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 CHANTILLY, Va., Sept. 10 /PRNewswire/ -- Fairchild Industries, Inc., is a subsidiary of the Fairchild Corporation (NYSE: FA), a leading aerospace, industrial products and communications services company. Fairchild Industries announced major restructuring initiatives in their aerospace fasteners segment which resulted in significant charges in the fourth quarter and year ended June 30, 1993. Fiscal 1993 Fairchild Industries' sales were $463,567,000 compared to $489,780,000 in fiscal 1992. Operating income for fiscal 1993 after pre-tax restructuring charges of $15,469,000, and inventory write-offs of $7,404,000 in the aerospace fasteners segment, was $19,362,000, down from $45,430,000 for fiscal 1992. The industrial products segment (D-M-E Company) and the communications services segment (Fairchild Communications Services Company) had significant increases in both sales and operating income in fiscal 1993.
 Sales were $114,520,000 in the fiscal 1993 fourth quarter, down from $123,807,000 in the fiscal 1992 fourth quarter. An operating loss of $9,367,000 was recorded in the fiscal 1993 fourth quarter compared to operating income of $17,142,000 in the 1992 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 United States 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 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 $14,426,000 compared to net earnings of $7,130,000 for the same quarter of fiscal 1992. For fiscal 1993, a net loss of $12,257,000 was reported, vs. net earnings of $14,255,000 in fiscal 1992. Fiscal 1992 included $5.0 million of dividends realized on participating pension annuity contracts. Net interest expense was higher in the current quarter and year, primarily due to higher total borrowings and higher interest rates. Net earnings in the current year also included a one-time extraordinary non-cash charge of $810,000, net of tax, for the write-off of deferred loan costs related to the recapitalization program completed last August.
 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."
 Summary Income Statement
 (Dollars in thousands)
 Periods 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
 Segment Operating Income:
 Aerospace Fasteners(A) (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 (659) (100) (3,260) (2,311)
 Other corporate income 1,043 1,842 4,251 3,438
 Operating income (9,367) 17,142 19,362 45,430
 Net interest expense 10,305 6,569 32,362 27,144
 Investment income 1,424 2,066 1,424 7,066
 Equity in earnings of
 affiliates - net 140 95 522 529
 Minority interest 76 (17) (129) (210)
 Earnings (loss) before
 income taxes (18,032) 12,717 (11,183) 25,671
 Income tax provision
 (benefit) (3,606) 5,587 264 11,416
 Net earnings (loss) from
 continuing operations (14,426) 7,130 (11,447) 14,255
 Extraordinary items - net -- -- (810) --
 Net earnings (loss) (14,426) 7,130 (12,257) 14,255
 (A) Includes non-recurring restructuring charges of $13,037,000 in the fiscal 1993 fourth quarter and $15,469,000 in fiscal 1993 and $2,500,000 in fiscal 1992.
 -0- 9/10/93
 /CONTACT: Mike Alcox, chief financial officer of Fairchild Industries, Inc., 703-478-5824/

CO: Fairchild Industries, Inc. ST: Virginia IN: ARO SU: ERN

TW-OS -- NY061 -- 0886 09/10/93 16:33 EDT
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Publication:PR Newswire
Date:Sep 10, 1993

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