Printer Friendly

VALHI REPORTS THIRD QUARTER RESULTS

 DALLAS, Oct. 29 /PRNewswire/ -- Valhi Inc. (NYSE: VHI) reported a net loss for the third quarter of 1993 of $2.0 million, or $.02 per share, compared to a net loss of $.8 million, or $.01 per share, in the third quarter of 1992. The third quarter 1993 results include an extraordinary loss of $3.2 million, or $.03 per share, related to the prepayment of $85.3 million principal amount of the company's 12 1/2 percent Senior Subordinated Notes.
 For the first nine months of 1993, Valhi reported a net loss of $69.4 million, or $.61 per share, compared to a net loss of $71.9 million, or $.63 per share, in 1992. The 1993 year-to-date results include an $84 million pre-tax charge to earnings for an other than temporary impairment in market value of an affiliate, as discussed below. The 1992 nine-month loss includes a one-time charge of $69.8 million, or $.61 per share, as a result of adopting new accounting standards for postretirement benefits other than pensions and income taxes effective Jan. 1, 1992.
 Operating income increased 39 percent to $27.0 million in the third quarter, with each segment reporting increases over the prior year, and increased 9 percent to $65.0 million in the first nine months of 1993. The third quarter improvements were in large part a result of volume increases. Refined sugar volumes increased 4 percent in the third quarter while in the forest products segment, medium-density fiberboard and log volumes were up 6 percent and 41 percent, respectively. Fast food comparable unit sales were 11 percent over the third quarter of last year while the major hardware products lines also reported increased sales. Refined sugar sales prices, while below comparable 1992 prices, strengthened in the third quarter in part due to government-imposed marketing allotments which limited the amount of domestic sugar that could be sold. In the forest products segment, the closure of the company's plywood operations in January 1993 reduced total sales compared to 1992 but aided earnings comparisons, while higher log selling prices also contributed to increased earnings. Increases in environmental and certain other expenses during the first half of 1993 together with lower interest income resulted in the unfavorable year-to-date comparison of general corporate and other items, net.
 The February and September 1993 redemptions of an aggregate $185 million principal amount of the company's 12 1/2 percent Notes, funded in part using proceeds from lower cost borrowings, were a significant factor in reducing interest expense. As previously announced, the company has called for redemption the remaining $50 million of 12 1/2 percent Notes using a portion of the proceeds from $100 million of 9 5/8 percent Senior Notes due 2003 issued by Valcor Inc., a new wholly owned subsidiary consisting of the company's forest products, fast food and hardware products businesses.
 The company reported a pre-tax loss of $16.1 million in the third quarter of 1993 related to its equity in losses of unconsolidated affiliates, NL Industries Inc. (49 percent owned) and Tremont Corp. (48 percent owned), compared to an $11.6 million loss in the third quarter of 1992. Lower selling prices for titanium dioxide pigments ("Ti02"), NL's principal product, in key European markets contributed significantly to the deterioration in NL's 1993 operating results. In October 1993, NL completed its previously announced Louisiana Ti02 joint venture and the refinancing of a portion of its DM-denominated long-term debt. The joint venture and refinancing transactions reduced NL's debt levels, extended debt maturities and increased liquidity to help NL through the current cyclical depression in the Ti02 industry.
 Tremont's titanium metals business continues to be significantly and adversely affected by, among other things, excess worldwide production capacity, reductions in aerospace spending and the availability of relatively inexpensive imported titanium sponge and scrap. As recently reported, Tremont's titanium metals subsidiary is not currently in compliance with an earnings covenant under its bank credit agreement. However, Tremont believes it is close to reaching an agreement with the banks to resolve this matter. Tremont's third quarter results were favorably impacted by a gain from the sale of its bentonite mining operations in July.
