MascoTech, Inc. Announces First Quarter Results
3 May 1999
MascoTech, Inc. Announces First Quarter Results
TAYLOR, Mich., May 3 -- MascoTech sales for the
first quarter 1999, aided by acquisitions, increased 12 percent to $449
million from $401 million in 1998. Income in the first quarter of 1999 was
$23.9 million or $.47 per share, compared with $32.7 million or $.60 per share
in 1998. First quarter results in 1999 and 1998 benefited from non-recurring
pre-tax gains, net of approximately $8 million and $12 million, respectively.
Earnings per share, excluding these non-recurring pre-tax gains, for first
quarters 1999 and 1998 would have been $.46 and $.48, respectively.
On January 22, 1998 MascoTech acquired the 63 percent of TriMas
Corporation that it did not already own. Assuming that MascoTech and TriMas
results were consolidated for the entire first quarter of 1998: pro forma
sales would have increased approximately three percent to $449 million as
compared with $437 million for first quarter 1998; and operating profit for
first quarter 1999 was $59 million (excluding gain on disposition of
businesses) as compared with operating profit on a pro forma basis of
approximately $64 million for first quarter 1998.
The Company has completed the sale of its aftermarket-related and vacuum
metalizing businesses for total proceeds aggregating approximately $105
million, including $90 million of cash which was applied to reduce the
Company's indebtedness. These transactions resulted in a net pre-tax gain of
approximately $25 million, of which $10 million net was recorded in the first
quarter 1999 based on the Company's revised estimate of the fair market value
of certain of these businesses, held for sale, at March 31, 1999. The
remaining pre-tax gain on disposition of approximately $15 million will be
recognized in the second quarter of 1999. The aggregate net pre-tax gain of
$25 million partially recovers the estimated $41 million pre-tax charge to
earnings in the second quarter of 1998 recorded to reflect the plan to dispose
of these businesses. First quarter 1999 results were negatively impacted by
an approximate $3 million charge (included in other expense) to reflect the
decline in value of an equity affiliate of the Company and a higher than
normal tax rate as a result of the divestitures.
MascoTech's CEO Frank M. Hennessey commented, "We are pleased with the
completion of the sale of our aftermarket-related and vacuum metalizing
businesses. We were also pleased to be able to retain a minority equity
interest in these companies enabling us to participate in their future
success. Although our first quarter results were negatively impacted by
softness in certain of our markets, primarily related to global economic
conditions and the phase out of certain programs, we continue to be optimistic
that the growth initiatives we are pursuing will result in long-term value
creation."
MascoTech is a diversified manufacturing company with world-leading metal
forming process capabilities and proprietary product positions serving
transportation, industrial and consumer markets.
Press releases are available through Company News On-Call by fax,
800-758-5804, extension 535375, or http://www.prnewswire.com. MascoTech's
press releases and other information are available through their new toll-free
number, 800-474-8324. Visit MascoTech's website at http://www.mascotech.com.
Statements in this press release, which are not historical facts are
forward looking statements that involve certain risks and uncertainty,
including but not limited to, risks associated with the uncertainty of future
financial results, conditions within the markets in which the Company
competes, labor relations of the Company and certain of its customers and
other uncertainties detailed in the Company's filings with the Securities and
Exchange Commission.
MASCOTECH, INC. ANNOUNCES FIRST QUARTER RESULTS
Three Months Ended
March 31
1999 1998
Net Sales $448,660 $400,760
Cost of Sales (332,640) (296,370)
Gross Profit 116,020 104,390
Selling, General and
Administrative Expenses (57,150) (45,560)
Gain on Disposition of
Businesses, Net 10,010 --
Operating Profit 68,880 58,830
Other Income (Expense), Net (22,140) (3,810)
Income Before Income Taxes 46,740 55,020
Income Taxes 22,880 22,280
Net Income $23,860 $32,740
Diluted Earnings Per Share $.47 $.60
Amounts in thousands except per share data.