Tesma Announces Dividend Increase
9 June 1998
Tesma Announces Dividend Increase And Fiscal 1998 Third Quarter Results
CONCORD, Ont., June 9 /CNW-PRN/ - Tesma International Inc. (TSE:TSM.A;
NASDAQ:TSMAF) reported today that its Board of Directors declared, in addition
to the dividend on the 6.5% Convertible Series Preferred Shares, an increased
quarterly dividend in respect of the third quarter of fiscal 1998 of $0.07
per share on the Class A Subordinate Voting and Class B shares payable on July
15, 1998 to shareholders of record on June 30, 1998.
``This represents a 40% increase in our quarterly common share dividend
and reflects the continuing positive developments in our sales and profits.
The dividend increase also ensures that the Company complies with the
shareholder profit participation requirements under our Corporate
Consitution,'' said Manfred Gingl, Tesma's President and CEO.
Tesma also announced its third quarter and nine months sales, income and
earnings per share for the period ended April 30, 1998.
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Three Nine
Months Ended Months Ended
April 30 April 30
1998 1997 1998 1997
Sales $181.7 $150.9 $484.5 $405.2
Operating income $ 19.0 $ 13.4 $ 48.4 $ 36.2
Net income $ 11.3 $ 8.0 $ 22.8 $ 20.7
Basic earnings per share $ 0.47 $ 0.42 $ 0.92 $ 1.07
Basic earnings per share
(excluding non-recurring item) - - $ 1.17 $ 1.07
Fully diluted earnings
per share $ 0.39 $ 0.34 $ 0.81 $ 0.90
Fully diluted earnings
per share (excluding
non-recurring item) - - $ 1.01 $ 0.90
>>
All results are reported in millions of Canadian dollars, except per
share figures. The nine month results for fiscal 1998 include a non-recurring
provision of $9.1 million reported in the first quarter of 1998 related to the
Company's previously disclosed patent litigation settlement.
Tesma's sales for the third quarter of fiscal 1998 were $181.7
million, an increase of 20% over the prior year. For the first nine months of
the current year, reported sales were a record $484.5 million, an increase of
20% over the prior period. Principal factors contributing to this growth were
Tesma's increased North American and European content per vehicle and the
sales generated by recently acquired subsidiaries.
For the third quarter, Tesma's operating income was $19.0 million, an
improvement of 41% or $5.6 million over the third quarter of fiscal 1997.
Higher sales and improved operating performance at several divisions have
resulted in better capacity utilization. Operating income increased 34% to
$48.4 million for the nine month period compared to a year ago.
Tesma's fully diluted earnings per share increased 15% to $0.39 from
$0.34 for the third quarter of fiscal 1998 and, excluding the non-recurring
item, 12% to $1.01 from $0.90 for the nine month period, despite a 15%
increase in the average number of shares outstanding.
Cash provided from operations was $19.3 million in the third quarter,
an improvement of $3.5 million over fiscal 1997. Net investment
activities totalled $13.7 million in the quarter for fixed and other
asset additions. For the nine months ended April 30, 1998, cash provided from
operations was $42.7 million, with net investment activities totalling $55.3
million.
``Tesma's investment activities in the third quarter include capital
spending required to fulfill obligations to supply water and oil pumps to
several major OEM customers,'' Manfred Gingl, President and CEO, said. ``The
launches of these significant programs are on track and on budget, with sales
of these new products to commence in fiscal 1999.''
Tesma is a global supplier of highly engineered powertrain, fueling and
cooling systems and components for the automotive industry. Tesma's strong
market presence and strategy for continuing growth results from its unique
focus on Innovation, Engineering and Performance. Tesma employs over 2,900
employees in 19 manufacturing facilities in North America and Europe.
<<
TESMA INTERNATIONAL INC.
