Figgie Reports 1998 First-Quarter Results.CLEVELAND--(BUSINESS WIRE)--April 28, 1998-- -- Sales Continue To Improve, Income From Continuing Operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the Up Before Charge -- -- Scott Aviation Posts Record First Quarter Results -- -- IEC'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). Well Underway, Bookings Up Approximately 53 Percent -- -- Debt Buy Back Program To Gain Momentum -- Figgie International Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :FIGIA) (NASDAQ:FIGI FIGI Fortress International Group Inc. (Columbia, MD) ) today reported increased sales and income from continuing operations before a restructuring charge restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. for the first quarter of 1998. (NOTE: The company's income statement has been restated to reflect the Snorkel snorkel, tube through which a submarine or diver can draw air while underwater. When in use, the top of the snorkel tube extends above the water surface into the air. division's operating results as income from discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. in 1997, net of taxes.) For the quarter ended March 31, 1998, Figgie's 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 to $64.9 million, versus $62.7 million in the first quarter of 1997. The company reported net income of $0.6 million, or $0.03 per share on a 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. basis, for the first quarter of 1998, compared with net income of $4.5 million, or $0.24 per share on a diluted basis, reported in 1997's first quarter. The company's 1998 first quarter results include a pretax pre·tax adj. Existing before tax deductions: pretax income. pretax adj [profit] → vor (Abzug der) Steuern charge of $2.3 million associated with the previously announced restructuring of its IEC (International Electrotechnical Commission, Geneva, Switzerland, www.iec.ch) An organization that sets international electrical and electronics standards founded in 1906. It is made up of national committees from over 60 countries. IEC - International Electrotechnical Commission subsidiary. Excluding this charge, the company had pretax income pretax income Reported income before the deduction of income taxes. Pretax income is sometimes considered a better measure of a firm's performance than aftertax income because taxes in one period may be influenced by activities in earlier periods. from continuing operations of $3.4 million in the first quarter of 1998, compared to $1.7 million in the prior year. Gross profit during the first quarter of 1998 was $18.1 million, compared with $19.5 million in the first quarter of 1997. 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. in the first quarter was $7.0 million, versus $6.9 million a year ago. "We are generally pleased with the performance of our operations in the first quarter," said Glen W. Lindemann Lindemann is a surname, and may refer to:
n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. projections, our consolidated forecast for 1998 remains unchanged." Scott Aviation Posts Record First Quarter Results The Scott Aviation division achieved record first quarter results in 1998 with sales of $46.2 million and operating income of $10.1 million. This record-setting performance was achieved by strong results from its two business units. "The division's Aviation business continued to achieve strong sales to its OEM (Original Equipment Manufacturer) The rebranding of equipment and selling it. The term initially referred to the company that made the products (the "original" manufacturer), but eventually became widely used to refer to the organization that buys the products and and airline customers in the first quarter," said Lindemann. "Scott also enjoyed high demand from distributors for the aftermarket Aftermarket See: Secondary market. aftermarket See secondary market. , as well as increased sales of its emergency escape breathing devices (EEBD EEBD Emergency Escape Breathing Device ) to foreign governments. "Demand for Scott's
Scott's can refer to several companies;
A self contained breathing apparatus, or SCBA, sometimes referred to as a Compressed Air Breaching Apparatus (CABA) or simply Breathing Apparatus (BA) technology from its government and municipal customers was the primary catalyst of the growth in its Health & Safety business," Lindemann added. According to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. Lindemann, Scott also benefited from two additional factors in the first quarter of 1998. "First, a multi-year contract with the U.S. Navy for EEBD was completed during the first quarter," he said. "Second, Scott increased its production schedule in the first quarter to meet accelerated customer delivery requirements The stipulation that requires that an item of materiel must be delivered in the total quantity required by the date required. ." Lindemann noted that Scott Aviation's bookings for the quarter were $50.2 million, up 36 percent on a year-to-year comparison, and 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. was approximately $58 million. "We continue to project Scott's year-end revenues to be approximately $170 million," he said. "With improved operating efficiencies, however, we have increased our projection for Scott's year-end operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: to approximately 21 percent from the previously announced level of approximately 20 percent." IEC's Restructuring Well Underway, Bookings Up Approximately 53 Percent As expected, IEC's operating results were down in the first quarter of 1998 compared to 1997's first quarter. "This subsidiary's old cost structure was in place for most of the first quarter and had a negative impact on its results," said Lindemann. "As well, we took a subsequent restructuring charge primarily due to 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 costs." In late February February: see month. , the company announced that it was restructuring IEC's business in an effort to restore its profitability in 1998. IEC will now focus on only those high-growth, high-profit defense and commercial markets in which it has a compelling competitive advantage. "Dick Tierney Tierney is an Irish surname. It is an Anglicized form of Gaelic Ó Tiarnaigh (male), Ní Tiarnaigh (female), also Tighearnaigh/Tighearnach. It is pronounced "tee + er + nee". It originated in Co. , IEC's new president, has made steady progress with IEC since joining the subsidiary in early March," said Lindemann. "Dick and his management team have re-aligned the