COMMONWEALTH ALUMINUM REPORTS RECORD FIRST QUARTER SALES AND EARNINGS; INITIATES QUARTERLY DIVIDENDS AT $.05 PER SHARE.LOUISVILLE Louisville (l  `ēvĭl), city (1990 pop. 269,063), seat of Jefferson co., NW Ky., at the Falls of the Ohio; inc. 1780. , Ky.--(BUSINESS WIRE)--April 18, 1995--Commonwealth
Aluminum Corporation (Nasdaq/NM: CALC (tool, mathematics) Calc - An extensible, advanced desk calculator and mathematical tool written in Emacs Lisp by Dave Gillespie <daveg@synaptics.com>. Calc runs as part of GNU Emacs. ) today reported record results for
the first quarter ended March 31, 1995. The Company's higher sales
and earnings for the period reflected both higher selling prices and
increased shipments versus the year-earlier period.
Net income for the first quarter of 1995 totaled $8.7 million or $.85 per common share compared with a net loss in the same period last year of $2.7 million or $.27 per common share. Based on debt outstanding of $75 million at quarter's end and current interest rates, pro forma earnings pro forma earnings Income not necessarily calculated in accordance with generally accepted accounting principles. For example, a company might report pro forma earnings that exclude depreciation expense and nonrecurring expenses such as restructuring costs. for the first quarter of 1995 would have been $.73 per common share. 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 increased 67% to $173.9 million compared with $104.2 million in the same period last year. First quarter shipments increased 17% to a record 155 million pounds from 133 million pounds in the year-earlier period. Shipments in the first quarter of 1994 were adversely affected by the closing of highways in Kentucky Kentucky, state, United States Kentucky (kəntŭk`ē, kĭn–), one of the so-called border states of the S central United States. It is bordered by West Virginia and Virginia (E); Tennessee (S); the Mississippi R. for three days due to snow and ice. The Company also announced that its Board of Directors has voted to initiate the payment of a quarterly cash dividend of $.05 per share. The first dividend will be paid on May 19, 1995, to stockholders of record on April 28, 1995. Mark V. Kaminski, President and Chief Executive Officer, said, "It is the belief of both the Board and management that Commonwealth Aluminum's stockholders should participate directly in the financial success of the Company; we are very appreciative of their support." Commenting on the quarter's results, Kaminski said, "Our efforts over the past few years to increase the production capacity of our Lewisport, Kentucky Lewisport is a city in Hancock County, Kentucky, along the Ohio River. The population was 1,639 at the 2000 census. It is included in the Owensboro, Kentucky Metropolitan Statistical Area. Lewisport's mayor is Chad Gregory, and the constable is Danny Case. mill have positioned us to take advantage of the record demand for aluminum sheet. Due to demand for aluminum sheet products, the margin between selling prices and raw material costs in the first quarter has reached levels not seen since 1988. This increase, coupled with our ongoing success in reducing conversion costs, has had a favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. impact on our earnings. We believe market conditions will continue to be favorable throughout 1995." He noted, however, that future periods will bear additional interest and financing costs as a result of the Company's restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). in the first quarter and its new status as a publicly held company. "Efficiency and productivity gains have been achieved in all areas of the production process, including casting, hot rolling The metallurgical process of Hot rolling, used mainly to produce sheet metal or simple cross sections from billets describes the method of when industrial metal is passed or deformed between a set of work rolls and the temperature of the metal is generally above its , cold rolling cold rolling n. The rolling of steel or other metal at room temperature to preserve its original crystal structure. and finishing," he continued, "leading to the record volume posted in the first quarter. Also during the quarter one of our three cold mills was re-engineered to enhance our heavy gauge product capability and improve product quality on existing products; this mill is scheduled to return to full operation during the second quarter of 1995." Kaminski attributed a large part of Commonwealth's improved productivity and efficiency to the ongoing modernization modernization Transformation of a society from a rural and agrarian condition to a secular, urban, and industrial one. It is closely linked with industrialization. As societies modernize, the individual becomes increasingly important, gradually replacing the family, of the Company's plant to reduce manufacturing bottlenecks. He said the Company, which spent approximately $6.0 million for equipment and facility improvements in the first quarter of 1995, expects capital expenditures for the year to total approximately $20 million. Prior to its initial public offering, Commonwealth was a wholly owned subsidiary Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. of Comalco Limited, the leading aluminum company based in Australia Australia (ôstrāl`yə), smallest continent, between the Indian and Pacific oceans. With the island state of Tasmania to the south, the continent makes up the Commonwealth of Australia, a federal parliamentary state (2005 est. pop. . Comalco has sold 8,966,616 common shares to the public at $14 per share, representing an 89.7% interest in the Company; Commonwealth received no proceeds from the sale of these shares. Comalco presently retains 1,033,384 shares which, until March 1996, may only be sold with the concurrence CONCURRENCE, French law. The equality of rights, or privilege which several persons-have over the same thing; as, for example, the right which two judgment creditors, Whose judgments were rendered at the same time, have to be paid out of the proceeds of real estate bound by them. Dict. de Jur. h.t. of the underwriters. No restrictions on the sale of those shares remain after that time. Concurrent with the offering, the Company entered into a $150 million Senior Secured Credit Facility with a syndicate Syndicate organized crime unit