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INTERNATIONAL TECHNOLOGY CORP. ANNOUNCES FISCAL 1993 THIRD QUARTER RESULTS

 TORRANCE, Calif., Jan. 26 /PRNewswire/ -- International Technology Corp. (NYSE: ITX) (IT) announced today revenues for the quarter ended Dec. 31, 1992 were $101.7 million compared with revenues of $105.9 million for the same quarter of the prior year. The company reported a loss from continuing operations for the quarter of $4.3 million or $.13 per share compared with income of $2.4 million or $.07 per share for the same period of the prior year. The loss from continuing operations in the current quarter included nonoperating charges of $6.3 million related to the anticipated settlement of a stockholders lawsuit and $2.0 million related to the writeoff of costs incurred in a joint venture in the U.K. Excluding nonoperating charges of $8.3 million, pre-tax income from continuing operations would have been $3.2 million for the quarter, compared with $2.4 million in the same quarter of the prior year. The net loss for the quarter ended December 31, 1992 was $8.2 million or $.24 per share and included a $3.8 million charge (net of taxes) related to the Company's discontinued Pollution Control Systems (PCS) manufacturing business.
 For the nine months ended December 31, 1992, revenues were $307.0 million compared with $311.5 million for the same period of the prior year. Income from continuing operations for the nine-month period was $2.6 million or $.08 per share compared to $15.6 million or $.47 per share for the same period last year. Excluding the effect of the third quarter charges of $8.3 million and the previously reported gains from the sale of EXEL stock options and common stock of $3.5 million and $7.3 million, pre-tax income from continuing operations for the current nine-month period was $10.5 million compared with $9.9 million in the same period of the prior year.
 Net income for the nine months ended December 31, 1992 was $11.8 million or $.35 per share. The year-to-date results reflect the adoption of Statement of Financial Accounting Standards No. 109 -- "Accounting for Income Taxes" (SFAS 109) which resulted in the retroactive restatement of income taxes for the first six months and the recording of a $13.0 million tax benefit to be realized through future tax deductions and operating loss and tax credit carryforwards.
 The third quarter operating results continued to reflect weakness in the economy, particularly in the commercial sector. Environmental Engineering and Services' operating results were negatively impacted by lower than expected realization and utilization levels. Demand for analytical services continues to be sluggish and pricing remains competitive. Construction and Remediation Services' revenues were lower due to reduced major project activity while margins were stable. Selling, general and administrative expenses were reduced as a result of cost containment efforts.
 "Although there were significant charges required in the quarter to address various nonoperating issues, we believe the resolution of such matters will allow the Company to better focus on its ongoing core businesses," said Robert B. Sheh, president and chief executive officer. "Excluding all nonoperating items, the operating income trends in fiscal year 1993 were slightly favorable to those of the prior year."
 The $6.3 million charge relates to the previously disclosed anticipated settlement of a class action lawsuit. Although a settlement agreement has not been reached, the Company believes a settlement of the lawsuit is likely in the near future for approximately $6.3 million, including related costs, after taking into account a contribution from the Company's insurance carrier. The Company expects to be able to discharge this obligation through the issuance of additional shares of common stock. In addition, the writeoff of $2.0 million relates to nonrecoverable costs invested in a joint venture in the U.K. which had been seeking permits to build two integrated waste treatment facilities. In November 1992, these permit requests were denied, and the Company subsequently ceased all activity related to the joint venture.
 Third quarter fiscal year 1993 also reflected a charge of $3.8 million, net of taxes, to reduce the net gain of $13.1 million which had been recorded in fiscal year 1992 from the sale of the PCS manufacturing business. This charge resulted from unexpected cost overruns in connection with the completion and closeout of certain projects retained by IT. Additionally, the Company has experienced difficulty collecting receivables and limiting its warranty obligations on certain projects which were complete prior to the sale of the business.
