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CLARK REPORTS INCREASED EARNINGS FOR SECOND QUARTER

 SOUTH BEND, Ind., July 26 /PRNewswire/ -- Clark Equipment Co. (NYSE: CKL) reported net income of $10.8 million, or $0.62 per share, on sales of $233.4 million in second quarter 1993. This compares to a net loss of $4.4 million, or $0.25 per share, on sales of $212.3 million in second quarter 1992. Quarterly results were announced by Leo J. McKernan, Clark chairman, president and chief executive officer. All figures exclude the impact of discontinued lift truck operations.
 In making the announcement, McKernan said, "VME Group N.V., Clark's 50 percent-owned construction machinery joint venture, returned to profitability in second quarter 1993, after nine consecutive quarters of losses. Clark's share of VME net income for the period was $0.9 million. This represents nearly a $10 million year-to-year performance improvement." Clark's share of the VME loss was $8.8 million in second quarter 1992.
 Clark consolidated operations, which include Melroe Co., Clark-Hurth Components and Clark Automotive (Brazil), generated net income of $9.9 million on sales of $233.4 million in the second quarter. These results compare to Clark consolidated net income of $4.4 million on sales of $212.6 million in second quarter 1992. Operating profits and margins improved for each Clark consolidated business unit compared to the prior-year period.
 Clark new orders increased to $242 million from $221 million in first quarter 1993 and $205 million in second quarter 1992. Backlog on June 30, 1993, was $153 million, up slightly from first quarter 1993, but below the same period in 1992.
 In discussing the performance of individual business units, McKernan said, "Operating results at Clark-Hurth improved due to tight expense control and ongoing cost reduction, even though markets for most major Clark-Hurth off-highway customers remained weak. Quarterly worldwide component sales declined more than 10 percent from the prior-year period." Noting that product shipments in North America were stable during the period, McKernan said, "While some construction machinery sectors improved somewhat over last year, other major areas, such as cranes and underground mining equipment, remained depressed. In discussing Clark-Hurth performance in Europe, he said, "The general recession was evident across all major construction machinery market segments and product lines.
 "Clark Automotive increased sales, orders and earnings during the second quarter, improving on the progress made in the first quarter," said McKernan. "Despite general economic uncertainty in Brazil, production at major automotive customers exceeded 1992 levels. The light truck market performed especially well during the period, while heavy and medium-duty trucks also showed some improvement," he said, noting that sales of agricultural tractor transmissions and off-highway axles showed only slight gains in comparison to 1992.
 Driven by excellent sales in North America, Melroe orders and shipments increased substantially during second quarter 1993 versus the prior-year period, according to McKernan. "The skid-steer loader market in North America has been especially strong, with year-to-date industry retail sales up more than 20 percent compared to the first six months of 1992," he said, adding that this strength was evident in all North American geographic areas. "Excavator sales in North America also improved, particularly in the construction and rental markets. In Europe, however, skid-steer loaders sales declined somewhat from record 1992 levels, while excavator sales showed a small increase," he said.
 "VME's second quarter profitability is especially impressive since second quarter 1993 sales declined slightly to $330.5 million from prior-year levels," said McKernan. He attributed the profit improvement to declining expenses resulting from VME's recently completed restructuring and benefits from the devaluation of the Swedish Krona. "Trends in worldwide construction machinery markets did not change significantly during the quarter. A recovery appears to be emerging in North America after two years of softness. However, no signs of recovery are evident in depressed European markets," he said.
 During second quarter 1993, Clark issued $90.2 million of medium- term notes. These include $50 million of 30-year notes at rates of approximately 8.35 percent. Funds from the notes were used to redeem the company's 9.625 percent Sinking Fund Debentures and to reduce outstanding bank debt.
 Looking ahead, McKernan said, "Clark expects continued improvement in operating performance compared to 1992. However, given the seasonal nature of Clark businesses and weak European markets, it is unlikely that third or fourth quarter earnings will exceed second quarter 1993 results. The lack of improvement in European markets is likely to prevent any substantial performance improvement at VME or Clark-Hurth Components. Even though demand at Melroe typically declines in the third quarter, Melroe is expected to continue generating strong earnings."
 In conclusion, McKernan said, "Overall, second quarter results document our progress in reducing our break-even point. Clark remains committed to its goal of remaining profitable in economic downturns and will continue to reduce product cost, while retaining market position and the ability to take full advantage of recovering markets."
 Clark Equipment Co.'s business is the design, manufacture and sale of skid-steer loaders, construction machinery, transmission for on- highway vehicles, and axles and transmissions for off-highway equipment.
 -0- 7/26/93
 /CONTACT: Joe Fimbianti of Clark Equipment Co., 219-239-0100/
 /FIRST AND FINAL ADD -- TABULAR MATERIAL TO FOLLOW/
 (CKL)


CO: Clark Equipment Co. ST: Illinois IN: SU: ERN

SH -- NY087 -- 5814 07/26/93 15:26 EDT
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Publication:PR Newswire
Date:Jul 26, 1993
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