Universal Automotive Industries, Inc. Announces First Quarter
Results
CHICAGO, May 15 Universal Automotive Industries, Inc.
(Nasdaq: UVSL and UVSLW; CHX: UVS), today announced that first quarter 2001
net sales decreased 8.4% to $16.0 million compared to the first quarter of
2000 sales of $17.5 million. Core business sales of brake parts decreased
7.1% compared to the same 2000 quarter as the Company was affected by the
weakness throughout the automotive aftermarket. In addition, the 2000 first
quarter included initial ramp-up shipments to Pep Boys, Inc., a new customer
in 2000, shipments that were not repeated in 2001.
The overall gross profit for the first quarter of 2001 was $2.9 million or
17.9% of net sales which is down compared to gross profit of $3.7 million or
21.0% of net sales in the first quarter of 2000. The decrease in gross profit
is attributable to decreased sales and to underabsorbed manufacturing overhead
costs. The Company experienced expected underabsorption of manufacturing
costs associated with the relocation of the rotor machining facility from
Texas to Missouri as the Texas facility was wound down and the Missouri
facility was ramped up. There also was some underabsorption associated with
the Canadian friction facility that resulted from lower than expected
production volumes early in the first quarter.
The Company is actively engaged in attempting to sell the Hungarian
foundry operation that was classified as a discontinued operation as of
December 31, 1999. The foundry operations are improving and, as such, the
Company believes that the likelihood of sale has improved, as does its
ultimate sales value. Commencing in 2001, because the Hungarian foundry has
not been disposed of within one year, the Company is required to include
income or loss from the discontinued operation in its earnings which amounted
to a loss of $155 thousand ($0.02 per share) for the quarter ended March 31,
2001.
Net loss for the quarter ended March 31, 2001 without the loss of the
discontinued operation was $930 thousand ($0.13 per share) compared to net
income of $57 thousand ($0.01 per share) for the first quarter of 2000. Total
net loss for the first quarter of 2001 was $1.085 million or $0.15 per share.
Arvin Scott, President and CEO commented: "We certainly are disappointed
with our operating results for the first quarter which stems from the soft
marketplace and our challenging economy. We have worked hard to control costs
and are exploring several new opportunities that we believe should yield
positive results in the next several quarters. We remain well positioned with
our industry and maintain a solid customer base."
UNIVERSAL AUTOMOTIVE INDUSTRIES, INC.
Summary of Financial Results
(000's) except per share data
Three Months Ended March 31
2001 2000
Net Sales:
Brake parts $14,875 $16,018
Commodities 1,153 1,484
Total 16,028 17,502
Gross profit 2,863 3,689
Gross profit percent 17.9% 21.1%
Selling, general, and
administrative expenses 3,181 3,088
Income (loss) from operations (318) 601
Other (income) expense:
Interest expense and other, net 580 578
Other, net 22 (66)
Loss from discontinued operations 155 0
Pretax income (loss) (1,075) 89
Income tax provision (benefit) 10 32
Net income (loss) ($1,085) $57
Basic net income (loss) per share ($0.15) $0.01
Weighted average shares outstanding 7,295,402 6,839,310
