DURA Automotive Reports Second Quarter 2003 Results
ROCHESTER HILLS, Mich.--July 24, 2003--DURA Automotive Systems, Inc. , today reported revenues of $606.4 million for the quarter ended June 30, 2003, down 5 percent from the $638.4 million recorded in the prior-year period. Including a gain of $0.7 million from discontinued operations and a pretax facility consolidation charge of $1.8 million, net income for the quarter was $10.8 million, or $0.58 per diluted share, compared to a net loss of $8.0 million, or $0.37 per diluted share, in the prior-year quarter. DURA's adjusted income from continuing operations for the quarter, which excludes facility consolidation charges, totaled $11.3 million, or $0.61 per diluted share, versus $22.6 million, or $1.16 per diluted share, in the prior-year quarter."Our second quarter results were solid despite an anticipated weaker automotive market," said Larry Denton, president and chief executive officer of DURA Automotive. "In the second quarter, we began multiple initiatives designed to boost our company's growth rate, including the acquisition of the Creation Group. Even though we expect continued softness in the third quarter, we will continue to aggressively execute our strategy to enhance DURA's competitive position, grow sales and earnings, and improve shareholder value."
Revenue for the quarter was positively impacted by approximately $45.0 million due to the strengthening of the Euro versus the U.S. Dollar. As expected, based on the company's previously disclosed forecast, revenue and operating income were negatively affected by the weakening of the automotive and recreation vehicle production volumes and the run-out of the company's conventional window regulator business. Operating income totaled $37.5 million, a 27 percent decrease versus $51.5 million in the second quarter of 2002. SG&A for the quarter was 6.4 percent of sales and in line with the company's previous estimates.
For the six months ended June 30, 2003, revenues decreased by $23.0 million to $1.2 billion compared to 2002. Operating income for the first half of 2003 decreased $22.5 million to $75.1 million compared to the first half of 2002 and net income increased $222.0 million to $20.0 million. During the first six months of 2003, cash generation resulted in a net debt reduction of $23.7 million.
A conference call to review the second quarter results is scheduled today at 11 a.m. ET. Interested participants may listen to the live conference call or replay over the Internet by logging onto the investor relations section of the company's Web site, www.duraauto.com. A recording of this call also will be available until 6 p.m. ET on Wednesday, July 30, 2003, by dialing (303) 590-3000, passcode 544440.
About DURA Automotive Systems, Inc.
DURA Automotive Systems, Inc., is the world's largest independent designer and manufacturer of driver control systems and a leading global supplier of seating control systems, engineered assemblies, structural door modules and integrated glass systems for the global automotive industry. The company is also a leading supplier of similar products to the North American recreation and specialty vehicle markets. DURA sells its automotive products to every North American, Japanese and European original equipment manufacturer (OEM) and many leading Tier 1 automotive suppliers. DURA is headquartered in Rochester Hills, Mich. Information about DURA and its products is available on the Internet at www.duraauto.com.
Use of Non-GAAP Financial Information
In addition to the results reported in accordance with accounting principles generally accepted in the United States ("GAAP") included throughout this news release, the Company has provided information regarding "adjusted income from continuing operations" (a non-GAAP financial measure). Adjusted income from continuing operations represents income from continuing operations adjusted for facility consolidation and other charges, net and loss on early extinguishment of debt, net. Management believes that adjusted income from continuing operations is useful to both management and investors in their analysis of the Company's ability to analyze operational performance. Adjusted income from continuing operations should not be considered in isolation or as a substitute for net income or other income statement data prepared in accordance with GAAP, or as a measure of profitability or liquidity. Also, adjusted income from continuing operations, as determined and presented by the Company, may not be comparable to related or similarly titled measures reported by other companies.
Forward-Looking Statements
This press release contains forward-looking statements that are subject to risks and uncertainties. These statements often include words such as "believe," "expect," "anticipate," "intend," "plan," "estimate," or similar expressions. These statements are based on certain assumptions that the company has made in light of its experience in the industry as well as its perspective of historical trends, current conditions, expected future developments and other factors it believes are appropriate in the circumstances. Actual results may differ materially from the anticipated results because of certain risks and uncertainties, including but not limited to (i) expected synergies, economies of scale and cost savings from the company's acquisitions not being fully realized or realized within the expected times frames; (ii) unanticipated difficulties servicing the indebtedness of the company; (iii) costs or operational difficulties related to integrating the operations of the acquired entities with those of the company being greater than expected; (iv) labor disputes involving the company or its significant customers; (v) risks associated with conducting business in foreign countries, and (vi) general economic or business conditions affecting the automotive industry, either nationally or regionally, being less favorable than expected.
