Printer Friendly

VALHI REPORTS FIRST QUARTER RESULTS

 DALLAS, May 7 /PRNewswire/ -- Valhi Inc. (NYSE: VHI) reported a net loss for the first quarter of 1993 of $60.3 million, or $.53 per share, compared to a net loss of $71.5 million, or $.63 per share, in the first quarter of 1992. The 1992 net loss includes a one-time charge of $69.8 million, or $.61 per share, as a result of adopting two new accounting standards, which mandated changes in accounting for postretirement benefits other than pensions and income taxes, effective Jan. 1, 1992. The 1993 results include a $84 million pre- tax charge to earnings for an other-than-temporary impairment market value of an affiliate, as discussed below.
 Operating income of $16.5 million in 1993 was 7 percent below the comparable 1992 quarter as increases in each of the company's forest products, fast food and hardware products segments was offset by lower earnings from the refined sugar segment. A 13 percent decline in refined sugar volume, resulting in part from the relative timing of sales during the crop year, along with lower selling prices were principal contributors to the lower earnings of the refined sugar segment. Earnings improvements in the solid wood portion of the forest products segment, resulting primarily from the effect on prices of increased demand, more than offset lower earnings from the company's medium density fiberboard ("MDF") operations. MDF results were hampered by a 6 percent decrease in total volume, in part because of certain production interruptions early in the year, along with lower average selling prices. A portion of the MDF price decline resulted from the relative weakness of foreign currencies in which a portion of sales are denominated. The permanent closure of the company's plywood operations in January 1993 contributed to the year-to-year decline in forest products sales dollars while improving operating income comparisons. The fast-food segment reported record first quarter sales and earnings primarily as a result of higher volumes. Hardware products results also improved primarily because of higher volumes in each of its major product lines.
 The previously reported retirements of a portion of the company's 12.5 percent Senior Subordinated Notes, funded in part using proceeds from the company's 9.25 percent Liquid Yield Option Notes issued in October 1992, were a significant factor in the reduction in interest expense.
 The company reported a pre-tax loss of $95.6 million in the first quarter of 1993 related to its unconsolidated affiliates, NL Industries Inc. (49 percent-owned) and Tremont Corp. (48 percent- owned). This 1993 loss includes an aggregate $84 million pre-tax charge to earnings for an other than temporary impairment in the market value of NL, including the company's equity in Tremont's impairment charge related to NL. The company has concluded that recessionary economic conditions, including high German interest rates, declining gross domestic product in key European markets and relative foreign currency exchange rates, will likely result in a more prolonged period of price weakness for NL's principal product, titanium dioxide pigments ("TiO2"), than previously believed. Correspondingly, the depressed levels of NL's per share NYSE market price are expected to be more prolonged. After recording this adjustment, the company's per share net carrying value of its investments in NL and Tremont was $4.91 and $9.13, respectively. The company added that "it continues to believe in the long-term prospects of NL and the TiO2 industry."
 The company's equity in the operations of NL and Tremont, excluding the impairment charges referred to above, was a loss of $11.6 million in the first quarter of 1993, compared to a loss of $9.7 million in the 1992 period. Declining TiO2 prices in key European markets contributed significantly to the deterioration in NL's 1993 operating results. Tremont (excluding its equity in NL), while still unprofitable, reported somewhat lower losses than one year ago.
