The Eastern Company Reports Results for the First Quarter of 2006.NAUGATUCK, Conn. -- The Eastern Company (AMEX AMEX See: American Stock Exchange :EML EML - Extended ML. A language for formally specifying SML programs. ["Formal Program Development in Extended ML for the Working Programmer", D. Sannella, Proc 3rd BCS/FACS Workshop on Refinement", Springer 1990]. ) today announced the results of its operations for the first quarter of 2006. Sales for the quarter were $27.9 million, compared to $26.3 million for the same period in 2005, a 6% increase, while net income was $1.1 million, or $0.30 per 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. share, compared to the $730,600, or $0.19 per diluted share, reported in the first quarter of 2005, a 57% increase. The increase in Company earnings, compared to the first quarter of 2005 reflected the positive impact of the initiative undertaken a year ago at our Metal Casting Metal casting A metal-forming process whereby molten metal is poured into a cavity or mold and, when cooled, solidifies and takes on the characteristic shape of the mold. facility which was to increase our focus and capability toward producing ductile iron Ductile iron, also called ductile cast iron or nodular cast iron, is a type of cast iron invented in 1943 by Keith Millis[1]. While most varieties of cast iron are brittle, ductile iron is much more ductile, as the name implies. products in addition to our malleable iron (Metal.) iron sufficiently pure or soft to be capable of extension under the hammer; also, specif., a kind of iron produced by removing a portion of the carbon or other impurities from cast iron, rendering it less brittle, and to some extent malleable. products. Leonard F. Leganza, President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. stated, "The sales increase of 6% in the first quarter was the fourteenth consecutive quarter of improved year-to-year sales and we anticipate further increased sales results as the year progresses. Of particular note, sales in the Metal Products group improved 5% compared to the prior year quarter. The improvement included increased sales of our proprietary mine roof support anchors as well as significantly greater sales of our ductile iron products. The combination of a stronger coal mining market and new ductile ductile /duc·tile/ (duk´til) susceptible of being drawn out without breaking. duc·tile adj. Easily molded or shaped. ductile susceptible of being drawn out without breaking. business are driving sales in a positive direction. " Mr. Leganza continued, "Another of our long-term objectives was focused on the operations of our recently established subsidiary in Shanghai, China. During the past two years our earnings have experienced the impact resulting from incurring the start up costs and expenses of training employees and establishing the equipment and infrastructure necessary to meet our production plans. During the first quarter of 2006 this operation has reached the sales and production levels necessary toward becoming a profitable operating unit operating unit A type of operating company that engages in transactions with outsiders and that is owned by another business. For example, in 1995 the stockholders of Capital Cities/ABC approved a $19 billion merger with the Walt Disney Company, whereupon . We are pleased with the progress made in the subsidiary's manufacturing capabilities and are certain it will be providing us new opportunities for Eastern's products in the Asian and European markets in addition to supplying our domestic operations with some of their requirements." Mr. Leganza commented further, "In 2006 the Company will continue to face the necessity of overcoming some of the challenges of our global economy. The rapid increase in energy, health care and raw material costs will have to be overcome by continuous productivity improvements and pricing policies in order to maintain healthy profit margins. Notwithstanding these challenges, considering the present status of our backlogs and current economic forecasts, all of our business units are on track for positive results in 2006." The Eastern Company is a 148-year-old manufacturer of industrial hardware, security products and metal castings. It operates from nine locations in the U.S., Canada, Mexico, Taiwan and China. The diversity of the Company's products helps it to respond to the changing requirements of a broad array of markets. 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. : Information in this news release contains statements which reflect the Company's current expectations regarding its future operating performance and achievements. Actual results may differ due to the many economic uncertainties that affect the Company's business environment. Further information about the potential factors which could affect the Company's financial results are included in the Company's reports and filings with the Securities and Exchange Commission. The Company is not obligated ob·li·gate tr.v. ob·li·gat·ed, ob·li·gat·ing, ob·li·gates 1. To bind, compel, or constrain by a social, legal, or moral tie. See Synonyms at force. 2. To cause to be grateful or indebted; oblige. to update or revise the aforementioned a·fore·men·tioned adj. Mentioned previously. n. The one or ones mentioned previously. aforementioned Adjective mentioned before Adj. 1. statements for those new developments.
Statement of Consolidated Income
THE EASTERN COMPANY (AMEX - EML)
THREE Months Ended
13 wks 13 wks
April 1, 2006 April 2, 2005
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Net Sales $27,860,183 $26,267,584
Net Income After Tax 1,143,765 730,582
Net Income Per Share:
Basic $0.31 $0.20
Diluted $0.30 $0.19
Weighted average shares outstandings:
Basic 3,643,127 3,634,991
Diluted 3,859,376 3,867,413
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