DURA AUTOMOTIVE SYSTEMS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in thousands, except per share amounts - unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
------------------- -----------------------
2003 2002 2003 2002
--------- --------- ----------- -----------
Revenues $606,430 $638,383 $1,199,235 $1,222,241
Cost of sales 528,172 544,893 1,044,548 1,049,319
--------- --------- ----------- -----------
Gross profit 78,258 93,490 154,687 172,922
Selling, general and
administrative expenses 38,900 34,360 77,435 67,375
Loss on early
extinguishment of debt - 5,520 - 5,520
Facility consolidation and
other charges 1,758 1,863 2,024 1,863
Amortization expense 71 219 141 543
--------- --------- ----------- -----------
Operating income 37,529 51,528 75,087 97,621
Interest expense, net 20,688 20,952 41,374 43,420
--------- --------- ----------- -----------
Income from continuing
operations before
provision for income
taxes and minority
interest 16,841 30,576 33,713 54,201
Provision for income taxes 6,049 11,935 12,123 19,301
Minority interest -
dividends on trust
preferred securities, net 663 601 1,326 1,243
--------- --------- ----------- -----------
Income from continuing
operations 10,129 18,040 20,264 33,657
Gain (loss) from
discontinued operations,
net 711 (26,030) (267) (30,423)
--------- --------- ----------- -----------
Income before accounting
change 10,840 (7,990) 19,997 3,234
Cumulative effect of
change in accounting, net - - - (205,192)
--------- --------- ----------- -----------
Net income (loss) $10,840 $(7,990) $19,997 $(201,958)
========= ========= =========== ===========
Basic earnings (loss) per
share:
Income (loss) from
continuing operations $0.55 $1.00 $1.11 $1.88
Discontinued operations 0.04 (1.45) (0.02) (1.70)
Cumulative effect of
change in accounting - - - (11.48)
--------- --------- ----------- -----------
Net income (loss) $0.59 $(0.45) $1.09 $(11.30)
========= ========= =========== ===========
Basic shares outstanding 18,290 17,935 18,275 17,875
========= ========= =========== ===========
Diluted earnings (loss)
per share:
Income (loss) from
continuing operations $0.55 $0.94 $1.09 $1.77
Discontinued operations 0.03 (1.31) (0.01) (1.55)
Cumulative effect of
change in accounting - - - (10.41)
--------- --------- ----------- -----------
Net income (loss) $0.58 $(0.37) $1.08 $(10.19)
========= ========= =========== ===========
Diluted shares outstanding 19,691 19,913 19,674 19,706
========= ========= =========== ===========
Capital expenditures $10,631 $11,085 $19,862 $24,611
Depreciation $18,143 $17,393 $37,402 $34,463
DURA AUTOMOTIVE SYSTEMS, INC. AND SUBSIDIARIES
ADJUSTED INCOME FROM CONTINUING OPERATIONS
(Amounts in thousands, except per share amounts - unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
------------------- -----------------
2003 2002 2003 2002
---------- -------- -------- --------
Income from continuing
operations 10,129 18,040 20,264 33,657
Facility consolidation and other
charges, net 1,125 1,118 1,295 1,118
Loss on early extinguishment of
debt, net - 3,422 - 3,422
---------- -------- -------- --------
Adjusted income from
continuing operations $11,254 $22,580 $21,559 $38,197
========== ======== ======== ========
Basic earnings per share:
Adjusted income from
continuing operations $0.62 $1.26 $1.18 $2.14
========== ======== ======== ========
Basic shares outstanding 18,290 17,935 18,275 17,875
========== ======== ======== ========
Diluted earnings per share:
Adjusted income from
continuing operations $0.61 $1.16 $1.16 $2.00
========== ======== ======== ========
Diluted shares outstanding 19,691 19,913 19,674 19,706
========== ======== ======== ========
DURA AUTOMOTIVE SYSTEMS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands)
June 30, December 31,
Assets 2003 2002
------ ----------- ------------
(unaudited)
Current assets:
Cash and cash equivalents $162,968 $143,237
Accounts receivable, net 316,649 245,615
Inventories 120,968 114,573
Current portion of derivative (a) (a)
instruments 15,000 15,825
Other current assets 119,181 103,875
Current assets of discontinued
operations - 32,041
