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HUNTCO SALES AND EARNINGS UP FOR SECOND QUARTER; 2 CENT DIVIDEND DECLARED

 CHESTERFIELD, Mo., Nov. 11 /PRNewswire/ -- Huntco Inc. (NASDAQ: HUNT), a Chesterfield-based intermediate steel processor, today announced results of operations for its second quarter of fiscal 1994, which quarter ended Oct. 31, 1993. Net sales were $36.1 million, an increase of 22.9 percent in comparison to the prior year's second quarter net sales of $29.4 million. Net income for the quarter was $2.0 million, or 24 cents per share, which compares to net income of $.5 million, or 12 cents per share in the prior year's second quarter. Weighted average common shares outstanding were 8,085,557 and 4,500,000 in the quarters ended Oct. 31, 1993 and 1992, respectively.
 Net sales for the six month period ended Oct. 31, 1993 were $69.7 million, an increase of 21.5 percent in comparison to net sales for the six month period ended Oct. 31, 1992 of $57.4 million. Net income for the six month period ended Oct. 31, 1993 was $3.6 million, or 52 cents per share, which compares to income before extraordinary items of $.8 million, or 18 cents per share and net income of $.3 million, or 7 cents per share in the six month period ended Oct. 31, 1992. Weighted average common shares outstanding were 6,891,039 and 4,500,000 in the six month periods ended Oct. 31, 1993 and 1992, respectively.
 The company declared a dividend of 2 cents per share for shareholders of record on Nov. 19, 1993 and payable on Nov. 30, 1993.
 The company attributes the improvements in net sales and earnings per share to the continuing development of its steel processing facility in Blytheville, Ark.; most significantly the new slitting line which became operational in June 1993. Also positively affecting the quarterly results were rising steel prices which reflected tight supplies and strong demand.
 The company experienced higher volumes and selling prices in its steel processing operations where net sales increased to $32.6 million and $63.0 million in the second quarter and six month period ended Oct. 31, 1993, respectively. These amounts compare to prior year second quarter and six month steel processing net sales of $26.4 million and $51.4 million, respectively. Selling prices increased 10.9 percent and tons sold increased 19.0 percent, resulting in a 23.4 percent increase in second quarter steel processing net sales in comparison to the prior year's second quarter. Selling prices increased 8.6 percent and tons sold increased 19.7 percent, resulting in a 22.6 percent increase in steel processing net sales for the six month period ended Oct. 31, 1993 in comparison to the corresponding period in the prior year. Approximately 94.5 percent of the increase in tons sold during the six month period ended Oct. 31, 1993 relates to the company's steel processing facility in Blytheville. Notwithstanding the increases in net sales and tons sold, steel processing sales were lower than expected because of the company's inability to acquire steel in sufficient quantities at acceptable prices to fill all of the potential orders which were available. However, adequate supplies of steel were available to the company by October 1993.
 Also affecting the comparison of net sales with prior year amounts were sales of $.5 million in the prior year second quarter and net sales of $1.3 million in the six month period ended Oct. 31, 1992, relating to the company's wire fabricating operations which were sold in December 1992. If these sales were eliminated, total steel processing sales actually increased 26.0 percent in the second quarter and 25.8 percent for the six month period ended Oct. 31, 1993 in comparison to the prior year periods.
 Benefiting from rising steel prices and tight supply conditions, gross profit in the steel processing segment averaged 13.8 percent during the second quarter of the current fiscal year and 14.6 percent for the six month period ended Oct. 31, 1993. These percentages compare to gross profit of 9.7 percent in the prior year's second quarter and 9.7 percent in the six month period ended Oct. 31, 1992.
 Net sales in the company's compressed air cylinder segment in the second quarter were $3.5 million, an increase of 18.1 percent over prior year levels. Net sales in the compressed air cylinder segment were $6.7 million for the six month period ended Oct. 31, 1993, an increase of 11.7 percent over the comparable prior year period. Gross profit in the compressed air cylinder segment in the second quarter was 19.8 percent of net sales which compares to 19.3 percent in the second quarter of the prior year. Gross profit in the compressed air cylinder segment for the six month period ended Oct. 31, 1993 was 17.7 percent of net sales which compares to gross profit of 18.9 percent in the prior year period. Net sales and gross profit for the second quarter and six month period ended Oct. 31, 1993 benefited from higher unit volumes which benefits were partially offset by lower selling values and higher material costs.
