Elsag Bailey Process Automation N.V. reports fourth-quarter and 1996 results.AMSTERDAM Amsterdam, city, Netherlands Amsterdam (ăm`stərdăm', Dutch ämstərdäm`), city (1994 pop. 724,096), constitutional capital and largest city of the Kingdom of the Netherlands, North Holland prov. , the Netherlands--(BUSINESS WIRE)--Feb. 26, 1997-- 1996 Revenues exceed $1.6 billion 1996 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. , before amortization and non-recurring costs, is $129 million 1996 Earnings per share, before non-recurring costs, is $1.53, assuming conversion of preferred shares Preferred shares Preferred shares give investors a fixed dividend from the company's earnings and entitle them to be paid before common shareholders. See: Preferred stock. Elsag Bailey Process Automation N.V., (NYSE NYSE See: New York Stock Exchange :EBY EBY Ente Binacional Yaciretá (Argentina-Paraguay) ) today announced financial results for the fourth quarter and full year 1996. FOURTH QUARTER OPERATING RESULTS For the quarter ending December December: see month. 31, 1996, Elsag Bailey Process Automation recorded revenues of $427 million, up nearly 9.5 percent from third quarter revenues of $390 million. Bookings for the quarter were $443 million. Gross profit margin Gross profit margin Gross profit divided by sales, which is equal to each sales dollar left over after paying for the cost of goods sold. gross profit margin A measure calculated by dividing gross profit by net sales. excluding non-recurring costs for the 1996 fourth quarter was 35.5 percent. Operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: excluding non-recurring costs and before amortization was 9.0 percent for the fourth quarter. For the fourth quarter the Company announced net income applicable to common shareholders, before non-recurring charges, of $24.3 million, or $0.66 per share, assuming conversion of the preferred shares. The quarter includes after tax non-recurring charges of $15.4 million, or $0.42 per share, assuming conversion of the preferred shares. Net income applicable to common shareholders, after non-recurring costs, for the quarter was $4.6 million, or $0.16 per share on a primary share basis. Common stock outstanding was 27,886,000 on a primary basis, and 36,840,000 assuming conversion of the preferred shares. FULL YEAR OPERATING RESULTS The acquisition of Hartmann Hartmann is a surname and may refer to:
German lover and later wife of Adolf Hitler. They began living together in 1936, but the liaison was kept secret, and she was never seen in public with him. They were married hours before their double suicide on April 30, 1945. in 1996 effectively doubled Elsag Bailey's revenues and bookings. Thus, a direct comparison with prior-year results is not reported here. Revenues for the full year 1996 were $1,606 million, and bookings for the year were $1,626 million. Excluding non-recurring charges relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the acquisition of Hartmann & Braun, gross profit margin for the full year was 36.5 percent; on the same basis, operating margin before the amortization of intangibles reached 8.0 percent. For the year, the Company announced net income applicable to common shareholders, before non-recurring charges, of $56.4 million, or $1.53 per share, assuming conversion of the preferred shares. The results include after tax non-recurring charges of $186.9 million and the extraordinary write-off Write-Off A reduction in the value of an asset or earnings by the amount of an expense or loss. Companies are able to write off certain expenses that are required to run the business, or have been incurred in the operation of the business and detract from retained revenues. of deferred financing costs of $.7 million, or $5.09 per share, assuming conversion of the preferred shares. Net loss for 1996 applicable to common shareholders, after non-recurring costs, was $147.3 million, or $5.28 per share on a primary share basis. In commenting on 1996, Vincenzo Vincenzo may refer to:
 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). , Japan, and 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. electric
utility market. The effect of these market conditions was further
compounded by the strengthening of the United States dollar which
reduced our earnings. As a result of these challenges, earnings were
below our expectations. However, 1996 was also a year of many
accomplishments on which we will build our future. We implemented much
of our plans for the integration of Hartmann & Braun, which is ahead
of our initial schedule. We have also been able to introduce a number
of important new technologies to our product family, and of equal
importance, we introduced a number of the Hartmann & Braun products
to new markets where Elsag Bailey has enjoyed a long presence."
