CTB International Corp. Reports Record Second Quarter Earnings.Business Editors MILFORD Milford. 1 Residential city (1990 pop. 49,938), New Haven co., SW Conn., on Long Island Sound; settled 1639, inc. as a city 1959. Oysters and clams are gathered there for commercial use, and the city also has light manufacturing, such as the production , Ind IND Investigational new drug Therapeutics A status assigned by the FDA to a drug before allowing its use in humans, exempting it from premarketing approval requirements so that experimental clinical trials may be conducted. See Phase 1.2, 3 studies, Sponsorship. .--(BUSINESS WIRE)--July 26, 2001 CTB CTB Council Tax Benefit (UK) CTB Coopération Technique Belge (French: Belgian Technical Cooperation) CTB Commonwealth Transportation Board (Virginia Department of Transportation) International Corp. (Nasdaq:CTBC CTBC Computer Take Back Campaign CTBC Cape Town Bridge Club (South Africa) ) today announced second quarter net income of $5.3 million, a 21 percent improvement over the year-ago period and the best second quarter net income in the Company's history. Earnings for 2001's second quarter increased to 48 cents 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, compared to 39 cents for the same period last year. Year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. , earnings have improved nearly 15 percent to $7.6 million versus $6.7 million a year ago. Earnings per diluted share for the six-month period totaled 69 cents, up from 59 cents per diluted share last year. These earnings achievements came despite a ten percent decline in second-quarter sales to $67.1 million, compared to $74.3 million in 2000. For the year, sales were $120.3 million, down nine percent from 2000's $132.0 million. CTB recorded second quarter operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. of $9.8 million, compared to $8.8 million in 2000. Year-to-date, operating income was up six percent to $14.4 million. Victor A. Mancinelli, CTB president and chief executive officer, remarked, "In the second quarter, we again demonstrated our ability to achieve record net income and strong operating income numbers for the quarter in spite of in opposition to all efforts of; in defiance or contempt of; notwithstanding. See also: Spite adverse conditions for certain of our markets and a substantial downward change from the strong grain markets of the last couple years. We were also pleased by the strong performance of our international business segment." The biggest 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. in CTB's sales in the quarter came from its Grain Segment, which focuses its sales efforts primarily in the U.S. and Canada Canada (kăn`ədə), independent nation (2001 pop. 30,007,094), 3,851,787 sq mi (9,976,128 sq km), N North America. Canada occupies all of North America N of the United States (and E of Alaska) except for Greenland and the French islands of . Sales for this segment for the quarter were $19.3 million compared with $27.8 million in 2000. This decline, which marks a departure from the strong performance of the two prior years, was attributed primarily to reduced commercial storage demand. The Company expects this slow demand to continue into the third quarter, however, early wet weather and late plantings could still lead to increased demand for storage later in the year compared to last year. Grain Segment sales for the six-month period totaled $31.9 million, down from $41.3 million the prior year. The Company's Protein Group Segment recorded second quarter sales of $22.8 million, down 11 percent from the prior year. The Segment continued to reflect the impact of the poor conditions in the U.S. poultry poultry, domesticated fowl kept primarily for meat and eggs; including birds of the order Galliformes, e.g., the chicken, turkey, guinea fowl, pheasant, quail, and peacock; and natatorial (swimming) birds, e.g., the duck and goose. market as well as the continued slow recovery of the hog market. These were offset somewhat by strong egg production system sales System sales is a business term used in the franchising industry. Franchisors provide supplies, marketing and administration services to franchisees in return for a part of the franchisees' revenues. Some franchisors also operate some outlets directly. amid market signals of a coming 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 egg production market. Due to the existing order 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. , the Company does not anticipate seeing the sales impact of this probable PROBABLE. That which has the appearance of truth; that which appears to be founded in reason. slowdown until later in the year. The Protein Group Segment, which focuses its sales efforts primarily in the U.S. and Canada, had 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 of $42.0 million in the first half, down from $49.3 million in the prior year. Continued strong sales in many regions outside the U.S. and Canada resulted in robust International Segment second quarter sales of $25.0 million, up 20 percent from the prior year. The Segment recorded sales of $46.4 million in the first half, up from $41.4 million in 2000, and also reported solid operating income improvement. CTB's net interest expense declined during the quarter to $770,000 from $1.2 million a year ago, primarily as a result of lower debt balances and reduced borrowing costs. "We are continuing our strategies of cost control and expense reduction as we work for full-year earnings growth," said Mancinelli. "We are, however, mindful mind·ful adj. Attentive; heedful: always mindful of family responsibilities. See Synonyms at careful. mind of the potential impact of new weakness in the grain and egg production markets, which we expect to result in lower sales levels compared to last year. The new weakness in these markets also poses a threat to achieving our previously stated earnings growth goal. As a result, we now expect earnings growth for the year in the high single digits to the low teens." Earnings Conference Call CTB is hosting a live Webcast of its conference call on the investor section of its Web site (www.ctbinc.com/invest.htm) today at 11:00 a.m. Eastern Time (10:00 a.m. in Milford). To listen to the call on the Web, please visit the site at least fifteen minutes early to download To receive a file transmitted over a network. In any communications session, "download" means receive, and "upload" means send. The download/upload often implies a big/little scenario, in which data is being downloaded from the "big" server into the "little" user's computer. and install any necessary audio software. A replay of the call will also be available on the site for two weeks. About CTB CTB International Corp. is a leading designer, manufacturer and marketer of systems for the poultry, hog, egg production, and grain industries. Founded in 1952, CTB operates from facilities in the U.S.A., 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 Latin America Latin America, the Spanish-speaking, Portuguese-speaking, and French-speaking countries (except Canada) of North America, South America, Central America, and the West Indies. as well as through a worldwide distribution
network. The Company's web address is www.ctbinc.com.Disclosure Regarding 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. In addition to historical information, this document contains certain statements representing the Company's expectations or beliefs concerning future events. These statements are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, which provides a 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. for such statements. The use of words such as "anticipates," "believes," "estimates," "expects," "intends," "plans," "projects," "could," "may," "will" or similar expressions are intended to identify these statements. The forward-looking statements contained in this document include, without limitation, statements related to implementation of operational improvements; possible impact of market conditions; achievement of earnings growth; execution of business strategies; and management of costs. They also involve certain risks and uncertainties regarding CTB International Corp.'s business and operations and the agriculture industry. The Company's actual results could differ materially from those expressed or implied Inferred from circumstances; known indirectly. In its legal application, the term implied is used in contrast with express, where the intention regarding the subject matter is explicitly and directly indicated. by such forward-looking statements. The Company cautions that these statements are further qualified by other important factors, including, but not limited to those set forth in the Company's Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. filing and its other filings with the Securities and Exchange Commission. The Company does not undertake any obligation to update this information.
