MAVERICK TUBE RESULTS IMPACTED BY LOWER DEMAND AND
HIGHER PRICED INVENTORIES
ST. LOUIS, Nov. 12 /PRNewswire/ -- Maverick Tube Corporation (AMEX: MAV) today announced results for its fourth quarter and fiscal year ended Sept. 30, 1991. Sales for fiscal 1991 were a record $126.0 million compared with sales of $123.3 million in 1990. The company reported fiscal 1991 earnings of $2.6 million, down from $5.8 million the year before. Earnings per share were 54 cents for fiscal 1991, down from $1.59 in fiscal 1990; fiscal 1991 reflected a larger number of shares outstanding due to an initial public offering.
During the fourth fiscal quarter of 1991, net sales were $23.0 million compared with net sales of $39.2 million in the same quarter of 1990. The company reported a loss during the fourth quarter of $1.1 million, or 20 cents per share, compared with earnings of $2.8 million or 77 cents per share the year before.
Fourth quarter results compared with a year ago were severely hampered by lower shipments, declining selling prices and inventory adjustments resulting from declining raw material prices. The decline in shipments was primarily attributable to lower industry-wide demand for new domestic oil country tubular goods (OCTG) products. U.S. drilling activity for the quarter declined by 20 percent from the same quarter the previous year. Selling prices fell by 6.5 percent during the quarter, due primarily to increased competition relative to the reduced demand for OCTG products. Raw material costs during the quarter exceeded current prices by $1.7 million, $1.3 million of which were reflected in a year-end adjustment. The resulting inventory value reflects currently prevailing steel costs.
Earnings for fiscal 1991 were reduced primarily by increased raw material costs associated with declining inventory values and, to a lesser extent, increased fixed costs associated with full year operations at the company's Texas facility.
Gregg Eisenberg, president and chief executive officer, noted, "Maverick really did pretty well during the fourth quarter, considering that drilling activity at this date represents a post-World War II low. Despite these difficult industry conditions, we maintained or slightly increased our market share. We also reduced our variable manufacturing unit costs, which are now in line with previous periods of higher demand."
Maverick Tube Corporation is a St. Louis based manufacturer of tubular products used in the energy industry in drilling, production and surface transportation applications.
MAVERICK TUBE CORPORATION
Selected Consolidated Financial Data
(In thousands, except shipments and per share data)
Periods ended Fourth Quarter Twelve Months
Sept. 30 1991 1990 1991 1990
Shipments (tons) 36,969 60,639 191,394 190,398
Net sales $ 22,981 $ 39,234 $126,029 $123,255
Gross profit 12 5,540 10,522 14,155
Income (loss) from opers. (1,600) 4,243 3,523 9,944
Net (loss) earnings $ (1,131) $ 2,768 $ 2,604 $ 5,796
Per share earnings (loss) $ (0.20) $ 0.77 $ 0.54 $ 1.59
Weighted average number
of shares outstanding 5,578 3,661 4,837 3,622
/CONTACT: Charles O. Struckhoff, vice president-administration and secretary of Maverick Tube, 314-573-1314/
(MAV) CO: Maverick Tube Corporation ST: Missouri IN: OIL SU: ERN GK -- NY020 -- 3350 11/12/91 10:01 EST