COLUMBUS, Ohio--(BUSINESS WIRE)--Dec. 16, 2004--Worthington
Industries, Inc. (NYSE:WOR) today reported record results for the
three and six-month periods ended November 30, 2004.
Highlights
Net sales for the second quarter of fiscal 2005 were $745.2
million, an increase of 38% from last year's $540.1 million. Second
quarter net earnings were $47.6 million and earnings per diluted share
were $0.54, compared to $16.9 million, or $0.20 per diluted share, for
the same period last year.
For the six-month period, net sales rose 46% to $1,514.5 million
from $1,038.1 million last year. Net earnings were $105.5 million and
earnings per diluted share were $1.19, compared to $22.8 million and
$0.26, respectively, for the same period last year.
"I am pleased to report our third consecutive quarter of record
quarterly earnings," said John McConnell, Chairman and CEO of
Worthington Industries. "These excellent results for the second
quarter do not include any inventory holding benefit and were obtained
when two of our key market segments, automotive and commercial
construction, were not at their peak. Our core businesses and joint
ventures are running very well. We have also announced several new
growth opportunities during the quarter:
-- We acquired the propane and specialty cylinder assets of
Western Industries on September 17, 2004, adding to our
product line in the Pressure Cylinders segment.
-- We formed a joint venture, Dietrich Residential Construction,
in our Metal Framing segment with Pacific Steel Construction
to construct military housing framed with light gauge steel.
-- We formed a joint venture, Dietrich Metal Framing Canada, with
Encore Coils to enter the Canadian metal framing market.
"We are committed to the prudent use of capital as we grow the
company," concluded McConnell.
Detailed Results
In the Processed Steel Products segment, quarterly net sales rose
42%, or $133.4 million, to $454.8 million from $321.4 million in the
comparable quarter of fiscal 2004. The increase in net sales was the
result of higher selling prices (up 50%). Volumes were down 6% due
entirely to the sale of the Decatur cold rolling assets in August
2004. Excluding the impact of the Decatur sale, volumes were up 2%.
Operating income improved because of a widening in the spread between
selling prices and material costs.
In the Metal Framing segment, net sales increased 35%, or $49.4
million, to $191.8 million from $142.4 million in the comparable
quarter of fiscal 2004. The increase was the result of higher pricing.
Volumes were down 24% as customers faced higher inventories and
delayed construction projects due to increased costs. A wider spread
between selling prices and material costs was responsible for a
significant improvement in operating income.
In the Pressure Cylinders segment, net sales increased 30%, or
$22.1 million, to $94.5 million from $72.4 million in the comparable
quarter of fiscal 2004. The propane and specialty cylinder assets of
Western Industries, acquired on September 17th, contributed $12.3
million to the sales increase. Excluding sales from the acquired
assets, unit volumes were up 9% due to strong sales in most product
lines. European revenues rose $4.8 million, of which $2.5 million was
due to the weakened dollar. Operating income for the segment increased
$2.0 million.
Worthington's unconsolidated joint ventures continued to perform
well. Equity in net income of the seven unconsolidated affiliates
totaled $11.7 million, up 40% from $8.4 million in the year ago
quarter. The improvement was due to strong results from most of the
unconsolidated joint ventures.
Other
Dividend declared
On November 18, 2004, the board of directors declared a quarterly
cash dividend of $0.16 per share payable December 29, 2004, to
shareholders of record December 15, 2004. This will be the 148th
consecutive quarter that Worthington has paid a dividend since it
became a public company in 1968.
Corporate Profile
Worthington Industries is a leading diversified metal processing
company with annual sales of more than $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 metal framing,
pressure cylinders, automotive past model service stampings, metal
ceiling grid systems and laser welded blanks. Worthington employs more
than 8,000 people and operates 63 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.
Conference Call
Worthington will review its second quarter results during its
quarterly conference call today, December 16, 2004, at 1:30 p.m.
