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CLARK EQUIPMENT ANNOUNCES YEAR-END RESULTS

 SOUTH BEND, Ind., Jan. 28 /PRNewswire/ -- Clark Equipment Co. (NYSE: CKL) today announced net income of $66.0 million, or $3.81 per share, for 1992. This result included a one-time benefit of $92 million from an accounting change for deferred taxes and an $8.5 million gain from the sale of Clark's forklift truck division. The year's results compare to a 1991 net loss of $337.5 million, or $19.52 per share, which included establishment of a $245 million non-cash reserve for future retiree benefits, primarily health care. Sales for 1992 were $802.7 million, up 11.3 percent from $721.4 million in 1991. The results were announced by Leo McKernan, Clark chairman, president and chief executive officer.
 Commenting on the company's performance, McKernan said, "Overall, 1992 was a year of solid gains for Clark. Our continuing consolidated operations, which include Melroe, Clark-Hurth and Clark Automotive Products, earned profits of $20.2 million. This is a $49.6 million improvement from 1991, when these operations produced a loss of $29.4 million.
 "However, the improvement in our businesses was offset by Clark's share of the losses of VME, our 50-percent-owned joint venture." McKernan added that for the fourth quarter of 1992, continuing consolidated operations produced net income of $4.6 million, which was offset by a $7.4 million loss at VME.
 For the fourth quarter 1992, Clark Equipment Co. recorded a loss of $2.8 million, or $0.16 per share, on sales of $191.3 million. This compares to a loss of $32.7 million, or $1.89 per share, on sales of $175.7 million in the same 1991 period. Included in 1991 results are special reserves primarily related to work force reductions and plant consolidations. LIFO income in 1992 was $1.8 million compared to $2.1 million in fourth quarter 1991.
 Incoming orders were $150 million in the fourth quarter, compared to $201 million in third quarter 1992 and $165 million in fourth quarter 1991. The order backlog at Dec. 31, 1992, was $123 million, compared to $156 million at year-end 1991.
 Looking at the performance of individual business units, McKernan said: "The worldwide recession in the construction machinery industry slowed performance gains at Clark-Hurth. Even though sales declined slightly, operating earnings and margins improved." In addition, he reported that Clark-Hurth fourth quarter order rates declined due to softening world markets: "U.S. order trends were stable, reflecting weak demand and slowing customer inventory reductions. European orders declined due to the deteriorating German market. Very low demand prevailed in other major European markets."
 Regarding Brazil-based Clark Automotive Products, he said, "The business remained profitable in the fourth quarter, despite normal seasonal sales declines. Good performance in Brazil's domestic automotive and light-truck markets offset weak markets for heavy trucks and off-highway equipment. The new Brazilian government, formed in late 1992 by Itamar Franco, faces difficult economic challenges, including high inflation and fiscal deficits. However, the Franco government appears committed to opening Brazil's economy. This should slow inflation and be positive for business growth.
 "Melroe set a new record for annual sales," reported McKernan, adding that fourth quarter sales and earnings were both substantially above results in the 1991 period: "Domestic markets improved slightly over the third quarter, but European markets slowed after a robust third quarter." He added that market share gains in North America and Europe were aided by new products.
 Regarding the company's 50-percent-owned joint venture, McKernan said, "VME continued to suffer from the worldwide recession in construction machinery. It was particularly hard hit by the downturn in Europe, where VME is very strong and the recession is especially severe. Clark's share of VME's fourth quarter loss was $7.4 million, which represents a substantial improvement over VME performance in the first nine months of 1992. We believe the stringent cost-reduction programs implemented in the last two years will substantially improve VME's 1993 performance, even if market volumes remain at current depressed levels." McKernan also reported that Clark and Volvo each contributed $35 million in subordinated debt to VME in the fourth quarter.
 McKernan reported that "On balance, 1992 was a year of progress for Clark. Aggressive cost reduction programs implemented in 1991 enabled Clark's continuing consolidated operations to improve performance and earn a profit in every quarter of 1992, despite the ongoing worldwide recession. VME's fourth quarter improvement reflects initial benefits from the arduous restructuring of 1991 and 1992."
 In conclusion, he said, "Although we were cautiously optimistic about the North American market, we see no convincing evidence of a general economic recovery. Construction machinery markets remain weak in Europe, Brazil and North America. We expect the European markets to continue weakening in the first half of 1993. These conditions will slow earnings recovery at VME and Clark-Hurth." He added that Clark remains committed to cost-reduction efforts and believes that it can improve its operating performance in 1993, even if sales remain stagnant.
