Intermet Reports Sales and Earnings for Second Quarter
17 July 1997
Intermet Reports Sales and Earnings for Second Quarter
DETROIT, July 17 -- Intermet Corporation today
reported a second quarter net income of $11.1 million. Income was up $0.3
million when compared with the same quarter last year and up $O.1 million when
compared with the first quarter 1997. Earnings per share for the second
quarter were $0.44, a five percent increase from the second quarter of 1996.
Second quarter sales of $211 million topped 1996 second quarter sales by
$67 million, or 47%. The increase in sales versus the second quarter of 1996
is attributed to the Sudbury acquisition, which contributed $75 million.
Without the acquisition, second quarter sales would have been down 6% when
compared with the same quarter last year. This is a result of slower domestic
light vehicle sales compounded by strikes at certain Chrysler and GM plants.
Gross margins in the second quarter remained lower than the previous year as a
result of the Sudbury consolidation, reduced sales volumes at the foundries
and continuing losses at Intermet's Alabama aluminum plant. These lower
margins were partially offset by continued SG&A and tax reduction efforts.
Record sales and earnings continued for the first six months of 1997.
Sales for the first six months of 1997 were $420 million, up $142 million or
51% from the first six months of last year. First half earnings per share
totaled $0.86 compared with $0.77 per share for the first six months 1996.
John Doddridge, Intermet's chairman and CEO, commented, "While second
quarter light vehicle sales in North America were down from the second quarter
of 1996, with the coming new model introductions and absent any more strikes,
light vehicle sales should only be down slightly from 1996. We expect our
casting operations to start reflecting stronger numbers as we begin to feel
the positive impact of new business later this year."
"Additionally, we are very proud that our plants continue to be honored
with respect to quality," said Doddridge. Both the Wagner and Havana
foundries have recently received QS-9000 and ISO 9001 certification and the
Columbus foundry has been given Honda's Quality Performance Award for
sustained achievements in quality and delivery. Also, Intermet's Frisby
subsidiary, a precision machining operation, has recently been awarded
ISO 9002 certification and the Ironton Iron foundry has been recommended for
QS-9000 certification.
John R. Horne, 59, chairman, president and CEO of Navistar International
Corporation, has been elected to Intermet's board of directors, effective
immediately.
"We are, obviously, very pleased to have Mr. Horne as a board member,"
said Doddridge. "His stellar reputation, his manufacturing and engineering
background, as well as his expertise in the transportation industry, bring to
us a unique perspective which will no doubt benefit Intermet and its
shareholders."
The Intermet board of directors has approved a quarterly dividend of $0.04
per share, payable September 30, 1997, to shareholders of record as of
September 1, 1997.
Detroit-based Intermet Corporation and its subsidiaries design and
manufacture precision iron and aluminum castings for automotive and industrial
equipment manufacturers worldwide, produce precision machined components,
cranes and specialty service vehicles, and provide custom coating
applications. Intermet has more than 6,400 employees at twenty-three
operating locations in North America and Europe.
Intermet Corporation Consolidated Income Statements
(In Thousands, Except Per Share Data)
Three Months Ended (unaudited) Six Months Ended (unaudited)
June 30, June 30, June 30, June 30,
1997 1996 1997 1996
Net sales $210,898 $143,782 $420,389 $277,940
Cost of sales 182,639 119,505 364,537 233,886
Gross profit 28,259 24,277 55,852 44,054
Operating expenses 7,587 4,519 14,546 9,648
Operating profit 20,672 19,758 41,306 34,406
Other income
(expense) net (4,192) (489) (7,117) (1,036)
Income tax expense 5,344 8,455 12,103 13,746
Net income $11,136 $10,814 $22,086 $19,624
Earnings per share $0.44 $0.42 $0.86 $0.77
Weighted average
shares outstanding 25,592 25,575 25,640 25,483
Intermet Corporation Consolidated Balance Sheets (In Thousands)
June 30, Dec. 31,
1997 1996
(unaudited)
Assets:
Cash and cash equivalents $7,403 $ 23,485
Other current assets 183,258 165,809
Property plant and
equipment (net) 221,563 222,782
Other noncurrent assets 110,712 114,236
Total assets $522,936 $526,312
Liabilities and shareholders'
equity:
Current liabilities $121,307 $171,368
Long-term debt 179,627 149,477
Other long-term liabilities 60,819 61,528
Total liabilities 361,753 382,373
Minority interest 2,337 2,837
Shareholders' equity 158,846 141,102
Total liabilities and
shareholders' equity $522,936 $526,312
SOURCE Intermet Corporation