 The adoption of SFAS 109, which was required to be retroactive to the beginning of fiscal year 1993, led to changes in the effective tax rate for each quarter of the year. The tax provision for the first six months of the year was restated to 36 percent, up from 14 percent which had been previously reported. In the quarter ended December 31, 1992, the Company reported a tax benefit related to continuing operations of $0.7 million to achieve an effective tax rate of 55 percent for continuing operations for the nine-month period. The tax rate is unusually high principally as a result of the partial nondeductibility of the $8.3 million of charges recorded in the third quarter. The Company expects to report an effective tax rate approximating the statutory rate in fiscal year 1994.
 "Demand in the private sector continues to be sluggish in spite of mild indications that the current economic climate will improve. We continue to monitor and modify our business to existing market conditions," said Mr. Sheh.
 International Technology Corp., based in Torrance, is a leading environmental management company providing services to government and industry. The Company's common stock is traded on the New York Stock Exchange under the symbol ITX.
 INTERNATIONAL TECHNOLOGY CORP.
 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
 (In thousands, except per share data)
 (Unaudited)
 Quarter ended Nine months ended
 December 31, December 31,
 1992 1991 1992 1991
 Revenues $101,673 $105,877 $307,042 $311,483
 Operating income 5,951 4,831 19,022 16,789
 Other income
 (expense), net (8,281)(a) --- (4,798)(b) 7,285(c)
 Interest expense, net (2,746) (2,466) (8,493) (6,922)
 Income (loss) from
 continuing operations
 before income taxes (5,076) 2,365 5,731 17,152
 (Provision) benefit
 for income taxes 730 --- (3,160) (1,584)
 Income (loss) from
 continuing
 operations (4,346) 2,365 2,571 15,568
 Discontinued operations
 (net of income taxes):
 Pollution control
 manufacturing
 Income from
 operations --- 1,498 --- 2,953
 Loss from
 disposition (3,809) --- (3,809) ---
 Income (loss) before
 cumulative effect of
 a change in accounting
 for income taxes (8,155) 3,863 (1,238) 18,521
 Cumulative effect of a
 change in accounting
 for income taxes --- --- 13,000 ---
 Net income (loss) $ (8,155) $ 3,863 $ 11,762 $ 18,521
 Net income (loss)
 per share:
 Continuing
 operations $ (.13) $ .07 $ .08 $ .47
 Discontinued
 operations:
 From operations --- .05 --- .08
 From disposition (.11) --- (.12) ---
 (.24) .12 (.04) .55
 Cumulative effect of a
 change in accounting
 for income taxes --- --- .39 ---
 $ (.24) $ .12 $ .35 $ .55
 Average common and
 common equivalent
 shares outstanding
 (in thousands) 33,329 33,391 33,221 33,446
 (a) Includes $6,300 related to the anticipated settlement of the stockholders litigation and $1,981 related to the writeoff of costs invested in a U.K. joint venture.
 (b) Includes a gain of $3,483 from the sale of stock options of EXEL in the first quarter of fiscal year 1993 as well as $6,300 related to the anticipated settlement of the stockholders litigation and $1,981 related to the writeoff of costs invested in a U.K. joint venture reported in the third quarter of fiscal year 1993.
 (c) Represents a $7,285 gain from the sale of EXEL common stock in the second quarter of fiscal year 1992.
 INTERNATIONAL TECHNOLOGY CORP.
 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
 (In thousands, except per share data)
 (Unaudited)
 Quarter ended Quarter ended
 September 30, 1992 June 30, 1992
 As As As As
 Restated Reported Restated Reported
 Income from continuing $ 3,323 $ 3,323 $ 7,484 $ 7,484
 operations before income
 taxes
 Provision for income taxes 1,196 16 2,694 1,497
 Income from continuing
 operations before
 cumulative effect of
 a change in accounting
 for income taxes 2,127 3,307 4,790 5,987
 Cumulative effect of
 a change in accounting
 for income taxes --- --- 13,000 ---
 Net income $ 2,127 $ 3,307 $17,790 $ 5,987
 Net income per share:
 Continuing operations $ .06 $ .10 $ .14 $ .18
 Cumulative effect of a
 change in accounting for
 income taxes - - .39 -
 $ .06 $ .10 $ .54 $ .18
 Average common and common
 equivalent shares
 outstanding
 (in thousands) 33,141 33,141 33,193 33,193
 -0- 1/26/93
 /CONTACT: Anthony J. DeLuca or Pat Boldt of International Technology, 310-378-9933/
 (ITX)


CO: International Technology Corp. ST: California IN: CPR SU: ERN

EH -- LA019 -- 8902 01/26/93 08:33 EST
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