Onex Reports Best-Ever Quarterly Results
TORONTO--Aug. 27, 2001--Onex Corporation today announced its financial results for the second quarter ended June 30, 2001.
| - | Revenues for the quarter were $6.3 billion, up 27% from the second quarter of 2000. |
| - | Net earnings were $747 million ($4.65 per share) compared to $37 million ($0.23 per share) in the second quarter last year. |
| - | Cash flow from operations for the quarter totalled $218 million, approximately equal to the same quarter last year. |
"Our second quarter results were spectacular. Our business is building shareholder value and that is what we did," said Gerald W. Schwartz, President and CEO of Onex Corporation. "The sale of our remaining interest in Sky Chefs in the quarter brought our total sale proceeds to $1.8 billion on our $99 million investment in Sky Chefs, a testament to the value created over our 16-year partnership with the company. This quarter alone our sale proceeds were $1.3 billion resulting in an after-tax gain of $910 million."
Onex' subsidiary Celestica reported strong growth in the second quarter over the same period last year despite the impact of the broad slowdown in technology end-markets being experienced by its customers. Celestica also announced a number of acquisitions in the quarter that expand its global reach and customer base.
Lower automotive production volumes impacted the results of our automotive companies in the second quarter. Management of those operating companies are making the necessary adjustments for these lower business volumes. Also, in the second quarter, Onex increased its ownership interest in Trim Systems from 35% to 74% with the purchase of one of the other original owner's remaining interest.
Onex established the name, Radian Communication Services Corporation, in the second quarter for its operations of LeBlanc and BMS Communications, which were acquired in February 2001. Radian expanded its U.S. wireless operations in the U.S. by adding three new offices and increasing its U.S. revenues during the quarter.
Writedowns were made in the second quarter on the book value of goodwill recorded for ClientLogic and certain of our automotive companies. The effect of these writedowns was a non-cash charge of $181 million ($1.12 per share) against Onex' net earnings.
Revenues for the six months ended June 30, 2001 were $12.5 billion, up 40% from $8.9 billion for the first six months of 2000. Operating earnings to June 30, 2001 rose to $595 million, an increase of 15% from $516 million for the first half of 2000. Net earnings for the six months of 2001 totalled $763 million ($4.72 per share), up $554 million from the $209 million ($1.28 per share) reported for the first six months of 2000.
Cash flow from operations for the six months of 2001 totalled $500 million ($3.09 per share), an increase of 32% from $380 million ($2.32 per share) for the first six months of 2000.
"Onex continues to be in a very strong financial position," said Mr. Schwartz. "With cash and near-cash items of close to $1.9 billion and no recourse debt, Onex is well poised to participate in future acquisition opportunities presented by the current economic environment."
Assets totalled $19.3 billion at June 30, 2001 and shareholders' equity was $2.2 billion.
Consolidated Statements of Earnings
Three Months ended Six Months ended
June 30 June 30
(Unaudited) 2001 2000 2001 2000
(in millions of dollars
except per share data)
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Revenues $ 6,324 $ 4,984 $ 12,481 $ 8,945
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Earnings Before the
Undernoted Items $ 408 $ 352 $ 795 $ 635
Amortization of
capital assets (146) (97) (285) (178)
Amortization of goodwill,
intangible assets and
deferred charges (92) (68) (179) (128)
Interest expense of
operating companies (117) (100) (228) (188)
Interest and other income 46 32 85 59
Gains of shares on
operating companies, net 67 1 68 178
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166 120 256 378
Acquisition, integration
and other expenses (107) (8) (122) (9)
Writedown of goodwill and
intangible assets by
operating companies (365) - (365) -
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Earnings (loss) before
income taxes and non-
controlling interests (306) 112 (231) 369
Provision for income taxes (24) (42) (55) (80)
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Earnings (loss) before
non-controlling interests (330) 70 (286) 289
Non-controlling interests
in results of operating
companies 167 (67) 110 (114)
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Earnings (loss) from
continuing operations (163) 3 (176) 175
Earnings from discontinued
operations 910 34 939 34
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Net Earnings for the Period $ 747 $ 37 $ 763 $ 209
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Net Earnings (Loss) per
Subordinate Voting Share
Basic
Continuing Operations $ (1.00) $ 0.03 $ (1.09) $ 1.08
Discontinued Operations $ 5.65 $ 0.20 $ 5.81 $ 0.20
Net Earnings $ 4.65 $ 0.23 $ 4.72 $ 1.28
Diluted
Continuing Operations $ (0.95) $ 0.02 $ (1.03) $ 1.01
Discontinued Operations $ 5.34 $ 0.19 $ 5.49 $ 0.19
Net Earnings $ 4.39 $ 0.21 $ 4.46 $ 1.20
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