Commercial Metals Co. reports record earnings of $38.2 million, up 46 percent despite LIFO effect and nonrecurring items.DALLAS--(BUSINESS WIRE)--Oct. 19, 1995--Commercial Metals Company (NYSE NYSE See: New York Stock Exchange : CMC (Common Messaging Calls) A programming interface specified by the XAPIA as the standard messaging API for X.400 and other messaging systems. CMC is intended to provide a common API for applications that want to become mail enabled. 1. ) today reported net earnings of $38.2 million or $2.52 per share on sales of $2.1 billion for the year ended August 31, 1995. This 46% increase in earnings over the prior year was achieved despite a $13.0 million increase for the year in the LIFO (Last In-First Out) A queueing method in which the next item to be retrieved is the item most recently placed in the queue. Contrast with FIFO. LIFO - stack reserve (reduced reported net earnings $8.4 million or 56 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. compared with a reduction of $6.2 million or 42 cents per share in net earnings in 1994) and a litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. accrual accrual, n continually recurring short-term liabilities. Examples are accrued wages, taxes, and interest. and other nonrecurring Non`re`cur´ring a. 1. Nonrecurrent; as, the costs of a layoff are considered as a nonrecurring expense s>. items recorded in the first quarter this year which reduced net earnings an additional $3.1 million or 20 cents per share. This compares with earnings of $26.2 million or $1.75 per share on sales of $1.7 billion for the same period last year. Cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses was a record for the third consecutive year and totalled $76.6 million, exceeding the previous record of $61.7 million set last year. The LIFO reserve is now $34.3 million. Net earnings for the fourth quarter were $10.2 million or 66 cents per share on sales of $592.6 million. This 13% increase in quarterly earnings was achieved despite an $8.0 million increase for the quarter in the LIFO reserve (reduced net earnings $5.2 million or 34 cents per share compared to a reduction of $3.1 million or 21 cents per share for the fourth quarter last year). This compares with earnings of $9.0 million or 63 cents per share on sales of $447 million in last year's fourth quarter. CMC President and Chief Executive Officer Stanley Stanley, town (1991 pop. 1,557), capital of the Falkland Islands, S Atlantic Ocean, on East Falkland island. It is the main port and trading center of the islands. The name is sometimes written as Port Stanley. A. Rabin Ra·bin , Yitzhak or Itzhak 1922-1995. Israeli military and political leader who commanded Israeli forces in the Six-Day War (1967) and served as prime minister (1974-1977 and 1992-1995). He shared the 1994 Nobel Peace Prize. said, "This was another great year with very high quality earnings. Our Manufacturing segment led by the CMC Steel Group was the principal earnings contributor. The CMC Steel Group reported record profits, the Recycling recycling, the process of recovering and reusing waste products—from household use, manufacturing, agriculture, and business—and thereby reducing their burden on the environment. segment generated vastly improved profits and we had good results in Marketing and Trading. Tonnage TONNAGE, mar. law. The capacity of a ship or vessel. 2. The act of congress of March 2, 1799, s. 64, 1 Story's L. U. S. 630, directs that to ascertain the tonnage of any ship or vessel, the surveyor, &c. records were achieved in steel manufacturing, steel fabrication fabrication (fab´rikā´sh  n),n the construction or making of a restoration. , copper tube production and scrap metal scrap metal Used metals that are an important source of industrial metals and alloys, particularly in the production of steel, copper, lead, aluminum, and zinc. Smaller amounts of tin, nickel, magnesium, and precious metals are also recovered from scrap. processed." Concerning the outlook Rabin said, "Our positive operating outlook for fiscal 1996 is based on a continuation continuation - continuation passing style of internal operating improvements, particularly at the SMI-Owen companies. Our market outlook is for moderate growth in the U.S. with a good level of business in the Southwest Southwest or south west is the ordinal direction halfway between south and west, the opposite of northeast. Southwest or south west may also refer to:
Southeast or South East can refer to: Mexico or Mexico City, Span. Ciudad de México (Méjico), city (1990 pop. 8,236,960; 1991 met. area est. 20,899,000), central Mexico, capital and largest city of Mexico. will continue, 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). will be sluggish, we expect a
