COMMONWEALTH ALUMINUM REPORTS THIRD QUARTER RESULTS.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)--Oct. 29, 1996--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 results for the
three- and nine-month periods ended September September: see month. 30, 1996. The
Company's third quarter results were highlighted by higher sales
volume, reversing the trend seen in the first half of the year, and by
the acquisition of CasTech Aluminum Group Inc., completed on September
20, 1996. The Company's results include CasTech's operations
for the last 11 days of the quarter.
Commonwealth's income before an extraordinary item in the third quarter totaled $4.6 million or $.46 per common share compared with $7.6 million or $.75 per common share in the year-earlier period. The third quarter 1996 results included a $2.2 million tax benefit of an additional 1995 pension contribution of $7.5 million made in August 1996. In connection with the CasTech acquisition, the Company posted an extraordinary charge of $1.4 million associated with the early extinguishment The destruction or cancellation of a right, a power, a contract, or an estate. Extinguishment is sometimes confused with merger, though there is a clear distinction between them. of debt, resulting in reported net income for the quarter of $3.3 million or $.32 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 for the quarter were $170.1 million compared with $160.3 million in the same period last year. Third quarter shipments totaled 168 million pounds compared with 140 million pounds in the year-earlier period. Commenting on the results, Mark V. Kaminski, President and Chief Executive Officer, said, "With record sales volume in the third quarter, Commonwealth continues to gain in market share against the backdrop Backdrop may refer to:
v to hold a limb motionless in order to ground its energy; a standard isometric resistance technique, it releases tension and lengthens muscle fibers. material margins - that inventory adjustments have been substantially completed. Although these early signs have not translated fully into order flow, they do brighten bright·en tr. & intr.v. bright·ened, bright·en·ing, bright·ens To make or become bright or brighter. bright the prospects for strengthening business conditions in 1997." Commonwealth's income before the extraordinary item for the first nine months of 1996 was $9.1 million or $.90 per common share compared with $29.2 million or $2.87 per common share in the same period last year. Net income for the first nine months of 1996 was $7.8 million or $.76 per share compared with $29.2 million or $2.87 per share for the same period last year. Results for the first nine months of 1995 included a tax settlement and income from a disposed dis·pose v. dis·posed, dis·pos·ing, dis·pos·es v.tr. 1. To place or set in a particular order; arrange. 2. operation which together increased net income by $3.3 million or $.32 per common share. Net sales for the first nine months of 1996 were $497.3 million compared with $526.4 million in the same period last year. Shipments totaled 483 million pounds compared with 458 million pounds in the year-earlier period. Earnings before interest, taxes and depreciation EBITD is an initialism or acronym for Earnings Before Interest, Taxes and Depreciation. See EBITDA. Some people find it useful to know this value for a business. (EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become ) for the quarter were $7.6 million or $.74 per common share. For the first nine months of 1996, EBITDA totaled $22.8 million or $2.23 per common share. At quarter's end, Commonwealth reported total assets of $785.8 million 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 $219.7 million. Total debt outstanding was $335.0 million as of September 30, 1996. In connection with the Company's recent acquisition of CasTech, Commonwealth replaced its previous credit arrangement with a new $325 million credit facility. In addition, it also privately placed $125 million in 10-3/4% senior subordinated notes due 2006. Kaminski noted that the CasTech acquisition is expected to