 Valhi Inc., headquartered in Dallas, is a diversified company engaged in the refined sugar, forest products, fast food and hardware products industries and, indirectly through publicly traded NL and Tremont, in the chemicals, titanium metals and bentonite mining industries. Valhi's common stock is traded on the New York and Pacific Stock Exchanges under the symbol "VHI."
 VALHI INC. AND SUBSIDIARIES
 Summary of Consolidated Operations
 (Unaudited)
 (In millions, except per share data)
 Three months ended
 March 31,
 1992 1993
 Net sales $195.6 $171.3
 Operating income $17.8 $16.5
 General corporate and other,
 net 2.4 .5
 Interest expense (13.8) (12.0)
 Total 6.4 5.0
 Equity in losses of affiliates,
 including provision for market
 value impairment in 1993 (9.7) (95.6)
 Loss before income taxes (3.3) (90.6)
 Provision for income tax benefit 1.8 30.3
 Loss before extraordinary item (1.5) (60.3)
 Extraordinary item (.2) ---
 Cumulative effect of changes in
 accounting principles (69.8) ---
 Net loss ($71.5) ($60.3)
 Loss per common share:
 Before extraordinary item ($.02) ($.53)
 Extraordinary item --- ---
 Cumulative effect of changes in
 accounting principles (.61) ---
 Net loss ($.63) ($.53)
 Weighted average
 common shares
 outstanding 113.9 114.1
 VALHI INC. AND SUBSIDIARIES
 Business Segment Information
 (Unaudited)
 (In millions)
 Three Months Ended
 March 31,
 1992 1993
 Net sales:
 Refined sugar $112.6 $91.2
 Forest products 46.9 39.6
 Fast food 24.4 26.1
 Hardware products 11.7 14.4
 Total $195.6 $171.3
 Operating income:
 Refined sugar $10.4 $6.1
 Forest products 3.8 5.4
 Fast food 1.6 1.9
 Hardware products 2.0 3.1
 Total $17.8 $16.5
 Equity in losses of affiliates:
 NL Industries Inc. ($6.9) ($9.5)
 Tremont Corp. (2.8) (2.1)
 Total (9.7) (11.6)
 Provision for market value
 impairment --- (84.0)
 Total ($9.7) ($95.6)
 VALHI INC. AND SUBSIDIARIES
 Condensed Consolidated Balance Sheets
 (In millions)
 Dec. 31, March 31,
 1992 1993
 (Unaudited)
 Current assets 504.6 $347.7
 Investment in NL and Tremont 248.4 154.0
 Other non-current assets 135.7 157.3
 Property and equipment 188.3 185.8
 Total $1,077.0 $844.8
 Current liabilities $489.0 $331.1
 Long-term debt 288.7 288.1
 Other non-current liabilities 40.2 31.5
 Stockholders' equity 259.1 194.1
 Total $1,077.0 $844.8
 Common shares outstanding 114.1 114.1
 Summary of Consolidated Stockholders' Equity
 Three Months Ended March 31, 1993
 (Unaudited)
 (In millions)
 Stockholders' equity at Dec. 31, 1992 $259.1
 Net loss (60.3)
 Dividends - $.05 per share (5.7)
 Currency translation and other 1.0
 Stockholders' equity at March 31, 1993 $194.1
 -0- 5/7/93
 /CONTACT: William C. Timm, VP-Finance and Administration of Valhi, 214-450-4212/
 (VHI)


CO: Valhi Inc. ST: Texas IN: FOD MNG SU: ERN

BP-MS -- LA031 -- 6188 05/07/93 19:11 EDT
COPYRIGHT 1993 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1993 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:May 7, 1993
Words:1120
Previous Article:DION ENTERTAINMENT APPOINTS NEW DIRECTORS
Next Article:BLUE CROSS AND BLUE SHIELD OF MINNESOTA ELECTS NEW BOARD CHAIR
Topics:


Related Articles
VALHI REPORTS SECOND QUARTER RESULTS
VALHI REPORTS THIRD QUARTER RESULTS
VALHI REPORTS THIRD QUARTER RESULTS
VALHI REPORTS 1992 RESULTS
VALHI REPORTS THIRD QUARTER RESULTS
VALHI'S EARNINGS CONTINUE TO IMPROVE
VALHI REPORTS HIGHEST FIRST QUARTER EARNINGS IN FIVE YEARS
VALHI REPORTS SIGNIFICANTLY INCREASED EARNINGS
VALHI REPORTS FIRST QUARTER RESULTS
VALHI REPORTS SECOND QUARTER RESULTS

Terms of use | Copyright © 2017 Farlex, Inc. | Feedback | For webmasters