Eastern Standard Time. Details on the conference call can be found on
the company's web site at www.WorthingtonIndustries.com
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, operating
results and earnings per share; projected capacity and working capital
needs; pricing trends for raw materials and finished goods;
anticipated capital expenditures and asset sales; projected timing,
results, costs, charges and expenditures related to facility
dispositions, shutdowns and consolidations; new products and markets;
expectations for the economy and markets; and other non-historical
matters 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 and pricing,
changes in product mix and market acceptance of products; fluctuations
in pricing, quality or availability of raw materials (particularly
steel), supplies, utilities and other items required by operations;
effects of facility closures and the consolidation of operations; the
ability to realize cost savings and operational efficiencies on a
timely basis; the ability to integrate newly acquired businesses and
achieve synergies therefrom; capacity levels and efficiencies within
facilities and within the industry as a whole; financial difficulties
of customers, suppliers, joint venture partners and others with whom
the company does business; the effect of national, regional and
worldwide economic conditions generally and within major product
markets, including a prolonged or substantial economic downturn; the
effect of adverse weather on customers, markets, facilities and
shipping operations; changes in customer spending patterns and
supplier choices and risks associated with doing business
internationally, including economic, 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;
deviation of actual results from estimates and/or assumptions used by
the company in the application of its significant accounting policies;
level of imports and import prices in the company's markets; the
impact of governmental regulations, both in the United States and
abroad; and other risks described from time to time in filings with
the United States Securities and Exchange Commission.
WORTHINGTON INDUSTRIES, INC.
EARNINGS HIGHLIGHTS
(In Thousands, Except Per Share)
Three Months Ended Six Months Ended
November 30, November 30,
----------------------- -----------------------
2004 2003 2004 2003
----------- ----------- ----------- -----------
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Net sales $ 745,168 $ 540,078 $1,514,508 $1,038,113
Cost of goods sold 620,650 472,836 1,230,346 921,888
---------- ---------- ---------- ----------
Gross margin 124,518 67,242 284,162 116,225
Selling, general &
administrative
expense 56,130 45,243 120,961 86,863
Impairment charges and
other - - 5,608 -
---------- ---------- ---------- ----------
Operating income 68,388 21,999 157,593 29,362
Other income
(expense):
Miscellaneous
expense (2,873) (114) (6,332) (503)
Interest expense (5,652) (5,565) (11,374) (11,156)
Equity in net
income of
unconsolidated
affiliates 11,740 8,391 25,036 16,327
---------- ---------- ---------- ----------
Earnings before
income taxes 71,603 24,711 164,923 34,030
Income tax expense 23,980 7,828 59,441 11,230
---------- ---------- ---------- ----------
Net earnings $ 47,623 $ 16,883 $ 105,482 $ 22,800
========== ========== ========== ==========
Average common shares
outstanding - diluted 88,665 86,503 88,389 86,510
---------- ---------- ---------- ----------
Earnings per
share - diluted $ 0.54 $ 0.20 $ 1.19 $ 0.26
========== ========== ========== ==========
Common shares
outstanding at
end of period 87,811 86,134 87,811 86,134
Cash dividends
declared per
common share $ 0.16 $ 0.16 $ 0.32 $ 0.32
WORTHINGTON INDUSTRIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In Thousands)
November 30, May 31,
2004 2004
------------ ------------
(Unaudited) (Audited)
ASSETS
Current assets
Cash and cash equivalents $ 11,143 $ 1,977
Receivables, net 300,051 348,833
Inventories 465,459 362,906
Deferred income taxes 3,589 3,963
Other current assets 34,410 115,431
----------- -----------
Total current assets 814,652 833,110
Investments in unconsolidated affiliates 136,855 109,040
Goodwill 168,441 117,769
Other assets 31,459 27,826
