SL Industries, Inc. Announces Financial Results for Its First Quarter Ended March 31, 2003
MT. LAUREL, N.J.--May 16, 2003--SL Industries, Inc. (AMEX & PHLX:SLI) announced today that revenue for the first quarter ended March 31, 2003 was $26,218,000, compared to $27,533,000 for the first quarter last year.Net income from continuing operations was $186,000, or $0.03 per diluted share, compared to a net loss of $928,000, or $0.16 per diluted share, for the same period in 2002. Discontinued operations did not affect the net income in the current quarter, but had a $0.09 per share positive impact in the first quarter of 2002. The loss from continuing operations for the period ended March 31, 2002 included $1,825,000 for special charges (change-in-control payments and proxy costs) and $225,000 for restructuring charges ($1,218,000 net of taxes).
These charges had a $0.21 negative effect on the net income for the period. The Company had net income from continuing operations of $290,000, or $0.05 per diluted share, excluding the above charges for the prior year quarter.
The Company reported net new orders of $29,714,000 in the first quarter of 2003, compared to net new orders of $30,043,000 in the first quarter of 2002. Backlog at March 31, 2003 was $40.6 million, as compared to $42.7 million a year earlier.
Commenting on the results, Warren Lichtenstein, Chairman and Chief Executive Officer of SL Industries, said, "our first quarter results represent the second consecutive quarter of profitability from continuing operations for the Company. All of the Company's operating subsidiaries had income from operations for the first quarter ended March 31, 2003, except SL Surface Technologies, Inc. which is facing historically low demand in its market and represents a minor part of the Company's business and financial results. We believe the Company's businesses performed well during the quarter, given the current challenging business environment."
"During the first quarter, the Company completed two important initiatives to improve its capital structure. In January, SL Industries, Inc. sold all of the capital stock of Electro Metall Export GmbH. This transaction allowed us to enter into a new three-year senior secured credit facility with LaSalle Business Credit LLC to refinance the Company's pre-existing bank debt. As a result of these transactions and the Company's operating cash flows over the quarter, the Company's bank debt has been reduced $7,556,000, from $17,557,000 to $10,001,000."
Lichtenstein concluded, "We are pleased with the progress the Company has made over the past year. During that time, we were able to improve operations, return the Company to stable profitability and reduce the level of debt from $26,303,000 at March 31, 2002. The Board of Directors has established May 29, 2003, as the date of the Annual Shareholders Meeting for shareholders of record on April 22, 2003. The meeting will be held at the Warwick Hotel in New York at 1:30 p.m.. We look forward to discussing our management and strategy for the Company's businesses with our shareholders at that time."
About SL Industries
SL Industries, Inc. designs, manufactures and markets Power and Data Quality (PDQ) equipment and systems for industrial, medical, aerospace and consumer applications. For more information about SL Industries, Inc. and its products, please visit the Company's web site at www.slindustries.com.
Forward-Looking Statements
This press release contains statements that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on current expectations, estimates and projections about the Company's business based, in part, on assumptions made by management. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict.
Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous factors, including those described above and the following: the effectiveness of the cost reduction initiatives undertaken by the Company, changes in demand for the Company's products, product mix, the timing of customer orders and deliveries, the impact of competitive products and pricing, constraints on supplies of critical components, excess or shortage of production capacity, difficulties encountered in the integration of acquired businesses and other risks discussed from time to time in the Company's Securities and Exchange Commission filings and reports.
In addition, such statements could be affected by general industry and market conditions and growth rates, and general domestic and international economic conditions. Such forward-looking statements speak only as of the date on which they are made, and the Company does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this release.
SL INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands)
Three-Months Ended
March 31,
2003 2002
-------- --------
(Unaudited)
Net sales $26,218 $27,533
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Cost and expenses:
Cost of products sold 17,119 17,169
Engineering and product development 1,918 2,010
Selling, general and administrative 6,020 6,719
Depreciation and amortization 648 731
Special charges - 1,825
Restructuring costs - 225
-------- --------
Total cost and expenses 25,705 28,679
-------- --------
Operating income (loss) from continuing
operations 513 (1,146)
Other income (expense):
Interest income 65 3
Interest expense (206) (516)
-------- --------
Income (loss) from continuing operations before
income taxes 372 (1,659)
Income tax provision (benefit) 186 (731)
-------- --------
Income (loss) from continuing operations 186 (928)
Income from discontinued operations (net of tax) - 552
-------- --------
Net income (loss) $186 $(376)
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Basic net income (loss) per common share
Income (loss) from continuing operations 0.03 (0.16)
Income from discontinued operations (net of
tax) - 0.09
-------- --------
Net income (loss) $0.03 $(0.07)
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Diluted net income (loss) per common share
Income (loss) from continuing operations 0.03 (0.16)
Income from discontinued operations (net of
tax) - 0.09
-------- --------
Net income (loss) $0.03 $(0.07)
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Shares used in computing basic net income (loss)
per common share 5,894 5,783
Shares used in computing diluted net income
(loss)
per common share 5,897 5,783
SL INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE OPERATIONS
(In thousands)
Three-Months Ended
March 31,
2003 2002
-------- --------
(Unaudited)
Net income (loss) $186 $(376)
Other comprehensive income (loss):
Currency translation adjustment, net of
related taxes - 13
-------- --------
Comprehensive income (loss) $186 $(363)
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SL INDUSTRIES, INC.
SUMMARY CONSOLIDATED BALANCE SHEETS
(In thousands)
March 31, Dec. 31,
2003 2002
-------- --------
(Unaudited)
Cash and cash equivalents $ - $3,539
Accounts receivable 19,017 18,001
Inventories 13,013 13,747
Net current assets held for sale - 22,950
Other current assets 6,257 3,347
-------- --------
Total current assets 38,287 61,584
Property, plant and equipment, net 10,582 10,852
Intangible assets, net 11,366 11,388
Other assets 5,185 6,843
-------- --------
Total assets $65,420 $90,667
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Current liabilities $23,594 $36,537
Net current liabilities held for sale - 14,950
Long-term debt less portion due within one year 3,162 -
Other liabilities 4,807 5,468
Shareholders' equity 33,857 33,712
-------- --------
Total liabilities and shareholders'
equity $65,420 $90,667
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