organization, refocused its sales efforts and improved its project management function." For the quarter, IEC's bookings were $28 million, up nearly 53 percent on a year-to-year comparison, and backlog was approximately $73 million. According to Lindemann, Tierney also conducted a thorough analysis of IEC's 1998 sales forecast Sales forecast A key input to a firm's financial planning process. External sales forecasts are based on historical experience, statistical analysis, and consideration of various macroeconomic factors. during the first quarter. "After reviewing Dick's findings, we now anticipate IEC's year-end revenue to be approximately $83 million," he said. "While we still expect IEC's operating margin will be near double-digit dou·ble-dig·it adj. Being between 10 and 99 percent: double-digit inflation. by year-end, it will be closer to 5 percent for the full year than the previously announced 7.5 percent." Lindemann also noted that negotiations with the Korean Korean, language of uncertain ancestry. It is thought by some scholars to be akin to Japanese, by others to be a member of the Altaic subfamily of the Ural-Altaic family of languages (see Uralic and Altaic languages), and by still others to be unrelated to any known government for its training range system have been terminated. "With the uncertain economic and financial conditions in the region, we were unable to find mutually acceptable terms," said Lindemann. Debt Buy Back Program To Gain Momentum As previously announced, the company's board of directors authorized au·thor·ize tr.v. au·thor·ized, au·thor·iz·ing, au·thor·iz·es 1. To grant authority or power to. 2. To give permission for; sanction: management to repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. its 9 7/8 bonds and buy back in the aggregate of not more than 1,000,000 shares of Class A and Class B common stock opportunistically on the open market over the course of the year. During the first quarter of 1998, the company repurchased approximately $3 million of its 9 7/8 bonds and did not repurchase any stock. "We plan to increase our debt buy back activity significantly in the remaining quarters of 1998," said Lindemann. "By doing so, we will be able to lower our interest rate expense and strengthen our balance sheet." The company has already repurchased approximately $36 million of these bonds in the second quarter. Lindemann noted that using cash for debt buy backs would not inhibit inhibit /in·hib·it/ (in-hib´it) to retard, arrest, or restrain. in·hib·it v. 1. To hold back; restrain. 2. the company's acquisition strategy. "We have a good relationship with our lenders," he continued. "We are confident that we will have access to funds as needed as needed prn. See prn order. when we find appropriately valued acquisition opportunities that meet our business and financial objectives." Figgie International Inc. manufactures high-performance Adj. 1. high-performance - modified to give superior performance; "a high-performance car" superior - of high or superior quality or performance; "superior wisdom derived from experience"; "superior math students" respiratory systems respiratory system: see respiration. respiratory system Organ system involved in respiration. In humans, the diaphragm and, to a lesser extent, the muscles between the ribs generate a pumping action, moving air in and out of the lungs through a and equipment for aviation, industrial, fire and government markets through its Scott Aviation division and designs and manufactures satellite-based guidance, navigation, instrumentation instrumentation, in music: see orchestra and orchestration. instrumentation In technology, the development and use of precise measuring, analysis, and control equipment. and communications systems In telecommunication, a communications system is a collection of individual communications networks, transmission systems, relay stations, tributary stations, and data terminal equipment (DTE) usually capable of interconnection and interoperation to form an integrated whole. for defense and commercial markets through its Interstate in·ter·state adj. Involving, existing between, or connecting two or more states. n. One of a system of highways extending between the major cities of the 48 contiguous United States. Noun 1. Electronics division. -0- Some statements contained in this news release are forward-looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. and involve a number of risks and uncertainties. Among factors that could cause actual results to differ materially are the following: the impact of competitive products and pricing; product development; military defense spending for GPS and strategic weapons systems; changes in product mix; new orders received and shipped during 1998; and other risks detailed in the company's Securities and Exchange Commission filings. -0-
Figgie International Inc.
Consolidated Financial Results (Unaudited)
(in thousands, except per share data)
Three Months Ended
March 31, March 31,
1998 1997
________ ________
Net Sales $ 64,861 $ 62,651
Cost of Sales 46,711 43,187
________ ________
Gross Profit on Sales 18,150 19,464
________ ________
% of Sales 28.0% 31.1%
Operating Expenses:
Selling, General and Administrative 9,125 9,742
Research & Development 1,986 2,825
________ ________
Total Operating Expenses 11,111 12,567
________ ________
Operating Profit 7,039 6,897
________ ________
% of Sales 10.9% 11.0%
Other Expense (Income):
Restructuring and Refinancing Costs 2,491 131
Interest Expense 4,297 5,453
Interest Income (1,441) (1,115)
Other, Net 531 724
________ ________
Income before Income Taxes 1,161 1,704
Income Tax 462 587
________ ________
Income from Continuing Operations 699 1,117
Discontinued Operations, net of tax
Income from Operations - 3,400
Extraordinary (Loss) on Extinguishment
of Debt (80) -
________ ________
Net Income (Loss) $ 619 $ 4,517
________ ________
________ ________
Weighted Average Shares - Basic 18,479 18,385
Weighted Average Shares - Diluted 18,699 18,594
Per Share Data - Basic EPS:
__________________________
Income from Continuing Operations $ 0.04 $ 0.06
Income from Discontinued Operations - 0.18
(Loss) on Early Extinguishment of Debt (0.01) -
________ ________
Net Income $ 0.03 $ 0.24
________ ________
________ ________
Per Share Data - Assuming Dilution:
__________________________________
Income from Continuing Operations $ 0.04 $ 0.06
Income from Discontinued Operations - 0.18
(Loss) on Early Extinguishment of Debt (0.01) -
________ ________
Net Income $ 0.03 $ 0.24
________ ________
________ ________
Figgie International Inc.