be accretive to Commonwealth's earnings in 1997. In addition, he said the Company's larger size, increased product and market diversification Diversification A risk management technique that mixes a wide variety of investments within a portfolio. It is designed to minimize the impact of any one security on overall portfolio performance. Notes: Diversification is possibly the greatest way to reduce the risk. , and enhanced technological capabilities are expected to reduce earnings volatility in the future. "We are very excited about the opportunity to combine what we consider to be the best direct-chill and continuous casting Continuous casting is a refinement of the casting process for the continuous, high-volume production of metal sections with a constant cross-section. It allows lower-cost production of metal sections with better quality, due to finer control through automation of the casting operations in the industry today. The broader product lines made possible through different casting technologies will strengthen our position in the industry, create new market opportunities domestically and internationally, and help us maintain a cost structure that has traditionally been among the lowest in the industry." Commonwealth's management currently is evaluating ways to optimize optimize - optimisation the consolidation and assimilation Assimilation The absorption of stock by the public from a new issue. Notes: Underwriters hope to sell all of a new issue to the public. See also: Issuer, Underwriting Assimilation of these new operations, including issues related to product planning Product Planning is the ongoing process of identifying and articulating market requirements that define a product’s feature set. See also
adj. Relating to or being that which remains after payment, especially of income taxes: after-tax profits. charge totaling between $6 million and $9 million related to these 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). efforts. Commonwealth 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 also is a leading manufacturer of electrical flexible conduit conduit /con·du·it/ (kon´doo-it) channel. ileal conduit the surgical anastomosis of the ureters to one end of a detached segment of ileum, the other end being used to form a stoma on the and prewired armored cable made principally from aluminum sheet. Commonwealth has manufacturing facilities in 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. - one of the largest multi-purpose aluminum rolling mills rolling mill: see steel. 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. - as well as in Bedford Bedford, town, England Bedford, town (1991 pop. 75,632), county seat of Bedfordshire, central England, on the Ouse River. It is an important industrial center; diesel engines, pumps, turbines, agricultural machinery, electrical equipment, and transistors and Uhrichsville, Ohio Uhrichsville is a city in Tuscarawas County, Ohio, United States. The population was 5,662 at the 2000 census. Geography Uhrichsville is located at (40.395208, -81.349226)GR1. , and Carson Carson, city (1990 pop. 83,995), Los Angeles co., S Calif., an industrial and residential suburb of Los Angeles; inc. 1968. Oil refining is the major industry; fabricated metals, paper, and other products are manufactured. The California State Univ. Dominguez Hills is there. , Long Beach and Torrance, California California (kăl'ĭfôr`nyə), most populous state in the United States, located in the Far West; bordered by Oregon (N), Nevada and, across the Colorado River, Arizona (E), Mexico (S), and the Pacific Ocean (W). . -0-
COMMONWEALTH ALUMINUM CORPORATION
Unaudited Consolidated Statements of Income
(in thousands, except per share amounts)
3 Months Ended 9 Months Ended
September 30, September 30,
1996 1995 Change 1996 1995 Change
Net sales $170,052 $160,264 6% $497,268 $526,399 -6%
Cost of goods sold 159,482 143,835 11% 468,017 471,657 -1%
Gross profit 10,570 16,429 -36% 29,251 54,742 -47%
Selling, general and
administrative
expenses 6,876 5,302 30% 19,076 16,811 13%
Operating income 3,694 11,127 -67% 10,175 37,931 -73%
