Prudential Steel Ltd. Announces Record Second Quarter Shipments and Revenue.Business Editors CALGARY Calgary (kăl`gərē), city (1991 pop. 710,677), S Alta., Canada, at the confluence of the Bow and Elbow rivers. The largest city in Alberta and the fastest-growing major city in Canada, Calgary is a corporate, transportation, and financial , Alberta--(BUSINESS WIRE)--July 25, 2000 Prudential Prudential is the name of two different companies and buildings named after them: Companies:
TSE 1. See Tokyo Stock Exchange (TSE). 2. See Toronto Stock Exchange (TSE). :PTS PTS put to sleep; a common euphemism for euthanasia, but also used to describe general anesthesia. .)
SUMMARY:
Three Months Ended June 30 Six Months Ended June 30
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2000 1999 2000 1999
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Earnings
Per Share $ 0.23 (0.03) $ 0.49 0.01
Shipments,
metric tonnes 81,158 31,274 183,851 71,779
Per Tonne 2000 1999 2000 1999
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Sales $ 962 894 $ 943 961
Cost of Sales 765 787 758 832
Gross Profit 197 107 185 129
Prudential Steel Ltd., one of North America's premier manufacturers of energy and industrial tubular tubular /tu·bu·lar/ (too´bu-lar) 1. shaped like a tube. 2. of or pertaining to a tubule. tubular 1. pertaining to renal tubules. 2. pertaining to fallopian tube. products, today announced its second quarter financial results for the period ended June June: see month. 30, 2000. New records were set for second quarter shipments and sales revenue, which surpassed the Company's previous second quarter record set in 1997. The Company recorded net income of $7 million, or $0.23 per share for the quarter, compared to a loss of $1.1 million or $0.03 per share recorded in the same quarter last year. For the first six months of 2000, the Company recorded net income of $14.8 million or $0.49 per share, a substantial improvement over net income of $0.3 million or $0.01 per share recorded for the first six months of 1999. Higher drilling activity, strong oil and gas prices and pipeline projects in 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 were major factors contributing to record second quarter shipments and revenue. There were 3.9 million meters drilled in western Canada
Western Canada, commonly referred to as the West during the second quarter, a 69 percent increase over the same period in 1999 when 2.3 million meters were drilled. Prudential's sales were $78 million and $173 million for the quarter and six months respectively, compared to sales of $28 million and $69 million recorded for the same time periods in 1999. Total shipments for the quarter increased 160 percent to 81,158 metric tonnes. Shipments for the six months increased 156 percent to 183,851 metric tonnes. Energy related tubulars accounted for approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 75 percent of shipments this quarter, with OCTG OCTG Oil Country Tubular Goods shipments up 123 percent and line pipe shipments up over 300 percent compared to 1999's second quarter results. Growth in the Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. and U.S. industrial and commercial construction sectors together with a positive economic climate saw shipments of industrial products increase to 11 percent of total shipments this quarter, nearly a 20 percent increase over industrial product shipments for second quarter 1999, largely the result of growth in Longview's shipment volume over the past year. Average selling prices The average sales price of goods or commodities. Especially used in the retail sector and technology distribution. per tonne tonne measure of weight or mass; 1 tonne=1000 kg. See also ton. of Prudential's energy related products remained virtually unchanged from the first quarter 2000. Although the price increases of industrial products observed early in the second quarter were rolled back late in the quarter, average selling prices of industrial products rose eight percent over first quarter 2000. Overall, the average selling price for the second quarter increased approximately four percent over the first quarter 2000 due largely to product mix. The average cost of sales per tonne increased approximately two percent to $765 in second quarter 2000 from $752 in first quarter 2000. This increase is due to increased raw material costs partially offset by lower conversion costs. Average gross margin per tonne showed a strong improvement with second quarter results of $197, an 84 percent increase over $107 recorded in the second quarter 1999, and nearly 12 percent better than the average gross margin of $176 per tonne recorded in the first quarter of 2000. Although raw material costs increased, Prudential's average gross margin also increased largely due to improved pricing, product mix and lower conversion costs. Capital expenditures totaled $7.9 million for the six months of 2000 with most of the spending associated with the new coil slitter slitter see teat slitter. in Longview Longview. 