Intermet Reports Record First Quarter
12 April 1999
Intermet Reports Record First Quarter
TROY, Mich., April 12 -- Intermet Corporation
today announced record first quarter sales, net income and earnings per share.
The company reported sales of $245 million, net income of $12 million and
earnings per share of 47 cents.
Sales rose $21 million, or 9.5 percent, over 1998 first quarter results,
led by a 13.7 percent increase in sales from Intermet's continuing core
casting operations. Spurred by the company's unprecedented new product
introductions in 1998, Intermet sales were also driven by the demand for new
vehicles, especially light trucks, during the first quarter. An aggressive
ramp-up of the GMT 800 and successful introductions of Ford and
DaimlerChrysler light trucks fueled record sales. Tool Products and VEGU
companies, acquired in December, 1998, added $20 million to revenues.
Net income rose 7.6 percent over the same quarter in 1998. Diluted
earnings per share were 4 cents higher than 1998 first quarter earnings per
share.
"Keeping pace with the tremendous surge in the light truck market and
subsequent demand for our products has been challenging. It has caused us to
run heavy overtime and has generated operating inefficiencies," said John
Doddridge, Intermet chairman and chief executive officer. "We experienced a
serious production process problem in launching a new product, which impacted
our earnings during this quarter as well as the fourth quarter of last year.
We have successfully developed a replacement process to correct the problem,
and it was implemented during the last week of March.
"Our positive numbers reflect the strength of the economy overall and our
markets in particular. Ductile iron castings are expected to increase for the
long term, and we are well positioned to take advantage of this trend."
Doddridge continued to say that "Intermet, like many small capital
companies, is very disappointed in the market valuation of the Company. As a
result, we initiated a stock repurchase program for up to 10 percent of our
stock over the next two years -- a move that we believe signifies our
confidence in the company's future."
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 7,000 employees at 19
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 1998 Annual Report for
the year ended Dec. 31, 1998.
Intermet Corporation Condensed Consolidated Income Statements
(In thousands, except per share data)
Three Months Ended (unaudited)
March 31 March 31,
1999 1998
Net sales $245,227 $224,033
Cost of sales 211,090 194,058
Gross profit 34,137 29,975
Operating expenses 9,783 7,801
Operating profit 24,354 22,174
Other expense, net 3,388 2,297
Income before income taxes 20,966 19,877
Provision for income taxes 8,833 8,606
Net income $ 12,133 $ 11,271
Earnings per share - basic $ 0.47 $ 0.44
Earnings per share - diluted $ 0.47 $ 0.43
Weighted average
shares outstanding:
Basic 25,827 25,404
Diluted 25,938 25,952
Intermet Corporation Condensed Consolidated Balance Sheets (in thousands)
March 31, December 31,
1999 (unaudited) 1998
Assets:
Cash and cash equivalents $ 8,716 $ 5,848
Other current assets 206,014 191,582
Property plant and equipment (net) 240,023 240,702
Other non-current assets 142,873 145,883
Total assets $597,626 $584,015
Liabilities and shareholders' equity:
Debt 185,280 164,101
Other liabilities 184,435 200,572
Total liabilities 369,715 364,673
Minority interest 2,337 2,337
Shareholders' equity 225,574 217,005
Total liabilities and
shareholders' equity $597,626 $584,015