Briggs & Stratton Corporation Reports Results for Q1 1999
14 October 1998
Briggs & Stratton Corporation Reports Results for the First Quarter of Fiscal 1999
MILWAUKEE, Oct. 13 -- The following was released today by
Briggs & Stratton Corporation :
Net income for the first quarter was $4.4 million or $.19 per share
compared to a loss of $2.6 million or $.10 per share for last year's first
quarter. This improvement was a result of a 31% sales increase. Engine
unit shipments increased 48%; the greatest increase was in engines for
walk-behind lawnmowers. The increase in unit shipments was to a great degree a
result of lawn and garden equipment manufacturers building product earlier
this year than they did last year -- a reaction to the product and engine
shortages that developed last spring. While we do expect higher unit shipments
this year, most of the first quarter increase was a shift of sales from later
in the year.
We continue to believe that the fiscal year will be a good one if weather
conditions are normal.
F. P. Stratton, Jr.
Chairman and Chief Executive Officer
Consolidated Statements of Earnings
(In Thousands)
Three Months Ended September
1998 1997
NET SALES $223,981 $170,557
COST OF GOODS SOLD 186,369 144,146
Gross Profit on Sales $37,612 $26,411
ENGINEERING, SELLING, GENERAL
AND ADMINISTRATIVE EXPENSES 29,248 29,174
Income (Loss) from Operations $8,364 $(2,763)
INTEREST EXPENSE (3,410) (3,794)
OTHER INCOME, Net 2,147 2,315
Income (Loss) Before Provision for
Income Taxes $7,101 $(4,242)
PROVISION (CREDIT) FOR INCOME TAXES 2,660 (1,610)
Net Income (Loss) $4,441 $(2,632)
Average Shares Outstanding 23,635 25,165
BASIC EARNINGS (LOSS) PER SHARE $.19 $(.10)
Diluted Average Shares Outstanding 23,701 25,315
DILUTED EARNINGS (LOSS) PER SHARE $.19 $(.10)
BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES
Consolidated Balance Sheets as of the End of September 1998 and 1997
(In Thousands)
CURRENT ASSETS: 1998 1997
Cash and Cash Equivalents $7,108 $4,825
Receivables 149,072 121,534
Inventories 156,683 204,803
Other 55,271 47,141
Total Current Assets $368,134 $378,303
OTHER ASSETS:
Marketable Securities $1,785 $ --
Deferred Income Tax Asset 8,260 16,673
Capitalized Software 7,555 11,066
Total Other Assets $17,600 $27,739
PLANT AND EQUIPMENT, at Cost $820,747 $809,182
Less - Accumulated Depreciation 429,015 411,199
Net Plant and Equipment $391,732 $397,983
$777,466 $804,025
CURRENT LIABILITIES: 1998 1997
Accounts Payable $65,966 $62,630
Domestic Notes Payable 15,653 12,980
Foreign Loans 15,867 11,936
Current Maturities on Long-Term Debt 15,000 15,000
Accrued Liabilities 113,544 108,125
Total Current Liabilities $226,030 $210,671
OTHER LIABILITIES:
Deferred Revenue on Sale of
Plant & Equipment $15,874 $15,951
Accrued Pension Cost 24,322 31,208
Accrued Employee Benefits 12,700 12,496
Postretirement Health Care Obligation 70,248 74,717
Long-Term Debt 128,154 142,948
Total Other Liabilities $251,298 $277,320
SHAREHOLDERS' INVESTMENT:
Common Stock and Additional Paid-in Capital $37,774 $39,678
Retained Earnings 531,393 481,049
Unearned Compensation on Restricted Stock (278) --
Cumulative Translation Adjustments (1,584) (1,276)
Treasury Stock, at Cost (267,167) (203,417)
Total Shareholders' Investment $300,138 $316,034
$777,466 $804,025
Consolidated Statements of Cash Flows
(In Thousands)
Three Months Ended September
CASH FLOWS FROM OPERATING ACTIVITIES: 1998 1997
Net Income (Loss) $4,441 $(2,632)
Depreciation and Amortization 12,394 10,979
Loss on Disposition of Plant and Equipment 147 1
Provision for Deferred Income Taxes 3,174 381
(Increase) Decrease in Accounts Receivable (13,714) 8,343
(Increase) in Inventories (48,805) (78,846)
(Increase) Decrease in Other Current Assets (4,255) 2,503
(Decrease) in Accounts Payable and
Accrued Liabilities (8,136) (9,880)
Other, Net (1,790) (348)
Net Cash Used in Operating Activities $(56,544) $(69,499)
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to Plant and Equipment $(13,609) $(12,855)
Proceeds Received on Sale of Plant
and Equipment 771 138
Net Cash Used in Investing Activities $(12,838) $(12,717)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net Borrowings on Domestic and Foreign Loans $12,960 $6,557
Purchase of Common Stock for Treasury (14,556) (26,396)
Dividends (6,853) (7,001)
Proceeds from Exercise of Stock Options 82 1,209
Net Cash Used in Financing Activities $(8,367) $(25,631)
EFFECT OF EXCHANGE RATE CHANGES $330 $(187)
NET DECREASE IN CASH AND CASH EQUIVALENTS $(77,419) $(108,034)
CASH AND CASH EQUIVALENTS, Beginning 84,527 112,859
CASH AND CASH EQUIVALENTS, Ending $7,108 $4,825
This release contains certain forward-looking statements that involve
risks and uncertainties that could cause actual results to differ materially
from those in the forward-looking statements. The forward-looking statements
are based on the Company's current views and assumptions and involve risks and
uncertainties that include, among other things, the effects of weather on
the purchasing patterns of the Company's customers and end use purchasers of
the Company's engines; the seasonal nature of the Company's business; actions
of competitors; changes in laws and regulations, including accounting
standards; employee relations; customer demand; prices of purchased raw
materials and parts; domestic economic conditions, including housing starts
and changes in consumer disposable income; foreign economic conditions,
including currency rate fluctuations; the ability of the Company's customers
and suppliers to meet year 2000 compliance; and unanticipated internal year
2000 issues. Some or all of the factors are beyond the Company's control.