"While market conditions have generally stabilized sta·bi·lize v. sta·bi·lized, sta·bi·liz·ing, sta·bi·liz·es v.tr. 1. To make stable or steadfast. 2. in Europe, we continue to see the effects of a competitive pricing environment. However, we believe our achievements in the last several years, along with the solid bookings of the fourth quarter, provide evidence that the foundation for Elsag Bailey's successful future has been established. While earnings per share will not show significant improvement over 1996 levels due to a reduction in non-operating income items and a higher tax rate, we believe that expectations for improved cash flows and operating earnings Operating Earnings Profits after subtracting expenses such as marketing, cost of goods sold, administration and general operating costs from revenue. Notes: Tax and interest expenses are not subtracted - operating earnings are synonymous with EBIT (earnings before will bring increased shareholder value in 1997," Mr. Cannatelli concluded. ACQUISITION OF ITALIAN UNIT The Company has completed the acquisition of the Elsag Bailey Process Automation division of Finmeccanica Finmeccanica S.p.A. is an Italian conglomerate company. Finmeccanica is the second largest industrial group and the first of the hi-tech industrial groups based in Italy. It works in the fields of defence, aerospace, security, automation, transport and energy. S.p.A. at the end of 1996. This division as a stand-alone company stand-alone company An independent operating firm. For example, a large diversified firm may consider spinning off a subsidiary because, as a stand-alone company, the subsidiary would command a higher price-earnings ratio than the parent. had revenues in 1996 of approximately $100 million, and has been a licensee licensee n. a person given a license by government or under private agreement. (See: license, licensor) LICENSEE. One to whom a license has been given. 1 M. Q. & S. 699 n. of Elsag Bailey's technology in Italy for more than ten years. The acquisition price was 1.3 million shares of the Company's Common Stock together with the assumption of approximately $13 million in debt. MANAGEMENT CHANGES The Company announced the promotion of Mike Zaharna, Group Executive Vice President, to the position of Chief Operating Officer Chief Operating Officer (COO) The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. . Mr. Cannatelli stated, "Mike and I will form the Office of the Managing Director, and will work closely to manage our global operations Global Operations is a first-person shooter computer game developed by Barking Dog Studios and published by both Crave Entertainment and Electronic Arts. It was released in March of 2002, following its public multiplayer beta version which contained only the Quebec map. . Mike will continue to concentrate his attentions on technology, market development and commercial activities. His more than 30 years experience in our industry has been invaluable to the Company's success and will serve us well in the coming years." The Company also announced that a product-based matrix management structure has been instituted to complement the Company's geographic operating structure. The new structure is intended to create a global focus to our product lines and ensure accelerated product development, increased market penetration Noun 1. market penetration - the extent to which a product is recognized and bought by customers in a particular market penetration - the act of entering into or through something; "the penetration of upper management by women" , and improved overall profitability. The specific appointments are as follows: Hartmut Wuttig to Group Vice President, Systems; Uwe Alwardt, to Group Vice President, Instrumentation instrumentation, in music: see orchestra and orchestration. instrumentation In technology, the development and use of precise measuring, analysis, and control equipment. ; and Garry Vail Vail (vāl), town (1990 pop. 3,569), Eagle co., W central Colo., on Gore Creek, in the Gore Range of the Rocky Mts.; founded as a ski resort 1962, inc. as a town 1966. , to Group Vice President, Analytical analytical, analytic pertaining to or emanating from analysis. analytical control control of confounding by analysis of the results of a trial or test. Products. "The addition of these talented managers to the group executive team, and their focus on our main product lines, will bring