Property, plant and equipment, net 561,116 555,394
----------- -----------
Total assets $ 1,712,523 $ 1,643,139
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable $ 305,895 $ 313,909
Current maturities of long-term debt 1,104 1,346
Other current liabilities 151,094 159,805
----------- -----------
Total current liabilities 458,093 475,060
Other liabilities 99,745 95,067
Long-term debt 287,961 288,422
Deferred income taxes 89,526 104,216
Shareholders' equity 777,198 680,374
----------- -----------
Total liabilities and
shareholders' equity $ 1,712,523 $ 1,643,139
=========== ===========
WORTHINGTON INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
Six Months Ended
November 30,
-----------------------
2004 2003
----------- -----------
(Unaudited) (Unaudited)
Operating activities
Net earnings $ 105,482 $ 22,800
Adjustments to reconcile net earnings to
net cash provided by operating activities:
Depreciation and amortization 28,507 33,706
Impairment charges and other 5,608 -
Other adjustments (37,001) (3,775)
Changes in current assets and
liabilities (71,952) (8,823)
---------- ----------
Net cash provided by
operating activities 30,644 43,908
Investing activities
Investment in property, plant and
equipment, net (19,331) (14,268)
Acquisitions, net of cash acquired (64,889) -
Investment in unconsolidated affiliate (1,500) (490)
Proceeds from sale of assets 83,804 2,937
---------- ----------
Net cash used by investing activities (1,916) (11,821)
Financing activities
Proceeds from short-term borrowings - (896)
Principal payments on long-term debt (2,018) (608)
Dividends paid (27,901) (27,525)
Other 10,357 (2,189)
---------- ----------
Net cash used by financing activities (19,562) (31,218)
---------- ----------
Increase in cash and cash equivalents 9,166 869
Cash and cash equivalents at beginning of
period 1,977 1,139
---------- ----------
Cash and cash equivalents at end of period $ 11,143 $ 2,008
========== ==========
WORTHINGTON INDUSTRIES, INC.
SUPPLEMENTAL DATA
(In Thousands)
This supplemental information is provided to assist in the analysis of
the results of operations.
Three Months Ended Six Months Ended
November 30, November 30,
----------------------- -----------------------
2004 2003 2004 2003
----------- ----------- ----------- -----------
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Processed Steel
Products
Volume (tons) 911 966 1,875 1,816
Net sales $ 454,831 $ 321,378 $ 908,658 $ 608,576
Material cost $ 327,900 $ 212,841 $ 637,650 $ 401,826
Operating income $ 34,610 $ 13,762 $ 70,404 $ 21,931
Metal Framing
Volume (tons) 145 192 324 390
Net sales $ 191,772 $ 142,417 $ 430,163 $ 283,481
Material cost $ 110,381 $ 86,225 $ 228,485 $ 179,179
Operating income $ 25,208 $ 871 $ 76,720 $ (2,783)
Pressure Cylinders
Volume (units)
Without
acquisition 2,970 2,718 6,161 5,841
Acquisition(a) 6,017 - 6,017 -
---------- ---------- ---------- ----------
8,987 2,718 12,178 5,841
Net sales
Without
acquisition $ 82,210 $ 72,434 $ 155,436 $ 138,969
Acquisition(a) 12,272 - 12,272 -
---------- ---------- ---------- ----------
$ 94,482 $ 72,434 $ 167,708 $ 138,969
Material cost $ 44,307 $ 30,094 $ 77,282 $ 59,114
Operating income $ 8,827 $ 6,855 $ 12,017 $ 10,393
(a) Acquisition of propane and specialty cylinder assets from
Western Industries effective September 17, 2004
The following provides detail of impairment charges and other included
in the operating income by segment presented above.
Three Months Ended Six Months Ended
November 30, November 30,
----------------------- -----------------------
2004 2003 2004 2003
----------- ----------- ----------- -----------
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Pre-tax impairment
charges and other
by segment
Processed Steel
Products $ - $ - $ 5,608 $ -
Metal Framing - - - -
Pressure Cylinders - - - -
---------- ---------- ---------- ----------
Total impairment
charges and
other $ - $ - $ 5,608 $ -
========== ========== ========== ==========
CONTACT: Worthington Industries, Inc.
Corporate Communications:
Cathy Mayne Lyttle, 614-438-3077
cmlyttle@WorthingtonIndustries.com
or
Investor Relations:
Allison McFerren Sanders, 614-840-3133
asanders@WorthingtonIndustries.com
SOURCE: Worthington Industries, Inc.