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COLTEC INDUSTRIES REPORTS FOURTH QUARTER AND 12-MONTH RESULTS

 NEW YORK, Jan. 13 /PRNewswire/ -- Coltec Industries Inc (NYSE: COT) today reported earnings per share from continuing operations before extraordinary item of 34 cents for the fourth quarter of 1992 compared with a loss of 16 cents in the 1991 fourth quarter. For the year ended Dec. 31, 1992, earnings per share from continuing operations before extraordinary item were $1.08 compared with a loss of 1 cent in 1991.
 Sales for the quarter ended Dec. 31, 1992, were $322.7 million compared with $318.5 million in the comparable quarter last year. Operating income for the 1992 fourth quarter was $65.1 million compared with $57.0 million in the 1991 fourth quarter. Operating income increased 14 percent over the 1991 fourth quarter and the company's operating margin improved to 20.2 percent in the 1992 fourth quarter from 17.9 percent in 1991.
 Sales for the year ended Dec. 31, 1992, were $1,290.1 million compared with $1,283.4 million last year. Operating income for 1992 was $240.6 million compared with $224.7 million in 1991. Operating income increased 7 percent over 1991, and the company's operating margin improved to 18.6 percent in 1992 from 17.5 percent in 1991.
 The company has entered into a letter of intent to sell its Central Moloney Transformer Division to Kuhlman Corporation. The pending sale will be accounted for as a disposal of a segment of a business. Accordingly, reported results have been restated to account for Central Moloney as a discontinued operation. This cash transaction, valued at a price approximating book value, is subject to the negotiation and execution of a definitive agreement and various approvals. The closing is scheduled to be completed in the first quarter of 1993.
 For the year ended Dec. 31, 1992, both sales and operating income in the aerospace/government segment declined 7 percent. In the automotive segment, operating income improved 44 percent on an 8 percent sales increase; and in the industrial segment, operating income increased 8 percent on a 4 percent increase in sales.
 In the aerospace/government segment, continued reductions in defense spending and the slowdown of certain commercial programs contributed to the sales decline and to a decline in incoming orders. As a result, the consolidated order backlog at the end of 1992 was 13 percent lower than the level at year-end 1991. The strong 1992 performance in the automotive segment was aided by increased new car and truck production and recovering aftermarket sales. Contributing to this improvement was initial production of the Chrysler LH car models.
 Earnings from continuing operations before extraordinary item for the 1992 fourth quarter, reflecting an effective income tax rate of 35 percent, were $23.8 million compared with a loss of $3.8 million in the 1991 fourth quarter. The 1991 fourth quarter included substantial interest expense that was reduced significantly by the recapitalization completed on April 1, 1992. Giving pro forma effect to the recapitalization as if it had occurred on Jan. 1, 1991, the company would have reported earnings from continuing operations before extraordinary item for the 1991 fourth quarter of $10.6 million, or 15 cents per share.
 In the 1992 fourth quarter, the company reported net earnings of $22.6 million which included $.4 million (1 cent per share) of income from discontinued operations and an extraordinary charge of $1.6 million (2 cents per share) for the write-off of deferred financing costs from early extinguishment of debt and from a debt refinancing.
 Earnings from continuing operations before extraordinary item for 1992 were $63.2 million compared with a loss of $.4 million in 1991. The lower 1991 earnings reflected substantial interest expense, reduced significantly by the recapitalization. Giving pro forma effect to the recapitalization as if it had occurred on Jan. 1, 1991, the company would have reported earnings from continuing operations before extraordinary item for 1992 of $80.9 million, or $1.17 per share, compared with $53.9 million, or 78 cents per share, in 1991.
 For the year ended Dec. 31, 1992, the company reported a net loss of $42.2 million, which included $1.5 million (3 cents per share) of income from discontinued operations and extraordinary charges of $106.9 million ($1.83 per share). Included in extraordinary charges was $105.3 million incurred in the second quarter in connection with the recapitalization, primarily for premiums, expenses and write-off of deferred financing costs from early extinguishment of debt.
 Looking ahead, John W. Guffey Jr., president and chief operating officer of Coltec Industries, noted, "We expect our aerospace/government segment to continue to be affected by the reductions in defense spending and slowdown of certain commercial programs at least through 1993. Our automotive segment demonstrated increasing strength toward the end of 1992, and we expect this trend to continue into 1993. Our industrial segment is poised to support growing orders from industry as the recovery gathers momentum."
 Coltec Industries Inc is a New York-based manufacturing company serving aerospace, automotive and other industrial markets.
 COLTEC INDUSTRIES INC AND SUBSIDIARIES
 Summary Consolidated Statement of Earnings (A)
 (In thousands, except per-share data, unaudited)
 Periods ended Three months Twelve months