1 City (1990 pop. 70,311), seat of Gregg co., E Tex.; inc. 1872. It is a manufacturing, business, and distribution center for the rich East Texas oil field. and new premium threader thread n. 1. a. Fine cord of a fibrous material, such as cotton or flax, made of two or more filaments twisted together and used in needlework and the weaving of cloth. b. A piece of such cord. 2. in Calgary. The coil slitter allows greater flexibility in buying steel and provides cost efficiencies for the Company. The premium threader allows Prudential greater participation in the energy sector offering products for use in specific applications where high tension and compression compression, external stress applied to an object or substance, tending to cause a decrease in volume (see pressure). Gases can be compressed easily, solids and liquids to a very small degree if at all. exist such as thermal and long-reach horizontal conditions found in heavy oil, high-pressure high-pres·sure adj. 1. Of or relating to pressures higher than normal, especially higher than atmospheric pressure. 2. Informal a. gas and sour wells. Both operational improvements will better enable Prudential to meet the growing demands of its customers while providing superior quality and service. Capital expenditures are estimated at $11 million for 2000. LONGVIEW UPDATE Longview incurred a loss of $0.40 million in the second quarter 2000, an improvement from a loss of $0.96 million incurred in the first quarter 2000 before the removal of intercompany transactions Intercompany transaction Transaction carried out between two units of the same corporation. . Demand for energy related products remained strong due to continued improvements in drilling in the U.S. and prices continued to improve. However, industrial products showed weakness in both demand and pricing due to service center inventory reductions and strong pressure from imports. Longview is operating at two shifts per day, five days per week. The construction of the new slitter for coils was completed on time and within the planned budget in late June and startup (STARTing UP) "At startup" means when the computer is first turned on or when a program is first loaded. See Startup folder. began in early July July: see month. . Production throughputs will increase during the third quarter of the year. OUTLOOK Despite OPEC's efforts to lower the crude oil price by increasing output, the six-month average WTI WTI West Texas Intermediate WTI Western Transportation Institute (Montana State University) WTI World Tribunal on Iraq WTI With The Idea (used in chess to point to the idea behind a specific move) crude oil price of US$29 persists because demand expectations for oil are still exceeding supply. This bodes well for western Canadian drilling with most industry forecasts being at the higher end Coordinates: For other places with the same name, see Billinge. Higher End or Billinge Higher End is a district of the Metropolitan Borough of Wigan, in Greater Manchester, England. of 14,500 to 17,000 wells drilled for 2000. This level of drilling represents approximately a 57 percent increase over 1999 and is comparable to the volumes seen in 1997 of 16,400 wells. Comparatively, in the U.S., drilling activity for 2000 is expected to increase approximately 30 percent over 1999. Average rig count has increased to 808 rigs to June 30, 2000 compared to 626 rigs in all of 1999 and 945 rigs for all of 1997. Industry forecasts show that there will be 23,000 wells drilled in 2000 compared to 18,500 wells in 1999 and 29,500 wells in 1997. Gas prices, which are double what they were in 1999, have sustained strong interest in natural gas drilling. The Alliance Pipeline, scheduled for service in October October: see month. 2000, will ensure continuing momentum in natural gas drilling and gathering lines throughout the second half of 2000 and into 2001. With strong activity levels on both sides of the border, Prudential is looking forward to a strong second half in 2000. MAVERICK Maverick family name of two brothers, Bret and Bait; self-centered and untrustworthy gentlemen gamblers. [TV: Terrace, II, 80] See : Gambling TUBE UPDATE The Company's pending combination with Maverick Tube Corporation is moving forward on schedule. Information concerning details of the pending transaction is expected to be mailed to shareholders in August. Note: Prudential Steel Ltd. will be holding a joint conference call with Maverick Tube Corporation to discuss both companies' earnings releases on Wednesday Wednesday: see week. , July 26 at 9:30 a.m. EST EST electroshock therapy. EST abbr. electroshock therapy (7:30 a.m. MST See micro systems technology. ). You may listen to the call by dialing 888-569-5033 (identification code #859030).
