Drew Announces Record First Quarter Results
22 April 1999
Drew Announces Record First Quarter Results
WHITE PLAINS, N.Y.--April 22, 1999--Drew Industries Incorporated (AMEX:DW) today reported record net sales of $85.9 million in the first quarter of 1999, an increase of 14 percent from sales of $75.2 million in 1998. Sales of Drew's manufactured housing products segment increased 8 percent to $67.5 million in 1999, while sales of its RV products segment increased 43 percent to $18.4 million.Earnings per share (diluted) increased 26 percent to $.34 in 1999 from $.27 in 1998, while net income for the first quarter of 1999 increased 30 percent to $3.9 million. Sales and earnings substantially exceeded analysts' estimates for the quarter; however, there can be no assurance that future results will similarly exceed analysts' current estimates.
Drew's record results were achieved despite continuing competition experienced in our axle and tire refurbishing product line, which reduced the gross margin of this product line. Steps have been taken to improve margins for the balance of the year. However, competition in this line of products, as well as our other product lines, is expected to continue throughout 1999.
"We were gratified by first quarter results and have planned further expansion this year. In particular in 1999, we plan to open at least three RV and manufactured housing chassis facilities. We also continue to explore west coast expansion for all of our products through new factories or acquisitions." said Leigh J. Abrams, President and CEO.
Drew, through its wholly-owned subsidiaries, Kinro, Lippert and Shoals, supplies a wide variety of components for manufactured homes and recreational vehicles. Manufactured products include windows, doors, chassis, chassis parts, roofs and new and refurbished axles. The Company also distributes new and refurbished tires. The Company operates 34 plants in 16 states.
This press release contains certain statements, including the Company's plans regarding its operating strategy, its products and performance and its views of industry prospects, which could be construed to be forward looking statements within the meaning of the Securities Exchange Act of 1934. These statements reflect the Company's current views with respect to future plans, events and financial performance. The Company has identified certain risk factors which could cause actual plans and results to differ substantially from those included in the forward looking statements. These factors include pricing pressures due to competition, raw material costs (particularly aluminum, steel, vinyl and glass), periodic inventory adjustments by retailers of manufactured homes in response to changes in retail sales and other business conditions and interest rates. In addition, general economic conditions may affect the retail sale of manufactured homes and RV's.
DREW INDUSTRIES INCORPORATED
OPERATING RESULTS
Quarter Ended March 31, Last Twelve
1999 1998 Months
(In thousands, except
per share amounts)
Net sales $ 85,887 $ 75,181 $ 341,346
Cost of sales 67,614 60,101 270,254
---------- ---------- -----------
Gross profit 18,273 15,080 71,092
Selling, general and
administrative expenses 10,717 8,969 40,704
---------- ---------- -----------
Operating profit 7,556 6,111 30,388
Interest expense 1,003 1,075 3,818
---------- ---------- -----------
Income before
income taxes 6,553 5,036 26,570
Provision for income taxes 2,611 2,000 10,446
---------- ---------- -----------
Net income $ 3,942 $ 3,036 $ 16,124
========== ========== ===========
Net income per
common share:
Basic $ .35 $ .27 $ 1.43
========== ========== ===========
Diluted $ .34 $ .27 $ 1.41
========== ========== ===========
Weighted average common
shares outstanding:
Basic 11,396 11,135 11,244
========== ========== ===========
Diluted 11,475 11,359 11,408
========== ========== ===========
Depreciation and
amortization $ 1,956 $ 1,495 $ 7,297
========== ========== ===========
BALANCE SHEET INFORMATION
March 31,
(In thousands, except per 1999 1998
share amounts and ratios) ---- ----
Current assets
Cash and short term investments $ 4,731 $ 3,480
Accounts receivable, net 18,437 16,816
Inventories 30,513 27,029
Prepaid expenses and
other current assets 4,528 4,001
---------- ----------
Total current assets 58,209 51,326
Fixed assets, net 44,114 40,436
Goodwill, net 47,437 43,821
Other assets 5,448 2,591
---------- ----------
Total assets $ 155,208 $ 138,174
========== ==========
Current liabilities
Current maturities of
long-term obligations $ 788 $ 594
Accounts payable and
accrued expenses 27,987 25,101
Total current liabilities 28,775 25,695
Long-term indebtedness 51,747 56,029
Other long-term obligations 1,665 1,370
---------- ----------
Total liabilities 82,187 83,094
Total stockholders' equity 73,021 55,080
---------- ----------
Total liabilities and
stockholders' equity $ 155,208 $ 138,174
========== ==========
Current ratio 2.0 2.0
Total debt to equity 0.7 1.0
Book value per share 6.35 $ 4.84