SMC Corporation Reports First Quarter Earnings
2001
BEND, Ore., May 15 Today SMC Corporation
released its results for the three month period ended March 31, 2001. For the
three months ended March 31, 2001, SMC reported sales of $45.1 million and net
loss of $1.8 million. This compares to sales of $53.1 million and net loss of
$260,000 for the three month period ended March 31, 2000. Although SMC's sales
to dealers declined during the first quarter of 2001, the Company's retail
market share of class A motorhomes increased by over 24% according to the
Statistical Surveys Inc. publication.
Gross profits decreased from $5.5 million to $2.5 million during the first
quarter comparisons. The decrease in gross profit is largely the result of
decreases in sales volumes. Although sales of Beaver product increased in both
revenues and units, sales of Safari and Harney Coach Works product decreased
over the same period. Warranty costs however, were lower in the first quarter
of 2001 by approximately 20%. Selling, general and administrative costs
decreased from $5.4 million to $4.9 million, primarily reflecting lower costs
of accounting and marketing. Offsetting the impact of the net loss were
improvements in inventories and receivables that ultimately generated cash
from operations totaling approximately $3.4 million. The Company kept capital
expenditures to a very low level and continued to pay down its debt.
In recent developments, the Company has implemented several strategic
initiatives that it hopes will significantly improve future results. The
Company anticipates annual overhead savings of more than $1 million based on
the elimination of several positions in the Company with additional amounts
targeted over the next three to six months. Also, due to reduced orders,
manufacturing activities at Harney Coach Works are being suspended while the
Company considers options. Employees of that operation are being offered
employment as openings occur at the Company's Composite Technology, Inc.
subsidiary that occupies the same facilities as Harney Coach Works. With the
recent resignation of Michael R. Jacque, President and Chief Operating Officer
of the Company, Mathew M. Perlot, Chairman of the Board of Directors for the
Company, has agreed to defer his retirement and return to direct the sales,
marketing, and product development functions of the Company. He will focus
particularly on the Safari product line and its unique characteristics, with
an emphasis on its value orientation in the marketplace.
The Company is currently reviewing proposals received by McDonald
Investments concerning strategic alternatives for the Company that includes
the possible sale of the Company to other parties in the RV industry. While
the Company does not have a specific timetable to complete its review, it
anticipates completion in the next few weeks.
SMC Corporation is one of the largest high line motor coach manufacturers
in the United States. Headquartered in Bend, Oregon, the Company has six
locations in Oregon. The Company offers customers luxury recreational vehicle
models under the Beaver, Safari and Harney Coach Works brand names.
Information about SMC Corporation and its products can be found on the World
Wide Web at http://www.smccorporation.com .
Forward-Looking Statements: The statements in this report regarding
anticipated cost savings and strategic alternatives are forward-looking
statements. A number of factors could cause actual results to differ
materially from these statements. Please also refer to the Company's SEC
reports, including, but not limited to its Form 10-K for the year ended
December 31, 2000.
SMC CORPORATION
CONSOLIDATED STATEMENT OF INCOME
$000's (except share and per share data)
Three Months Ended
03/31/00 3/31/01
Net Sales 53,052 45,073
Gross Profit 5,456 2,500
Income (Loss) from
Operations 56 (2,420)
Loss Before Taxes (434) (3,008)
Benefit for Taxes (174) (1,113)
Net Loss (260) (1,895)
Net Loss /share
basic (0.05) (0.33)
Net Loss /share
diluted (0.05) (0.33)
Weighted share
basic 5,780,000 5,745,000
Weighted shares
diluted 5,780,000 5,745,000
SMC CORPORATION
CONSOLIDATED BALANCE SHEET
In Thousands
12/31/00 3/31/01
Assets
Current 49,671 42,105
Property & Equipment 12,827 12,455
Other 2,143 3,206
Total Assets 64,641 57,766
Liabilities
Current 38,631 34,667
Long-term Debt 8,613 7,597
Total Liabilities 47,244 42,264
Shareholders' Equity 17,397 15,502
Total Liability & Equity 64,641 57,766
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