Ameron International Corp. Reports Results for Period Ended May 31, 1998.PASADENA, Calif.--(BUSINESS WIRE)--June 24, 1998--Ameron International Corporation (NYSE NYSE See: New York Stock Exchange :AMN Amn abbr. airman ) today reported 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. earnings of $1.09 per share on sales of $137 million for its second quarter, which ended May 31, 1998. This compares to $1.30 per share on sales of $131.5 million for the same period in 1997. Year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. diluted earnings were 86 cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. on sales of $239.5 million, compared to $1.53 per share on sales of $239.8 million last year. As expected, the quarterly earnings shortfall Shortfall The amount by which the capital required to fulfill a financial obligation exceeds available capital. Notes: Shortfall risk is often combated with an efficient hedging strategy created by a fund, group, institution, or individual. was due in large part to a strike that stopped work at Ameron's largest steel pipe plant for six weeks, including most of the first month of the second quarter. In addition, heavy El Nino rainfall early in the quarter continued delaying shipments to jobsites in the West. Now that the rain has subsided and operations have returned to normal, sales are meeting expectations. The concrete and steel pipe business recently received $54 million in new orders, including a major tunnel liner liner /lin·er/ (lin´er) material applied to the inside of the walls of a cavity or container for protection or insulation of the surface. liner see teat cup liner. contract for the Metropolitan Water District in Southern California Southern California, also colloquially known as SoCal, is the southern portion of the U.S. state of California. Centered on the cities of Los Angeles and San Diego, Southern California is home to nearly 24 million people and is the nation's second most populated region, and a large pipeline contract in Colombia Colombia (kəlŭm`bēə, Span. kōlōm`byä), officially Republic of Colombia, republic (2005 est. pop. 42,954,000), 439,735 sq mi (1,138,914 sq km), NW South America. Bogotá is the capital and largest city. . The backlog Backlog The total value of sales orders waiting to be fulfilled. Notes: This figure is used mainly in the manufacturing industry. Increases or decreases in a company's backlog indicate the future direction of sales and earnings. for this business is currently the largest in the company's 91-year history. Three primary factors impacted quarterly and year-to-date earnings for Ameron's worldwide protective coatings business: severe El Nino weather that hampered projects in the western and Gulf regions in the first quarter and early in the second quarter; competitive pressures in industrial maintenance markets in the U.S. and Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). ; and start-up Start-upThe earliest stage of a new business venture. , integration and system-conversion costs associated with Ameron's recent acquisition of Croda Coatings, which included plants in England, Australia and New Zealand New Zealand (zē`lənd), island country (2005 est. pop. 4,035,000), 104,454 sq mi (270,534 sq km), in the S Pacific Ocean, over 1,000 mi (1,600 km) SE of Australia. The capital is Wellington; the largest city and leading port is Auckland. . Ameron's global fiberglass fiberglass, thread made from glass. It is made by forcing molten glass through a kind of sieve, thereby spinning it into threads. Fiberglass is strong, durable, and impervious to many caustics and to extreme temperatures. pipe business reported significantly higher sales and earnings for the quarter and first half, with domestic and European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. operations both making strong contributions. The increase was driven in part by strong demand for fuel-handling pipe systems, including Ameron's new rigid coaxial co·ax·i·al adj. Having or mounted on a common axis. coaxial Adjective 1. Electronics (of a cable) transmitting by means of two concentric conductors separated by an insulator products. Results from Ameron's construction products business in Hawaii also continued to improve in the second quarter, partly because of increased demand from the private sector. However, the outlook for construction activity in the Islands remains uncertain because of the sluggish economy Sluggish Economy A state in the economy in which the growth is slow, flat or declining. The term can refer to the economy as a whole or a component of the economy, such as weak housing starts. and the potential impact of the Asian economic crisis on tourism. "As we forecasted, we had a tough first half, primarily because of weather problems and project delays in two of our core businesses, as well as the strike," said James S. Marlen, Ameron chairman, president and chief executive officer. "We're now accelerating deliveries wherever possible, and we expect considerable improvement in the second half." Marlen noted that the main point of contention in the strike was union participation in healthcare costs. "We felt that management had to take a stand on this issue since it had long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. implications for the company. We believe we now have an equitable equitable adj. 1) just, based on fairness and not legal technicalities. 2) refers to positive remedies (orders to do something, not money damages) employed by the courts to solve disputes or give relief. (See: equity) EQUITABLE. agreement with the unions." Early in the third quarter, Ameron and Tokyo Steel announced their intention to sell their ownership in Tamco, a steel mini-mill and rebar re·bar n. 1. A rod or bar used for reinforcement in concrete or asphalt pourings. 