General Bearing Reports Q2 Results
22 July 1998
General Bearing Reports Second Quarter Results; Pre-Tax Income Up From First Quarter and Year Ago Period
WEST NYACK, N.Y., July 22 -- General Bearing Corporation
today reported sales of $11,011,000 for the second quarter,
ended June 27, 1998, versus sales of $11,476,000 for the year earlier period.
The Company said that pre-tax income rose to $1,138,000, or $0.28 per share
compared with $1,086,000 or $0.27 per share reported for the same period last
year. Net income was $670,000, or $0.17 per share, up from the first quarter
results of $627,000, or $0.16 per share. In 1997, the Company posted second
quarter net income of $1,453,000, or $0.37 a share. In the second quarter,
ended June 28, 1997, the Company realized a tax benefit of $367,000, versus
this year's second quarter, when the Company booked a $468,000 provision for
taxes.
General Bearing President David L. Gussack noted, "We've continued to make
substantial progress in reducing costs. Our cost of sales was 65%, down from
68% a year ago. We anticipate continued progress in this respect." He
explained that progress in pre-tax earnings as well as the gain in after-tax
income compared to the first quarter is indicative of the Company's continuing
excellent financial performance.
Gussack said that the rate of new orders indicates rising sales in the
second half of the year. For example, the Company will initiate shipments to
Great Dane Trailers, the second largest producer in the truck trailer
industry. The new agreement with Great Dane calls for shipments of more than
$3 million of wheel bearings annually.
In addition, the Company initiated partial shipments in May under its
$14 million agreement with Ford Motor Company. "By the end of the quarter, we
were approaching projected normal shipping volumes and expect to ship
$3 million of product to Ford by year end," said Gussack.
For the six-month period, sales rose to $21,348,000 from $21,068,000 a
year ago, while operating income was $2,207,000, up from $2,061,000 in the
year earlier period. Net income was $1,296,000, or $0.33 a share, versus
$2,320,000, or $0.63 a share, a year ago.
General Bearing manufactures, sources, assembles and distributes a variety
of bearing components and products. The Company manufactures ball bearings,
tapered roller bearings, spherical roller bearings and cylindrical roller
bearings. Under "The General" and the "Hyatt" trademarks, the Company
supplies Original Equipment Manufacturers (OEMs) in the automobile,
truck/trailer, railcar, office equipment, machinery and appliance industries,
as well as the Industrial Aftermarket.
"Safe Harbor" statement under the Private Securities Litigation Reform Act
of 1995: This press release contains forward-looking statements that are
subject to risks and uncertainties, including, but not limited to, the impact
of competitive products, product demand and market acceptance risks, reliance
on key strategic alliances, fluctuations in operating results and other risks
detailed from time to time in the Company's filings with the Securities and
Exchange Commission. These risks could cause the Company's actual results for
the current FY and beyond to differ materially from those expressed in any
forward looking statements made by, or on behalf of, the company.
GENERAL BEARING CORPORATION AND SUBSIDIARIES
Consolidated Statements of Operations
(In Thousands, except for per share figures)
Thirteen Weeks Ended, Twenty-Six Weeks Ended,
6/27/98 6/28/97 6/27/98 6/28/97
Sales $11,011 $11,476 $21,348 $ 21,068
Cost of sales 7,183 7,843 14,490 14,578
Gross profit 3,828 3,633 6,858 6,490
SG&A expense 2,494 2,331 4,651 4,429
Operating income 1,334 1,302 2,207 2,061
Other income -- -- 295 --
Interest expense, net 196 216 354 497
Income before income
tax (benefit) 1,138 1,086 2,148 1,564
Income tax (benefit) 468 (367) 852 (756)
Net income $670 $1,453 $1,296 $2,320
Income per share
- basic $0.17 $0.37 $0.33 $0.63
Income per share
- diluted $0.17 $0.37 $0.32 $0.63
Weighted average
shares outstanding
- basic 3,917,521 3,900,000 3,910,589 3,697,252
Weighted average
shares outstanding
- diluted 3,988,050 3,900,000 4,029,731 3,697,252