slight improvement in Japan, some pickup PickupA gain in yield made by selling one bond and buying another. Also referred to as "yield pickup." Notes: When the present yield is relatively low compared to the longer-term yields, pickups will be done by investors trying to increase the yield and duration of their in China and moderate demand in the rest of the Pacific Rim Pacific Rim, term used to describe the nations bordering the Pacific Ocean and the island countries situated in it. In the post–World War II era, the Pacific Rim has become an increasingly important and interconnected economic region. . We anticipate that the second half of the fiscal year will be better than the first." Commercial Metals Company Commercial Metals Company NYSE: CMC is an United States based steel and metal manufacturer founded in 1915. It owns four steel minimills in Texas, Alabama, South Carolina and Arkansas, one copper minimill (Howell Metal Company) in Virginia, fabricators, and recyclers in the and subsidiaries manufacture, recycle re·cy·cle tr.v. re·cy·cled, re·cy·cling, re·cy·cles 1. To put or pass through a cycle again, as for further treatment. 2. To start a different cycle in. 3. a. and market steel and metal products, related materials and services through a network of over 90 locations including 4 steel minimills, 19 steel fabrication plants, 3 steel joist plants, 2 railcar rebuilding facilities, 8 concrete related product warehouses, an industrial products supply company, a copper tube mill, 34 metal recycling facilities and 15 marketing and trading offices in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. and in strategic overseas markets. -0-
COMMERCIAL METALS COMPANY
Fourth Quarter Operating Results
(in thousands except share data)
Three months ended August 31,
-----------------------------
1995 1994
----------- -----------
Revenues:
Net sales $ 592,565 $ 447,232
Other revenues 3,357 2,199
----------- -----------
595,922 449,431
Costs and Expenses:
Cost of goods sold 542,004 404,340
Selling, general and
administrative expenses 31,769 26,391
Interest expense 3,852 2,747
Employees' retirement plans 3,201 2,221
----------- -----------
580,826 435,699
Earnings Before Income Taxes 15,096 13,732
Income Taxes 4,908 4,702
----------- -----------
Net Earnings $ 10,188 $ 9,030
=========== ===========
Net earnings per share $ .66 $ .63 Cash dividends per share $ .12 $ .12 Average shares outstanding 15,470,296 14,415,753
Fiscal Year Ended August 31,
----------------------------
1995 1994
----------- -----------
Revenues:
Net sales $ 2,107,426 $ 1,657,810
Other revenue 9,353 8,424
----------- -----------
2,116,779 1,666,234
Costs and Expenses:
Cost of goods sold 1,892,540 1,504,566
Selling, general and
administrative expenses 133,058 103,547
Interest expense 15,246 9,271
Employees' retirement plans 11,277 7,943
Litigation accrual 6,650 --
----------- -----------
2,058,771 1,625,327
Earnings Before Income Taxes 58,008 40,907
Income Taxes 19,800 14,737
----------- -----------
Net Earnings $ 38,208 $ 26,170
=========== ===========
Net earnings per share. $ 2.52 $ 1.75 Cash dividends per share $ .48 $ .46 Average shares outstanding 15,151,072 14,956,479 Note: The LIFO method of inventory valuation had the effect of decreasing net earnings for the quarter $5.2 million (34 cents per share) compared to an decrease of $3.1 million (21 cents per share) last year, and for the fiscal year net earnings were $8.4 million lower (56 cents per share) compared to a decrease of $6.2 million (42 cent per share) last year.
CONSOLIDATED CONDENSED BALANCE SHEETS
(in thousands)
August 31,
------------------------
1995 1994
---------- ----------
Assets
Current Assets:
Cash and temporary investments $ 21,018 $ 38,269
Accounts receivable 268,657 228,035
Financial services loans and advances -- 19,560
Inventories 208,114 133,748
Other 36,316 26,473
---------- ----------
Total Current Assets 534,105 446,085
Other Assets 4,259 1,984
Net Property, Plant and Equipment 209,739 156,808
---------- ----------
$ 748,103 $ 604,877
========== ==========
Liabilities and Stockholders' Equity
Current Liabilities:
Commercial paper $ -- $ 20,000
Notes Payable -- 21,000
Financial services notes payable 5,189 50,912
Accounts payable 107,906 84,644
Other payables and accrued expenses 137,933 85,220
Income taxes payable 3,246 4,338
Current maturities of long-term debt 14,108 4,852
---------- ----------
Total Current Liabilities 268,382 270,966
Deferred Income Taxes 18,553 19,077 Long-Term Debt 158,004 72,061
Stockholders' Equity 303,164 242,773
---------- ----------
$ 748,103 $ 604,877
========== ==========
BUSINESS SEGMENTS
(in thousands)
Marketing Financial
Mfg. Recycling & Trading Services
-------- --------- --------- ---------
Fiscal Year 1995
----------------
Total revenues $912,739 $ 511,135 $ 749,225 --
Operating profit
(loss) 54,417 11,337 17,751 --
Interest Expense -- -- -- --
-------- --------- --------- ---------
Adjust.