 Selling, general and administrative expenses were 5.8 percent and 6.0 percent of net sales for the second quarter and six month period ended Oct. 31, 1993, an increase from prior year levels which were 5.7 percent of net sales for both the second quarter and six month period ended Oct. 31, 1992. These increases primarily reflect higher accruals pursuant to incentive compensation plans.
 Income from operations for the second quarter was $3.1 million, an increase of $1.6 million, or 111.9 percent, in comparison to the prior year second quarter income from operations of $1.5 million. Income from operations for the six month period ended Oct. 31, 1993 was $6.2 million, an increase of $3.3 million, or 114.4 percent, in comparison to the comparable period in the prior year of $2.9 million.
 The company realized interest income of $50,000 in the second quarter which compares with interest expense of $.5 million in the prior year second quarter. Interest expense for the six month period ended Oct. 31, 1993 was $.4 million which compares with interest expense of $1.4 million in the six month period ended Oct. 31, 1992. The reductions in interest expense reflect lower debt levels resulting from application of the proceeds from the company's initial public offering of its Class A Common Stock, which proceeds were received in early July 1993.
 The effective income tax rate for the second quarter and six month period ended Oct. 31, 1993 was 38.5 percent and 38.6 percent, respectively. The effective income tax rate in the second quarter and six month period ended Oct. 31, 1992 was 42.0 percent and 44.1 percent, respectively. The decline in the effective tax rate primarily reflects the effect of nondeductible goodwill amortization which has a lesser effect as the company's taxable income increases.
 Huntco is a major intermediate steel processor, specializing in the processing of flat rolled carbon steel and is also a leading manufacturer of compressed air cylinders.
 HUNTCO INC.
 CONSOLIDATED BALANCE SHEETS
 (dollars in thousands)
 (Unaudited) (Audited)
 Oct. 31, April 30,
 1993 1993
 Assets
 Current assets:
 Cash and cash equivalents $5,935 $477
 Accounts receivable, net 17,805 17,700
 Inventories 25,633 21,699
 Other current assets 599 847
 $49,972 $40,723
 Property, plant and
 equipment, net 25,026 20,012
 Goodwill 5,723 5,867
 Other assets 211 432
 $80,932 $67,034
 Liabilities & shareholders' equity
 Current liabilities:
 Accounts payable $6,740 $12,109
 Accrued expenses 2,210 2,036
 Current maturities of
 long-term debt --- 2,611
 Current maturities of
 capital lease obligations 333 171
 9,283 16,927
 Notes payable --- 29,208
 Capital lease obligations 1,814 2,230
 Deferred income taxes 1,669 1,669
 3,483 33,107
 Preferred stock of subsidiary --- 5,470
 Shareholders' equity:
 Preferred stock --- ---
 Class A common stock 37 2
 Class B common stock 43 43
 Additional paid-in-capital 55,840 2,245
 Retained earnings 12,246 9,240
 68,166 11,530
 $80,932 $67,034
 HUNTCO INC.
 CONSOLIDATED STATEMENTS OF INCOME
 (in thousands, except for earnings per share amounts)
 (unaudited)
 Six Months Three Months
 Ended Oct. 31, Ended Oct. 31,
 1993 1992 1993 1992
 Net sales $69,707 $57,367 $36,108 $29,381
 Costs of sales 59,288 51,227 30,872 26,235
 Gross profit 10,419 6,140 5,236 3,146
 Selling, general and
 administrative expenses 4,210 3,244 2,098 1,665
 Income from operations 6,209 2,896 3,138 1,481
 Other income (expense):
 Interest expense, net (401) (1,445) 50 (545)
 Other, net (1) 6 (5) 6
 Income before income taxes
 and extraordinary item 5,807 1,457 3,183 942
 Provision for income taxes 2,243 642 1,225 396
 Income before
 extraordinary item 3,564 815 1,958 546
 Extraordinary item, net of tax --- (484) --- ---
 Net income $3,564 $331 $1,958 $546
 Earnings per common and
 common equivalent share:
 Income before
 extraordinary item $0.52 $0.18 $0.24 $0.12
 Extraordinary item, net of tax --- $(0.11) --- ---
 Net income $0.52 $0.07 $0.24 $0.12
 Weighted average common
 shares outstanding 6,891 4,500 8,086 4,500
 -0- 11/11/93
 /CONTACT: Robert J. Marischen of Huntco, 314-878-0155/
 (HUNT)


CO: Huntco Inc. ST: Missouri IN: SU: ERN

BB -- DV005 -- 3475 11/11/93 21:29 EST
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Date:Nov 11, 1993
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