Barnes Group Inc. Reports Another Outstanding Year
27 January 1999
Barnes Group Inc. Reports Another Outstanding Year
BRISTOL, Conn.--Jan. 27, 1999--Barnes Group Inc. today reported that 1998 earnings per share were $1.72, after a non-recurring expense of $ .38 per share related to the accelerated retirement package of its retired chief executive officer. The $2.10 per share before the non-recurring expense is a 5 percent increase over the record $2.00 per share for the comparable period in 1997. Net income for 1998 was $34.5 million, or $42.2 million before the non-recurring charge, compared to $40.4 million for the same period a year earlier. The Company further reported that it experienced a moderate sales increase for 1998 to $651 million from $643 million in 1997.
Fourth quarter earnings per share were $ .37 for 1998, compared to $ .47 per share for the same period a year ago, while net income for the quarter was $7.3 million for 1998, compared to $9.4 million a year ago. The year-over-year decline in fourth quarter profits is due primarily to lower sales volume at its Bowman Distribution business, lower foreign exchange gains and a product line rationalization, including a plant closure at Associated Spring. The Company reported that sales for the fourth quarter were $155 million for 1998, compared to the $160 million reported in 1997.
"Given this year's unsettled economic situation in Asia, the General Motors (GM) strike, and the non-recurring retirement expense, we are generally pleased with our performance. Our earnings before the non-recurring expense were again at a new high although we experienced a slowdown during the fourth quarter, " said Edmund M. Carpenter, Barnes' new president and chief executive officer.
"Barnes Aerospace once again turned in record year-over-year results in sales and profit due to the strong commercial aviation engine and airframe markets," Carpenter said. Sales for the group were $155 million, up 13 percent from $137 million for 1997. Profits for the group were $17.3 million for 1998, up 20 percent from $14.4 million for the comparable period a year ago. "Both Windsor Manufacturing, an original equipment manufacturer and Windsor Airmotive, an overhaul and repair business provider, turned in significant increases in both sales and earnings during 1998," said Carpenter.
Associated Spring reported sales of $262 million for 1998, compared to $259 million for 1997. Profit for 1998 was $29.1 million, compared to 1997's profit of $29.4 million. "Associated Spring's North American operations turned in a solid year-over-year performance and its Mexico operation reported a strong turnaround indicating a successful resolution of the operating issues encountered last year. As reported earlier this year, Associated Spring's financial results were negatively impacted by the GM strike and the ongoing economic situation in Asia, which is affecting Spring's traditionally strong Singapore operations," Carpenter said.
Bowman Distribution reported a reduction in sales to $247 million for 1998 compared to $259 million for the prior year, while profits increased to $40.4 million in 1998, up from $38.9 million in 1997. "Bowman's 1998 sales shortfall resulted primarily from a decline in volume due to the loss of a large customer and the continued refocus of Bowman's sales efforts to meet the changing requirements of larger customers. However, they continued to aggressively manage costs minimizing the impact of the sales shortfall, particularly in the first half of 1998," said Carpenter.
Barnes Group Inc. (www.barnesgroupinc.com) is a $650 million diversified international company headquartered in Bristol, CT. It is a leading manufacturer of complex metal components and precision springs for industrial, automotive and aerospace markets and a major distributor of maintenance repair and overhaul products to industrial and transportation markets.
Barnes Group Inc.
Income Statement Highlights
(Dollars in millions, except per share data)
Unaudited
Three months Twelve months
ended Dec. 31 ended Dec. 31
1998 1997 1998 1997
Net Sales $ 154.9 $ 160.1 $ 651.2 $ 642.7
Operating Income(a) 12.1 15.3 55.2 65.8
Net Income (a) 7.3 9.4 34.5 40.4
Income per share-basic(a) $ .37 $ .47 $ 1.72 $ 2.00
-diluted (a) .36 .46 1.69 1.96
Dividends per share .18 .17 .69 .65
(a) Includes a one-time pre-tax charge for CEO retirement package of
$12.9 million ($7.7 million after tax, $.38 per share) recorded in
June 1998