Oilgear Reports First Quarter Results
MILWAUKEE--May 10, 2002--The Oilgear Company today reported sales and earnings for the first quarter ended March 31, 2002.The manufacturer of fluid power components and electronic controls posted sales of $20,597,000 for the first quarter of 2002, compared to sales of $21,541,000 for the same period in 2001. Net earnings were $24,000 or $0.01 per share for the first quarter of 2002, compared to earnings of $187,000 or $0.10 per share in the first quarter of 2001.
"Our first quarter sales reflect the extended softness in the U.S. fluid power market and the negative effect of the strong U.S. dollar on sales outside the United States," said David A. Zuege, president and chief executive officer. "The much talked about recovery has not yet reached the Fluid Power Industry. According to data provided by the National Fluid Power Association, U.S. shipments of hydraulic equipment were down 7.5% in the first quarter of 2002 from 2001. Our domestic shipments were down by a slightly lesser amount and we believe that we did not lose market share. And, in addition, we are pleased to see that we continue to be most successful in obtaining the more technically sophisticated customer projects, which is a tribute to our high level of technology."
Zuege indicated that margins suffered in the first quarter of 2002 due to the increased price competition brought on by the long downturn in the industry, a decrease in sales which resulted in lower utilization of our production facilities and a less profitable mix of business.
Zuege said that orders in the first quarter of 2002 were $20.8 million, down 8.0% from orders in the first quarter of 2001 while backlog reached $20.7 million at the end of the first quarter, up slightly from the backlog at the end of fiscal 2001. "While overall orders were down slightly from last year's first quarter, we're pleased to see orders from our European operations come in ahead of last year's first quarter," Zuege said.
A leader in the fluid power industry, The Oilgear Company provides advanced technology in the design and production of unique fluid power components and electronic controls. The company serves customers in the primary metals, machine tool, automobile, petroleum, construction equipment, chemical, plastic, glass, lumber, rubber and food industries. Its products are sold as individual components or integrated into high performance applications.
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. In addition to the assumptions and other factors referenced specifically in connection with such statements, the following could impact the business and financial prospects of the Company: factors affecting the Company's international operations, including fluctuations in currencies, changes in laws and political or financial insecurity of foreign governments; factors affecting the Company's ability to hire and retain competent employees, including unionization of non-union employees and strikes or work stoppages; factors affecting the economy generally, including an economic slowdown and other conditions that could reduce demand for the Company's products; decrease in stock price as a result of market conditions; changes in the law or standards applicable to the Company, including environmental laws and accounting pronouncements; availability of raw materials; unanticipated technological developments that result in competitive disadvantages and may impair existing assets; and factors set forth in the Company's periodic reports filed with the SEC in accordance with the Securities Exchange Act. 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 Operating Statement
(Unaudited)
(In Thousands)
Three Months Ended March 31,
----------------------------
2002 2001
---- ----
Net sales...............................$ 20,597,000 $ 21,541,000
Cost of sales 15,596,000 15,762,000
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Gross profit..........................$ 5,001,000 $ 5,779,000
Operating expenses 4,597,000 5,010,000
------------- -------------
Operating income......................$ 404,000 $ 769,000
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Interest expense 285,000 408,000
Other income (expense).................. 4,000 (80,000)
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Earnings before income taxes............ 123,000 281,000
Income taxes 47,000 78,000
------------- -------------
Net earnings from minority interest 52,000 16,000
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Net earnings..........................$ 24,000 $ 187,000
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Basic earnings per share of common
stock..................................$ 0.01 $ 0.10
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Diluted earnings per share of common
stock..................................$ 0.01 $ 0.10
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Dividends per share.....................$ 0.00 $ 0.07
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Basic weighted average outstanding
shares................................. 1,943,000 1,960,000
Diluted weighted average outstanding
shares................................. 1,946,000 1,970,000
The Oilgear Company
Consolidated Condensed Balance Sheet
(Unaudited)
(In Thousands)
March 31, December 31,
2002 2001
------------- -------------
ASSETS
Current Assets
Cash and cash equivalents.............$ 5,680,000 $ 4,997,000
Accounts receivable................... 15,735,000 17,002,000
Inventories........................... 23,623,000 23,910,000
Other current assets 3,068,000 2,186,000
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Total current assets $ 48,106,000 $ 48,095,000
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Net property plant and equipment 21,970,000 22,701,000
Other assets 1,110,000 1,136,000
------------- -------------
$ 71,186,000 $ 71,932,000
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Current debt..........................$ 6,496,000 $ 7,564,000
Accounts payable...................... 5,632,000 5,377,000
Other current liabilities............. 7,760,000 8,230,000
------------- -------------
Total current liabilities...........$ 19,888,000 $ 21,171,000
------------- -------------
Long-term debt.......................... 17,986,000 17,130,000
Unfunded employee benefit costs......... 13,996,000 13,996,000
Other non-current liabilities........... 1,126,000 1,107,000
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Total liabilities.....................$ 52,996,000 $ 53,404,000
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Minority interest in consolidated
subsidiary............................. 956,000 946,000
Shareholders' equity.................... 17,234,000 17,582,000
------------- -------------
$ 71,186,000 $ 71,932,000
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