 The company's 1993 year-to-date loss of $131 million attributable to NL and Tremont includes an $84 million first quarter pre-tax charge for an other than temporary impairment in the market value of NL, including the company's equity in Tremont's impairment charge related to Tremont's 18 percent equity in NL.
 Valhi Inc., headquartered in Dallas, is a diversified industrial management company engaged in the refined sugar, forest products, fast food and hardware products industries. Valhi is also engaged in the chemicals and titanium metals industries through its equity interests in NL and Tremont. 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 Nine months ended
 Sept. 30, Sept. 30,
 1993 1992 1993 1992
 Net sales $213.2 $207.5 $578.0 $612.7
 Operating income $27.0 $19.5 $65.0 $59.7
 Business unit
 dispositions, net --- 3.5 .5 3.5
 General corporate
 and other, net (.3) (.2) (2.7) 2.3
 Interest expense (8.6) (12.0) (30.4) (38.4)
 Total 18.1 10.8 32.4 27.1
 Equity in losses of
 affiliates,
 including provision
 for market value
 impairment in 1993 (16.1) (11.6) (130.8) (31.7)
 Income (loss) before
 income taxes 2.0 (.8) (98.4) (4.6)
 Income tax benefit
 (expense) (.8) --- 32.2 2.7
 Income (loss) before
 extraordinary items 1.2 (.8) (66.2) (1.9)
 Extraordinary items (3.2) --- (3.2) (.2)
 Cumulative effect of
 changes in accounting
 principles --- --- --- (69.8)
 Net loss ($2.0) ($.8) ($69.4) ($71.9)
 Income (loss) per
 common share:
 Before extraordinary
 items $.01 ($.01) ($.58) ($.02)
 Extraordinary items (.03) --- (.03) ---
 Cumulative effect of
 changes in accounting
 principles --- --- --- (.61)
 Net loss ($.02) ($.01) ($.61) ($.63)
 Weighted average
 common shares
 outstanding 114.1 113.9 114.1 113.9
 VALHI INC. AND SUBSIDIARIES
 Business Segment Information
 (Unaudited)
 (In millions)
 Three months ended Nine months ended
 Sept. 30, Sept. 30,
 1993 1992 1993 1992
 Net sales:
 Refined sugar $120.8 $118.0 $318.3 $349.7
 Forest products 48.2 49.6 131.7 148.7
 Fast food 28.0 24.9 81.4 75.0
 Hardware products 16.2 15.0 46.6 39.3
 Total $213.2 $207.5 $578.0 $612.7
 Operating income:
 Refined sugar $13.8 $9.3 $28.0 $31.3
 Forest products 6.8 5.7 19.6 16.0
 Fast food 2.2 1.6 6.2 5.2
 Hardware products 4.2 2.9 11.2 7.2
 Total $27.0 $19.5 $65.0 $59.7
 Equity in losses of
 affiliates:
 NL Industries Inc. ($11.5) ($8.6) ($37.0) ($22.6)
 Tremont Corp. (4.6) (3.0) (9.8) (9.1)
 Total (16.1) (11.6) (46.8) (31.7)
 Provision for market
 value impairment --- --- (84.0) ---
 Total ($16.1) ($11.6) ($130.8) ($31.7)
 VALHI INC. AND SUBSIDIARIES
 Condensed Consolidated Balance Sheets
 (In millions)
 Sept. 30, Dec. 31,
 1993 1992
 (Unaudited)
 Current assets $208.0 $504.6
 Investment in NL and Tremont 112.1 248.4
 Other noncurrent assets 174.2 135.7
 Property and equipment 195.7 188.3
 Total $690.0 $1,077.0
 Current liabilities $217.0 $489.0
 Long-term debt 261.5 288.7
 Other noncurrent liabilities 31.1 40.2
 Stockholders' equity 180.4 259.1
 Total $690.0 $1,077.0
 Common shares outstanding 114.1 114.1
 VALHI INC.
 Summary of Consolidated Stockholders' Equity
 Nine Months Ended Sept. 30, 1993
 (Unaudited)
 (In millions)
 Stockholders' equity at Dec. 31, 1992 $259.1
 Net loss (69.4)
 Dividends -- $.05 per share (5.7)
 Currency translation and other (3.6)
 Stockholders' equity at Sept. 30, 1993 $180.4
 -0- 10/29/93
 /CONTACT: William C. Timm, VP-Finance and Administration of Valhi, 214-450-4212/
 (VHI)


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

MF-JL -- LA037 -- 8704 10/29/93 16:56 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:Oct 29, 1993
Words:1362
Previous Article:PIONEER BANCORP REPORTS THIRD QUARTER RESULTS
Next Article:SPECTRUM SIGNAL PROCESSING POSTS 51 PERCENT INCREASE IN NINE MONTHS SALES
Topics:

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