CTB International Corp. and Subsidiaries
Condensed Consolidated Income Statements
(In thousands, except per share data)
(Unaudited)
For the Three Months For the Six Months
Ended June 30, Ended June 30,
-------------------- -------------------
2001 2000 2001 2000
-------- -------- -------- --------
NET SALES $ 67,141 $ 74,294 -9.6% $120,326 $132,045 -8.9%
COST OF SALES 46,601 54,181 -14.0% 85,226 95,801 -11.0%
-------- -------- -------- --------
Gross profit 20,540 20,113 2.1% 35,100 36,244 -3.2%
30.6% 27.1% 29.2% 27.4%
OTHER OPERATING
EXPENSE:
Selling, general,
and
administrative
expenses 10,092 10,756 -6.2% 19,456 21,448 -9.3%
15.0% 14.5% 16.2% 16.2%
Amortization of
goodwill 636 596 6.7% 1,283 1,201 6.8%
-------- -------- -------- --------
OPERATING INCOME 9,812 8,761 12.0% 14,361 13,595 5.6%
14.6% 11.8% 11.9% 10.3%
INTEREST
EXPENSE - Net (770) (1,219) -36.8% (1,346) (2,461) -45.3%
OTHER (EXPENSE)
INCOME - Net (132) (198) -33.3% (306) (44) 595.5%
-------- -------- -------- --------
INCOME BEFORE
INCOME TAXES 8,910 7,344 21.3% 12,709 11,090 14.6%
INCOME TAXES 3,564 2,938 21.3% 5,084 4,436 14.6%
-------- -------- -------- --------
NET INCOME $ 5,346 $ 4,406 21.3% $ 7,625 $ 6,654 14.6%
======== ======== ======== ========
8.0% 5.9% 6.3% 5.0%
DILUTED EARNINGS
PER SHARE:
Earnings per
share $ 0.48 $ 0.39 23.1% $ 0.69 $ 0.59 16.9%
======== ======== ======== ========
Weighted average
shares 11,078 11,182 -0.9% 11,083 11,330 -2.2%
======== ======== ======== ========
CTB International Corp. and Subsidiaries
Summary by Business Segment
(In thousands)
(Unaudited)
For the Three Months For the Six Months
Ended June 30, Ended June 30,
-------------------- -------------------
2001 2000 2001 2000
--------- --------- --------- ---------
External net sales
Protein Group $ 22,837 $ 25,676 $ 41,965 $ 49,333
Grain 19,270 27,817 31,915 41,274
International 25,034 20,801 46,446 41,438
--------- --------- --------- ---------
Total $ 67,141 $ 74,294 $120,326 $132,045
========= ========= ========= =========
Operating income
Protein Group $ 5,119 $ 5,562 $ 8,650 $ 10,846
Grain 4,465 6,611 6,421 9,068
International 4,800 2,323 7,631 4,934
Other(a) (4,572) (5,735) (8,341) (11,253)
--------- --------- --------- ---------
Total $ 9,812 $ 8,761 $ 14,361 $ 13,595
========= ========= ========= =========
(a) Consists primarily of CTB's centralized and/or corporate functions
and includes inter-company eliminations.
CTB International Corp. and Subsidiaries
Condensed Consolidated Balance Sheets
(In thousands)
(Unaudited)
As of As of
June 30, December 31,
2001 2000
---- ----
ASSETS
Current assets $ 69,460 $ 62,368
Property, plant, and equipment - net 47,761 50,399
Intangibles - net 77,946 81,848
Other assets 1,129 742
---------- ----------
Total assets $ 196,296 $ 195,357
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities $ 37,461 $ 33,507
Long-term debt 53,215 62,505
Deferred income taxes 9,005 8,982
Accrued postretirement benefit cost and other 3,387 3,350
---------- ----------
Total liabilities 103,068 108,344
Shareholders' equity 93,228 87,013
---------- ----------
Total liabilities and shareholders' equity $ 196,296 $ 195,357
========== ==========
CTB International Corp. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
For the Six Months
Ended June 30,
-------------------
2001 2000
--------- ---------
Net cash flows from operating activities $ 10,347 $ 9,401
Net cash flows from investing activities (2,079) (1,464)
Net cash flows from financing activities (7,078) (8,016)
--------- ---------
Net increase in cash and cash equivalents 1,190 (79)
Net effect of translation differences (21) (797)
Cash and cash equivalents, beginning of period 2,009 2,439
--------- ---------
Cash and cash equivalents, end of period $ 3,178 $ 1,563
========= =========
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