ROGERS CORPORATION ANNOUNCES 1992 LOSS RESULTING FROM MAJOR FOURTH QUARTER 1992 CHARGES AND STRONG UPTURN IN EARNINGS IN THE FIRST QUARTER
ROGERS, Conn., March 26 /PRNewswire/ -- Harry Birkenruth, president and chief executive officer of Rogers Corporation (AMEX: ROG), today announced that, primarily as a result of measures taken to improve the company's profitability, and the adoption of Financial Accounting Standards Number 106 (FAS 106), the company will show as loss for the year 1992 of $32.7 million, after a fourth quarter restructuring charge of $26.6 million, and after the additional $6.6 million FAS 106 charge. Birkenruth also stated that in 1993 sales are growing and earnings are improving substantially. In the first quarter of 1993, profits, which will carry only modest tax rates this year, are expected to be well in excess of $1.5 million, the best quarterly performance in a number of years. Birkenruth said the steps that have been taken are part of the company's strategy to focus and build further on its existing specialty polymer composite materials businesses generated the company's growth in the 1960's and 1970's and have provided most of the company's profits since that time. But these profits often were not apparent as a result of substantial losses incurred in Rogers' electronic components businesses, particularly flexible circuits. The charges in the fourth quarter were made up of the following three major components:
Divestiture Charge $22.4 Million
A Letter of Intent has been signed for the divestiture of the Flexible Interconnections Division (FID) to a limited partnership managed by Ampersand Ventures, a prominent venture capital firm based in Wellesley, Mass., with particular emphasis on specialty materials and chemical operations. FID, Rogers' largest division, and one of the leaders in the flexible circuit marketplace, has sales of $53 million in 1992, but the division has had significant losses for many years. The divestiture would include the company's 50 percent interest in a related joint venture, Smartflex Systems. Although there are asset writedowns and other expenses associated with the divestiture, which are reflected in the restructuring charge, the transaction will provide substantial immediate cash to Rogers.
Other Charges $4.2 Million
The focus on the materials businesses and on improved effectiveness also resulted in various other asset writedowns, as well as costs associated with streamlining the U.S. sales force, consolidating European sales and administrative functions in Belgium, and the reduction and consolidation of certain corporate functions in the U.S.
Accounting Change $6.6 Million
Financial Accounting Standard Number 106, "Employers' Accounting for Postretirement Benefits Other Than Pensions", was adopted in the fourth quarter, effective as of the beginning of 1992. This resulted in a one- time, non-cash charge of $6.2 million and an incremental related expense of $0.4 million for the year. The company has obtained temporary waivers from its lenders so that the taking of these charges will not place it in technical default of its loan covenants. However, there will be technical defaults if permanent waivers are not obtained, or if the company is unable to complete is refinancing by the time the 1992 financial statements are issued next month. Rogers has received a commitment from Fleet Bank, N.A. for up to $25 million under a revolving credit and term loan arrangement to be used to retire some present loans and provide additional capital. Discussions are underway with Rogers' other lenders to obtain consents to complete the Fleet transaction. The company's present financial position is strong with cash and with available unused revolving credit capacity of more than $9 million. Birkenruth indicated that, following the divestiture, the company will have four product groups which, in total, were solidly profitable in 1992, and, which, in the first quarter of 1993, are expected to have sales approximately 15 percent higher than in the same period last year.
Rogers is a recognized leader in specialty printed circuit laminate materials. These materials are primarily used to make high performance circuits for microwave and computer applications. The company sees excellent growth opportunities over the next few years, particularly for high frequency circuit materials in the rapidly-growing wireless communications market, for use in cellular communications networks, direct broadcast systems, wireless printers and local area computer network applications.
High Performance Elastomers
Rogers' materials and components are based on proprietary cellular elastomer technology and serve a variety of markets, including office equipment, footwear, automotive, and printing. This product group recently has been the fastest growing portion of Rogers' activities, and a major plant expansion is underway.
Moldable Composite Materials
Rogers is in a leading position in glass-reinforced phenolic materials for small electric-motor commutators, under-the-hood automotive applications, and in materials for electronic applications.
After the divestiture, this product group will consists of power distribution products -- used most often in mainframe computer and telephone switching applications -- and Durel Corporation. a rapidly- growing joint venture with 3M in the electroluminescent lamp business. Birkenruth concluded by stating that, "The recent changes, although painful, have brought the company back to profitablility, and will provide a strong springboard for further long-term improvement." Based in Rogers, Conn., Rogers Corporation is a manufacturer of specialty high performance materials and components. ROGERS CORPORATION Financial Results (dollars in thousands, except per share amounts) Quarter Ended Nine Months Ended 1/3/93 12/29/91 1/3/93 12/29/91 Sales $46,847 $ 42,668 $ 172,361 $ 182,352 Restructuring charge (26,602) (2,941) (26,602) (2,774) Loss before cumulative effect of accounting change (26,489) (3,030) (26,425) (2,320) Cumulative effect of change in accounting for postretirement benefits --- --- (6,241) --- Net loss (26,489) (3,030) (32,666) (2,320) Loss per share before cumulative effect of accounting change (8.56) (0.98) (8.54) (0.75) Loss per share of cumulative effect of accounting change --- --- (2.02) --- Net loss per share (8.56) (0.98) (10.56) (0.75) Shares outstanding 3,099,234 3,084,020 3,094,461 3,081,351 -0- 3/26/93 /CONTACT: Robert F. White of Rogers Corp., 203-774-9605/ (ROG)
CO: Rogers Corporation ST: Connecticut IN: CPR SU: ERN
CH -- NE008 -- 0103 03/26/93 13:56 EST
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|Date:||Mar 26, 1993|
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