Quixote Reports Record Fiscal 1999 Q3 and Nine Month Results
19 April 1999
Quixote Corporation Reports Record Fiscal 1999 Third Quarter and Nine Month Results
CHICAGO--April 19, 1999--Quixote Corporation today reported record results for the third quarter and first nine months of fiscal 1999, ended March 31,1999.Fiscal 1999 third quarter sales increased 43% to a record $18,347,000 from $12,821,000 in the same period last year, reflecting strong internal growth and the contributions of Highway Information Systems, Inc., which was acquired in April 1998, and Nu-Metrics, Inc., which was acquired in December 1998. Earnings from continuing operations rose 38% to $1,133,000, or $0.14 per diluted share, from $820,000, or $0.10 per diluted share, in the fiscal 1998 third quarter. Net earnings rose to $1,373,000, or $0.17 per diluted share, in the third quarter which include a gain from discontinued operations of $240,000, or $0.03 per diluted share, due to the reversal of certain accruals resulting from the favorable outcome of some legal proceedings and other contingencies. Net earnings for the comparable fiscal 1998 third quarter were $820,000, or $0.10 per diluted share.
For the first nine months of fiscal 1999, sales increased 32% to a record $49,212,000 from $37,273,000 in the same period of fiscal 1998. Earnings from continuing operations rose 21% to $3,693,000, or $0.45 per diluted share, from $3,050,000, or $0.38 per diluted share, in the first nine months of the 1998 fiscal year. Net earnings of $3,933,000, or $0.48 per diluted share, in the first nine months of fiscal 1999 increased 268% from $1,070,000, or $0.13 per diluted share, in the first nine months of fiscal 1998. Net earnings in the current nine-month period include a gain from discontinued operations of $240,000, or $0.03 per diluted share, due to the previously discussed reversal of certain accruals. The fiscal 1998 nine-month period included a loss from discontinued operations of $1,980,000, or $0.25 per diluted share, relating to the Company's discontinued Disc Manufacturing, Inc. subsidiary.
The Company noted that internal sales growth rose 29% during the third quarter led by strong improvement in sales from its largest subsidiary, Energy Absorption Systems, Inc. The improvement reflects continued strong sales of the QuadGuard(R) line of crash cushions and the Alpha 100K TMA(TM) (Truck-Mounted Attenuator). The Company's most recent acquisitions, Highway Information Systems, Inc. and Nu-Metrics, Inc., added sales of $1,754,000 in the quarter. Long-term debt declined by $7,160,000, or 32%, to $15,458,000 at March 31, 1999 versus $22,618,000 at December 31, 1998.
Philip E. Rollhaus, Jr., Quixote's Chairman and Chief Executive Officer, commented: "Sales and earnings from continuing operations were the strongest we have seen for any third quarter or first nine- month period. March sales were the highest of any month in the Company's history. In addition, we entered this current quarter with a near record backlog of $11,900,000. Our research, development and engineering team has made a significant contribution to our improved performance through the development of new products as well as the improvement of existing products. Some of these additions include the introduction of a reusable QuadGuard(R) crash cushion system called the Elite and the expansion of our line of REACT 350(R) crash cushions."
Mr. Rollhaus continued, "Additionally, our Dragnet(R) Vehicle Arresting System is receiving increasing attention for its potential in reducing the number of tragic accidents at railroad- highway crossings, a subject of growing concern for railroads, highway departments, the media and the public. As a result, the Illinois Department of Transportation has installed our Dragnet System on a test basis at three railroad-highway intersections on the Chicago-St. Louis high-speed rail corridor. More recently, NBC television had a program on the needless loss of life occurring at railroad-highway crossings in which the effectiveness of the Dragnet System was prominently portrayed."
Mr. Rollhaus concluded, "Looking forward, we are optimistic about Quixote's prospects for greater growth within the areas of transportation and highway safety. We are beginning to see the early benefits of the new six-year federal highway program under the "Transportation Equity Act for the 21st Century" in terms of increasing orders as we head into the heavy construction season. At the same time, our international sales, to which we are giving heightened attention, have increased 33% through the first nine months and should reach a record number by the end of our fiscal year."
Quixote Corporation, (www.quixotecorp.com), through its wholly- owned subsidiaries, Energy Absorption Systems, Inc. and the TranSafe Corporation, is the world's leading manufacturer of energy-absorbing highway crash cushions, truck-mounted impact attenuators, computerized highway advisory radio transmitting systems, electronic wireless measuring and sensing devices, and other highway safety products and services.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: Except for historical information contained herein, the matters set forth in this news release are forward-looking statements. The forward-looking statements set forth above involve a number of risks and uncertainties that could cause actual results to differ materially from any such statement, including the risks and uncertainties discussed in the Company's Annual Report on Form 10-K for its fiscal year ended June 30, 1998, under the caption "Forward-Looking Statements" in Management's Discussion and Analysis of Financial Condition and Results of Operations, which discussion is incorporated herein by this reference.
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Quixote Corporation
Earnings Summary
Three Months Ended Nine Months Ended
March 31, March 31,
1999 1998 1999 1998
Net sales $ 18,347,000 $ 12,821,000 $ 49,212,000 $ 37,273,000
Operating
profit $ 2,047,000 $ 1,172,000 $ 6,299,000 $ 4,060,000
Other income
(expense) (304,000) (1,000) (618,000) 297,000
Earnings from
continuing
operations before
income taxes 1,743,000 1,171,000 5,681,000 4,357,000
Provision
for income
taxes 610,000 351,000 1,988,000 1,307,000
Earnings from
continuing
operations 1,133,000 820,000 3,693,000 3,050,000
Gain (loss) from
discontinued
operations 240,000 -- 240,000 (1,980,000)
Net earnings $ 1,373,000 $ 820,000 $ 3,933,000 $ 1,070,000
Basic per share data:
Earnings from
continuing
operations $ 0.14 $ 0.10 $ 0.46 $ 0.38
Gain (loss) from
discontinued
operations 0.03 -- 0.03 (0.25)
Net earnings $ 0.17 $ 0.10 $ 0.49 $ 0.13
Average
common
shares 8,018,193 7,904,556 7,962,584 7,971,514
Per share data assuming
dilution:
Earnings from continuing
operations $ 0.14 $ 0.10 $ 0.45 $ 0.38
Gain (loss) from
discontinued
operations 0.03 -- 0.03 ( 0.25)
Net earnings $ 0.17 $ 0.10 $ 0.48 $ 0.13
Average
diluted
common
shares 8,238,973 7,998,831 8,216,341 8,065,789
Quixote Corporation
Balance Sheet Data
As of March 31, As of June 30,
1999 1998
Assets
Current
assets $ 29,804,000 $ 26,853,000
Property, plant
and equipment, net 15,598,000 13,482,000
Intangible assets 24,231,000 12,553,000
Other assets 1,229,000 987,000
Assets of
discontinued
operations -- 5,190,000
$ 70,862,000 $ 59,065,000
Liabilities and Shareholders' Equity
Current liabilities $ 10,935,000 $ 11,707,000
Long-term debt, net 14,908,000 7,677,000
Deferred income
tax liabilities 795,000 795,000
Liabilities of
discontinued
operations 1,247,000 - -
Shareholders' equity 42,977,000 38,886,000
$ 70,862,000 $ 59,065,000