 Dec. 31 1992 1991 1992 1991
 Net sales $322,715 $318,481 $1,290,129 $1,283,361
 Costs and expenses 257,663 261,443 1,049,571 1,058,645
 Operating income 65,052 57,038 240,558 224,716
 Dividend income -- -- -- 1,431
 Earnings from continuing
 operations before interest,
 income taxes and extraord.
 item 65,052 57,038 240,558 226,147
 Interest, net 28,478 49,841 135,517 199,596
 Earnings from continuing
 operations before income
 taxes and extraord. item 36,574 7,197 105,041 26,551
 Provision for income taxes 12,808 11,027 41,823 26,954
 Earnings (loss) from
 continuing operations
 before extraord. item (B) 23,766 (3,830) 63,218 (403)
 Discontinued operations (C) 445 (83) 1,465 2,612
 Earnings (loss) before
 extraordinary item 24,211 (3,913) 64,683 2,209
 Extraordinary item (D) (1,583) -- (106,930) 591
 Net earnings (loss) 22,628 (3,913) (42,247) 2,800
 Earnings (loss) per common share:
 Continuing operations(B) $.34 $(.16) $1.08 $(.01)
 Discontinued operations(C) .01 -- .03 .10
 Extraordinary item(D) (.02) -- (1.83) .02
 Net earnings (loss) .33 (.16) (.72) .11
 Average number of common
 and common equivalent
 shares 69,545 25,000 58,413 25,000
 (A) -- The unaudited summary consolidated statement of earnings for the first quarter of 1992 and for the 12 months of 1991 reflects the interest and finance cost related to the outstanding 14-3/4 percent senior discount debentures of Coltec Holdings Inc because the net proceeds of the issuance and sale of senior notes and senior subordinated notes by the company in April 1992, together with bank borrowings, were used to repay such indebtedness.
 Earnings (loss) per common share for the 12 months ended Dec. 31, 1992, does not equal the sum of earnings (loss) per common share for each of the four quarters of 1992 due to the public offering of 44.3 million shares of common stock in the April 1992 recapitalization.
 (B) -- Giving pro forma effect to the April 1992 recapitalization as if it had occurred on Jan. 1, 1991, the company would have reported earnings from continuing operations before extraordinary item as follows:
 (In millions, except per-share data)
 Periods ended Three months Twelve months
 Dec. 31 1991 1992 1991
 Earnings from cont. opers.
 before interest, income
 taxes and extraord. item $57.0 $240.5 $226.1
 Interest, net 28.0 116.3 117.3
 Earnings from continuing
 operations before income
 taxes and extraord. item 29.0 124.2 108.8
 Provision for income taxes 18.4 43.3 54.9
 Earnings from cont. opers.
 before extraord. item 10.6 80.9 53.9
 Earnings per common share:
 Continuing operations $.15 $1.17 $.78
 (C) -- The company has entered into a letter of intent to sell its Central Moloney Transformer Division to Kuhlman Corporation. The pending sale will be accounted for as a disposal of a segment of a business. Accordingly, the unaudited summary consolidated statement of earnings has been restated to account for Central Moloney as a discontinued operation. This cash transaction, valued at a price approximating book value, is subject to the negotiation and execution of a definitive agreement and various approvals. The closing is scheduled to be completed in the first quarter of 1993. Central Moloney's 1992 and 1991 sales were $78.6 million and $89.6 million, respectively.
 (D) -- The extraordinary charge for the three months ended Dec. 31, 1992, reflects the write-off of deferred financing costs from early extinguishment of debt and from a debt refinancing. In addition, the 12 months ended Dec. 31, 1992, included an extraordinary charge incurred in the second quarter in connection with the April 1992 recapitalization, primarily for premiums, expenses and write-off of deferred financing costs from early extinguishment of debt.
 Industry Segment Information
 (In millions, unaudited)
 Periods ended Three months Twelve months
 Dec. 31 1992 1991 1992 1991
 Sales:
 Aerospace/government $129.2 $136.2 $523.7 $562.8
 Automotive 102.8 96.0 402.6 372.6
 Industrial 90.8 86.8 365.2 349.7
 Intersegment elimination (.1) (.5) (1.4) (1.7)
 Total 322.7 318.5 1,290.1 1,283.4
 Operating income:
 Aerospace/government 27.1 29.1 102.1 109.6
 Automotive 24.6 14.9 85.1 59.3
 Industrial 21.3 19.4 81.9 75.9
 Total segments 73.0 63.4 269.1 244.8
 Corporate unallocated (7.9) (6.4) (28.5) (20.1)
 Operating income 65.1 57.0 240.6 224.7
 In the aerospace/government segment, sales declines were reported in 1992 by Menasco and Walbar due to continued reductions in defense spending and stretch-out of certain commercial programs. The strong 1992 performance in the automotive segment was aided by increased new car and truck production and recovering aftermarket sales. Selected price increases and the introduction of new automotive products having higher margins contributed to the improved operating results for the automotive segment. In the industrial segment, improved results in 1992 were achieved by Garlock Bearings, Garlock Plastomer, Quincy Compressor and Delavan Commercial; while lower 1992 operating income was reported by Garlock Mechanical Packing.
 The unaudited industry segment information has been restated to account for Central Moloney Transformer Division as a discontinued operation.
 -0- 1/13/93
 /CONTACT: Michael Dunn of Coltec Industries, 212-940-0523/
 (COT)


CO: Coltec Industries Inc ST: New York IN: ARO SU: ERN

CK-GO -- NY027 -- 4424 01/13/93 13:16 EST
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Date:Jan 13, 1993
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