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
($ in thousands) As At
As At June 30 December 31
Prepared without audit 2000 1999 1999
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ASSETS
Current
Cash and cash
equivalents --- 4,922 ---
Accounts receivable 48,879 21,807 50,936
Inventory 110,972 61,948 75,271
Prepaid expenses 1,088 2,046 845
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Total current assets 160,939 90,723 127,052
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LIABILITIES
Current
Bank loans 45,360 8,532 14,529
Accounts payable and
accrued liabilities 31,252 15,063 42,259
Income taxes payable 6,069 --- ---
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Total current liabilities 82,681 23,595 56,788
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Working capital 78,258 67,128 70,264
Capital assets 62,939 59,136 58,551
Deferred pension expense 247 825 514
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Capital employed 141,444 127,089 129,329
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Deduct
Post employment
benefits payable 770 500 691
Future income taxes 1,371 1,029 1,548
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Shareholders' equity 139,303 125,560 127,090
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Represented by -
Share capital 42,416 41,953 41,966
Retained earnings 96,887 83,607 85,124
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139,303 125,560 127,090
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On behalf of the Board: J. Donald Wilson Donald (or Don) Wilson might refer to:
American basketball player. As a guard for the Cincinnati Royals, he became in 1962 the only player in National Basketball Association history to average in double figures in scoring, rebounding, and assists. President and Chief Executive Officer Chairman of the Board
CONSOLIDATED STATEMENTS OF INCOME AND RETAINED EARNINGS
($ in thousands, except per share amounts)
Three Months Six Months
Ended June 30 Ended June 30
Prepared without audit 2000 1999 2000 1999
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Sales 78,062 27,965 173,359 68,943
Cost of sales 62,079 24,617 139,297 59,695
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Gross profit 15,983 3,348 34,062 9,248
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Expenses
Selling, general and
administration 3,018 2,566 6,020 5,352
Interest expense
(income), net 386 (32) 559 (69)
Depreciation 1,800 1,632 3,536 2,582
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5,204 4,166 10,115 7,865
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Income before
income taxes 10,779 (818) 23,947 1,383
Income tax expense 3,814 260 9,157 1,110
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Net income for
the period 6,965 (1,078) 14,790 273
Retained earnings,
beginning of period 91,437 86,197 85,124 86,358
Dividends (1,515) (1,512) (3,027) (3,024)
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Retained earnings,
end of period 96,887 83,607 96,887 83,607
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Earnings per share
-Basic 0.23 (0.03) 0.49 0.01
-Fully diluted 0.22 (0.03) 0.47 0.01
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Shipments,
Metric Tonnes 81,158 31,274 183,851 71,779
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CONSOLIDATED STATEMENTS OF CASH FLOWS
($ in thousands except per share amount)
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Three Months Six Months
Ended June 30 Ended June 30
Prepared without audit 2000 1999 2000 1999
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OPERATING ACTIVITIES
Net income (loss) for
the year 6,965 (1,078) 14,790 273
Add (deduct) items
not affecting cash
Depreciation 1,800 1,632 3,536 2,582
Future income taxes (896) (84) (177) (361)
Deferred pension
expense 131 93 267 187
Accrued post
employment benefits 39 11 79 18
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8,039 574 18,495 2,699
Net change in non-cash
working capital (39,026) (1,302) (38,825) 10,675
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Cash (used in)
provided by operating
activities (30,987) (728) (20,330) 13,374
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FINANCING ACTIVITIES
Bank loans 34,340 3,319 30,831 (855)
Dividends paid (1,515) (1,512) (3,027) (3,024)
Common shares issued 449 --- 449 ---
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Cash provided by
(used in) financing
activities 33,274 1,807 28,253 (3,879)
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INVESTING ACTIVITIES
Expenditures on
capital assets (5,943) (1,983) (7,923) (4,573)
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Cash used in
investing activities (5,943) (1,983) (7,923) (4,573)
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Net (decrease)
increase in cash (3,656) (904) --- 4,922
Cash position,
beginning of period 3,656 5,826 --- ---
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Cash position,
end of period --- 4,922 --- 4,922
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