Sales for the fiscal 2003 first quarter were $525.5 million, an increase of 28%
from $409.6 million last year, and exceeded the previous first quarter record of
$500.4 million generated in 1998. Earnings were $27.5 million and earnings per
diluted share were $0.32 compared to earnings of $14.3 million, or $0.17 per
diluted share, for the same period last year. The increase in earnings and
diluted earnings per share was 92% and 88%, respectively, for the comparable
first quarters. Record net income for the period exceeded the previous record of
$25.4 million earned in the first quarter of fiscal 1995.
First quarter results included one month of operations for Unimast Incorporated,
Worthington's second largest acquisition. Unimast generated $22.0 million in
sales and $2.5 million in operating income during the month of August. Its
operating income more than covered financing costs, and thus the transaction was
immediately accretive to earnings per share by approximately $0.01.
"Fiscal 2003 is off to a great start. Record sales and earnings, strong cash
flow and a sizeable, immediately accretive acquisition all occurred in this
first quarter, even as economic data offered conflicting indications about the
state of the economic recovery," said John P. McConnell, Chairman and CEO of
Worthington Industries.
"Solid operating improvements occurred in all three business segments. The
drivers we saw last quarter continued: increased automotive demand in processed
steel, stronger pricing in metal framing and record demand for propane
cylinders, propelled by the mandated overfill prevention device. Assuming
stability in the markets we serve in the coming months, we are optimistic that
realization of the benefits of our consolidation plan and growth opportunities
offered by the combination of Dietrich Metal Framing and Unimast will add up to
an improved fiscal 2003," concluded McConnell.
Record first quarter revenues were a result of both increased volumes and
pricing improvements in all three business segments.
Within the Processed Steel Products business segment, net sales increased 20% or
$53.3 million to $318.9 million from $265.6 million in the comparable quarter of
fiscal 2002. Sales to the automotive sector, the largest market for this
business segment, were up. Several other customer sectors were up significantly
including furniture and office equipment, lawn and garden, appliance and metal
framing. Direct and tolling volumes were up over the prior year offsetting a
decline in the spread between selling prices and material costs. Although much
improved from the prior year, the segment operating margin of 7.0% is still well
below the margins that Processed Steel Products has generated historically.
Within the Metal Framing business segment, net sales increased 52% or $41.3
million to $120.8 million from $79.5 million in the comparable quarter of fiscal
2002. The increase in metal framing revenues is due both to the Unimast
acquisition in the month of August and to higher selling prices, driven by raw
material increases. Excluding Unimast, units shipped were relatively flat
indicating weakness in the commercial construction market. Excluding the
one-month impact of the Unimast acquisition, sales increased $19.3 million or
24%.
Within the Pressure Cylinders business segment, net sales increased 33% or $20.5
million to $82.1 million from $61.6 million in the comparable quarter of fiscal
2002. The increase is due to significantly greater demand for propane cylinders
as a result of certain regulatory requirements mandating that all propane
cylinders have overfill prevention devices.
Operating income of $42.3 million was generated in the first quarter, an 87%
improvement over the same quarter last year. The overall operating margin of
8.1% reflects improved operating margins in each of the three primary business
segments, reflecting the leveraging of the sales increases, and compares
favorably to last year's 5.5% operating margin.
Worthington's joint ventures also contributed to first quarter results. Equity
in net income of five unconsolidated affiliates totaled $8.4 million, up 72%
from $4.9 million in the year ago quarter.
Worthington Industries, Inc. 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 more than 8,000 people and operates 66 facilities in 10
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/employer partnerships in American industry serve
as the company's foundation. Worthington Industries is listed as one of the 100
Best Companies to Work For in America by Fortune magazine.
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 sales and operating results; projected capacity
levels; anticipated capital expenditures; projected timing, results, costs,
charges and expenditures related to plant closures and consolidations; and other
non-historical information constitute "forward- looking statements" within the
meaning of the Act. Because they are based on beliefs, estimates and
assumptions, forward-looking statements are inherently subject to risks and
uncertainties that could cause actual results to differ materially from those
projected. Any number of factors could affect actual results, including, without
limitation, product demand, changes in product mix and market acceptance of
products; changes in pricing or availability of raw materials, particularly
steel; effects of plant closures and the consolidation of operations; capacity
restraints and efficiencies; conditions in major product markets; delays in
construction or equipment supply; financial difficulties of customers, suppliers
and others with whom we do business; the effect of national, regional and
worldwide economic conditions; risks associated with doing business
internationally, including economical, political and social instability, and
foreign currency exposure; acts of war and terrorist activities; the ability to
improve processes and business practices to keep pace with the economic,
competitive and technological environment; the business environment and impact
of governmental regulations, both in the United States and abroad; and other
risks described from time to time in filings with the SEC.
