Alamo Group Inc. Announces 2001 Second Quarter Results.Business Editors SEGUIN, Texas--(BUSINESS WIRE)--Aug. 2, 2001 Alamo Alamo Eighteenth-century mission in San Antonio, Texas, site of a historic siege of a small group of Texans by a Mexican army (1836) during the Texas war for independence from Mexico. Group Inc. (NYSE NYSE See: New York Stock Exchange :ALG ALG antilymphocyte globulin. ALG antilymphocyte globulin. ALG Antilymphocyte globulin, see there ) today reported results for the second quarter ended June 30, 2001. Net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight for the second quarter increased 10% to $66.8 million from $60.7 million for the same period last year. Net income for the quarter declined 16% to $3.5 million, or $0.36 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, from $4.2 million, or $0.43 per diluted share, in the prior-year period. Net income for the quarter of $0.36 per diluted share was below expectations. For the first six months of 2001, net sales were $123.6 million compared with $110.7 million for the six-month period last year, an increase of 12%. Net income for the six month period of 2001 was $6.4 million, or $0.65 per diluted share, compared with $6.8 million, or $0.71 per diluted share, for the same period last year. Sales for Alamo's North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. Agricultural business improved by 16% in the quarter compared to last year due to increased sales of Rhino branded products and the acquisition of Schulte Industries in November 2000. Unfortunately, the slowdown For articles with similar titles, see Slow Down (disambiguation). A slowdown is an industrial action in which employees perform their duties but seek to reduce productivity or efficiency in their performance of these duties. in the agricultural industry continues to negatively affect the sale of hay making products, tillage products and spare parts Spare parts, also referred to as Service Parts is a term used to indicate extra parts available and in proximity to the mechanical item, such as a automobile, boat, engine, for which they might be used. Spare parts are also called “spares. sales, which affected the profitability of this segment of the Company's business. North American Industrial sales for the quarter grew 12% from last year, due primarily to increased sales of wholegoods and tractors by Alamo Industrial and Tiger products, but Schwarze sweeper sales were down from the prior year due to the soft U.S. economy and higher fuel costs. The profitability of this segment was also negatively impacted by reduced parts sales. Overall European sales declined by 7% reflecting the depressed conditions in the agricultural market in general which has been further exacerbated by the continuation of the foot and mouth epidemic epidemic, outbreak of disease that affects a much greater number of people than is usual for the locality or that spreads to regions where it is ordinarily not present. concentrated mainly in the U.K., the Company's largest European market. Ron Robinson Ron Robinson (born March 24, 1962 in Exeter, California) was a Major League Baseball right-handed pitcher for the Cincinnati Reds (1984-1990) and the Milwaukee Brewers (1990-1992). He was the first-round pick (19th overall) of the Reds in the 1980 amateur draft. , President and Chief Executive Officer, commented, "We are disappointed by the continued soft economic conditions in the agricultural markets worldwide. While in most areas we believe our market share of our major products have stayed the same or increased, the total market is down. A slowdown in general economic conditions, combined with higher fuel prices has also had a negative effect in many of our business segments particularly spare parts, which are our most profitable items. And, we had hoped the foot and mouth epidemic, principally in the United Kingdom would have been largely resolved by summer, but it is now apparent this will continue into the third quarter of 2001 albeit at a slower rate." Mr. Robinson continued, "In our last quarterly report we indicated we were still in line to meet our expectations for the year provided there was no further deterioration de·te·ri·o·ra·tion n. The process or condition of becoming worse. in the agricultural market or the general economic situation and a timely resolution to the foot and mouth problem. None of these conditions have been met. Therefore, we believe the results for 2001 in total will be below our earlier stated expectations and more in line with last year's results. While we cannot alter the market conditions, we are actively working on improving our operations and are pleased with the progress we have made this year, particularly in our manufacturing area where we have improved our on