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NATIONAL GYPSUM COMPANY ANNOUNCES FOURTH QUARTER AND YEAR-END RESULTS FOR 1991

 NATIONAL GYPSUM COMPANY ANNOUNCES FOURTH QUARTER
 AND YEAR-END RESULTS FOR 1991
 DALLAS, March 16 /PRNewswire/ -- National Gypsum Company today announced financial results for the three and twelve months ending December 31, 1991.
 For the fourth quarter, net revenues were $280.3 million, compared with $341.0 million for the same quarter last year. The company experienced a $13.1 million operating loss for the quarter, compared with a $462.9 million operating loss in the same period last year. A net loss of $68.9 million was realized during the fourth quarter of 1991, compared with a net loss of $469.7 million for the same three months in 1990. This year's fourth quarter results included $95.4 million in pre-tax bankruptcy expenses which contained a $90 million non-cash provision to increase the Company's estimate of the net liability subject to compromise for asbestos-related claims. Last year's fourth quarter included a $450.1 million pre-tax write-off of goodwill and other intangibles, in response primarily to continued deterioration in the gypsum wallboard industry, and $14.1 million in pre-tax bankruptcy expenses. Net cash provided by operating activities was $12.5 million, compared with net cash used of $3.0 million in last year's fourth quarter.
 For the twelve months, net revenues were $1.1 billion, compared with $1.3 billion for 1990. An operating loss of $23.4 million was incurred for the year, compared with an operating loss of $457.1 million in 1990. A net loss of $95.8 million was realized during 1991, compared with a net loss of $522.9 million in 1990. This year's results included pre-tax bankruptcy expenses of $129.8 million. Results for 1990 included the $450.1 million pre-tax write-off, pre-tax bankruptcy expenses of $14.1 million and an after-tax extraordinary gain of $6.9 million from open-market purchases during the first quarter of 1990. Net cash provided by operating activities during 1991 was $68.2 million, including $18.0 million in net income taxes received, compared with $25.9 million in net cash provided for 1990.
 Peter C. Browning, chairman and chief executive officer, said the decline in net revenues and the operating loss during 1991, compared with 1990, were the result primarily of a 7 percent decrease in average wallboard prices, a 12 percent decline in wallboard sales volume and a 7 percent decrease in billings for The Austin Company. He said that the reduction in net loss for 1991, compared with 1990, reflects the $450.1 million write-off in 1990 and a $106.1 million decrease in interest expense during 1991 resulting from protection under Chapter 11. Browning stated that the decrease in interest expense for 1991 was offset by $129.8 million in mostly non-cash bankruptcy expenses. He also said that the increase in net cash provided by operating activities during 1991 was the result primarily of a $45.8 million reduction in interest paid and an increase of $8.7 million in income tax refunds.
 "Despite operating in an industry environment characterized by over 35 percent overcapacity and resulting average wallboard prices at their lowest level in 13 years, the Company's Gold Bond Building Products division has made important strides toward achieving its operating objective of becoming the absolute lowest-cost producer and the preferred supplier," Browning said.
 "For example, we have reduced Gold Bond's salaried population by 21 percent; reduced hourly population by about 15 percent; reduced the number of sales offices from 31 to 15; and reduced officer positions by 20 percent. As a partial result of these actions, National Gypsum's SG&A expenses for 1991 were reduced by approximately 14 percent.
 "In addition, we have completed an average of 15 1/2 hours of quality training for each employee in the gypsum wallboard division, with the following initial results: reduced cost of customer claims, improved wallboard plant productivity, improved machine utilization rate and improved good product percentage. We have also introduced a number of new products and services, including a highly successful 1-800 technical service program for architects and contractors. Continuing improvement in these and other areas is necessary if we are to succeed in implementing our operating strategy throughout the 1990's because even though housing starts have recently increased over record lows, overcapacity in the wallboard industry is expected to continue to affect pricing," Browning concluded.
 NATIONAL GYPSUM COMPANY
 CONSOLIDATED STATEMENTS OF OPERATIONS
 FOR THE FOURTH QUARTERS AND TWELVE MONTHS OF 1991 AND 1990
 Three months ended Dec. 31 1991 1990
 (in thousands)
 Net revenues $ 280,311 $ 341,008
 Cost of products and
 services sold 253,066 306,405
 Selling, general and
 administrative expense 24,978 31,174
 Depreciation, depletion and
 amortization 15,349 466,287(b)
 Operating loss (13,082) (462,858)
 Interest expense (contractual
 interest for 1991 -- $37,277;
 1990 -- $34,045) 1,455 11,112
 Other income (expense) - net 3,792 (3,748)
 Bankruptcy expenses 95,367(a) 14,142(a)
 Income tax benefit 37,165 22,138
 Net loss (68,947) (469,722)
 Net cash provided (used) by
 operating activities 12,482 (3,025)
 12 Months ended Dec. 31 1991 1990
 (in thousands)
 Net revenues $1,136,283 $1,332,839
 Cost of products and
 services sold 1,014,337 1,168,817
 Selling, general and
 administrative expense 94,204 109,009
 Depreciation, depletion and
 amortization 51,099 512,079(b)
 Operating income (loss) (23,357) (457,066)
 Interest expense (contractual
 interest for 1991 -- $144,986;
 1990 -- $133,593) 4,521 110,660
 Other income (expense) - net 8,794 (620)
 Bankruptcy expenses 129,766(a) 14,142(a)
 Income tax benefit 53,068 52,612
 Loss before extraordinary item (95,782) (529,876)
 Extraordinary gain --- 6,935
 Net loss (95,782) (522,941)
 Net cash provided by operating
 activities 68,178 25,854
 Note:
 (a) Bankruptcy expenses include bankruptcy-related professional fees, the provision for allowed claims (1991 only), the provision for rejected executory contracts and other items. The bar date for filing claims not related to asbestos or certain environmental matters was March 18, 1991. The company is still evaluating these claims for the purpose of estimating amounts expected to be allowed for consideration in the Plan of Reorganization. During the fourth quarter of 1991, the Company recorded a provision for allowed claims of $90 million to increase its estimate of the net liability subject to compromise for all asbestos-related claims to approximately $106 million as of Dec. 31, 1991.
 (b) Includes a $450.1 million write-off of goodwill and other intangibles.
 -0- 3/16/92
 /CONTACT J. Michal Conaway, Vice President and Chief Financial Officer, National Gypsum Company, 214-969-3422/ CO: National Gypsum Company ST: Texas, North Carolina IN: CST SU: ERN


CM-AT -- CH002 -- 8108 03/16/92 08:27 EST
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