an increased emphasis to the product needs of our customers worldwide," said Mr. Cannatelli. Other executive management changes include the decision of William P. Donnelly, Group Vice President, Finance and Control, to accept a position with another company. "I am saddened by Bill's upcoming departure, and want to thank him for his years of talented service to Elsag Bailey," said Cannatelli. "We all wish him the best in his new position." Mr. Donnelly will continue to assist Elsag Bailey during a transition period. Timothy R. Lucie-Smith, Vice President and Group Controller, has assumed responsibility for the overall reporting and control functions. Finally, reinforcing the Company's commitment to its shareholders, Christopher M. Farage has recently joined Elsag Bailey as Director of Investor Relations Investor relations The process by which the corporation communicates with its investors. , responsible for managing the Company's relationship with investors and communications with the financial community. One of the world's leading process automation companies, Elsag Bailey Process Automation N.V., incorporated in the Netherlands, has nearly tripled its revenues in three years through acquisitions and by aggressively expanding its product markets to over 40 countries. Elsag Bailey's products--computerized systems which control process manufacturing The manufacturing industry that uses process control systems. See process control. ; instrumentation products which automatically report measurements from the plant floor; and analytical products which measure the efficiency of process manufacturing operations--keep its customers on the cutting edge of productivity. Elsag Bailey global customers are among the leading names in a wide range of process industries including electric utilities, oil and gas, pulp and paper, water and wastewater, metals and ceramics ceramics (sərăm`ĭks), materials made of nonmetallic minerals that have been permanently hardened by firing at a high temperature, or objects made of such materials. , and food and beverage F&B is a common abbreviation in the United States and Commonwealth countries, including Hong Kong. F&B is typically the widely accepted abbreviation for "Food and Beverage," which is the sector/industry that specializes in the conceptualization, the making of, and delivery of foods. . For more information about Elsag Bailey, please feel free to visit the Company's web site at www.bailey.com . This document contains forward looking statements subject to 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. created by the Securities 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. Reform Act of 1995. These include, without limitation, the statements related to Elsag Bailey's expected earnings and results, anticipated conditions in its markets, the effect of new system and product introductions, the ability of the Company to successfully and timely complete the acquisition and integration of the Elsag Bailey Process Automation division of Finmeccanica and realize cost savings, the effect of the Company's new product line based management structure, the effect of foreign currency fluctuations relative to the U.S. dollar, and any other statements concerning matters that are not historical facts. Actual results and performance could differ materially from those expressed in or implied by 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. as a result of a number of known and unknown risks. These and other risks and uncertainties affecting Elsag Bailey are discussed in greater detail in Elsag Bailey's Form 20-F filed with the United States Securities and Exchange Commission for the year ended December 1995. -0-
Elsag Bailey Process Automation N.V.
CONDENSED CONSOLIDATED STATEMENT OF INCOME
(Amounts in thousands, except share data)
For the quarter ended For the year ended
Dec. 31, Dec. 31, Dec. 31, Dec. 31,
1996 1995 1996 1995
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Revenues $ 427,464 $ 224,413 $1,606,100 $ 843,874
Cost of sales (1) 279,644 160,161 1,148,840 557,646
__________ __________ __________ __________
Gross profit 147,820 64,252 457,260 286,228
Selling, general and
administrative
expenses (2) 107,120 49,010 413,214 187,224
Research, development
and engineering
expenses (3) 22,360 11,584 141,335 36,218
Amortization of
intangibles (4) 10,816 6,779 80,396 25,197
Royalty (income)
affiliates (1,965) (2,066) (7,117) (6,463)