time performance significantly. Some of our other programs such as our ERP (Enterprise Resource Planning) An integrated information system that serves all departments within an enterprise. Evolving out of the manufacturing industry, ERP implies the use of packaged software rather than proprietary software written by or for one customer. systems development effort and the closure of our Guymon plant, while they negatively affected our results in the first half of 2001, they should improve in the second half of the year and beyond. Due to these initiatives we believe we will be a stronger company, better able to respond to the demands of our markets and have an ability to take advantage of the current market conditions to improve our position." Mr. Robinson concluded, "Finally, we are sad to report that O.S. (Todd) Simpson, Jr., a director of Alamo Group for over 30 years died on May 6, 2001 at the age of 65. He was a valued contributor to the board and will be greatly missed." Alamo Group is a leader in the design, manufacture, distribution and service of high quality equipment for right-of-way maintenance and agriculture. Our products include tractor-mounted mowing mow 1 n. 1. The place in a barn where hay, grain, or other feed is stored. 2. A stack of hay or other feed stored in a barn. and other vegetation vegetation /veg·e·ta·tion/ (vej?e-ta´shun) any plantlike fungoid neoplasm or growth; a luxuriant fungus-like growth of pathologic tissue. maintenance equipment, street sweepers, agricultural implements and related after market parts and services. The Company, founded in 1969, has over 1,400 employees and operates eleven plants in the North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. and Europe as of July, 2001. The corporate offices of Alamo Group Inc. are located in Seguin, Texas Seguin (pronounced IPA: /səˈgiːn/) is a city in Guadalupe County, Texas, in the United States. As of the 2000 census, the city population was 22,011. and the headquarters for the Company's European operations are located in Salford Priors Salford Priors is a rural, agricultural village and civil parish about six miles south west of Alcester, Warwickshire, UK. It is found on the Warwickshire border with Worcestershire. , England. This release contains forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. that are made pursuant to the safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. provisions of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. Forward-looking statements involve known and unknown risks and uncertainties, which may cause the Company's actual results in future periods to differ materially from forecasted results. Among those factors which could cause actual results to differ materially are the following: market demand, competition, weather, seasonality, currency-related issues, and other risk factors listed from time to time in the Company's SEC reports. The Company does not undertake any obligation to update the information contained herein, which speaks only as of this date.
Alamo Group Inc. and Subsidiaries (NYSE:ALG)
Condensed Consolidated Statements of Income
(In thousands, except per share amounts)
(Unaudited)
Second Quarter Ended Six Months Ended
-------------------- ----------------
6/30/01 6/30/00 6/30/01 6/30/00
------- ------- ------- -------
North American
Agricultural $24,611 $21,161 $47,664 $42,755
Industrial 32,121 28,735 56,105 46,569
European 10,034 10,829 19,827 21,367
------- ------- ------- -------
Total sales 66,766 60,725 123,596 110,691
Cost of sales 50,561 45,409 93,000 82,730
------- ------- ------- -------
Gross margin 16,205 15,316 30,596 27,961
Operating expenses 9,862 8,672 19,535 16,603
------- ------- ------- -------
Income from
operations 6,343 6,644 11,061 11,358
Interest expense (1,012) (681) (1,812) (1,041)
Interest income 160 209 306 399
Other income (Expense) (85) 31 (15) (163)
------- ------- ------- -------
Income before
income taxes 5,406 6,203 9,540 10,553
Provision for
income taxes 1,930 2,053 3,171 3,721
------- ------- ------- -------
Net income $ 3,476 $ 4,150 $ 6,369 $ 6,832
======== ======== ======== ========
Net income per
common share:
Basic $ 0.36 $ 0.43 $ 0.66 $ 0.71
======== ======== ======== ========
Diluted $ 0.36 $ 0.43 $ 0.65 $ 0.71
======== ======== ======== ========
Average common shares:
Basic 9,704 9,695 9,704 9,695
======== ======== ======== ========
Diluted 9,788 9,754 9,790 9,747
======== ======== ======== ========
Summary Balance Sheet Data
6/30/01 12/31/00 6/30/00
------- -------- -------
Receivables $ 68,736 $ 50,359 $ 60,053
Inventories $ 64,946 $ 59,608 $ 52,949
Current Liabilities $ 30,641 $ 27,071 $ 32,578
Long Term Debt $ 45,399 $ 30,355 $ 22,782
Equity $ 118,096 $114,539 $ 111,898
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