CONSOLIDATED STATEMENTS OF INCOME AND RETAINED EARNINGS
(Canadian dollars in thousands, except
per share figures) (Unaudited)
THREE MONTHS ENDED NINE MONTHS ENDED
April 30 April 30
1998 1997 1998 1997
Sales $181,711 $150,882 $484,530 $405,208
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Cost of goods sold 140,648 116,988 375,216 312,099
Depreciation and amortization 5,894 5,076 17,280 13,838
Selling, general and
administration 13,381 10,975 36,377 31,286
Interest (net) 66 283 (111) 402
Amortization of discount on
Convertible Series
Preferred Shares 339 788 1,004 2,336
Affiliation fees and other
charges 2,417 3,353 6,328 9,021
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Operating income 18,966 13,419 48,436 36,226
Litigation settlement - - 9,132 -
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Income before income taxes 18,966 13,419 39,304 36,226
Income taxes 7,693 5,406 16,523 15,482
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Net income for the period 11,273 8,013 22,781 20,744
Dividends on Convertible Series
Preferred Shares
(net of return of capital) (589) (459) (1,761) (1,401)
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Net income attributable to
Class A Subordinate Voting
Shares and Class B Shares 10,684 7,554 21,020 19,343
Retained earnings, beginning
of period 63,769 44,943 55,721 34,953
Dividends on Class A
Subordinate Voting Shares
and Class B Shares (1,132) (906) (3,420) (2,705)
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Retained earnings, end of
period $ 73,321 $ 51,591 $ 73,321 $ 51,591
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Earnings per Class A
Subordinate Voting Share or
Class B Share
Basic $0.47 $0.42 $0.92 $1.07
Fully diluted $0.39 $0.34 $0.81 $0.90
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Average number of Class A
Subordinate Voting Shares and
Class B Shares outstanding
(in millions)
Basic 23.0 18.1 22.9 18.1
Fully diluted 30.0 26.2 30.0 26.0
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TESMA INTERNATIONAL INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Canadian dollars in thousands)
(Unaudited)
THREE MONTHS ENDED NINE MONTHS ENDED
April 30 April 30
1998 1997 1998 1997
CASH PROVIDED FROM (USED FOR):
OPERATING ACTIVITIES
Net income $ 11,273 $ 8,013 $ 22,781 $ 20,744
Items not involving current
cash flows 8,076 7,773 19,956 16,354
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19,349 15,786 42,737 37,098
Changes in non-cash
working capital (8,182) (4,372) (11,843) (15,686)
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11,167 11,414 30,894 21,412
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INVESTMENT ACTIVITIES
Fixed asset additions (12,802) (11,742) (47,489) (35,306)
Purchase of subsidiaries 324 (2,584) (7,947) (2,584)
Increase in investments and
other (928) (527) (4,153) (1,529)
Proceeds from disposition of
fixed assets and other 139 1,005 1,618 1,465
Cash acquired on acquisition of
subsidiaries (443) 35 2,665 35
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(13,710) (13,813) (55,306) (37,919)
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FINANCING ACTIVITIES
Repayment of notes receivable
from employees 6 130 255 406
Increase (decrease) in bank
indebtedness 2,269 (1,573) 1,648 (1,757)
Issues of long-term debt - 1,347 2,307 1,676
Repayments of long-term debt (359) (593) (4,085) (1,806)
Issuance of Class A Subordinate
Voting Shares 1,575 63 2,683 1,750
Dividends on Class A Subordinate
Voting Shares and Class B
Shares (1,132) (906) (3,420) (2,705)
Dividends on Convertible Series
Preferred Shares (966) (1,147) (2,843) (3,441)
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1,393 (2,679) (3,455) (5,877)
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Decrease in cash during
the period (1,150) (5,078) (27,867) (22,384)
Cash, beginning of period 49,093 17,958 75,810 35,264
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Cash, end of period $ 47,943 $ 12,880 $ 47,943 $ 12,880
-------------------------------------------------------------------------
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TESMA INTERNATIONAL INC.
CONSOLIDATED BALANCE SHEETS
(Canadian dollars in thousands)
(Unaudited)
As at As at
April 30, 1998 July 31, 1997
ASSETS
Current
Cash $ 47,943 $ 75,810
Accounts receivable 103,651 74,039
Inventories 53,319 42,918
Prepaid expenses and other 5,364 6,895
Income taxes receivable 1,420
Accounts receivable from related
companies 2,132 1,638
------------------------------------------------------------------------
212,409 202,720
Investments 1,073 1,141
Fixed assets 173,366 138,442
Other assets 12,406 7,192
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$399,254 $349,495
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LIABILITIES AND SHAREHOLDERS' EQUITY
Bank indebtedness $ 9,116 $ 7,469
Accounts payable 41,739 35,118
Accrued salaries and wages 17,584 14,448
Other accrued liabilities 29,826 20,314
Income taxes payable 4,897
Accounts payable to related companies 2,364 2,061
Long-term debt due within one year 4,131 4,549
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109,657 83,959
Long-term debt 14,824 13,358
Deferred income taxes 20,063 20,050
Convertible Series Preferred Shares 58,201 57,197
SHAREHOLDERS' EQUITY
Convertible Series Preferred Shares 1,514 2,596
Class A Subordinate Voting Shares 119,096 116,413
Class B Shares 2,583 2,583
Retained earnings 73,321 55,721
Currency translation adjustment (5) (2,382)
------------------------------------------------------------------------
196,509 174,931
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$399,254 $349,495
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