Autocam Reports Record Third Quarter and Nine Month Results
23 April 1998
Autocam Reports Record Third Quarter and Nine Month Results
KENTWOOD, Mich., April 23 -- Autocam Corporation
today reported record financial results for the three and nine
months ended March 31, 1998. The Kentwood, Michigan-based manufacturer of
precision-machined parts reported net income for the three months ended
March 31, 1998 of $2,482,483, or 40 cents per diluted share, on sales of
$24,789,959, versus net income of $1,080,482, or 18 cents per diluted share,
on sales of $16,057,586 for the third quarter of fiscal 1997. For the nine
months ended March 31, 1998, the Company reported net income of $5,721,974, or
92 cents per diluted share, on sales of $64,013,913, versus net income of
$4,025,323, or 66 cents per diluted share, on sales of $45,975,116 for the
same period in fiscal 1997.
"We are very proud of the quarter's results," Autocam President John C.
Kennedy said. "The expected strong growth in all sectors of our business
during the third quarter, particularly automotive braking systems and computer
electronics components, helped push year-to-date sales and earnings above
levels reported for all of last year."
Sales of components used in automotive fuel systems increased 12% when
comparing the third quarter of fiscal 1998 to the same period in fiscal 1997.
The Company continues to strengthen its relationships with all key domestic
and international players in the manufacture of gasoline and diesel fuel
injectors. "Third quarter profits were enhanced by the continued improvement
in capacity utilization and equipment and labor efficiency experienced on
newer programs which had experienced manufacturing difficulties during the
third quarter of last fiscal year," Kennedy said. Kennedy indicated that the
acquisition of Autocam do Brasil added $2.1 million in sales for the quarter
(representing two months of business), over 50% of which was to two U.S.
manufacturers of diesel fuel injection systems.
The acquisition of The Hamilton Group in June 1997 added $4 million and
$10.2 million in sales, primarily of braking systems components, during the
three and nine months ended March 31, 1998, respectively, versus the same
periods in fiscal 1997. "Sales during the quarter ended March 31, 1998 have
exceeded Hamilton's historical levels. Sales are expected to continue to grow
as the Company begins production on a new braking system program for a key,
existing braking systems customer," Kennedy said.
The Company reported strong gains in sales of computer electronics
components producing a component used in computer microprocessor
subassemblies. The Company also reported solid growth in sales of medical
device components, primarily coronary stents. Both of these programs were
significant contributors to earnings during the most recent quarter. Kennedy
believes that although the Company expects to produce large quantities of
computer microprocessor subassembly components during the fourth quarter, it
is likely that volumes will decline relative to the third quarter consistent
with the decline in microprocessor demand. Kennedy commented that predicting
medical device demand is difficult, especially on new customer product
designs; however, current customer orders suggest that fourth quarter should
be another strong quarter for medical device sales and earnings, particularly
coronary stents.
Kennedy indicated that the Company expects to post earnings for the fourth
quarter of fiscal 1998 that will be significantly better than one year ago.
"We expect year-over-year sales and earnings improvements from all segments of
our business. Our strategy to grow the business by supplying strategic
customers on a global basis will continue to pay dividends through increased
future business," Kennedy said.
The Company announced that it plans to begin production in its new
Marshall, Michigan manufacturing facility late in the fourth fiscal quarter.
"The construction is progressing as planned, and the majority of the
manufacturing managers and machinists have been working at the Company's
headquarters for three to six months learning the Company's management
philosophies and continuous improvement methods," Kennedy said. "We believe
these concepts and our corporate culture have been significant contributors to
our overall profitability, and we are therefore taking action to insure our
new facilities employ the same entrepreneurial philosophies."
The Company also announced that it would pay its regular quarterly cash
dividend of 2 cents per common share on May 18, 1998 to shareholders of record
on May 4, 1998.
This release may contain forward-looking statements relating to future
financial results. Actual results may differ materially as a result of
various factors. The Company has control over some, but not all of these
factors. These risk factors and additional information are included in the
Company's reports on Form 10-K and 10-Q on file with the Securities and
Exchange Commission.
Autocam manufactures precision-machined parts used in automotive fuel and
braking systems, automotive electric motor assemblies, medical devices, and
computer electronics. Autocam's common stock trades on the Nasdaq National
Market under the symbol "ACAM". For more information on the Company, visit
our Internet website at http://www.autocam.com.
AUTOCAM CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
For the Three Months Ended
March 31,
1998 1997
$$ % $$ %
Sales $24,789,959 100.0% $16,057,586 100.0%
Cost of sales 18,285,577 73.8% 12,950,188 80.6%
Gross profit 6,504,382 26.2% 3,107,398 19.4%
Selling, general and administrative 1,669,179 6.7% 1,026,483 6.5%
Other operating expenses 51,875 0.2% 51,875 0.3%
Income from operations 4,783,328 19.3% 2,029,040 12.6%
Interest and other expense, net 801,384 3.3% 378,458 2.3%
Minority interest in net income 80,939 0.3% - -
Income before tax provision 3,901,005 15.7% 1,650,582 10.3%
Tax provision 1,418,522 5.7% 570,100 3.6%
Net income $2,482,483 10.0% $1,080,482 6.7%
Basic net income per share $0.41 $0.18
Diluted net income per share $0.40 $0.18
Basic weighted average
shares outstanding 6,047,480 5,992,128
Diluted weighted average
shares outstanding 6,267,266 6,087,172
For the Nine Months Ended
March 31,
1998 1997
$$ % $$ %
Sales $64,013,913 100.0% $45,975,116 100.0%
Cost of sales 48,785,555 76.2% 35,910,481 78.1%
Gross profit 15,228,358 23.8% 10,064,635 21.9%
Selling, general and administrative 3,989,304 6.3% 2,716,853 6.0%
Other operating expenses 155,625 0.2% 155,625 0.3%
Income from operations 11,083,429 17.3% 7,192,157 15.6%
Interest and other expense, net 2,056,294 3.2% 1,018,995 2.2%
Minority interest in net income 80,939 0.1% - -
Income before tax provision 8,946,196 14.0% 6,173,162 13.4%
Tax provision 3,224,222 4.9% 2,147,839 4.6%
Net income $5,721,974 8.9% $4,025,323 8.8%
Basic net income per share $0.95 $0.67
Diluted net income per share $0.92 $0.66
Basic weighted average
shares outstanding 6,024,996 5,989,658
Diluted weighted average
shares outstanding 6,210,101 6,063,672
CONSOLIDATED BALANCE SHEETS
March 31, June 30,
1998 1997
Assets:
Cash and equivalents $1,014,292 $2,510,500
Accounts receivable 12,502,980 8,841,516
Inventories 6,819,686 5,444,420
Other current assets 1,275,697 722,020
Total current assets 21,612,655 17,518,456
Fixed assets, net 62,173,610 53,291,418
Goodwill and other intangible assets 14,265,976 6,443,364
Other assets 12,553,860 6,384,590
Total assets $110,606,101 $83,637,828
Liabilities and shareholders' equity:
Current maturities of long-term debt $6,277,995 $5,905,541
Accounts payable 6,088,519 4,398,050
Accrued liabilities 5,063,777 2,911,939
Total current liabilities 17,430,291 13,215,530
Long-term obligations,
net of current maturities 39,532,355 25,191,778
Other liabilities 9,225,006 8,615,550
Minority interest 1,859,607
Shareholders' equity 42,558,842 36,614,970
Total liabilities and
shareholders' equity $110,606,101 $83,637,828
SOURCE Autocam Corporation