Williams Controls Reports Third Quarter Results
PORTLAND, Ore., Aug. 21 Williams Controls, Inc. (OTC: WMCO) today announced its results for the third
quarter of fiscal 2001 ended June 30, 2001. Sales for the third quarter
decreased 30% to $12,601,000 compared to $18,022,000 reported in the third
quarter of fiscal 2000. For the nine months ended June 30, 2001, sales
decreased 17% to $42,610,000 compared to the prior year's first nine months
sales of $51,495,000. For the quarter ended June 30, 2001 approximately 12%
of the decline was attributable to overall reductions in sales volumes in the
automotive and heavy truck industries with the remaining 18% due to the
closure late in the second quarter of fiscal 2001 of the Company's plastic
injection molding business, Premier Plastics Technology (PPT). For the nine
months, 10% of the sales reductions were due to the automotive and truck
market declines, while the remaining 7% was due to the closure of PPT.
For the three months ended March 31, 2001, net income allocable to common
shareholders was $ 1,637,000, or $.07 per diluted share, compared to a net
loss of $1,321,000, or ($.07) per diluted share, during the comparable period
one year ago. The net loss allocable to common shareholders for the nine
months ended June 30, 2001 was $9,923,000, or ($.50) per diluted share,
compared to a loss of $3,915,000, or ($.20) per diluted share in last years'
comparable period. The financial statements for the three and nine months
ended June 30, 2000 have been restated to reflect the application in the
fourth quarter of fiscal 2000 of the provisions of the Financial Accounting
Standards Board Emerging Issues Task Force 99-10 relating to the Company's
affiliate, Ajay Sports, Inc. As a result of applying EITF 99-10, the Company
recorded an additional $ 594,000 equity interest in loss of affiliate for the
three months ended June 30, 2000 and $ 2,457,000 for the nine months ended
June 30, 2000.
The net income for the three months ended June 30, 2001 includes
recognition of a gain of $2,486,000, or $.09 per diluted share, related to the
sale of land and building at the Company's Aptek subsidiary and a gain of
$1,837,000, or $.07 per diluted share, related to the sale of the Company's
GPS subsidiary, GeoFocus, Inc. Additionally, the nine month period ended
June 30, 2001, included impairment losses of $4,366,000, or ($.22) per share,
related to the goodwill and intangible assets of the Company's adjustable
pedal business, ProActive Pedals and $1,996,000, or ($.10) per share, related
to the shutdown of the Company's plastic injection molding business, Premier
Plastics Technology (PPT).
Excluding the impact of the effect of gains related to the sale of the
Aptek land and building and the GeoFocus subsidiary, and the impairment losses
related to ProActive and PPT, the Company reported a net loss allocable to
common shareholders of $2,686,000, or ($.13) per share for the third quarter
of fiscal 2001 and $7,884,000 or ($.40) per share for the first nine months of
fiscal 2001. Gross margins declined from the prior year due to a combination
of lower sales levels, costs related to the closure of PPT and, in the
nine-month period, production and shipping inefficiencies caused by the
Company's liquidity constraints. Costs relating to obtaining additional
financing resulted in higher interest expense in the three and nine months
ended June 30, 2001 compared to last year's corresponding periods.
Williams Controls President and CEO Thomas K. Ziegler stated, "The sale of
our Deerfield Beach Florida property and GeoFocus subsidiary provided much
needed cash to pay down our debt with our secured lender and provide operating
liquidity. As a result of the sale of these assets, we have been able to
reduce our bank debt to $6.3 million. The payments on the bank loans were
made as required in our loan agreement. Our loan agreement expired on July
11, and we were able to reach an agreement with our secured lender to extend
our existing loan agreement through December 31, 2001, subject to certain
conditions."
Mr. Ziegler concluded, "The reduction in our revenues for vehicle
components during the 3rd quarter is generally in line with the downturn in
our customer's sales of heavy duty trucks. We are continuing to make progress
on our previously announced plans to sell one or more parts of the business.
The sale of our GeoFocus subsidiary and our Deerfield Beach facility during
the past quarter demonstrates our commitment to carryout this plan, and create
additional liquidity that will help stabilize our business and preserve its
value."
Williams Controls is a designer, manufacturer and integrator of sensors
and controls for the transportation industry. For more information, you can
find Williams Controls on the Internet at http://www.wmco.com .
Williams Controls, Inc.
Unaudited Condensed Consolidated Statements of Operations
(Dollars in thousands, except per share amounts)
Three Months Three Months Nine Months Nine Months
Ended 6/30/01 Ended 6/30/00 Ended 6/30/01 Ended 6/30/00
(as restated) (as restated)
Sales $12,601 $18,022 $42,610 $51,495
Cost of sales 10,533 13,368 35,364 37,843
Gross margin 2,068 4,654 7,246 13,652
Research and
development 1,213 2,068 3,180 5,239
Selling 292 516 1,058 1,381
Administration 1,970 2,308 6,748 6,564
Gain on sale of Aptek
land and building (1,837) - (1,837) -
Gain on sale of
Geofocus (2,486) - (2,486) -
Loss on impairment
of assets - PPT - - 1,996 -
Loss on impairment of
assets - ProActive - - 4,366 -
Earnings (loss) from
operations 2,916 (238) (5,779) 468
Other expenses 1,132 1,296 3,248 4,574
Income (loss) before
income taxes 1,784 (1,534) (9,027) (4,106)
Income tax benefit - (361) - (633)
Net Income (Loss) 1,784 (1,173) (9,027) (3,473)
Dividends on preferred
stock (147) (148) (896) (442)
Net income (loss)
allocable to common
shareholders $1,637 $(1,321) $(9,923) $(3,915)
Net income (loss)
per common
share - basic $0.08 $(0.07) $(0.50) $(0.20)
Net income (loss)
per common share -
diluted $0.07 $(0.07) $(0.50) $(0.20)
Weighted avg. shares
used in per share
calculation -
basic 19,921,114 19,789,396 19,921,114 19,787,131
Weighted avg.
shares used in
per share
calculation -
diluted 26,356,023 19,789,396 19,921,114 19,787,131