Lund International Holdings, Inc. Announce Q2 Results
13 August 1998
Lund International Holdings, Inc. Announced Second Quarter Results of Operations
ANOKA, Minn., Aug. 13 -- Lund International Holdings, Inc.
announced net sales and income from operations for the second
quarter of 1998, ended June 30, 1998. The financial results for the quarter
and six month period ended June 30, 1998 include the results of operations of
Deflecta-Shield Corporation, acquired by Lund on December 30, 1997.
Net sales for the quarter were $29,897,000, compared to $12,112,000 for
the same period in 1997. Net sales for the six month period ended June 30,
1998 were $57,082,000, compared to $22,553,000 for the same period in 1997.
For both periods, the increase in net sales was attributed to the
consolidation of Deflecta-Shield's results in 1998.
The gross profit margin for the three month period ended June 30, 1998 was
31.1%, compared to 34.8% for the same period in 1997. The gross profit margin
for the six month period ended June 30, 1998 was 30.2% compared to 34.3% for
the six month period ended June 30, 1997. The decrease in gross profit margins
for both periods was primarily attributable to product promotions for
aftermarket plastic and fiberglass products, a shift in product sales mix, raw
material and labor rate increases, startup costs associated with the new
facilities in Illinois and Indiana, and purchase accounting inventory
write-offs in the first quarter of 1998.
Net income for the three month period ended June 30, 1998 was $163,000, or
$.02 per share, compared to $804,000, or $.18 per share, for the same period
in 1997. Lund incurred a net loss of $98,000, $.02 per share, for the six
month period ended June 30, 1998 compared to a net income of $1,271,000, or
$.29 per share, for the same period last year.
While income from operations exceeded the comparable periods, amortization
of purchase accounting goodwill and interest on acquisitions debt resulted in
net income below last year's levels.
William J. McMahon, President and Chief Executive Officer, stated that,
"The second quarter showed continued success of our newly acquired product
lines, specifically heavy duty truck accessories, suspension products and
aluminum products. The decline in our aftermarket fiberglass and plastic
product lines is primarily a result of reduced sales to our warehouse
distributors who are facing stiff competition from original equipment
manufacturers and retail chains. Our focus is on increasing market share with
the traditional distributors while continuing to expand our presence at the
OEMs and retail chains.
"We have made significant strides in our consolidation efforts with
Deflecta-Shield. During the second quarter of this year, we closed our
Oklahoma manufacturing facility and began producing tonneau covers at Belmor
in Chicago. In addition, our out-sourced hood shield production has been
moved to our Autotron OEM plant in Colorado. In June, the Autotron
manufacturing facility achieved QS9000 quality certification. This quality
certification is mandatory for an OEM supplier.
To further our consolidation efforts we began construction on a 104,000
square foot addition at our Anoka site with a completion date in early 1999.
This $4.2 million expansion will accommodate the distribution functions now
performed at Indianola."
Statements made in this press release relating to future financial
results, the effects of the acquisition company operations, trends and market
analyses, among others, are forward-looking statements made under the Private
Securities Litigation Reform Act of 1995. These statements involve risks and
uncertainties which could cause results of operations to differ materially
from those anticipated. Among the factors that could cause results of
operations to differ materially are the following: inability to obtain
expected efficiencies, or to obtain them in a timely manner; consumer
preference changes; risks of expansion into new distribution channels; delays
in designing, developing, testing, or shipping of products; increased
competition; general economic developments and trends; developments and trends
in the light truck and automotive accessory market; sales of heavy trucks,
which are cyclical; the timely development and introduction of competitive new
products by the Company and acceptance of those new products; and increased
costs. This is not an exhaustive list and the Company may supplement this
list in future filings or releases or in connection with the making of
forward-looking statements.
LUND INTERNATIONAL HOLDINGS, INC.
CONDENSED CONSOLIDATED
INCOME STATEMENTS
(Unaudited)
(in thousands, except per share data)
Three months ended Six months ended
June 30, June 30,
1998 1997 1998 1997
Net Sales $29,897 $12,112 $57,082 $22,553
Cost of goods sold 20,603 7,898 39,824 14,809
Gross profit 9,294 4,214 17,258 7,744
Operating expenses
General and Administrative 2,940 1,075 5,507 2,207
Selling and marketing 3,413 1,790 6,689 3,267
Research and development 694 333 1,450 659
Amortization of intangibles 586 31 1,167 62
Total operating expenses 7,633 3,229 14,813 6,195
Income from operations 1,661 985 2,445 1,549
Other income, net (1,366) 105 (2,657) 169
Income (loss) before
income taxes 295 1,090 (212) 1,718
Income tax expense (benefit) 132 286 (114) 447
Net income (loss) $163 $804 $(98) $1,271
Basic net income (loss)
per share $0.03 $0.18 $(0.02) $0.29
Diluted net income (loss)
per share $0.02 $0.18 $(0.02) $0.29
Weighted average common shares 6,412 4,376 5,841 4,375
Weighted average common and
common equivalent shares 6,761 4,394 5,841 4,394
LUND INTERNATIONAL HOLDINGS, INC.
CONDENSED CONSOLIDATED
BALANCE SHEETS
(Unaudited)
(in thousands)
June 30, December 31,
1998 1997
ASSETS
Current assets $48,685 $52,465
Non-current assets
Property and equipment, net 20,410 20,621
Intangibles, net 67,599 68,778
Other assets, net 2,633 2,163
Total assets $139,327 $144,027
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities $17,494 $25,007
Long-term liabilities 59,388 56,506
Stockholders' equity 62,445 62,514
Total liabilities and
stockholders' equity $139,327 $144,027