throughout major cities of the United States. [Am. Hist.: NCE, 2018] See : Gangsterism of 12 banks. On March 17, 1995, the Company drew $50 million of the total available amount in the form of a five-year term loan, which amount was paid to Comalco to redeem redeem v. to buy back, as when an owner who had mortgaged his/her real property pays off the debt. The term also refers to paying the amount due and all charges after a foreclosure (due to failure to make payments when due) has begun. a portion of the common shares it held prior to the offering. The balance of the Company's credit facility is intended to provide Commonwealth with revolving credit Revolving Credit A line of credit where the customer pays a commitment fee and is then allowed to use the funds when they are needed. It is usually used for operating purposes, fluctuating each month depending on the customers current cash flow needs. for working capital and general corporate purposes. On March 17, the Company drew $25 million to meet working capital needs; overall borrowings at quarter's end totaled $75 million. Commonwealth concluded the quarter with a strong balance sheet, highlighted by total assets of $430.3 million at March 31, 1995, and total stockholders' equity Stockholders' Equity The portion of the balance sheet that includes capital received from investors in exchange for stock (paid-in capital), donated capital, and retained earnings. This is equal to total assets minus liabilities, preferred stock and intangible assets. of $191.3 million. The Company's current ratio at quarter's end, including short-term debt Short-term debt Debt obligations, recorded as current liabilities, requiring payment within the year. and current portion of long-term debt Current Portion Of Long-Term Debt A portion of the balance sheet that represents the total amount of long-term debt that must be paid within the next year. The balance sheet has a liability section, which is broken down into long-term and current debt. , was 2.4:1, and long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. was 19% of stockholders' equity and long-term debt. Commonwealth Aluminum is one of North America's leading manufacturers of aluminum sheet for the transportation, construction and consumer durables Consumer durables Consumer products that are expected to last three years or more, such as an automobile or a home appliance. consumer durables See durable goods. end-use markets. The Company manufactures a variety of common alloy alloy (ăl`oi, əloi`) [O. Fr.,=combine], substance with metallic properties that consists of a metal fused with one or more metals or nonmetals. products in the form of aluminum sheet at its Lewisport, Kentucky rolling mill rolling mill: see steel. , one of the largest multi-purpose aluminum rolling mills in 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. . -0-
COMMONWEALTH ALUMINUM CORPORATION
Unaudited Consolidated Statements of Income
(in thousands, except per share amounts)
Three Months Ended
March 31,
1995 1994
Change
Net sales $173,907 $104,203 67%
Cost of goods sold 156,361 102,635 52%
Gross profit 17,546 1,568 nm
Selling, general and
administrative expenses 5,791 4,748 22%
Operating income (loss) 11,755 (3,180) nm
Other income 35 402 -91%
Interest and financing expenses (392) 1 nm
Net income (loss) before taxes 11,398 (2,777) nm
Provision for income taxes (2,736) 56 nm
Net income (loss) 8,662 (2,721) nm
Net income (loss) per share $ .85 $(.27) nm
Weighted average shares outstanding 10,187 10,187 --
Unaudited Operating and Financial Statistics
(dollars in thousands)
Three Months Ended
March 31,
1995 1994
Change
Net sales volume (millions lbs.) 154.9 132.8 17%
Production volume (millions lbs.) 155.3 118.4 31%
Gross profit percent 10.1% 1.5%
Operating income percent 6.8% -3.1%
EBITDA 16,086 1,466 nm
EBITDA per share $1.58 $ .14 nm
Current ratio 2.4x 2.8x
Interest coverage ratio
(EBITDA to interest expense) 41.0x nm
Return on stockholders' equity 18.1% -5.0%
Debt-to-capitalization
(includes revolving debt) 28.2% 0.0%
Effective tax rate 24.0% 2.0%
Commonwealth Aluminum completed its initial public offering on
March 17, 1995. Earnings per share, EBITDA per share, and shares
outstanding are based on shares outstanding at March 31, 1995.
Based on debt outstanding of $75 million at quarter's end and
current interest rates, pro forma earnings for the first quarter of
1995 would have been $.73 per share.
nm= Not meaningful.
Consolidated Statements of Cash Flows
(in thousands)
Three Months Ended
March 31,
1995 1994
Operating activities:
Net income (loss) $ 8,662 $ (2,721)
Depreciation 4,296 4,244
Cash profit 12,958 1,523
Change in working capital
and other net assets (28,959) 11,408
Net cash (used) provided
by operating activities (16,001) 12,931
Investing activities:
Additions to property,
plant and equipment (8,507) (2,125)
Financing activities:
Term loan borrowings 44,375 --
Revolving debt borrowings 30,625 --
Payments to former parent company (49,500) --
Net cash used provided by
financing activities 25,500 --
Net increase (decrease) in cash for the period 992 10,806 Cash and equivalents, beginning of period 0 7,734 Cash and equivalents, end of period $ 992 $ 18,540
Consolidated Balance Sheets
(in thousands)
Three Months Ended
March 31,
1995 1994
ASSETS
Cash and cash equivalents $ 992 $ 18,540
Accounts receivable 104,381 65,716
Inventories 115,779 74,164
Due from broker 5,770 6,591
Prepayments 6,254 4,694
Total current assets 233,176 169,705
Property, plant and equipment 196,818 189,634
Other non-current assets 305 12,519
-------- --------
$430,299 $371,858
LIABILITIES AND STOCKHOLDERS' EQUITY Current portion of long-term loan 5,625 -- Short-term borrowings 25,000 -- Accounts payable 46,155 42,004 Accrued liabilities 12,581 10,851 Accrued income taxes 3,647 119 Deferred gains - unrealized 5,770 6,591 Total current liabilities 98,778 59,565 Pension benefits 12,956 16,161 Postretirement and other liabilities 82,852 80,029 Term loan 44,375 -- Total liabilities 238,961 155,755
Common stock 102 --
Additional paid-in capital 301,041 358,498
Accumulated deficit (107,145) (142,395)
Unearned compensation (2,660) --
Total stockholders' equity 191,338 216,103
-------- --------
$430,299 $371,858
CONTACT: Commonwealth Aluminum Corp., Louisville W. Peter Day, 502/589-8125 |
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