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FIBREBOARD ANNOUNCES FAVORABLE INSURANCE SETTLEMENT, QUANTIFIES ASBESTOS LIABILITY AND REPORTS 1991 YEAR-END RESULTS

 FIBREBOARD ANNOUNCES FAVORABLE INSURANCE SETTLEMENT,
 QUANTIFIES ASBESTOS LIABILITY AND REPORTS 1991 YEAR-END RESULTS
 CONCORD, Calif., March 30 /PRNewswire/ -- Fibreboard Corporation (AMEX: FBD) announced today a favorable insurance settlement with Pacific Indemnity, its 1991 full year and fourth quarter results and quantification of its asbestos liability through the end of the decade.
 Pacific Indemnity Settlement
 Fibreboard announced today a settlement with Pacific Indemnity Insurance Company which could provide up to $360 million for asbestos- related costs. Fibreboard received an immediate $10 million payment plus a provision for an additional $20 million to meet asbestos expenses until the final resolution of insurance coverage litigation against Pacific and Continental Casualty Insurance Company. The agreement provides additional funds of up to $330 million dependent upon certain final court decisions.
 Fibreboard Chairman, John Roach, said, "This favorable development for Fibreboard accomplishes two objectives. First, it solves the short-term asbestos-related liquidity problem we previously disclosed. Second, assuming Fibreboard ultimately wins the insurance coverage appeal, which we believe is likely, Fibreboard will have virtually unlimited insurance coverage from Continental Casualty for pre-1959 personal injury asbestos claims and substantial amounts from this Pacific settlement to fund post-1959 claims." Roach added that a reversal of certain trial court judgments would relieve Pacific from any settlement responsibilities and Fibreboard would be responsible for repaying advanced interim funds. Further details of the Pacific settlement follow.
 1991 Fourth Quarter and Year-End Results
 Fourth quarter pre-tax operating loss before unusual items was $1.2 million compared to a loss of $1.7 million in 1990's fourth quarter. 1991 fourth quarter sales increased to $60 million from $53 million in 1990. Strong fourth quarter operating profit resulted from improved performance by the company's Wood Products Group. Including a one-time pre-tax charge of $20 million for various restructuring costs and a $20 million increase in the reserve for asbestos costs, the company recorded a net loss of $29.2 million or $7.21 per share for the 1991 fourth quarter compared to net income of $1.6 million or $0.61 per share in 1990.
 For the year ended Dec. 31, 1991, Fibreboard reported pre-tax operating profit before unusual items of $1.7 million on sales of $234 million compared to a loss of $2.0 million and $245 million in 1990. Including charges of $60 million, the company recorded a net loss of $43.9 million or $10.99 per share for 1991 versus net income of $1.3 million or $0.34 per share in 1990. 1990's net income included a $9.8 million gain on the sale of timberlands.
 The 1991 full year loss included non-cash pre-tax charges which totaled $60 million. In the second quarter, a $20 million pre-tax charge was recorded in connection with the discontinued Arrowood venture in Roxboro, N.C. This charge should be sufficient to allow the disposal of this operation without further loss. In addition, Fibreboard recorded a one-time $20 million pre-tax charge in the fourth quarter, including a write-off of goodwill associated with certain past acquisitions, a provision for future retiree medical benefits and restructuring charges for both operational and management changes. Fibreboard also increased its asbestos reserve by $20 million to a total of $26 million to cover the company's current estimate of future unreimbursable expenses related to the company's asbestos problem for the rest of this decade.
 Commenting on the year, John Roach stated, "While 1991 operating earnings from continuing businesses were below acceptable levels, we are encouraged by a strong second half performance arising from a recently implemented company-wide reorganization and improved pricing in wood products. After reviewing all operations and facilities, we elected to take primary non-cash charges and reserve increases in a comprehensive house-cleaning program. Future reported earnings should reflect results as Fibreboard is currently constituted and managed."
 Wood Products Group
 1991 wood products sales declined 2 percent to $165 million from $169 million in 1990, resulting from lower shipments for all products offset by selective sales price increases, which in many categories reached all time highs in the fourth quarter continuing into the first quarter of 1992. The pre-tax operating profit before unusual items increased to $11.5 million in 1991 from $1.9 million in 1990 and reflects price increases, better lumber grade recovery and favorable effects of a restructuring. Pre-tax operating income, including unusual items, was $3.6 million in 1991 versus $11.7 million in 1990. Unusual charges aggregated $7.9 million in 1991 compared to a $9.8 million gain on the sale of timberland in 1990.
 Industrial Insulation Products Group (Pabco)
 Sales of industrial insulation products decreased by 9 percent to $52 million in 1991 from $58 million in 1990. Pre-tax operating profits before unusual items were $4.5 million in 1991 versus $5.4 million in 1990. Sales and margin declines were a reflection of reduced overall demand resulting in lower volume for molded insulation and reduced prices for metal products. After a $5.0 million restructuring charge arising primarily from a write-off of goodwill, Pabco incurred a $459,000 operating loss in 1991 compared to income of $5.4 million in 1990.
