Myers Industries Reports Fourth Quarter and Fiscal Year 2001 Results
AKRON, Ohio--Feb. 19, 2002--Myers Industries, Inc. today announced net sales for the fourth quarter of 2001 were $148,505,622, a decrease of 13 percent from the $171,291,035 reported in 2000. Net income was $2,332,154, a decrease of 48 percent compared to $4,460,463 in the prior year's fourth quarter. Net income per share of $.10 was down 47 percent compared with $.19 in the fourth quarter of 2000.For the year ended December 31, 2001, net sales of $607,950,431 were down 7 percent from the $652,659,900 reported for the same period in 2000. Net income was $15,191,019, a 37 percent decrease from net income of $24,000,607 in the prior year. Net income per share was $.64, a 37 percent decrease from the $1.01 reported for the comparable period in 2000.
Included in the fourth quarter and full year of 2000 is a $1.9 million, or $.08 per share, after tax restructuring charge for the closing of one of the Company's manufacturing facilities.
Excluding acquisitions, net sales would have decreased 14 percent for the fourth quarter and 9 percent for the full year of 2001. Foreign currency translation had no material impact on sales and earnings for both the quarter and the year.
The lower sales and earnings for the quarter and full year resulted from lower demand, mainly from industrial markets, and did not reflect any company-specific issues or net loss in market share. Commenting on results, Myers Industries' President and Chief Executive Officer Stephen E. Myers said, "The economic decline that began in 2000 accelerated into a recession throughout 2001, particularly affecting our industrial markets.
"The Company remained profitable in spite of the downturn. We moderated capital spending and reduced inventory and receivables. In addition, we lowered our employment level by 7 percent to just over 4,100 by the end of the year.
"Strong cash flow allowed us to reduce total debt by $14.0 million during the fourth quarter and $35.3 million for the year. At the close of 2001, total debt was down 12 percent to $264.9 million from $300.2 million at the end of 2000."
Segment Report: Results Reflect the Weakened Markets
In the manufacturing segment, net sales of polymer products were down 15 percent for the fourth quarter and 7 percent for the year, compared to the same periods in 2000. Excluding acquisitions, manufacturing segment net sales would have decreased 16 percent for the quarter and 10 percent for the year. Nearly all end markets, particularly manufacturing-based markets, suffered from lower demand. The Company's decline in margins was due primarily to the impact of low demand from the weakened markets and the consequent unabsorbed fixed costs from lower production levels.
Compared to 2000's fourth quarter and full year, distribution segment net sales were down 6 percent for the fourth quarter and 5 percent for the year. Independent tire dealers and other key customers experienced lower demand for tire and allied services across virtually every region of the U.S. The sales mix in the segment continued to shift from capital equipment to consumable service supplies.
Implementation of FASB Rules 141 and 142: As of January 1, 2002
The Financial Accounting Standards Boards (FASB) recently issued Statement of Financial Accounting Standard No. 141 (SFAS 141), "Business Combinations," and SFAS 142, "Goodwill and Other Intangible Assets." The statements were effective for the Company as of January 1, 2002. These statements will result in modifications relative to the Company's accounting for goodwill and other intangible assets. Specifically, the Company ceased goodwill and certain intangible asset amortization as of January 1, 2002. Upon adopting the new standards and cessation of amortization for goodwill, the Company anticipates increases in annual income before taxes of $9.2 million and net income per share of approximately $.30. Additionally, intangible assets, including goodwill, are subject to new impairment testing criteria. Other than the impact on earnings of intangible asset amortization, the Company is still reviewing the impact of adoption on the Company's financial statements, including the possible impairment of goodwill recorded on the current balance sheet.
Conference Call Reminder
Myers Industries' fourth quarter and year-end conference call will be at 2 p.m. Eastern today, conducted by President and CEO Stephen Myers and Vice President and CFO Greg Stodnick. Dial 1-888-881-4892 and ask for the Myers Industries call. Please dial-in at least 10 minutes early. A replay will be available at 1-877-289-8525, access code 168828#, until February 26.
About Myers Industries
Myers Industries, Inc. is an international manufacturer of polymer products for industrial, agricultural, automotive, commercial, and consumer markets. The Company is also the largest wholesale distributor of tools, equipment, and supplies for the tire, wheel, and undervehicle service industry in the U.S. Myers has 25 manufacturing facilities in North America and Europe, 43 domestic and five international distribution branches, more than 20,000 products, and more than 4,100 employees. Visit www.myersind.com to learn more.
Forward-Looking Statements: Statements in this release may include "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any statement that is not of historical fact may be deemed "forward-looking." These statements involve a number of risks and uncertainties, many outside of the Company's control, that could cause actual results to materially differ from those expressed or implied. Factors include, but are not limited to: changes in the markets for the Company's business segments, unanticipated downturn in business relationships with customers or their purchases from us, competitive pressures on sales and pricing, increases in raw material costs or other production costs, and further deterioration of economic and financial conditions in the United States and around the world. Myers Industries does not undertake to update forward-looking statements contained herein.
MYERS INDUSTRIES, INC.
CONDENSED STATEMENT OF INCOME
Quarter Ended Year Ended
December 31, December 31,
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2001 2000 2001 2000
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Net Sales $148,505,622 $171,291,035 $607,950,431 $652,659,900
Cost of Sales 98,718,901 115,617,125 403,011,346 435,081,945
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Gross Profit 49,786,721 55,673,910 204,939,085 217,577,955
Operating Expenses 41,579,389 42,542,551 158,999,924 154,308,093
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Operating Income 8,207,332 13,131,359 45,939,161 63,269,862
Interest Expense 3,686,178 5,882,896 18,699,142 22,360,255
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Income Before
Income Taxes 4,521,154 7,248,463 27,240,019 40,909,607
Income Taxes 2,189,000 2,788,000 12,049,000 16,909,000
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Net Income $ 2,332,154 $ 4,460,463 $ 15,191,019 $ 24,000,607
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Net Income
Per Share(a) $.10 $.19 $.64 $1.01
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Average Shares
Outstanding(a) 23,840,274 23,743,977 23,801,899 23,862,568
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CONDENSED STATEMENT OF FINANCIAL POSITION
As of December 31, 2001 and 2000
2001 2000
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Assets
Current Assets $196,618,597 $219,307,253
Other Assets 194,811,960 201,291,971
Property, Plant, and Equipment 190,735,821 201,504,746
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$582,166,378 $622,103,970
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Liabilities and Shareholders' Equity
Current Liabilities $104,899,238 $112,890,230
Long Term Debt 247,145,234 284,273,097
Deferred Income Taxes 12,595,697 11,037,935
Shareholders' Equity 217,526,209 213,902,708
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$582,166,378 $622,103,970
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(a) Adjusted for a 10 percent stock dividend paid in August 2001.