SMC Corporation Fourth Quarter and Year-End Results
11 February 1999
SMC Corporation Fourth Quarter and Year-End Results
HARRISBURG, Ore., Feb. 11 -- SMC Corporation
today reported its results for the fourth quarter of 1998. For the three
month period ended December 31, 1998, net sales increased to $67.1 million
from $52.4 million reported for the fourth quarter in 1997. Although net
income decreased for the same three month period, from $1.7 million in 1997
to $1.1 million in 1998, net income increased significantly from a loss of
$2.5 million reported in the third quarter of 1998. Earnings per share
decreased from $.27 on 6.7 million shares outstanding to $.18 on 6.2 million
shares outstanding for the three months ended December 31, 1997 and
December 31, 1998, respectively.
For the year ended December 31, 1998, net sales were $217 million, up from
1997 revenues of $203 million. Net income for 1998 was $409,000, down from
$4.2 million recorded in 1997. Earnings per share were $.06 in 1998 compared
to $.65 per share reported in 1997.
Jay L. Howard, SMC's President commented, "We are pleased that sales of
our new Renegade Class A motorcoach has contributed to our sales growth.
Although the margins of this new product were low, we expect improvement as
this product moves from its start up phase to full production." Mr. Howard
added, "Total year margins were negatively impacted by the 1999 model change
over at our Safari plant and the introduction of the new Renegade model at the
Harney County facility. We believe these production issues are behind us."
Selling, general and administrative costs decreased by over $600,000 from
prior year levels, with essentially all of this decrease coming in the fourth
quarter. Increased costs in other expense represent the costs of settling
several warranty matters.
Mr. Howard commented, "We expect our efforts to control costs will
continue to result in reduced overhead costs particularly in selling and
administrative functions. We will continue to focus on manufacturing costs to
make further improvements in our operating margins."
SMC Corporation is one of the largest high line motor coach manufacturers
in the United States. Headquartered in Harrisburg, Oregon, the Company has
six locations in Oregon.
Information about SMC Corporation and its products can be found on the
World Wide Web at http://www.smc-corporation.com.
Forward Looking Statements: The statements in this report regarding
increased competition and start-up of a new production facility are forward-
looking statements. A number of factors could cause actual results to differ
materially from these statements, including delays in full operation of the
production facility, a general slowdown in the economy or the RV market
specifically, or new products from competitors. Please also refer to the
Company's SEC reports, including, but not limited to its Form 10Q Quarterly
Report for the quarter ended September 30, 1998 and its Form 10K Annual Report
for the year ended December 31, 1997.
SMC CORPORATION
CONSOLIDATED BALANCE SHEET
In Thousands
12/31/97 12/31/98
Assets
Current 39,081 45,453
Property & Equipment 18,585 20,551
Other 2,176 2,016
Total Assets 59,842 68,020
Liabilities
Current 29,335 36,473
Deferred Tax 781 928
Long-term Debt 5,433 7,410
Total Liabilities 35,549 44,811
Shareholders' Equity 24,293 23,209
Total Liability & Equity 59,842 68,020
SMC CORPORATION
CONSOLIDATED STATEMENT OF INCOME
$000's(except share and per share data)
Three Months Ended Year to Date
12/31/97 12/31/98 12/31/97 12/31/98
Net Sales 52,377 67,079 203,019 217,485
Cost of Sales 43,947 59,667 175,809 195,405
Gross Profit 8,430 7,412 27,210 22,080
Sales, General,
Adm 5,558 5,040 19,353 18,742
Income from
Operations 2,872 2,372 7,857 3,338
Interest Expense 183 261 933 813
Other Expenses (Inc) (82) 217 (120) 774
Legal Expense -- -- -- 1,070
Income Before Taxes 2,771 1,894 7,044 681
Provision for Taxes 1,085 757 2,798 272
Net Income 1,686 1,137 4,246 409
Net Income/share
basic 0.27 0.18 0.65 0.06
Net Income/share
diluted 0.27 0.18 0.65 0.06
Weighted shares
basic 6,343,173 6,238,491 6,506,562 6,429,317
Weighted shares
diluted 6,343,173 6,238,491 6,507,000 6,429,317