2. A group of such rods forming a grid. [re(inforcing) bar.] manufacturer in Southern California. Ameron owns 50% of Tamco, which is treated as an unconsolidated affiliate, and Tokyo Steel owns 25%. A leading supplier of rebar in the western United States Noun 1. western United States - the region of the United States lying to the west of the Mississippi River West Santa Fe Trail - a trail that extends from Missouri to New Mexico; an important route for settlers moving west in the 19th century , Tamco had sales of $139 million in 1997. "Tamco is a very solid, successful business with which Ameron has enjoyed a long and prosperous affiliation," Marlen said. "The reason we have decided to divest To deprive or take away. Divest is usually used in reference to the relinquishment of authority, power, property, or title. If, for example, an individual is disinherited, he or she is divested of the right to inherit money. is that Tamco is not a core business for Ameron and not part of our long-range strategic plan. Resources from the divestiture The breakup of AT&T. By federal court order, AT&T divested itself on January 1, 1984 of its 23 operating companies, which became known as the Regional Bell Operating Companies (RBOCs). will be redeployed into our core businesses to support our growth strategy." Cautionary statement for purposes of 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 Reform Act of 1995": Any of the above statements that refer to Ameron's estimated or anticipated future results are forward-looking and reflect the Company's current analysis of existing trends and information. Actual results may differ from current expectations based on a number of factors affecting Ameron's businesses, including competitive conditions and changing market conditions. Matters affecting the economy generally, including the state of economics worldwide, can affect the Company's results. These 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. represent the Company's judgment only as of the date of this communication. Since actual results could differ materially, the reader is cautioned not to rely on these forward-looking statements. Moreover, Ameron disclaims any intent or obligation to update these forward-looking statements. -0-
Ameron International Corporation
Consolidated Statements of Income
Second Quarter Ended May 31,
(In thousands except share and per share data)
1998 1997
Sales $136,974 $131,525
Cost of Sales 100,648 96,317
Gross Profit 36,326 35,208
Selling, General
and Administrative Expenses 29,598 26,449
Operating Profit 6,728 8,759
Royalty, Equity and Other Income 3,692 2,326
Income before Interest and Income Taxes 10,420 11,085
Interest, net 3,393 3,098
Income before Income Taxes 7,027 7,987
Income Taxes 2,537 2,717
Net Income $ 4,490 $ 5,270
Basic Net Income Per Share (Based on
Weighted Average Shares Outstanding
of 4,009,773 Shares in 1998 and
4,002,001 Shares in 1997) $ 1.12 $ 1.32
Diluted Net Income Per Share (Based on
Diluted Common Shares Outstanding
of 4,115,941 Shares in 1998 and
4,069,733 Shares in 1997) $ 1.09 $ 1.30
Cash Dividends Paid $ .32 $ .32
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Ameron International Corporation
Consolidated Statements of Income
Six Months Ended May 31,
(In thousands except share and per share data)
1998 1997
Sales $239,500 $239,786
Cost of Sales 178,972 176,895
Gross Profit 60,528 62,891
Selling, General
and Administrative Expenses 54,644 52,732
Operating Profit 5,884 10,159
Royalty, Equity and Other Income 5,463 4,945
Income before Interest and Income Taxes 11,347 15,104
Interest, net 5,886 5,554
Income before Income Taxes 5,461 9,550
Income Taxes 1,911 3,342
Net Income $ 3,550 $ 6,208
Basic Net Income Per Share (Based on
Weighted Average Shares Outstanding
of 4,009,773 Shares in 1998 and
4,002,001 Shares in 1997) $ 0.89 $ 1.55
Diluted Net Income Per Share (Based on
Diluted Common Shares Outstanding
of 4,115,941 Shares in 1998 and
4,069,733 Shares in 1997) $ 0.86 $ 1.53
Cash Dividends Paid $ .64 $ .64
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Ameron International Corporation
Consolidated Statements of Cashflow
Six Months Ended May 31,
(In thousands)
1998 1997
Operating Activities
Net Income $ 3,550 $ 6,208
Adjustments to Reconcile
Net Income to Net Cash 11,776 9,402
Changes in Operating Assets
and Liabilities (13,935) (36,419)
Cash Provided (Used) By Operations 1,391 (20,809)
Investing Activities
Proceeds from Sale of Assets 326 355
Additions to Property, Plant
and Equipment, and Acquisitions (61,129) (11,496)
Other, Net (699) (1,518)
Cash Used by Investing Activities (61,502) (12,659)
Financing Activities
Short and Long-Term Borrowings, Net 58,633 31,275
Dividends on Common Stock (2,566) (2,561)
Other, Net 343 628
Cash Provided by Financing Activities 56,410 29,342
Effect of Exchange Rate Changes on Cash (69) (354)
Net Change in Cash $ (3,770) $ (4,480)
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Ameron International Corporation
Consolidated Balance Sheets
(In thousands)
May 31, November 30,
1998 1997
ASSETS
Current Assets
Cash and Equivalents $ 6,078 $ 9,848
Receivables, Net 129,258 122,352
Inventories 125,993 95,752
Other 13,024 13,340
Total Current Assets 274,353 241,292
Investments and Advances -
Affiliated Companies 33,689 33,777
Property, Plant and Equipment, Net 161,288 127,678
Other Assets 28,683 30,478
Total Assets $ 498,013 $ 433,225
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Short-Term Borrowings $ 1,311 $ 715
Current Portion of Long-Term Debt 17,645 17,654
Trade Payables 43,106 31,988
Accrued Liabilities and Other 39,845 36,908
Total Current Liabilities 101,907 87,265
Long-Term Debt, Less Current Portion 201,117 140,917
Other Liabilities 43,627 52,061
Total Liabilities 346,651 280,243
Stockholders' Equity
Common Stock 12,969 12,946
Additional Paid-In Capital 17,289 16,969
Retained Earnings 172,553 171,569
Cumulative Translation Adjustments (8,670) (5,726)
Treasury Stock (42,779) (42,779)
Total Stockholders' Equity 151,362 152,982
Total Liabilities
and Stockholders' Equity $ 498,013 $ 433,225
CONTACT: Ameron International Corp., Pasadena Gary Wagner/Dan Stracner, 626/683-4000 |
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