National-Standard Reports Second Quarter Results
24 April 1998
National-Standard Reports Second Quarter Results
NILES, Mich., April 24 -- National-Standard Company
announced sales for the second quarter ended March 31, 1998 of
$58.0 million, compared to $63.1 million reported for the same period last
year, according to Michael B. Savitske, President and Chief Executive Officer.
The decrease was due in part to lower sales in the U.K. subsidiary, a direct
result of the restructuring in the U.K. during Fiscal 1997. In North America,
sales declined in the air bag inflator filtration products and rubber
reinforcement products segments. The decline in air bag products follows the
decision to limit the sale of certain lower margin wire cloth products. The
decline in rubber reinforcement is due primarily to lower selling prices.
These declines, however, were partially offset by a 5 percent increase in weld
wire sales over the same period last year.
Net income for the second quarter was $.1 million, or 2 cents per share,
versus a net loss of $10.7 million, or $2.03 per share, for the same period
last year. Last year's second quarter loss includes a $9.9 million charge for
restructuring the Company's operations in the United Kingdom. The
restructuring continues to have a positive impact on 1998 results. Operating
profit in the U.K. continues to improve over last year on significantly lower
sales. Continued improvement is expected for the remainder of the year.
For the first six months of 1998, sales were $114.9 million with a net
income of $.3 million, or $.06 per share, compared to sales of $123.0 million
with a net loss of $10.0 million, or $1.88 per share, in the year earlier
period.
"The second quarter was marked by continued success in our QS-9000
registration activities and significant progress in implementing constraint
management and team training, all of which are critical for continuous
improvement in our performance," said Michael B. Savitske, President and Chief
Executive Officer. "The new air bag materials facility in Peterlee, England
shipped its first production quantities in March. Sales from this facility
are expected to be $3.0 million for our fiscal year. Also, our modernization
and capacity addition activities are progressing well. The first phase of new
machinery installation began in the second quarter. Additional equipment will
be delivered over the summer.
"While the UK restructuring has had a positive impact on the UK net
income, results have been adversely affected by lower sales prices as a direct
result of the continued strength of the pound sterling. We do expect full
year operating results for the unit to be considerably better than last year.
"Domestically, our focus remains on achieving QS-9000 registration for all
facilities, continuing to manage manufacturing constraints to generate the
capacity needed to meet the growth in weld wire, and continuous improvement in
both manufacturing costs and product quality. Weld wire sales were down a bit
early in the second quarter. We achieved our lead time reduction objectives
as manufacturing throughput increased as a result of constraint management and
capacity increases. As a result, our customers were able to adjust their
ordering patterns and reduce inventory. The second quarter ended very strong
as additional sales growth was made possible by capacity increases. Year-to-
date weld wire sales are nine percent above last year."
Founded in 1907, National-Standard is a Niles, Michigan based firm with
annual sales of approximately $250 million. In ten operating facilities
throughout the world, the Company manufactures and distributes a broad range
of wire and wire-related products, including tire bead wire and welding wire,
in addition to wire cloth and fabricated filters for the automotive air bag
industry.
This press release may contain forward-looking statements as defined under
the Private Securities Litigation Reform Act of 1995. Cautionary statements
accompanying these forward-looking statements are set forth, along with this
release, in a Form 8-K filed with the Securities and Exchange Commission.
Financial Highlights
National-Standard Company and Subsidiaries
($000 except per share amounts)
For three months ended March 31: 1998 1997
Net Sales $ 57,959 $ 63,127
Operating Income/(Loss) 954 (9,397)
Net Income/(Loss) 127 (10,687)
Income/(Loss) Per Share .02 (2.03)*
Average Shares Outstanding 5,233,542 5,272,000
For six months ended March 31 1998 1997
Net Sales $114,900 $123,001
Operating Income/(Loss) 1,879 (7,752)
Net Income/(Loss) 333 (9,950)
Income/(Loss) per Share .06 (1.88)*
Average Shares Outstanding 5,231,066 5,291,854
* The three- and six-month periods ended March 1997 per share data of
$(2.03) and $(1.88) respectively, includes $(1.87) per share and $(1.86) per
share related to the restructuring charge.
SOURCE National-Standard Company