Printer Friendly

FAIRCHILD CORPORATION REPORTS FISCAL 1993 FOURTH QUARTER, ANNUAL RESULTS

 CHANTILLY, Va., Sept. 10 /PRNewswire/ -- The Fairchild Corporation (NYSE: FA) announced major restructuring initiatives in its Aerospace Fasteners segment which resulted in significant charges in the fourth quarter and year ended June 30, 1993. Fiscal 1993 sales were $463,567,000 compared to $489,780,000 in fiscal 1992. Operating income for fiscal 1993 after pretax restructuring charges of $15,469,000 and inventory write-offs of $7,404,000 in the Aerospace Fasteners segment was $4,174,000, down from $25,986,000 in fiscal 1992. The Industrial Products segment (D-M-E Company) and the Communications Services segment (Fairchild Communications Services Company) reported significant increases in both sales and operating income in fiscal 1993. Lower corporate administrative expense and higher other corporate income in the current year partially offset the decline in operating income.
 Sales were $114,520,000 in the fiscal 1993 fourth quarter, down from $123,807,000 in the fiscal 1992 fourth quarter. The Aerospace Fasteners segment had an operating loss of $18,890,000 in the fiscal 1993 fourth quarter, which included a non-recurring charge of $13,037,000 for restructuring and further downsizing the fastener operations in Europe and the U.S. and $4,518,000 for writedowns of inventory. Reduced demand, price erosion, and higher quality costs also adversely impacted this business. Operating income of $7,230,000 was reported by the Aerospace Fasteners segment in the prior year's quarter. Again, the Industrial Products and Communications Services segments achieved record high sales and earnings, which helped lessen the impact.
 After these charges, the company reported a net loss for the fiscal 1993 fourth quarter of $22,189,000, or $1.38 per share, compared to a net loss of $5,606,000 or $.35 per share for the same quarter of fiscal 1992.
 For fiscal 1993, a loss of $43,490,000 before a net extraordinary loss of $12,614,000 was reported. This compared to a loss of $23,164,000 before a net extraordinary gain of $329,000 for fiscal 1992. On a per share basis, the net loss for fiscal 1993 was $3.48 per share as compared to a net loss of $1.40 per share for fiscal 1992.
 The net extraordinary loss included a one-time extraordinary non- cash charge of $11,800,000, net of tax, which is Fairchild's share of the extraordinary charge taken by Fairchild's 44 percent owned equity affiliate, Rexnord Corporation, as a result of premiums paid by Rexnord to repurchase its debt and the write-off of its deferred loan costs, in connection with its recent recapitalization. Although Fairchild's net results were affected by the one-time non-recurring charge at Rexnord Corporation, Fairchild's 44 percent investment in Rexnord Corporation has an imputed market value, at today's NYSE trading price, of approximately $140 million, more than $75 million higher than the carrying value of Fairchild's books.
 While equity earnings were above the prior year level in both periods, they were adversely affected by charges taken by Fairchild's 47.2 percent owned affiliate, Banner Aerospace, of $11,500,000 due to losses of closed operations, severance costs and inventory write-offs resulting in Banner incurring a loss of $3,140,000, or $.17 per share, for their year ended March 31, 1993. Investment income was down for the year due to lower investments in fiscal 1993 and gains realized in fiscal 1992.
 Commenting on the results, Chairman and Chief Executive Officer, Jeffrey J. Steiner, stated, "We are pleased to see the continued strong performance of D-M-E Company and Fairchild Communications Services Company. However, total operating income for the year was disappointing due to the continuation of depressed sales and incoming orders at our Aerospace Fasteners business. We have taken and continue to take actions to reduce capacity in the Aerospace Fasteners segment, streamline operations and improve efficiencies in all business segments, including the corporate offices, with the goal of maximizing performance in the near-term future despite current adverse conditions in the aviation industry."
 The Fairchild Corporation is a leading supplier of aerospace fasteners, tooling and electronic control systems for the plastics injection molding industry, and telecommunications services for tenants in commercial office buildings. In addition, Fairchild has significant equity investments in Rexnord Corporation (NYSE: REX), a leading manufacturer of mechanical power transmission components, and Banner Aerospace, Inc. (NYSE: BAR), a leading distributor of aircraft replacement parts.
 FAIRCHILD CORPORATION
 Summary Income Statement
 (In thousands, except per share data)
 Period ended Fourth quarter Year
 June 30, 1993 1992 1993 1992
 Sales by business segment:
 Aerospace fasteners $ 57,009 $ 73,100 $247,080 $299,270
 Industrial products 39,036 35,704 148,449 132,238
 Communications services 18,475 15,003 68,038 58,272
 Total 114,520 123,807 463,567 489,780
 Operating income by
 business segment:
 Aerospace fasteners(A)(B) (18,890) 7,230 (15,398) 15,654
 Industrial products 5,302 4,546 19,081 15,250
 Communications services 3,837 3,624 14,688 13,399
 Total (9,751) 15,400 18,371 44,303
 Corporate administrative
 expense (4,191) (6,108) (19,506) (21,979)
 Other corporate income 777 1,481 5,309 3,662
 Operating income (loss) (13,165) 10,773 4,174 25,986
 Net interest expense 17,783 17,529 70,418 69,575
 Investment income
 (expense) -- net 2,034 (463) 2,696 9,450
 Equity in earnings of
 affiliates 3,791 1,137 11,196 7,296
 Minority interest (518) (17) (2,289) (210)
 Loss from continuing
 opers. before taxes (25,641) (6,099) (54,641) (27,053)
 Income tax benefit 3,786 933 11,176 6,885
 Loss from continuing opers. (21,855) (5,166) (43,465) (20,168)
 (Earnings) loss from
 discontinued opers. -- net 83 (440) (25) (2,996)
 Loss bef. extraord. items (21,772) (5,606) (43,490) (23,164)
 Extraord. items -- net (C) (417) --- (12,614) 329
 Net loss (22,189) (5,606) (56,104) (22,835)
 Earnings (loss) per share:
 Continuing operations (1.36) (.32) (2.70) (1.24)
 Discontinued operations .01 (.03) --- (.18)
 Extraordinary items (.03) --- (.78) .02
 Net loss (1.38) (.35) (3.48) (1.40)
 Common shares outstanding 16,103 16,153 16,113 16,318
 (A) Includes restructuring charges of $13 million and $15.5 million within the Aerospace Fasteners segment in the fourth quarter and twelve month periods, respectively, of fiscal 1993.
 (B) Includes $2.5 million restructuring charge within the aerospace segment fiscal 1992.
 (C) Extraordinary items -- net includes an extraordinary charge of $11.8 million net of tax relating to the company's share of Rexnord's extraordinary charge associated with the Rexnord recapitalization in fiscal 1993.
 -0- 9/10/93
 /CONTACT: Mike Alcox, chief financial officer of Fairchild Corp. 703-478-5824/
 (FA REX BAR)


CO: Fairchild Corporation; Rexnord Corporation; Banner Aerospace, Inc. ST: Virginia IN: ARO SU: ERN

WB-LM -- NY060 -- 0875 09/10/93 16:19 EDT
COPYRIGHT 1993 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1993 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Sep 10, 1993
Words:1143
Previous Article:A.L. LABORATORIES DECLARES REGULAR QUARTERLY CASH DIVIDEND
Next Article:FAIRCHILD INDUSTRIES, INC., REPORTS FISCAL 1993 FOURTH QUARTER AND ANNUAL RESULTS
Topics:

Terms of use | Copyright © 2017 Farlex, Inc. | Feedback | For webmasters