Prestolite Electric Announces Second Quarter 2001 Results
ANN ARBOR, Mich.--July 26, 2001--Prestolite Electric Incorporated and its parent, Prestolite Electric Holding Inc., today released second quarter 2001 financial results. Second quarter sales from continuing operations of $42.2 million declined 3.1% from the second quarter of 2000 while earnings before interest, taxes, depreciation and amortization (EBITDA) of $5.3 million increased 78.5%. Compared to the first quarter of 2001 sales grew 0.6% while EBITDA rose by 11.1%."In addition to emphasizing new product launches, we are maintaining our cost reduction focus in the face of marketplace uncertainty," said P. Kim Packard, company president and CEO. "We have seen strength in the European aftermarket, North American specialty markets and in our exports to Asia. Sales to the aftermarket arms of North American original equipment customers rose in the second quarter but continue at a lower level than normal. Truck production in North America remains very weak, and we face significant uncertainty in Argentina." In conjunction with personnel reductions Prestolite recorded a $769,000 charge for severance in the second quarter following a $341,000 first quarter charge. The company expects to record an additional severance charge of about $1.0 million in the third quarter.
The net loss for the second quarter of $0.2 million compared to a net loss of $2.8 million in the second quarter of 2000 and net loss of $0.9 million in the first quarter of 2001. Capital spending totaled $1.0 million during the second quarter and $2.4 million during the first half of 2001.
Prestolite Electric Incorporated manufactures alternators and starter motors in the United States, United Kingdom, Argentina, South Africa and China. These are supplied under the Prestolite, Leece-Neville, and Indiel brand names for original equipment and aftermarket application on a variety of vehicles and industrial equipment. Genstar Capital Corporation and management own the equity of the company.
EBITDA is a widely accepted financial indicator of a company's ability to service debt, but is not calculated the same by all companies. EBITDA should not be considered by an investor as an alternative to net income as an indicator of a company's operating performance or as an alternative to cash flow as a measure of liquidity. This release contains forward-looking statements that involve risks and uncertainties regarding the anticipated financial and operating results of the Company. The Company undertakes no obligation to publicly release any revisions to any forward-looking statements contained herein to reflect events or circumstances occurring after the date of this release. The Company's actual results may differ materially from those projected in forward-looking statements made by, or on behalf of, the Company.
Prestolite Electric Holding, Inc.
Consolidated Unaudited Income Statement Highlights
Second Quarter 2001
(in thousands of dollars)
Three months ending Six months ending
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June 30, July 1, June 30, July 1,
2001 2000 2001 2000
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Net sales $42,218 $43,577 $84,182 $88,464
Cost of good sold 33,882 36,531 67,641 72,974
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Gross profit 8,336 7,046 16,541 15,490
Selling, general and
administrative 5,089 6,850 10,577 14,087
Severance 769 1,673 1,110 1,700
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Operating income (loss) 2,478 (1,477) 4,854 (297)
Other (income) expense (98) (447) 35 (346)
Unrealized foreign exchange loss 7 544 32 614
Interest expense 3,247 4,169 6,343 8,302
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(Loss) from continuing
operations before
income taxes (678) (5,743) (1,556) (8,867)
Income tax benefit (72) (1,411) (93) (1,926)
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(Loss) from continuing
operations (606) (4,332) (1,463) (6,941)
Net income - discontinued
operations -- 1,554 -- 2,351
Net gain on senior note purchase 391 -- 391 --
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Net (loss) $ (215) $(2,778) $(1,072) $(4,590)
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Operating income (loss) $ 2,478 $(1,477) $ 4,854 $ (297)
Other income (expense) 98 447 (35) 346
Severance 769 1,673 1,110 1,700
Depreciation 1,650 1,977 3,527 3,953
Amortization 310 352 625 707
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EBITDA - continuing
operations $ 5,305 $ 2,972 $10,081 $ 6,409
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