Aftermarket Technology Corp. Reports First Quarter 2002 Results
WESTMONT, Ill., April 25 Aftermarket Technology Corp., today reported financial results for the quarter ended March 31, 2002.
Net sales increased by $2.1 million to $101.3 million in the first quarter of 2002 versus the prior year's first quarter. Income from continuing operations, before an extraordinary item associated with the replacement and enhancement of the Company's credit facility, increased $1.8 million, or 23.4%, from $7.7 million, excluding special charges and before goodwill amortization, for the three months ended March 31, 2001. Income from continuing operations before extraordinary item per diluted share was $0.42 for the three months ended March 31, 2002 up from $0.37 for the three months ended March 31, 2001, excluding special charges and amortization of goodwill. This increase was primarily attributable to increased efficiencies and revenue growth in the Company's Drive Train and Logistics segments.
Accomplishments and Highlights
In commenting on the Company's results, Mike DuBose, Chairman, President and CEO said, ``I am pleased to report a strong quarter for ATC, exceeding our original expectations. In addition to the positive financial performance, we were successful in strengthening our balance sheet and reducing our cost of capital by completing the public offering of 2,760,000 shares and closing on a new credit facility that provides for $170 million of term loans and $50 million of revolving credit. We have now repaid all amounts outstanding under our previous credit facility and redeemed all $110 million of our 12% senior subordinated notes. We have reduced our year end 2001 net debt by $41 million to $156 million at the end of the first quarter.''
DuBose continued, ``Despite a difficult environment and a particularly mild winter, we saw increased strength in our remanufactured transmissions volume and our logistics business.''
``As expected, our Engine business experienced softness during the quarter. However, sales of remanufactured transmissions to the Independent Aftermarket have met our expectations. This strategic initiative provides ATC with a solid platform to penetrate the automotive aftermarket with our 'best-in-class' remanufactured units.''
``Finally, our ATC Lean and Continuous Improvement initiative continues on track as we aggressively work on improving productivity and reducing costs throughout the Company.''
DuBose concluded, ``We remain committed to our full year guidance of $1.90 and expect to achieve $0.44 in the second quarter from continuing operations and before extraordinary items. We remain excited about the growth initiatives being pursued in 2002.''
ATC will host a conference call to discuss this release in detail on Friday, April 26, 2002 at 9:00 AM Central time. The conference call number is 888-335-6716. A replay of the call will be available through Friday, May 3, 2002. The dial-in number for the replay is 877-519-4471. The access code is 3235618.
ATC is headquartered in Westmont, Illinois. The Company's operations include drivetrain remanufacturing, third party logistics, electronics remanufacturing and reverse logistics services.
The preceding paragraphs contain statements that are not related to historical results and are ``forward-looking'' statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include those that are predictive or express expectations, that depend upon or refer to future events or conditions, or that concern future financial performance (including future revenues, earnings or growth rates), ongoing business strategies or prospects, or possible future Company actions. Forward-looking statements involve risks and uncertainties because such statements are based on current expectations, projections and assumptions regarding future events that may not prove to be accurate. Actual results may differ materially from those projected or implied in the forward-looking statements. The factors that could cause actual results to differ are discussed in the Company's Annual Report on Form 10-K for the year ended December 31, 2001 and other filings made by the Company with the Securities and Exchange Commission.
AFTERMARKET TECHNOLOGY CORP.
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
For the three months ended March 31,
2002 2001
(Unaudited)
Net sales $101,266 $99,229
Cost of sales 67,122 66,767
Gross profit 34,144 32,462
Selling, general and administrative
expense 14,675 14,382
Amortization of intangible assets 83 1,256 (A)
Special charges - 862 (B)
Income from operations 19,386 15,962
Interest income 427 356
Other income, net 33 6
Minority interest in losses (63) -
Interest expense (4,654) (6,009)
Income from continuing operations
before income taxes and
extraordinary item 15,129 10,315
Income tax expense 5,643 3,970
Income from continuing operations
before extraordinary item 9,486 6,345 (C)
Loss from discontinued operations,
net of income taxes - (325)
Income before extraordinary item 9,486 6,020
Extraordinary item, net of income
taxes (928) -
Net income $8,558 $6,020
Per common share - basic:
Income from continuing operations
before extraordinary item $0.44 $0.31
Loss from discontinued operations - (0.02)
Extraordinary item (0.04) -
Net income $0.40 $0.29
Weighted average number of common
shares outstanding 21,543 20,578
Per common share - diluted:
Income from continuing operations
before extraordinary item $0.42 $0.31 (C)
Loss from discontinued operations - (0.02)
Extraordinary item (0.04) -
Net income $0.38 $0.29
Weighted average number of common
and common equivalent shares
outstanding 22,387 20,763
(A) Per the provisions of Statement of Financial Accounting Standards
No. 142, Goodwill and Other Intangible Assets, beginning January 1,
2002, goodwill amortization expense is no longer recorded. For the
three months ended March 31, 2001 the goodwill amortization charge
was $875, net of income taxes of $350.
(B) Primarily related to termination benefits for management upgrades and
delayering.
(C) Income from continuing operations before extraordinary item, special
charges and goodwill amortization of $7.7 million, or $0.37 per
diluted share, as referenced in the preceding text excludes the items
referenced in footnotes (A) and (B) above, net of tax.