__________ __________ __________ __________
Operating income (loss) 9,489 (1,055) (170,568) 44,052
Interest expense 10,846 6,494 37,341 24,721
Other expenses
(income) (5) (6,556) (2,352) (10,877) (3,187)
__________ __________ __________ __________
Income (loss) before
income taxes,
minority interest
and extraordinary item 5,199 (5,197) (197,032) 22,518
Income tax benefit (6) (3,845) (13,376) (66,528) (12,546)
Minority interest in
net income of
subsidiaries 118 1,795 --- 3,440
Minority interest -
dividends on
preferred securities 4,345 380 16,084 380
__________ __________ __________ __________
Income (loss) before
extraordinary item 4,581 6,004 (146,588) 31,244
Extraordinary item -
write-off deferred
financing costs --- --- (718) (651)
__________ __________ __________ __________
Net income (loss)(7) $ 4,581 $ 6,004 $ (147,306) $ 30,593
__________ __________ __________ __________
__________ __________ __________ __________
Net income (loss) per share:
Primary $ 0.16 $ 0.26 $ (5.28) $ 1.31
__________ __________ __________ __________
__________ __________ __________ __________
Assuming conversion
of the preferred
shares (8) $ 0.24 $ 0.26 $ (3.56) $ 1.31
__________ __________ __________ __________
__________ __________ __________ __________
Weighted average
number of shares
outstanding:
Primary 27,886,000 23,400,000 27,886,000 23,400,000
__________ __________ __________ __________
__________ __________ __________ __________
Assuming conversion
of the preferred
shares (8) 36,840,000 23,400,000 36,840,000 23,400,000
__________ __________ __________ __________
__________ __________ __________ __________
(1) 1996 included charges, $3,740 in the quarter and $128,723 for the year, for the step-up step-up A scheduled increase in the exercise or conversion price at which a warrant, an option, or a convertible security may be used to acquire shares of common stock. of inventory and restructuring and integration costs, including severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when and other costs associated with terminated personnel. (2) 1996 included charges, $13,045 in the quarter and $27,511 for the year, for restructuring and integration costs, including severance and costs associated with terminated personnel. (3) 1996 included charges, $1,476 in the quarter and $63,144 for the year, for the write-off of in-process research and development and restructuring and integration costs, including severance and costs associated with terminated personnel. (4) 1996 included charges, $354 in the quarter and $38,351 for the year, for the write-off of intangibles related to decisions undertaken resulting from the Hartmann & Braun acquisition. (5) 1996 included charges, $79 in the quarter and $759 for the year, for integration costs including costs associated with terminated personnel. (6) 1996 included tax benefits, $(3,290) in the quarter and $(71,607) for the year, associated with non-recurring charges noted above. (7) 1996 included, $15,404 in the quarter and $186,881 for the year, after tax, for non-recurring charges noted above. (8) However, preferred shares are anti-dilutive. -0-
Elsag Bailey Process Automation N.V.
CONDENSED CONSOLIDATED BALANCE SHEET
(Amounts in thousands)
(Unaudited)
December 31, 1996 December 31, 1995
Cash and cash equivalents $ 21,241 $ 11,627
Accounts receivable 404,535 173,046
Costs in excess of
billings on uncompleted
contracts 169,006 74,005
Inventory 289,492 136,690
Other current assets 97,129 93,933
Other assets 1,203,291 679,524
__________ __________
Total assets $2,184,694 $1,168,825
__________ __________
__________ __________
Notes payable $ 40,001 $ 29,028
Current maturities of long-term debt 81,321 2,733
Billings in excess of
costs on uncompleted contracts 93,431 32,194
Other current liabilities 525,446 243,161
Long-term debt 566,915 286,789
Other liabilities 329,400 89,187
Minority equity 10,586 12,065
Minority equity - obligated
preferred securities of
grantor trust 278,858 196,667
Total shareholders' equity 258,736 277,001
__________ __________
Total liabilities and
shareholders' equity $2,184,694 $1,168,825
__________ __________
__________ __________
NOTE TO EDITORS: There is an "at" symbol before "bailey.com" below. That symbol may not appear properly in some systems. CONTACT: Elsag Bailey Process Automation Christopher M. Farage, Ph.D., 216/585-8675 e-mail: chris.farage@bailey.com |
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