Tower Automotive Announces Operating Results
for the First Quarter
GRAND RAPIDS, Mich., April 19 Tower Automotive, Inc. today announced its operating results
for the first quarter ended March 31, 2001.
For the first quarter of 2001, revenues were $628 million, an eight
percent decrease, compared with $685 million in the 2000 period. Operating
income declined 47 percent to $38 million from $72 million reported last year.
Net income for the first quarter of 2001 was $13 million, or 28 cents per
diluted share outstanding, versus $37 million, or 65 cents per diluted share,
in the comparable 2000 period.
In commenting on first quarter results, Dug Campbell, president and chief
executive officer of Tower Automotive, said, "As expected, the first quarter
of 2001 proved to be the most difficult in Tower Automotive's history.
Reduced volumes, pricing pressure and intense launch activities on several
programs provided colleagues with an intense combination of challenges to
overcome. We were able to successfully meet the requirements of the Ford
Explorer launch and continue on time development of our Ram Truck, Econoline,
and Cadillac launch activities, while managing the business profitably.
"Excluding our Korean operations, which were not consolidated in 2000,
sales for the first quarter of 2001 as compared to the first quarter of 2000
were down approximately 22 percent. That volume decline and expenses of the
aforementioned launches resulted in a year-to-year decline in net income. We
were able to preserve our working capital position through the first quarter
of 2001 and stay within our planned level of capital spending. Total
borrowings increased by approximately $50 million. Of the increase,
approximately $28 million was due to the exercise of our option to purchase an
additional 13.76 percent of Yorozu Corporation, bringing our ownership up to
30.76 percent. The balance of the increase in borrowings was to support the
capital spending requirements of the various launches taking place in 2001.
"We are forecasting an improvement to revenues and earnings in the second
quarter, as compared to the first quarter of 2001. However, excluding the
effect of Korean sales, the volumes will still be well below those experienced
in the second quarter of 2000. The strength of volumes for the balance of the
year is still clouded but, relative to our business mix, should result in
sales at a SAAR of 15 to 15.3 million units for the year."
Tower Automotive, Inc., produces a broad range of assemblies and modules
for vehicle structures and suspension systems for the automotive
manufacturers, including Ford, DaimlerChrysler, GM, Honda, Toyota, Nissan,
Auto Alliance, Fiat, Kia, Hyundai, BMW and Volkswagen. Products include body
structural assemblies such as pillars and package trays, control arms,
suspension links, engine cradles and full frame assemblies. The company is
based in Grand Rapids, Mich., and has its corporate office in Minneapolis,
Minn.
This news release contains forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995. Actual results may
differ materially from the anticipated results as a consequence of certain
risks and uncertainties, including but not limited to general economic
conditions in the markets in which Tower Automotive operates, and other risks
detailed from time to time in the company's Securities and Exchange Commission
filings.
TOWER AUTOMOTIVE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in thousands, except per share amounts - unaudited)
Three Months Ended March 31,
2001 2000
Revenues $628,376 $685,364
Cost of sales 549,105 573,642
Gross profit 79,271 111,722
Selling, general and
administrative expenses 35,299 34,656
Amortization expense 6,078 5,099
Operating income 37,894 71,967
Interest expense, net 19,722 13,197
Income before provision for
income taxes 18,172 58,770
Provision for income taxes 7,028 23,508
Income before equity in
earnings of joint ventures
and minority interest 11,144 35,262
Equity in earnings of joint ventures 4,381 4,480
Minority interest - dividends
on trust preferred securities, net (2,664) (2,619)
Net income $12,861 $ 37,123
Basic earnings per common share $0.29 $0.79
Basic shares outstanding 44,111 47,209
Diluted earnings per common share $0.28 $0.65
Diluted shares outstanding 52,233 63,926
TOWER AUTOMOTIVE, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Amounts in Thousands)
March 31, December 31,
Assets 2001 2000
(unaudited)
Current assets:
Cash and cash equivalents $-- $3,373
Accounts receivable 365,970 278,707
Inventories 114,056 132,478
Prepaid tooling and other 108,292 133,935
Total current assets 588,318 548,493
Property, plant and equipment, net 1,240,673 1,199,964
Investments in joint ventures 301,684 267,217
Goodwill and other assets, net 865,111 877,073
$2,995,786 $2,892,747
Liabilities and Stockholders' Investment
Current liabilities:
Current maturities of long-term
debt and capital lease obligations $134,834 $149,066
Accounts payable 290,046 248,389
Accrued liabilities 202,578 175,219
Total current liabilities 627,458 572,674
Long-term debt, net of current maturities 996,505 933,442
Obligations under capital leases, net of
current maturities 6,714 8,458
Convertible subordinated notes 200,000 200,000
Deferred income taxes 35,276 33,884
Other noncurrent liabilities 168,027 185,444
Total noncurrent liabilities 1,406,522 1,361,228
Mandatorily redeemable trust convertible
preferred securities 258,750 258,750
Stockholders' investment:
Preferred stock -- --
Common stock 477 476
Additional paid-in capital 451,088 450,455
Retained earnings 320,817 307,956
Deferred income stock plan (8,942) (8,942)
Accumulated other comprehensive loss (20,206) (9,672)
Treasury stock, at cost (40,178) (40,178)
Total stockholders' investment 703,056 700,095
$2,995,786 $2,892,747
