Intermet Reports Fourth Quarter Earnings
28 January 1999
Intermet Reports Fourth Quarter Earnings
TROY, Mich., Jan. 28 -- Intermet Corporation
today reported record annual sales of $842 million, $28 million higher than
1997 sales of $814 million, while 1998 operational earnings were $41.0 million
($1.58 per diluted share) versus operational net earnings of $40.0 million
($1.55 per diluted share) in 1997. 1998 sales were underpinned by a very
strong domestic market and considerable new business coming on stream in the
latter part of the year. However, the GM strike and weather-related problems
in the third quarter combined with the production performance in the fourth
quarter allowed the Company to increase earnings per share by 2% year over
year.
John Doddridge, chairman and chief executive officer, said, "The fourth
quarter was a very difficult quarter for Intermet. The tremendous surge in
demand for our products when combined with the inefficiencies of running the
facilities at much greater than rated capacity forced us to place many of our
customers on sales allocation in December. In 1998 we successfully launched
in excess of 100 products. Unfortunately, at one of our facilities we
experienced greater than expected start-up costs which significantly impacted
earnings. We are happy to report that major progress has been made in this
area."
Fourth quarter income of $0.31 per diluted share on net income of $8.1
million compared with $0.41 per diluted per share on net income of $10.6
million in the fourth quarter of 1997 reflecting less than expected production
performance principally at the Columbus and Ironton operations. Net fourth
quarter sales of $209 million were up slightly from last year's record fourth
quarter sales of $204 million. Excluding divested operations, fourth quarter,
sales were up 9.4 percent compared with the same period last year.
"Our first quarter 1999 order board remains strong," said Doddridge. "We
essentially have our customers off allocation as our plants improve operating
efficiencies and demand is lowered from the annualized 19 million vehicle
build rate shown on our order board in December. Additionally, new production
capacity has been installed becoming operational in January at one of our
ferrous foundries."
The Intermet board of directors voted to approve a quarterly dividend of 4
cents per share, payable March 31, 1999 to shareholders of record as of March
1, 1999.
With headquarters in Troy, Michigan, Intermet Corporation and its
subsidiaries design and manufacture precision iron and aluminum cast
components for automotive and industrial equipment manufacturers worldwide.
Intermet also produces precision machined components and manufactures cranes
and specialty service vehicles. The company has more than 6,300 employees at
nineteen operating locations in North America and Europe. Intermet's internet
address is http://www.intermet.com.
This news release may include forecasts and forward-looking statements
about Intermet, its industry and the markets in which it operates. Forward-
looking statements and the achievement of any forecasts or projections are
subject to risks, uncertainties and other factors that could cause actual
results to differ materially from those expressed or denied. Such risks and
uncertainties are fully detailed as a preface to the Management's Discussion
and Analysis of Financial Condition in the Company's 1997 Annual Report for
the year ended December 31, 1997.
Intermet Corporation Condensed Consolidated Income Statements
(In thousands, except per share data)
Three Months Ended (unaudited) Twelve Months Ended
December 31, December 31, December 31, December 31,
1998 1997 1998 1997
Net sales $208,900 $203,805 $841,598 $813,729
Cost of sales 182,128 174,761 730,857 706,771
Gross profit 26,772 29,044 110,741 106,958
Operating expenses 9,796 8,278 35,092 31,760
Operating profit 16,976 20,766 75,649 75,198
Other expense, net 2,446 4,568 10,461 13,809
Income before
income taxes 14,530 16,198 65,188 61,389
Provision for
income taxes 6,463 5,628 24,199 21,376
Net income $8,067 $10,570 $40,989 $40,013
Earnings per
share - basic $0.31 $0.43 $1.60 $1.59
Earnings per
share - diluted $0.31 $0.41 $1.58 $1.55
Weighted average
shares outstanding:
Basic 25,743 25,239 25,610 25,211
Diluted 25,918 25,822 25,947 25,783
Intermet Corporation Condensed Consolidated Balance Sheets (in thousands)
December 31, December 31,
1998 1997
Assets:
Cash and cash equivalents $5,848 $7,022
Other current assets 191,582 186,260
Property plant and equipment (net) 240,702 241,899
Other non-current assets 143,882 104,265
Total assets $582,014 $539,446
Liabilities and shareholders' equity:
Debt 164,101 186,920
Other liabilities 198,567 174,761
Total liabilities 362,668 361,681
Minority interest 2,337 2,337
Shareholders' equity 217,005 175,428
Total liabilities and
shareholders' equity $582,014 $539,446