 Resort Operations (Northstar-at-Tahoe)
 Resort operations revenue declined by 6 percent to $17 million in 1991 from $18 million in 1990 as a result of a continuing California drought. Stringent cost control measures and a reasonable snowfall in March and December helped keep this group marginally profitable at $144,000 down from $899,000 in operating profit in 1990.
 Outlook
 Commenting on the company's outlook, Roach said, "While earnings from the Wood Products Group were substantially improved in 1991 over 1990, management believes there is room for further improvement in all the core business groups. Management believes that the restructuring changes of the past six months will lead to improved performance for each of the Fibreboard's core business groups.
 "We believe that within three years the Wood Products Group has the potential to achieve $14 to $19 million of pre-tax operating profit, the Industrial Insulation Products Group has the potential to do $6 to $8 million and Northstar $3 to $5 million, all before general corporate and net interest expenses."
 Roach went on to say, "All of Fibreboard's core businesses are cyclical, but are driven by different elements of the economy. Consequently, we cannot assume that all of our businesses would achieve their potential simultaneously. We therefore believe that the company, on a consolidated basis, has the potential within three years to achieve $15 to $20 million in pre-tax income."
 The company cautioned that the earnings potential of its core business is based on conditions and assumptions affecting each of the businesses as described in its 1991 Form 10-K. Therefore, there can be no assurance that the potentials can or will be achieved.
 Asbestos Personal Injury Costs Through 1999
 Fibreboard has attempted to quantify its asbestos-related liabilities for existing claims and those reasonably anticipated through the end of the decade as well as its insurance resources available to satisfy those liabilities. While there are many uncertainties in such a process and significant risk of error exists, Fibreboard currently estimates such liabilities at $1.610 billion. Fibreboard believes it will ultimately receive insurance resources of $1.584 billion, resulting in a $26 million net liability. Since Fibreboard had $6 million of remaining asbestos reserves for unreimbursable costs, 1991 operating income was charged an additional $20 million to increase the reserve to a level the company currently believes will be sufficient to cover unreimbursable asbestos related expenses to the end of the decade.
 The quantification does not include personal injury claims likely to be received by Fibreboard after the end of the decade. Nor does it include asbestos-in-buildings claims which Fibreboard does not believe can be quantified at this time.
 Accounting Treatment
 Fibreboard has recorded as a liability the settlement amounts for claims resolved under its Insurance Assignment Program, even though the settling claimants agree to look to Continental Casualty for payment of the settlement. The amount of settlements under this program was $246.8 million at Dec. 31, 1991. Fibreboard has recorded a corresponding increase in assets as it expects Continental will ultimately be required to satisfy these settlements. In addition, Fibreboard has recorded as a liability amounts still to be paid under its Structured Settlement Program. Consequently, Fibreboard's total assets and liabilities increased significantly from year to year. Fibreboard expects total assets and liabilities will continue to increase in the future as further settlements are made under these programs and are accounted for in this manner.
 Pacific Indemnity Detail
 Under the terms of the settlement, Fibreboard received an immediate payment of $10 million for interim asbestos claims costs. The company will also receive up to $20 million in additional interim funds, as needed, between now and the time of the final decision in its personal injury insurance coverage litigation against Pacific and Continental Casualty. Fibreboard has previously received a trial court judgment in its favor finding that Pacific and Continental Casualty have virtually unlimited liability for all cases in which a claimant was first exposed to asbestos prior to 1959. The carriers have appealed this judgment to the California Court of Appeal and a decision is not expected until late 1992 or early 1993 at the earliest.
 If Fibreboard prevails in all respects in the final coverage case decision, Pacific will pay $105 million into a trust fund to be used primarily to pay asbestos-related personal injury claims where Fibreboard has no other insurance. If Fibreboard finally prevails on the trigger and scope of the coverage issues but loses on the no-aggregate limit issue, Pacific will instead pay $80 million into trust. Only in the event the trigger and scope of coverage judgments are reversed or substantially modified by the Court of Appeal, a situation the company considers unlikely, would Fibreboard receive no additional funds and have a repayment obligation for interim funds previously received.
 Pacific will pay an additional $225 million into the trust if Fibreboard finally prevails on all issues in the insurance coverage case and obtains a final court order protecting Pacific from certain contribution and related claims by Continental Casualty. In the event Fibreboard does not prevail on the no-aggregate limit issue and obtains the order protecting Pacific, the additional Pacific payment into trust is $140 million.
 Fibreboard Corporation, headquartered in Concord, Calif., manufactures lumber, hardwood plywood, moulding and millwork, agricultural container components, precision molded industrial insulation and fire-proofing materials. It also owns and operates Northstar-at-Tahoe, a ski resort and year-round vacation and conference center in California.
