Tower Automotive, Inc. Announces Q3 Results
16 October 1997
Tower Automotive, Inc. Announces Increased Third-Quarter and Nine-Month Results
MINNEAPOLIS, Oct. 16 -- Tower Automotive, Inc. ,
today announced increased revenues and operating income for the third quarter
and nine months ended September 30, 1997. Operating results for these periods
reflect the Company's acquisitions of the Automotive Products Company division
(APC) of A.O. Smith Corporation in April 1997 and Societa Industria Meccanica
e Stampaggio S.p.A. (SIMES) in May 1997.
Revenues for the third quarter of 1997 were $349.5 million compared with
$114.6 million reported in the 1996 period. Operating income of $27.4 million
increased significantly versus $10.2 million reported last year. Net income
of $11.8 million more than doubled compared with $5.2 million last year. Net
income of 50 cents per share, on both a primary and fully diluted basis,
increased 39 percent compared with 36 cents in the comparable 1996 period, on
a substantially increased share base.
For the nine months ended September 30, 1997, revenues of $801.9 million
compared with $280.0 million in the year-ago period. Operating income of
$68.7 million increased $41.6 million compared with $27.1 million reported
last year. Net income of $31.7 million before an extraordinary loss, or $1.58
per share, compared with $13.7 million, or $1.07 per share, in 1996. The
Company reported an extraordinary loss on the early extinguishment of debt of
$2.4 million, or 12 cents per share, as a result of the repayment of certain
indebtedness in April 1997.
Commenting on the results, Dugald Campbell, president and chief executive
officer of Tower Automotive, said, "We are very pleased with our operating
results given that we had several significant product launches during the
quarter and we were able to effectively manage the process and contain the
costs associated with these launches. Additionally, the integration of our
recent acquisitions of APC and SIMES continues to progress on schedule. These
acquisitions substantially enhance our ability to respond to vehicle
manufacturers' move toward sourcing larger 'chunks' of the vehicle to one
supplier."
On July 29, 1997, the Company completed the sale of $200 million of 5%
Convertible Subordinated Notes due 2004 pursuant to a Rule 144A private
offering. The notes are convertible, at the option of the holder, into
shares of Common Stock of the Company at a conversion price of $51.75
per share and are noncallable for three years. The Company used the net
proceeds from this offering to reduce its bank indebtedness.
Tower Automotive and Promotora de Empresas Zano, S.A. de C.V. recently
announced that they have completed an agreement to become partners in Metalsa,
the largest vehicle frame and structures supplier in Mexico, under which Tower
acquired a 40 percent interest in Metalsa. In addition, the parties have
entered into a technology sharing arrangement that will enable both companies
to utilize the latest available product and process technology.
Tower Automotive, Inc., produces a broad range of stamped and welded
assemblies for vehicle body structures and suspension systems for the
automotive manufacturers, including Ford, Chrysler, General Motors, Honda,
Toyota, Nissan, Mazda, Fiat and Mercedes. Products include body structural
assemblies such as pillars and package trays, control arms, suspension links,
engine cradles and full frame assemblies. The Company has its operating
headquarters in Grand Rapids, Mich., and a corporate office in Minneapolis,
Minn.
TOWER AUTOMOTIVE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(Amounts in Thousands Except per Share Amounts - Unaudited)
Three Months Nine Months
Ended Sept. 30, Ended Sept. 30,
1997 1996 1997 1996
Revenues $349,507 $114,583 $801,896 $280,025
Cost of sales 302,318 97,542 689,566 237,118
Gross profit 47,189 17,041 112,330 42,907
Selling, general and
administrative
expenses 17,190 6,211 38,364 14,294
Amortization expense 2,583 675 5,247 1,525
Operating income 27,416 10,155 68,719 27,088
Interest expense, net 7,706 1,529 15,852 4,302
Income before provision
for income taxes 19,710 8,626 52,867 22,786
Provision for income taxes 7,882 3,390 21,140 9,060
Net income before
extraordinary item 11,828 5,236 31,727 13,726
Extraordinary item - loss on early
extinguishment of debt, net of
income taxes - - 2,434 -
Net income $11,828 $5,236 $29,293 $13,726
Net income per share:
Before extraordinary
item $0.50 $0.36 $1.58 $1.07
Extraordinary loss - - (.12) -
Net income-primary $0.50 $0.36 $1.46 $1.07
Net income-fully
diluted $0.50 $0.36 $1.45 $1.07
Weighted average common
and common equivalent
shares outstanding:
Primary 23,513 14,764 20,144 12,924
Fully diluted 26,096 14,764 21,014 12,924
TOWER AUTOMOTIVE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in Thousands)
September 30, Dec. 31,
Assets 1997 1996
(unaudited)
Current assets:
Cash and cash equivalents $10,776 $39,596
Accounts receivable 210,282 61,073
Inventories 86,432 21,864
Other current assets 83,869 14,433
Total current assets 391,359 136,966
Property, plant and equipment, net 708,324 156,248
Restricted cash 7,796 10,833
Goodwill and other assets, net 370,455 94,560
$1,477,934 $398,607
Liabilities and Stockholders' Investment
Current liabilities:
Current maturities of long-term debt $722 $722
Accounts payable 147,772 32,280
Accrued liabilities 84,484 22,429
Total current liabilities 232,978 55,431
Long-term debt, net of current maturities 606,092 113,460
Other noncurrent liabilities 141,566 47,839
Stockholders% investment:
Preferred stock - -
Common stock 229 143
Warrants to acquire common stock 2,000 2,000
Additional paid-in capital 422,723 136,759
Retained earnings 72,443 43,150
Subscriptions receivable (97) (175)
Total stockholders' investment 497,298 181,877
$1,477,934 $398,607
SOURCE Tower Automotive, Inc.