----------- ------------
Total current assets 734,766 655,166
----------- ------------
Property, plant and equipment, net 448,775 444,479
Goodwill, net 806,155 774,983
Noncurrent portion of derivative (a) (a)
instruments 22,712 14,698
Deferred income taxes and other assets,
net 45,431 47,607
----------- ------------
$2,057,839 $1,936,933
=========== ============
Liabilities and Stockholders' Investment
----------------------------------------
Current liabilities:
Accounts payable $262,581 $216,045
Accrued liabilities 215,808 193,973
Current maturities of long-term debt 5,325 7,154
Current liabilities of discontinued
operations - 25,931
----------- ------------
Total current liabilities 483,714 443,103
----------- ------------
Long-term debt, net of current
maturities 161,501 162,422
Senior notes 350,000 350,000
Subordinated notes 566,370 556,632
Senior notes - derivative instrument (a) (a)
adjustment 37,712 30,523
Other noncurrent liabilities 135,376 134,201
Mandatorily redeemable convertible trust
preferred securities 55,250 55,250
----------- ------------
Stockholders' investment:
Common stock - Class A 165 165
Common stock - Class B 18 17
Additional paid-in capital 347,399 347,065
Treasury stock (1,975) (1,974)
Retained earnings (107,406) (127,403)
Accumulated other comprehensive income
(loss) 29,715 (13,068)
----------- ------------
Total stockholders' investment 267,916 204,802
----------- ------------
$2,057,839 $1,936,933
=========== ============
(a) As required by SFAS 133, reflects fair value of interest rate swap
contracts entered into in connection with the April 2002 Senior
Notes offering.
DURA AUTOMOTIVE SYSTEMS, INC. AND SUBSIDIARIES
2002 QUARTERLY INCOME STATEMENT
(Amounts in thousands, except per share amounts - unaudited)
For the Quarters Ended
----------------------------------------
September December
March 31, June 30, 30, 31,
2002 2002 2002 2002
---------- --------- --------- ---------
Revenues $583,858 $638,383 $561,540 $576,542
Cost of sales 504,426 544,893 487,252 498,450
---------- --------- --------- ---------
Gross profit 79,432 93,490 74,288 78,092
Selling, general and
administrative expenses 33,015 34,360 35,175 33,021
Loss on early extinguisment
of debt - 5,520 - -
Facility consolidation,
product recall and other
charges - 1,863 917 13,341
Amortization expense 324 219 214 232
---------- --------- --------- ---------
Operating income 46,093 51,528 37,982 31,498
Interest expense, net 22,468 20,952 20,995 19,493
---------- --------- --------- ---------
Income from continuing
operations before
provision for income taxes
and minority interest 23,625 30,576 16,987 12,005
Provision for income taxes 7,366 11,935 3,712 14,592
Minority interest - dividends
on trust preferred
securities, net 642 601 622 621
---------- --------- --------- ---------
Income from continuing
operations 15,617 18,040 12,653 (3,208)
Loss from discontinued
operations, net (4,393) (26,030) (8,701) (87,457)
---------- --------- --------- ---------
Income (loss) before
accounting change 11,224 (7,990) 3,952 (90,665)
Cumulative effect of change
in accounting (205,192) - - -
---------- --------- --------- ---------
Net income (loss) $(193,968) $(7,990) $3,952 $(90,665)
========== ========= ========= =========
Basic earnings (loss) per
share:
Income from continuing
operations $0.88 $1.00 $0.69 $(0.18)
Discontinued operations (0.25) (1.45) (0.47) (4.79)
Cumulative effect of change
in accounting (11.52) - - -
---------- --------- --------- ---------
Net income (loss) $(10.89) $(0.45) $0.22 $(4.97)
========== ========= ========= =========
Basic shares outstanding 17,814 17,935 18,257 18,241
========== ========= ========= =========
Diluted earnings (loss) per
share:
Income from continuing
operations $0.83 $0.94 $0.67 $(0.18)
Discontinued operations (0.22) (1.31) (0.44) (4.79)
Cumulative effect of change
in accounting (10.52) - - -
---------- --------- --------- ---------
Net income (loss) $(9.91) $(0.37) $0.23 $(4.97)
========== ========= ========= =========
Diluted shares outstanding 19,499 19,913 19,948 18,241
========== ========= ========= =========