 55 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 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; and other risks described from time to
time in the Company's filings with the Securities and Exchange Commission.
