Williams Controls Announces Q2 Earnings
16 April 1998
Williams Controls Announces Second Quarter Earnings From Continuing Operations of $.07 Per Share On 26% Sales Increase
PORTLAND, Ore., April 16 -- Williams Controls, Inc.
announced significantly improved net earnings from continuing
operations and net income for the Company's second quarter ended March 31,
1998. Net earnings from continuing operations for the period were $1,247,000
or $.07 per share, compared to net earnings from continuing operations of
$391,000 or $.02 per share for the quarter ended March 31, 1997.
Net income was $1,087,000 or $.06 per share during the quarter, compared
to a net loss of $131,000 or $.01 per share in the same period one year ago.
For the quarter, the Company reported a net loss from discontinued operations
of $160,000 or $.01 per share, compared to a net loss from discontinued
operations of $522,000 or $.03 per share for the quarter ended March 31, 1997.
The loss from discontinued operations during the recently completed quarter
related to the operations of the Company's Kenco Williams, Inc. subsidiary
prior to its sale by the Company, which was announced on March 17, 1998.
The strong earnings growth during the quarter was driven by a substantial
increase in sales and improved overall gross profit margins. Sales for the
period were $17,891,000, a 26% increase over the $14,248,000 reported during
the same period of the prior year. This included a 31% increase from the
Vehicle Components business, which experienced continued strong demand for its
electronic throttle controls in the truck, bus and off-highway vehicle
markets. Overall gross profit margins for the Company increased to 30% during
the quarter, up from 24% during the second quarter of fiscal 1997 and 28% in
the first quarter of fiscal 1998. This was a result of the growth in sales
and the continued focus on controlling costs throughout the Company.
For the six months ended March 31, 1998, net earnings from continuing
operations were $1,943,000 or $.11 per share, compared to $783,000 or $.04 per
share in the same period one year ago. Net income for the six-month period
was $1,783,000 or $.10 per share, compared to a net loss of $118,000 or $.01
per share in the same period one year ago. During the first half of fiscal
1998, the Company reported a net loss from discontinued operations of $160,000
or $.01 per share, compared to a net loss from discontinued operations of
$901,000 or $.05 per share for the same period of the prior year, relating to
the losses at Kenco.
Sales for the six months ended March 31, 1998 were $32,835,000, an 18%
increase over the $27,769,000 reported for the same period of the prior year.
Sales in the Company's Vehicle Components business increased 27% during the
first six months of 1998. Overall gross profit margins for the Company
reached 29% for the first half of fiscal 1998, up from 24% during the same
period of 1997.
Williams Controls chairman and CEO Thomas W. Itin stated, "This was the
third consecutive quarter in which the Company has improved its net earnings
from continuing operations, beginning with $.01 per share in the fourth
quarter of fiscal 1997, followed by $.04 per share in the first quarter of
this fiscal year and $.07 in the recently completed second quarter. These
positive results reflect a continued strong performance by our Vehicle
Components business that serves the truck and automotive markets, and
validates our growth strategy in those markets as a means to increase
shareholder value."
Mr. Itin continued, "Our belief in, and commitment to, the transportation
market is further evidenced by the upcoming grand opening of our new Premier
Plastic Technologies manufacturing center in Sterling Heights, Michigan, which
is scheduled for mid-May. For the first quarter since we purchased this Tier
1 automotive supplier in 1995, it has contributed to the bottom line of
Williams Controls, and we believe it is poised to continue this progress in
the coming quarters."
Williams Controls is a leading manufacturer and integrator of innovative
sensors, controls, and communications systems for the transportation,
communication and agricultural industries. For more information, you can
reach the Company at http://www.wmco.com on the World Wide Web. This news release
contains forward-looking statements relating to the Company, its current
operations and its future prospects, especially those related to the Company's
Vehicle Components business and its Premier Plastic Technologies subsidiary,
which involve risks and uncertainties that could cause actual results to
differ materially from those projected. These and other risks relating to the
Company's business are set forth in the Company's most recent Form 10-K and
other filings with the Securities and Exchange Commission.
Williams Controls, Inc.
Unaudited Consolidated Statements of Operations
(Dollars in thousands, except per share amounts)
Three months Three months Six months Six months
ended 3/31/98 ended 3/31/97 ended 3/31/98 ended 3/31/97
Net sales $17,891 $14,248 $32,835 $27,769
Cost of sales 12,586 10,867 23,375 21,003
Gross margin 5,305 3,381 9,460 6,766
Operating expenses 2,813 2,294 5,142 4,350
Earnings before interest
and taxes 2,492 1,087 4,318 2,416
Interest and other
expenses 471 504 1,204 1,151
Income before taxes 2,021 583 3,114 1,265
Income tax expense 791 241 1,210 513
Minority interest in
consolidated
subsidiaries (17) (49) (39) (31)
Net earnings from
continuing
operations 1,247 391 1,943 783
Loss from discontinued
operations (160) (522) (160) (901)
Net earnings (loss) 1,087 (131) 1,783 (118)
Earnings per share from
continuing
operations .07 .02 .11 .04
Loss per share from
discontinued
operations (.01) (.03) (.01) (.05)
Net earnings (loss)
per share .06 (.01) .10 (.01)
Williams Controls, Inc.
Consolidated Balance Sheets
(Dollars in thousands)
March 31, 1998 September 30, 1997
(unaudited)
Assets
Current Assets:
Cash $1,064 $700
Accounts receivable, net 13,038 8,468
Inventories 13,998 14,517
Net assets held for
disposition -- 638
Prepaid expenses 1,377 713
Other current assets 1,098 1,098
Total current assets 30,575 26,134
Investment in affiliate 161 559
Property, plant and
equipment 24,742 24,146
Less accumulated
depreciation and
amortization (6,664) (6,066)
Net property, plant
and equipment 18,078 18,080
Receivable from affiliate 3,634 3,645
Net assets held for
disposition -- 1,610
Other assets 3,288 1,348
Total assets $55,736 $51,376
Liabilities and Stockholders' Equity
Current Liabilities:
Accounts payable $6,372 $5,070
Accrued expenses 3,703 3,008
Current portion of
long-term debt and leases 1,517 1,428
Estimated loss on disposal -- 500
Other 49 --
Total current
liabilities 11,641 10,006
Other liabilities 1,471 1,215
Long-term debt and capital
leases 23,522 22,857
Total long-term
liabilities 24,993 24,072
Commitments and contingencies -- --
Minority interest in
consolidated subsidiaries 424 463
Stockholders' equity:
Common stock 180 179
Additional paid-in capital 9,882 9,822
Retained earnings 9,184 7,402
Unearned ESOP shares (191) (191)
Treasury stock (130,200 shares) (377) (377)
Total stockholders'
equity 18,678 16,835
Total liabilities and
stockholders' equity $55,736 $51,376
SOURCE Williams Controls, Inc.