Segment Operating Results (Unaudited)
(in thousands)
Three Months Ended Three Months Ended
March 31, 1998 March 31, 1997
SCOTT AVIATION ______________ ______________
Net Sales $ 46,214 $ 39,958
Cost of Sales 31,311 27,173
________ ________
Gross Profit on Sales 14,903 12,785
% of Sales 32.2% 32.0%
Operating Expenses:
Selling, General and Administration 3,904 3,644
Research and Development 891 1,178
________ ________
Total Operating Expenses 4,795 4,822
________ ________
Operating Income $ 10,108 $ 7,963
________ ________
% of Sales 21.9% 19.9%
Bookings $ 50,243 $ 36,822
INTERSTATE ELECTRONICS
Net Sales $ 18,647 $ 22,693
Cost of Sales 15,400 16,014
________ ________
Gross Profit on Sales 3,247 6,679
% of Sales 17.4% 29.4%
Operating Expenses:
Selling, General and Administration 2,975 3,303
Research and Development 1,095 1,647
________ ________
Total Operating Expenses 4,070 4,950
________ ________
Operating Income (Loss) $ (823) $ 1,729
________ ________
% of Sales (4.4)% 7.6%
Bookings $ 28,081 $ 18,391
CORPORATE EXPENSES
Selling, General and Administrative $ 2,246 $ 2,795
Restructuring and Refinancing Costs $ 2,491 $ 131
Figgie International Inc.
Consolidated Balance Sheets
(in thousands)
March 31, December 31,
1998 1997
____________ ____________
ASSETS (Unaudited)
CURRENT ASSETS
Cash and Cash Equivalents $ 104,259 $ 104,243
Trade Accounts Receivable, net 41,958 35,862
Inventories 31,331 30,049
Prepaid Expenses 1,375 885
Recoverable Income Taxes - 4,120
Current Deferred Tax Asset 8,200 6,400
_________ _________
Total Current Assets 187,123 181,559
_________ _________
PROPERTY, PLANT AND EQUIPMENT
Land and Land Improvements 42,760 43,732
Buildings and Leasehold Improvements 24,574 24,103
Machinery and Equipment 28,870 28,793
_________ _________
96,204 96,628
Accumulated Depreciation (30,581) (29,275)
_________ _________
Net Property, Plant and
Equipment 65,623 67,353
_________ _________
OTHER ASSETS
Deferred Divestiture Proceeds and
Other, Net 28,616 29,324
Prepaid Pension Costs 12,723 12,723
Intangible Assets 1,931 1,953
Cash Surrender Value of Insurance
Policies 3,526 3,596
Prepaid Finance Costs 930 1,106
Deferred Tax Asset 41 889 44,060
Other 1,818 1,589
_________ _________
Total Other Assets 91,433 94,351
_________ _________
Total Assets $ 344,179 $ 343,263
_________ _________
_________ _________
Figgie International Inc.
Consolidated Balance Sheets
(in thousands)
March 31, December 31,
1998 1997
____________ ____________
LIABILITIES (Unaudited)
CURRENT LIABILITIES
Accounts Payable $ 18,676 $ 19,515
Accrued Insurance Reserves 13,197 12,033
Accrued Compensation 6,476 6,430
Accrued Interest 7,840 3,895
Accrued Environmental Reserve 2,991 3,217
Accrued Liabilities and Expenses 9,938 9,329
Current Maturities of Long-Term Debt 489 639
_________ _________
Total Current Liabilities 59,607 55,058
_________ _________
Long-Term Debt 158,315 161,395
Non-Current Insurance Reserves 29,773 31,410
Other Non-Current Liabilities 23,782 23,804
_________ _________
Total Liabilities 271,477 271,667
_________ _________
STOCKHOLDER'S EQUITY
Preferred Stock - -
Class A Common Stock 1,378 1,373
Class B Common Stock 470 471
Capital Surplus 110,349 109,871
Accumulated Deficit (39,399) (40,018)
Unearned Compensation (14) (24)
Cumulative Translation (82) (77)
_________ _________
Total Stockholders' Equity 72,702 71,596
_________ _________
Total Liabilities and Stockholders'
Equity $ 344,179 $ 343,263
_________ _________
_________ _________
CONTACT: Figgie International Inc. Bill Sickman/Rob Berick, 440/684-3415/3416 |
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