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NATIONAL GYPSUM ANNOUNCES 1993 THIRD QUARTER RESULTS

 CHARLOTTE, N.C., Oct. 21 /PRNewswire/ -- National Gypsum Company (NASDAQ-NMS: NGCO) today announced financial results for operations for the three months ending Sept. 30, 1993. On July 1, 1993, the company acquired certain assets, principally related to the production and distribution of gypsum wallboard and related products, of the "old" National Gypsum Company in connection with the consummation of the Chapter 11 Plan of Reorganization initiated by the former National Gypsum Company. Results of operations to be reported by the company for periods beginning July 1, 1993, will not be comparable to the "old" company's results of operations; therefore, the results for the first six-months of 1993 for the "old" company have not been combined with the three months results of the new company for year-to-date reporting purposes.
 Third quarter 1993 net revenues for the "new" company were $137.1 million, while net revenues for the "old" company in the same period of 1992 were $124.0 million. This year's third quarter operating income was $10.0 million, compared with $345,000 for the same period last year. This year's third quarter operating income includes a pretax $6.6 million charge for reduction of force which will be offset partially by a pretax $2.3 million pension gain, also related to the reduction of force, to be recorded in the fourth quarter of 1993. Net income for the quarter was $4.7 million, which included interest expense of $3.2 million and income tax expense of $3.4 million. An $8.5 million net loss was incurred in last year's third quarter, which included interest expense of $1.2 million, bankruptcy expense of $9.1 million and an income tax benefit of $2.8 million. Earnings per share for the three months ending Sept. 30, 1993, were $0.23. Earnings per share are not reported for last year's third quarter results since "old" National Gypsum Company was not publicly held.
 Net cash used by operating activities during this year's third quarter was $10.1 million, including $36.1 million paid for bankruptcy claims settlements and professional fees paid by the "new" company in accordance with the Chapter 11 Plan of Reorganization. Net cash provided by operating activities in last year's third quarter was $20.2 million.
 The 1993 third quarter revenues reflect an approximate 3 percent increase in average wallboard prices, over the 1993 second quarter and approximately 10 percent over the 1992 third quarter. Wallboard volumes increased to 1.3 billion for this year's third quarter, compared with 1.2 billion in this year's second quarter and 1.3 billion in the same period during 1992.
 NATIONAL GYPSUM COMPANY
 CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
 FOR THE THIRD QUARTERS OF 1993 AND 1992
 National Old NGC
 Gypsum and
 Company Subsidiaries
 and (Debtor-in-
 Subsidiaries Possession)
 Three Months Three Months
 Ended Ended
 Sept. 30, Sept. 30,
 1993(A) 1992
 (Thousands) (Thousands)
 Net revenues $137,130 $124,038
 Cost of products sold 93,925 92,924
 Selling, general and
 administrative expenses 23,916 19,912
 Depreciation, depletion and
 amortization 9,305 10,857
 Operating income 9,984 345
 Interest expense (contractual
 interest for 1992--$36,921) (3,186) (1,154)
 Other income (expense)-net 1,265 804
 Bankruptcy expenses --- 9,144
 Income tax expense (benefit) 3,412 (2,802)
 Income (loss) from continuing
 operations 4,651 (6,347)
 Net loss of discontinued
 operations (net of applicable
 income tax benefit of
 $1,402 in 1992) (B) --- (2,158)
 Net income (loss) $4,651 $(8,505)
 Earnings per share
 (20,000,000 shares
 outstanding) $0.23 ---(C)
 Net cash (used) provided by
 operating activities $(10,089) $20,181
 NATIONAL GYPSUM COMPANY
 CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
 FOR THE THIRD QUARTERS OF 1993 AND 1992
 Old NGC Old NGC
 and and
 Subsidiaries Subsidiaries
 (Debtor-in (Debtor-in
 Possession) Possession)
 Six Months Nine Months
 Ended Ended
 June 30, Sept. 30,
 1993(A) 1992
 (Thousands)
 Net revenues $237,625 $349,018
 Cost of products sold 176,145 273,883
 Selling, general and
 administrative expenses 45,279 56,576
 Depreciation, depletion and
 amortization 21,112 32,809
 Operating loss (4,911) (14,250)
 Interest expense (contractual interest
 for 1993-$72,991 and 1992-$110,221) (1,517) (2,864)
 Other income (expense) -- net(D) 25,444 2,563
 Bankruptcy expenses(E) 96,805 30,961
 Income tax benefit 41,216 13,659
 Loss from continuing operations (36,573) (31,853)
 Net loss of discontinued operations
 (net of applicable income tax
 benefit of $6,340 in 1993
 and $4,002 in 1992)(B) (14,275) (6,090)
 Extraordinary gain on extinguishment
 of liabilities subject to compromise
 (net of applicable income tax
 expense of $35,200)(F) 757,327 --
 Cumulative effect of change in
 accounting principle (net of
 applicable income tax benefit
 of $32,988)(G) (52,284) --
 Net income (loss) $654,195 $(37,943)
 Earnings per share (20,000,000
 shares outstanding)(C) -- --
 Net cash provided by operating
 activities $25,618 $10,291
 Notes:
 (A) On July 1, 1993, the "new" National Gypsum Company acquired certain assets, principally related to gypsum wallboard and related products, of the "old" National Gypsum Company in connection with the consummation of the Chapter 11 plan of reorganization initiated by the "old" National Gypsum Company. Results of operations to be reported by the "new" company for periods beginning July 1, 1993, are not comparable to the "old" company's results of operations.
 (B) Due to the provisions of "old" National Gypsum Company's confirmed Plan of Reorganization, effective July 1, 1993, regarding the disposition of The Austin Company, a wholly owned engineering and construction service company of the "old" National Gypsum Company, the results of operations and cash flows related to Austin have been classified as discontinued operations.
 (C) "Old" National Gypsum Company was not publicly held.
 (D) Other income (expense) in 1993 includes a net casualty gain of $19.2 million resulting from the receipt of insurance proceeds from the loss in March 1993 of one of "old" National Gypsum Company's chartered vessels.
 (E) Bankruptcy expenses include the writedown of assets, the provision for allowed claims, bankruptcy-related professional fees and other items. During the second quarter of 1993, "old" National Gypsum Company recorded adjustments to writedown assets by $83.0 million for fresh-start reporting. Such adjustments included a $72.8 million writedown of net property, plant and equipment and a $17.1 million reduction of prepaid pension cost. During the first quarter of 1992, "old" National Gypsum Company recorded a provision for allowed claims of approximately $10 million to increase its estimate of the net liability subject to compromise for all asbestos-related claims.
 (F) An aftertax extraordinary gain of $757.3 million was recorded for the extinguishment of "old" National Gypsum Company's liabilities subject to compromise.
 (G) S.F.A.S. No. 106 requires accrual accounting for retiree benefit costs. The "old" National Gypsum previously expensed these costs as paid. Accordingly, the "old" company adopted S.F.A.S. No. 106 as of Jan. 1, 1993, and elected immediate recognition of the postretirement transition obligation for continuing operations of approximately $52.3 million, after tax, which charge was reported as a change in accounting principle in "old" National Gypsum Company's statement of operations for the first quarter of 1993.
 -0- 10/21/93
 /CONTACT: Allan V. Cecil, VP-Corporate Communications and Investor Relations, of National Gypsum, 704-365-7227 or FAX 704-365-7391/
 (NGCO)


CO: National Gypsum Company ST: North Carolina IN: CST SU: ERN

CM-MM -- CH001 -- 5012 10/21/93 09:19 EDT
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Date:Oct 21, 1993
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