 FIBREBOARD CORPORATION AND SUBSIDIARIES
 Summary of Sales and Earnings (Unaudited)
 (Dollar amounts in thousands except per share)
 Quarter Year
 Ended Dec. 31 Ended Dec. 31
 1991 1990 1991 1990
 Net sales $59,967 $53,106 $234,056 $244,609
 Income (loss) from
 continuing operations
 before taxes (34,195) 8,087 (32,226) 7,813
 Income (loss) from
 continuing operation
 before cumulative effect
 of a change in
 accounting principles (28,122) 3,598 (27,334) 3,269
 Income (loss) per share
 from continuing
 operations $(6.94) $.92 $(6.84) $.84
 SUMMARY OF CONTINUING OPERATIONS
 Sales and Earnings
 Sales by Quarter
 1st 2nd 3rd 4th Year
 1990 68,018 61,235 62,250 53,106 244,609
 1991 54,889 57,279 61,921 59,967 234,056
 Earnings by Quarter
 1st 2nd 3rd 4th Year
 1990 2,001 (1,808) (522) 3,598(A) 3,269(A)
 1991 (570) 1,185 173 (28,122)(B) (27,334)(B)
 Earnings Per Share by Quarter
 1st 2nd 3rd 4th Year
 1990 .51 (.46) (.13) .92 .84(A)
 1991 (.14) .30 .04 (6.94) (6.84)
 (A) -- Includes a gain on the sale of timberland of $9.8 million.
 (B) -- Includes charges of $20.0 million for asbestos-related costs,
 and $13.9 million of unusual items.
 FIBREBOARD CORPORATION AND SUBSIDIARIES
 Consolidated Statements of Income (Unaudited)
 (Dollar amounts in thousands except per share)
 Quarter Year
 Ended Dec. 31 Ended Dec. 31
 1991 1990 1991 1990
 Net sales $59,967 $53,106 $234,056 $244,609
 Cost of sales 52,375 49,558 206,765 226,444
 Gross margin 7,592 3,548 27,291 18,165
 Other expenses
 Selling &
 administrative 8,197 4,595 23,445 19,334
 Asbestos related costs 20,000 -- 20,000 --
 Unusual items 12,985 (9,816) 13,912 (9,816)
 Income (loss)
 from operations (33,590) 8,769 (30,066) 8,647
 Interest expense,
 net of capitalized
 interest (1,214) (1,528) (5,342) (4,214)
 Interest income 609 846 3,182 3,380
 Income (loss) from
 continuing operations
 before income taxes (34,195) 8,087 (32,226) 7,813
 Income taxes related to
 continuing operations 6,073 (4,489) 4,892 (4,544)
 Income (loss) from
 continuing operations
 before cumulative
 effect of a change in
 accounting principle (28,122) 3,598 (27,334) 3,269
 Cumulative effect of
 change in accounting for
 post retirement benefits
 other than pensions -- -- (1,954) --
 Discontinued operations:
 Loss from operations,
 net of tax (565) (1,950) (3,792) (1,950)
 Anticipated
 loss on disposal (513) -- (10,851) --
 Net income (loss) $(29,200) $1,648 $(43,931) $1,319
 Earnings per share:
 Income (loss) from
 continuing operations
 before accounting
 change $(6.94) $0.92 $(6.84) $0.84
 Cumulative effect of
 accounting change -- -- (0.49) --
 Income (loss) from
 discontinued operations
 net of income taxes (0.27) (0.31) (3.66) (0.50)
 Net income (loss) $(7.21) $0.61 $(10.99) $0.34
 Weighted average shares
 outstanding (thousands) 4,051 3,902 3,997 3,901
 FIBREBOARD CORPORATION AND SUBSIDIARIES
 Sales and Operating Profit By Major Product Groups
 (Unaudited -- dollar amounts in thousands)
 Quarter Year
 Ended Dec. 31 Ended Dec. 31
 1991 1990 1991 1990
 Outside sales
 Wood products $43,709 $34,430 $165,101 $169,080
 Insulation products 13,213 16,051 52,292 57,711
 Resort operations 3,045 2,625 16,663 17,818
 Total $59,967 $53,106 $234,056 $244,609
 Operating profit (loss)
 Wood Products-operations $4,465 $ 93 $ 11,450 $ 1,928
 Wood Products
 -unusual items (7,896) 9,816 (7,896) 9,816
 Total (3,431) 9,909 3,554 11,744
 Insulation products
 -operations 1,042 2,049 4,497 5,431
 Insulation products
 -unusual (4,956) -- (4,956) --
 Total (3,914) 2,049 (459) 5,431
 Resort operations (1,012) (949) 144 899
 Total Operations (8,357) 11,009 3,239 18,074
 Unallocated unusual items (133) -- (1,060) --
 Asbestos related costs (20,000) -- (20,000) --
 Unallocated expense (5,100) (2,240) (12,245) (9,427)
 Interest income
 (expense), net (605) (682) (2,160) (834)
 Income (loss) from
 continuing operations
 before taxes $(34,195) $ 8,087 $(32,226) $ 7,813
 -0- 3/30/92
 /CONTACT: Stephen L. DeMaria of Fibreboard, 510-686-0700/
 (FBD) CO: Fibreboard Corporation ST: California IN: PAP SU: ERN


JT -- NY012 -- 2681 03/30/92 08:04 EST
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