Oilgear Reports Second Quarter Results
MILWAUKEE--Aug. 10, 2001--The Oilgear Company today reported sales and earnings for the second quarter ended June 30, 2001.For the second quarter of 2001, Oilgear reported net sales of $21,709,000, compared to sales of $22,097,000 for the same period in 2000. Net earnings were $141,000 or $0.07 per share for the second quarter of 2001, compared to earnings of $288,000 or $0.15 per share for the comparable prior period.
For the first half of 2001, net sales were $43,250,000, compared to sales of $46,561,000 for the first half of 2000. Net earnings were $328,000 or $0.17 per share for the first six months of 2001, compared to earnings of $827,000 or $0.42 per share for the same period in the prior year.
"The decrease in sales in the first half is primarily due to a 10% decline in the domestic segment. This compares favorably with the 15% decline in total U.S. hydraulics sales as reported by the National Fluid Power Association," said David A. Zuege, president and chief executive officer. "We are confident that we have not lost market share in the U.S."
Zuege indicated that European business levels continue to be good, but sales were down 6% in the second quarter due to the adverse translation effects of the depressed EURO and British Pound in relation to the strong U.S. dollar. "The super strong value of the dollar is putting U.S. companies at a disadvantage in the European market," Zuege said. "Our International sales, which exclude Europe, were buoyed by the strength of our business in Mexico and Korea."
Orders in the second quarter of 2001 amounted to $20.2 million, down 14% from the second quarter of 2000. The backlog was at $20.8 million at the end of the second quarter, down 2% from the beginning of the year. "The U.S. fluid power market continues to be down, with particular weakness in the mobile market," Zuege added.
Zuege indicated that in response to the softness of the U.S. manufacturing sector, Oilgear has reduced hours and introduced other cost cutting programs at its U.S. plants. "Despite our cost reduction efforts, U.S. operating income decreased in the second quarter," Zuege said. "At the same time, European and International operating income increased, with the European increase primarily due to a higher-margin product mix."
A leader in the fluid power industry, The Oilgear Company provides advanced technology in the design and production of unique fluid power components, systems and electronic controls. The company serves customers in the primary metals, machine tool, automobile, aerospace, petroleum, construction equipment, chemical, plastic, glass, lumber, rubber and food industries.
Certain matters discussed in this press release are "forward-looking statements" intended to qualify for the safe harbors from liability established by the Private Securities Litigation Reform Act of 1995. These forward-looking statements can generally be identified as such because the context of the statement will include words such as the company "believes," "anticipates," "expects" or words of similar import. Similarly, statements that describe the company's future plans, objectives or goals are also forward-looking statements. Such forward-looking statements are subject to certain risks and uncertainties which could cause actual results to differ materially from those currently anticipated. Shareholders, potential investors and other readers are urged to consider these factors and those set forth in the company's filings with the SEC carefully in evaluating the forward-looking statements. The forward-looking statements made herein are only made as of the date of this press release and the company undertakes no obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances.
News releases and product information from The Oilgear Company are
available 24 hours a day on-line at: www.oilgear.com
The Oilgear Company
Consolidated Condensed Earnings Statement
(Unaudited)
(In Thousands)
Three Months Ended June 30,
2001 2000
------------ ------------
Net sales $ 21,709,000 $ 22,097,000
Cost of sales 16,509,000 16,392,000
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Gross profit $ 5,200,000 $ 5,705,000
Operating expenses 4,628,000 5,052,000
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Operating income $ 572,000 $ 653,000
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Interest expense 410,000 356,000
Other income 82,000 103,000
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Earnings before income taxes 244,000 400,000
Income taxes 84,000 86,000
------------ ------------
Net earnings from minority interest 19,000 26,000
------------ ------------
Net earnings $ 141,000 $ 288,000
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Basic earnings per share of common stock $ 0.07 $ 0.15
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Diluted earnings per share of common stock$ 0.07 $ 0.15
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Dividends per share $ 0.07 $ 0.07
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Basic weighted average outstanding shares 1,943,000 1,981,000
Diluted weighted average outstanding shares 1,945,000 1,986,000
Six Months Ended June 30,
2001 2000
------------ ------------
Net sales $ 43,250,000 $ 46,561,000
Cost of sales 32,270,000 34,649,000
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Gross profit $ 10,980,000 $ 11,912,000
Operating expenses 9,638,000 10,164,000
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Operating income $ 1,342,000 $ 1,748,000
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Interest expense 819,000 698,000
Other income 1,000 135,000
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Earnings before income taxes 524,000 1,185,000
Income taxes 161,000 276,000
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Net earnings from minority interest 35,000 82,000
------------ ------------
Net earnings $ 328,000 $ 827,000
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Basic earnings per share of common stock $ 0.17 $ 0.42
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Diluted earnings per share of common stock$ 0.17 $ 0.42
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Dividends per share $ 0.14 $ 0.14
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Basic weighted average outstanding shares 1,952,000 1,981,000
Diluted weighted average outstanding shares 1,958,000 1,986,000
The Oilgear Company
Consolidated Condensed Balance Sheet
(Unaudited)
(In Thousands)
June 30, December 31,
2001 2000
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ASSETS
Current Assets
Cash and cash equivalents $ 4,390,000 $ 5,102,000
Accounts receivable 18,361,000 18,593,000
Inventories 24,374,000 23,830,000
Other current assets 5,249,000 4,585,000
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Total current assets $ 52,374,000 $ 52,110,000
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Net property plant and equipment 23,847,000 24,836,000
Other assets 7,630,000 7,886,000
------------ ------------
$ 83,851,000 $ 84,832,000
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Current debt $ 6,895,000 $ 3,273,000
Accounts payable 7,198,000 7,727,000
Other current liabilities 6,542,000 8,248,000
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Total current liabilities $ 20,635,000 $ 19,248,000
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Long-term debt 19,352,000 20,058,000
Unfunded employee benefit costs 11,685,000 11,685,000
Other non-current liabilities 1,360,000 1,550,000
------------ ------------
Total liabilities $ 53,032,000 $ 52,541,000
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Minority interest in consolidated subsidiary 939,000 904,000
Stockholders' equity 29,880,000 31,387,000
------------ ------------
$ 83,851,000 $ 84,832,000
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