Corp. & Elim. Consolidated
--------- --------- ------------
Total revenues $ 10 $ (56,330) $ 2,116,779
Operating profit (loss) (10,251) -- 73,254
Interest Expense -- -- (15,246)
--------- --------- ------------
Earnings before income taxes $ 58,008
============
Marketing Financial
Mfg. Recycling & Trading Services
-------- --------- --------- ---------
Fiscal Year 1994
----------------
Total revenues $598,275 $342,250 $ 757,922 $ 2,747
Operating profit
(loss) 37,670 4,998 13,507 1,731(a)
Interest Expense -- -- -- --
-------- --------- --------- ---------
Adjust.
Corp. & Elim. Consolidated
--------- --------- ------------
Total revenues $ 34 $ (34,994) $ 1,666,234
Operating profit (loss) (9,681) -- 48,225
Interest Expense -- -- (7,318)(a)
--------- --------- ------------
Earnings before income taxes $ 40,907
============
(a) Interest expense of the financial services segment was included in operating profit in the amount of $1,953 in 1994.
1995 1994
----- -----
Steel Mill Tons Shipped 1,528 1,247 Steel Fabrication Plants Tons Shipped 564 348 Scrap Metal Tons Processed and Shipped 1,688 1,372
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
August 31,
--------------------------
1995 1994
----------- -----------
Cash Flows from Operating Activities
Net earnings $ 38,208 $ 26,170
Adjustments to earnings not
requiring cash:
Depreciation and amortization 38,134 30,143
Provision for losses on receivables 1,084 1,258
Deferred income taxes (524) 4,304
Other (268) (209)
----------- -----------
Cash flows from operations before changes
in operating assets and liabilities $ 76,634 $ 61,666
Changes in operating assets and
liabilities net of effect of
Owen acquisition:
Decrease (increase) in
accounts receivable 6,652 (65,906)
Decrease (increase) in financial
services loans and advances 19,560 16,208
Decrease (increase) in inventories (39,804) 2,853
Decrease (increase) in other assets (5,635) (9,014)
Increase (decrease) in accounts payable,
accrued expenses and income taxes 15,472 4,998
----------- -----------
Net cash flows from operating
activities $ 72,879 $ 10,805
Cash Flows from Investing Activities
Acquisition of Owen net of
cash acquired (24,769)
Temporary investments 19,174 9,485
Purchases of property, plant
and equipment (39,311) (48,152)
Sales of property, plant and equipment 993 733
----------- -----------
Net cash used by investing activities $ (43,913) $ (37,934)
Cash Flows from Financing Activities
Commercial paper -- net change (20,000) 20,000
Notes payable -- net change (21,000) 21,000
Financial services notes payable (45,723) 9,909
New long-term debt 160,000 --
Refinance long-term debt of acquisition (32,000)
Payments on long-term debt (64,801) (4,648)
Stock issued under stock option,
purchase, and bonus plans 2,337 4,347
Tax benefits related to stock option plan 1,355 661
Treasury stock acquired -- (17,120)
Dividends paid (7,211) (6,705)
----------- -----------
Net cash provided (used) by financing
activities. (27,043) 27,444
Increase (Decrease) in Cash and Cash Equivalents 1,923 315
Cash and Cash Equivalents at
Beginning of Year 19,095 18,780
----------- -----------
Cash and Cash Equivalents at End of Year $ 21,018 $ 19,095 -0- =========== =========== CONTACT: Commercial Metals Co. Bob Davis
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