 Clark Equipment Company's business is the design, manufacture and sale of skid-steer loaders, construction machinery, transmissions for on-highway vehicles, and axles and transmissions for off-highway equipment.
 CLARK EQUIPMENT CO. AND CONSOLIDATED SUBSIDIARIES
 STATEMENT OF INCOME AND RETAINED EARNINGS
 (AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
 FOR THE PERIOD ENDED Dec. 31
 Fourth Quarter 12 Months
 1992 1991(a) 1992 1991(a)
 Net sales $191,270 $175,720 $ 802,716 $ 721,350
 OPERATING COSTS
 AND EXPENSES:
 Cost of goods sold 159,863 159,890 663,565 663,678
 Selling, general &
 adminis. expenses 26,492 24,991 99,821 103,171
 ------- -------- ------ --------
 $183,355 $184,881 $ 763,386 $ 736,849
 ------- -------- -------- ---------
 Operating income(loss) 7,915 (9,161) 39,330 (15,499)
 Other income (expense),
 net 4,068 5,269 16,885 10,597
 Interest expense (5,661) (6,450) (25,631) (25,583)
 ------- ------ ------- -------
 Pre-tax income (loss)
 from consolidated
 operations 6,322 (10,342) 30,584 (30,485)
 Provisions (credit)
 for income taxes 1,736 925 10,361 (1,060)
 ------ ------- ------- --------
 Income(loss) from con-
 solidated operations 4,586 (11,267) 20,223 (29,425)
 Equity in net loss of
 associated company (7,363) (9,963) (48,083) (23,129)
 -------- -------- --------- -------
 Loss from continuing
 operations (2,777) (21,230) (27,860) (52,554)
 DISCONTINUED OPERATIONS:
 Income (loss) from
 operations 0 (11,753) (6,701) (40,784)
 Gain on sale 0 -- 8,519 --
 ---- -------- ------ -------
 Income(loss) from dis-
 continued operations 0 (11,753) 1,818 (40,784)
 ----- ------- ------- --------
 Loss before extraordinary
 credit and effect of
 changes in accounting
 principle (2,777) (32,983) (26,042) (93,338)
 Income tax benefit from
 loss carryforward -- 326 -- 718
 Effect of accounting changes:
 Postretirement benefits -- -- -- (244,900)
 Income taxes -- -- 92,000 --
 ------- -------- -------- ---------
 Net Income (loss) (2,777) (32,657) 65,958 (337,520)
 Add: Income retained
 (accumulated deficit)
 at beginning of
 period 47,836 11,758 (20,899) 316,621
 Deduct: Excess cost of
 treasury shares issued
 over the cost of certain
 employee benefits 190 -- 190 --
 ------ ------- -------- -------
 Income retained at
 end of period $ 44,869 $(20,899) $ 44,869 $(20,899)
 INCOME (LOSS) PER SHARE:
 From continuing
 operations $(.16) $(1.23) $(1.60) $(3.04)
 From discontinued
 operations -- (.68) .10 (2.36)
 Extraord. credit - .02 - .04
 From effect of account-
 ing change - - 5.31 (14.16)
 ------ ------- ------- ---------
 Net income (loss) $(.16) $(1.89) $ 3.81 $(19.52)
 Avg no. of shares 17,349 17,309 17,334 17,293
 No. of shares outstand-
 ing at end of period 17,351 17,311 17,351 17,311
 (a) Restated to reflect the deconsolidation of the material handling business.
 CLARK EQUIPMENT CO. AND CONSOLIDATED SUBSIDIARIES
 CONDENSED BALANCE SHEET (Amounts in Thousands)
 Dec. 31, Dec. 31,
 1992 1991
 Assets
 Current Assets:
 Cash, equivalents and
 short-term investments $ 191,924 $ 183,296
 Accounts and notes receivable 66,151 116,769
 Accounts receivable from
 associated companies 1,046 2,731
 Refundable income taxes 0 7,400
 Inventories 100,817 184,023
 Investment in discontinued
 operations-remaining
 finance operations 9,648 9,111
 Prepaid income taxes-net 121,314 4,200
 Other current assets 5,198 12,880
 -------- --------
 TOTAL CURRENT ASSETS 396,125 520,410
 Investments and advances -
 associated companies 121,314 137,695
 Prepaid income taxes-net 101,831 --
 Property, plant and
 equipment - net 225,872 299,942
 Goodwill and acquired
 intangibles-net 81,653 119,469
 Other assets 31,896 42,434
 -------- -------
 TOTAL ASSETS $ 958,691 $1,119,950
 LIABILITIES AND STOCKHOLDER'S EQUITY
 Current Liabilities:
 Notes payable $ 23,821 $ 57,311
 Accounts payable and
 accrued liabilities 118,195 226,979
 Income taxes payable 3,320 4,295
 Accrued postretirement
 benefits-current 19,000 17,800
 Deferred income taxes-current 963 --
 Current installments on
 long-term debt 21,570 21,271
 -------- -------
 Total current liabilities 186,869 327,656
 Long-term borrowings 186,629 216,949
 Other non-current
 liabilities 90,508 106,336
 Accrued postretirement
 benefits 229,903 230,100
 Deferred income taxes 12,195 1,410
 -------- -------
 TOTAL LIABILITIES 706,104 882,451
 STOCKHOLDERS' EQUITY:
 Capital stock 323,164 322,950
 Retained earnings (accumulated
 deficit) 44,869 (20,899)
 Cumulative translation &
 other adjustment (28,843) 28,054
 Common stock held in
 treasury at cost (50,951) (52,049)
 LEVERAGED EMPLOYEE STOCK
 OWNERSHIP
 Plan shares (35,652) (40,557)
 -------- --------
 Total stockholders' equity 252,587 237,499
 -------- --------
 TOTAL LIABILITIES AND
 STOCKHOLDERS' EQUITY $ 958,691 $1,119,950
 Debt/Capitalization ratio 47.9 pct 55.4 pct
 Current year capital
 expenditures $ 37,284 48,602
 Current year depreciation
 charges $ 44,120 45,772
 -0- 1/28/93
 /CONTACT: Joseph Fimbianti of Clark Equipment, 219-239-0176/
 (CKL)


CO: Clark Equipment Company ST: Indiana IN: SU: ERN

KE -- DE018 -- 0372 01/28/93 14:56 EST
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Date:Jan 28, 1993
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