WOODHEAD INDUSTRIES ANNOUNCES RECORD SALES AND ELEVATED PROFIT
MARGINS IN SECOND QUARTER; OUTLOOK POSITIVE FOR SECOND HALF
NORTHBROOK, Ill., April 15 /PRNewswire/ -- Woodhead Industries, Inc. (NASDAQ: WDHD) today reported that sales in its second fiscal quarter were the highest for any quarter in the company's 70-year history.
Earnings rose sharply as gross and net profit margins improved. Management attributed the greater profitability to new product introductions as well as footholds gained in new markets and new territories. Production efficiencies also contributed to the higher returns.
Alan Reed, chairman and CEO, said that domestic sales, strong in the first quarter, continued higher in recent months, and were joined in the second quarter by a rise in international demand, which accounted for 18.3 percent of total sales. He cited in particular good order flow in the company's electrical products unit. Its sales showed strong increases, in contrast to an electrical products market described by industry observers as "flat."
Substantial demand from the Middle East aided the company's fledgling Singapore operation, while distribution was expanded in Australia and Mexico.
For the three months ended March 28, 1992, net income was $1,060,000 or 32 cents per share, compared with $174,000, or 5 cents per share, in fiscal 1991's second quarter. The year-ago period bore a $727,000 after-tax charge, equal to 23 cents per share, for reserves and expenses relating to various litigation matters. Sales for the quarter reached $20,173,000, up 3.6 percent from $19,475,000 a year ago.
First-half net income doubled to $2,010,000, or 61 cents per share, from $999,000, or 31 cents per share, for the first six months of fiscal 1991. Six months sales rose 3.8 percent to $38,429,000 from $37,031,000.
In the second quarter, cost of sales actually declined despite increased volume. Higher factory output and more efficient production resulted from additional just-in-time work cells and new tooling and equipment.
"The company's fundamental growth strategy, formalized in January 1991, calls for substantial investments in engineering and marketing of new products -- regardless of the prevailing economic climate -- in order to increase market share, address new applications with existing products, and open new territories," Reed said. He noted that new project introductions in the first half ran 50 percent ahead of the year-ago pace.
Woodhead's financial condition strengthened further over the past year. Stockholders' investment grew by 8 percent, assets rose almost 9 percent, working capital expanded to $12.3 million from $11.1 million, and long-term debt remained nominal at $.5 million. Reed said that a $3 million increase in fixed assets reflected the company's ongoing commitment to more efficient production and faster response to customer requirements.
Looking ahead, Reed said management's view is positive for continued gains in the second half, even without discernible improvement in general economic activity.
Woodhead Industries, Inc. develops, manufactures and markets specialty electrical devices, custom cable assemblies, motion control products, and ergonomic workstations for a broad range of industrial applications.
WOODHEAD INDUSTRIES, INC.
(In thousands, except per-share numbers)
Quarters ended 3/28/92 3/30/91 Percent
Net sales $20,173 $19,475 3.6
Net income 1,060 174 509.2
Common and common
equivalent shares 3,334 3,198 4.3
Earnings per share -
primary $.32 $.05 540.0
/CONTACT: Robert G. Jennings, VP-finance and CFO of Woodhead Industries, 708-272-8181/
(WDHD) CO: Woodhead Industries Inc. ST: Illinois IN: SU: ERN
CK -- NY075 -- 8714 04/15/92 12:48 EDT