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THE TIMKEN COMPANY REP0RTS HIGHER EARNINGS ON LOWER SALES FOR SECOND QUARTER, FIRST SIX MONTHS OF 1992

 THE TIMKEN COMPANY REP0RTS HIGHER EARNINGS ON
 LOWER SALES FOR SECOND QUARTER, FIRST SIX MONTHS OF 1992
 CANTON, Ohio, July 30 /PRNewswire/ -- The Timken Company (NYSE: TKR) today reported higher earnings on lower sales for the second quarter and first six months of 1992, ended June 30.
 Net sales for the second quarter of 1992 fell 4.0 percent to $419.2 million from $436.5 million a year earlier. Second quarter gross profit was 21.6 percent of net sales, up from 19.1 percent in 1991. Net income increased to $3.4 million ($0.11 per share) in the second quarter of 1992 from $739,000 ($0.03 per share) in 1991.
 "Given prevailing economic circumstances, we are encouraged by our second quarter performance," said Joseph F. Toot, Jr., president. "We are pleased to see our initiatives to increase productivity and quality and to reduce costs contribute to higher net income. But our lower sales say much about the extremely slow pace of the economic recovery which, for many manufacturing companies, has been negligible," added Toot.
 Net sales for the first six months of 1992 ($840.1 million) are below 1991 levels, primarily due to lower sales volume. Gross profit for the first half of $181.3 million (21.6 percent of net sales) is ahead of 1991's $178.3 million (20.4 percent of net sales). Net income for 1992's first half was $8.3 million ($0.28 per share), up $3.8 million from 1991.
 The company's Bearing Business had slightly lower sales volume offset by some modest price increases. The sales mix continues to be skewed toward lower margin products with growth in automotive markets but continued softness in industrial and aerospace markets. Some non- U.S. markets have strengthened slightly while Europe remains affected by an extended recession.
 Although bearing sales volume is somewhat lower in 1992, plant operating levels have increased and stabilized compared to 1991 when they were reduced to achieve significant inventory reductions. Unit cost reductions, manufacturing efficiencies and continuous improvement efforts also contributed to the increase in gross profit.
 The company's Steel Business had slightly lower sales volume compared to 1991, but also contributed to the increase in gross profit. Manufacturing efficiencies have been achieved through the implementation of synchronous flow operations and wide-scale continuous improvement activities. These factors more than offset the costs associated with a very successful start-up of the company's new continuous caster. The caster is being integrated into current operations and will be a source of new business opportunities.
 Operating income for the second quarter of 1992 was reduced by severance payment charges to general administrative expenses as part of the previously announced voluntary retirement program for salaried employees. To date, 270 U.S. employees have elected to retire during 1992, which will result in reduced expenses in 1992, primarily in the fourth quarter. Approximately $14 million of wage and benefit expenses will be saved each succeeding year beginning in 1993. These severance charges and an allowance for expenses connected with a product warranty claim reduced the quarter's net income by $3.5 million ($0.12 per share).
 The Timken Company is a leading international manufacturer of highly engineered bearings and alloy steels. The company employs nearly 18,000 people worldwide and recorded 1991 sales of more than $1.6 billion.
 Financial Summary -- The Timken Company and Subsidiaries
 Consolidated Statements of Income
 Second Quarter Ended June 30 Six Months Ended June 30
 (Thousands of dollars, except per share data)
 1992 1991 1992 1991
 Net sales $419,181 $436,451 $840,117 $872,669
 Cost of products
 sold 328,676 353,164 658,842 694,375
 Gross Profit $90,505 $83,287 $181,275 $178,294
 Selling,
 administrative,
 general expenses 77,176 73,953 150,457 149,976
 Operating Income $13,329 $9,334 $30,818 $28,318
 Other income (expense):
 Interest expense (6,675) (5,897) (13,598) (13,350)
 Other income
 (expense) - Net: (464) (1,601) (2,027) (4,371)
 Income Before
 Taxes $6,190 $1,836 $15,193 $10,597
 Provision for income
 taxes 2,817 1,097 6,913 6,102
 Net Income $3,373 $739 $8,280 $4,495
 Net Income Per
 Share $0.11 $0.03 $0.28 $0.15
 Average shares
 outstanding 30,128,454 29,555,485 30,037,325 29,478,408
 Consolidated Balance Sheets
 June 30 Dec. 31
 (Thousands of dollars) 1992 1991
 ASSETS
 Cash and cash equivalents $6,313 $2,273
 Accounts receivable 220,768 188,182
 Inventories 319,149 320,076
 Other 44,208 51,965
 Total Current Assets $590,438 $562,496
 Property, plant and equipment 1,053,116 1,058,872
 Other assets 137,706 137,771
 Total assets $1,781,260 $1,759,139
 LIABILITIES
 Accounts payable and other
 liabilities $155,642 $169,442
 Short-term debt and commercial
 paper 162,951 138,521
 Accrued expenses 120,362 105,583
 Total Current Liabilities $438,955 $413,546
 Long-term debt 132,720 134,583
 Accrued pension cost 88,680 90,022
 Deferred income taxes 99,698 102,017
 Total Liabilities $760,053 $740,168
 SHAREHOLDERS' EQUITY $1,021,207 $1,018,971
 Total Liabilities and Equity $1,781,260 $1,759,139
 -0- 7/30/92
 /CONTACT: Keith Price of The Timken Company, 216-471-3825/
 (TKR) CO: The Timken Company ST: Ohio IN: AUT SU: ERN


KK -- CL014 -- 5081 07/30/92 12:03 EDT
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Date:Jul 30, 1992
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