WORTHINGTON INDUSTRIES, INC.
EARNINGS HIGHLIGHTS
(In Thousands, Except Per Share)
Three Months Ended
Aug. 31,
2002 2001
(Unaudited) (Unaudited)
Net sales:
Processed Steel Products $318,921 $265,571
Metal Framing 120,838 79,546
Pressure Cylinders 82,136 61,602
Other 3,569 2,839
Total net sales 525,464 409,558
Cost of goods sold 436,040 349,561
Gross margin 89,424 59,997
Selling, general & administrative expense 47,103 37,411
Operating income:
Processed Steel Products 22,317 13,538
Metal Framing 16,364 6,566
Pressure Cylinders 7,194 1,817
Other (3,554) 665
Total operating income 42,321 22,586
Other income (expense):
Miscellaneous income (expense) (1,341) 527
Interest expense (6,103) (5,497)
Equity in net income of unconsolidated
affiliates 8,415 4,880
Earnings before taxes 43,292 22,496
Income taxes 15,802 8,211
Net earnings $27,490 $14,285
Average common shares outstanding -
diluted 86,499 85,799
Earnings per share - diluted $0.32 $0.17
Common shares outstanding at end of
period 85,624 85,391
Cash dividends declared per common
share $0.16 $0.16
WORTHINGTON INDUSTRIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In Thousands)
Aug. 31, May 31,
2002 2002
(Unaudited) (Audited)
ASSETS
Current assets
Cash and cash equivalents $2,455 $496
Accounts receivable, net 138,251 197,240
Inventories 316,303 219,950
Deferred income taxes 44,499 43,538
Other current assets 36,085 29,116
Total current assets 537,593 490,340
Investments in unconsolidated
affiliates 90,857 91,759
Goodwill 102,039 75,400
Other assets 34,166 33,219
Property, plant and equipment, net 795,331 766,596
Total assets $1,559,986 $1,457,314
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable $293,531 $233,181
Notes payable 14,152 5,281
Current maturities of long-term debt 1,002 1,082
Other current liabilities 112,348 99,807
Total current liabilities 421,033 339,351
Other liabilities 72,673 73,731
Long-term debt 295,247 289,250
Deferred income taxes 148,019 148,726
Shareholders' equity 623,014 606,256
Total liabilities and
shareholders' equity $1,559,986 $1,457,314
WORTHINGTON INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
Three Months Ended
Aug. 31,
2002 2001
(Unaudited) (Unaudited)
Operating activities
Net earnings $27,490 $14,285
Adjustments to reconcile net
earnings to net cash provided by
operating activities:
Depreciation and amortization 17,510 16,988
Other adjustments 9,626 (327)
Changes in current assets and
liabilities 75,785 9,493
Net cash provided by operating
activities 130,411 40,439
Investing activities
Investment in property, plant and
equipment, net (6,421) (12,748)
Acquisitions, net of cash acquired (113,740) -
Proceeds from sale of assets 175 7,882
Net cash used by investing
activities (119,986) (4,866)
Financing activities
Proceeds from (payments on) short-
term borrowings 5,667 (4,266)
Principal payments on long-term debt (241) (17,219)
Dividends paid (13,683) (13,660)
Other (209) 194
Net cash used by financing
activities (8,466) (34,951)
Increase in cash and cash equivalents 1,959 622
Cash and cash equivalents at
beginning of period 496 194
Cash and cash equivalents at end of period $2,455 $816
SOURCE Worthington Industries, Inc.
CONTACT:
Cathy Mayne Lyttle, VP, Corporate Communications,
+1-614-438-3077, or cmlyttle@WorthingtonIndustries.com, or Allison McFerren
Sanders, Director, Investor Relations, +1-614-840-3133, or
asanders@WorthingtonIndustries.com, both of Worthington Industries
URL: http://www.worthingtonindustries.com
Copyright (C) 2002 PR Newswire. All rights reserved.