Halco income - - - 1,263
Other income
(expense), net 95 118 (152) 2,949
Interest expense, net 1,346 913 2,468 2,651
Net income before
taxes and
extraordinary item 2,443 10,332 -76% 7,555 39,492 -81%
Provision for
income taxes (2,191) 2,686 - (1,574) 10,267 -
Income before
extraordinary item 4,634 7,646 -39% 9,129 29,225 -69%
Extraordinary expense
(net of tax) 1,355 - - 1,355 - -
Net income $ 3,279 $ 7,646 -57% $ 7,774 $29,225 -73%
Net income per share:
Income before
extraordinary
item $ .46 $ .75 -39% $ .90 $ 2.87 -69%
Extraordinary
charge (.14) - - (.14) - -
$ .32 $ .75 -57% $ .76 $ 2.87 -74%
Weighted average
shares outstanding 10,195 10,190 - 10,195 10,189 -
Unaudited Operating and Financial Statistics
(dollars in thousands)
3 Months Ended 9 Months Ended
September 30, September 30,
1996 1995 Change 1996 1995 Change
Net sales volume
(millions lbs.) 168.0 140.4 20% 482.6 457.8 5%
Production volume
(millions lbs.) 168.2 145.6 16% 473.0 462.6 2%
Gross profit percent 6.2% 10.3% 5.9% 10.4%
Operating income
percent 2.2% 6.9% 2.0% 7.2%
EBITDA $ 7,563 $15,892 -52% $22,760 $55,897 -59%
EBITDA per share $ .74 $ 1.56 -52% $ 2.23 $ 5.49 -59%
Current ratio 1.4x 3.3x 1.4x 3.3x
Interest coverage ratio
(EBITDA to interest
expense) 5.6x 17.4x 9.2x 21.1x
Return on stockholders'
equity (annualized) 6.0% 14.0% 5.0% 18.0%
Debt-to-capitalization 60.4% 18.0% 60.4% 18.0%
Effective tax rate - 26.0% - 26.0%
COMMONWEALTH ALUMINUM CORPORATION
Consolidated Statements of Cash Flows
(in thousands)
3 Months Ended 9 Months Ended
September 30, September 30,
1996 1995 1996 1995
Operating activities:
Net income $ 3,279 $ 7,646 $ 7,774 $ 29,225
Depreciation and
amortization 5,258 4,647 14,245 13,754
Cash profit 8,537 12,293 22,019 42,979
Change in working capital
and other net assets 2,228 16,660 3,722 (23,618)
Net cash (used) provided by
operating activities 10,765 28,953 25,741 19,361
Investing activities:
Additions to property,
plant and equipment (279,679) (1,235) (284,501) (12,567)
Disposals of property,
plant and equipment 5 33 215 241
Net cash used in investing
activities (279,674) (1,202) (284,286) (12,326)
Financing activities:
Dividends paid on
common stock (509) (509) (1,530) (1,018)
Proceeds from short-term
borrowings 135,000 - 131,000 25,000
Repayment of short-term
borrowings (25,000) (22,600) (25,000) (25,000)
Proceeds from long-term
loan 225,000 - 225,000 50,000
Repayment of long-term
debt (66,384) (1,875) (73,590) (3,750)
Payments to former
parent company - - - (49,500)
Net cash provided by
financing activities 268,107 - (255,880) (4,268)
Net increase (decrease) in
cash for the period (802) 2,767 (2,665) 2,767
Cash and equivalents,
beginning of period 802 - 2,665 -
Cash and equivalents,
end of period $ -0- $ 2,767 $ -0- $ 2,767
COMMONWEALTH ALUMINUM CORPORATION
Consolidated Balance Sheets
(in thousands)
Sept 30, Sept 30,
1996 1995
ASSETS
Cash and cash equivalents $ - $ 2,767
Accounts receivable 160,729 96,183
Inventories 155,962 119,065
Due (to) from broker (4,191) 2,441
Prepayments and other current assets 13,751 3,473
Total current assets 326,251 223,929
Property, plant and equipment 275,239 191,648
Other non-current assets 12,128 305
Goodwill 171,187 -
Total assets $785,805 $415,882
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable $86,910 $ 41,153
Accrued liabilities and other 39,092 13,855
Accrued income taxes 3,562 3,472
Deferred (losses) gains - unrealized (4,191) 2,441
Short-term borrowings 110,000 -
Current portion of long-term loan 5,000 7,500
Total current liabilities 240,373 68,421
Deferred income tax 9,750 -
Long-term debt 220,006 38,750
Pension benefits 11,114 19,978
Postretirement benefits and other 84,870 77,586
Total liabilities 566,113 204,735
Common stock 102 102
Additional paid-in capital 301,324 301,040
Treasury stock (35) -
Accumulated deficit (77,305) (87,601)
Unearned compensation (2,125) (2,394)
Minimum pension adjustment (2,269) -
Total stockholders' equity 219,692 211,147
Total liabilities and
stockholders' equity $785,805 $415,882
CONTACT: Commonwealth Aluminum Corp., Louisville Henry Ford, 502/295-5372 |
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