Carlisle Companies Reports A Record Second Quarter
15 July 1999
Carlisle Companies Reports A Record Second Quarter
SYRACUSE, N.Y.--July 15, 1999--Carlisle Companies Incorporated reported record earnings of $28 million, or diluted earnings per share of $.91, for its second quarter ending June 30, 1999, an increase of 14 percent over 1998 earnings of $25 million, or diluted earnings per share of $.80. Second quarter sales in 1999 increased 8 percent to $426 million compared to $396 million for the same period in 1998.For the six months ended June 30, 1999, Carlisle reported sales of $816 million versus $759 million in 1998. Net earnings for the same period of $50 million or $1.62 per share exceeded 1998 earnings of $43 million or $1.42 per share.
Steve Munn, Carlisle's Chairman and CEO, said, " The second quarter results set yet another milestone for Carlisle's quarterly sales and earnings. Favorable competitive position allows us to meet performance objectives in most of our markets. We continue to be optimistic about achieving 1999 targets."
Carlisle is a diversified manufacturer of products serving construction materials, industrial components, automotive components and general industry markets.
CARLISLE COMPANIES INCORPORATED
June 30, 1999
FINANCIAL RESULTS
(In millions, except per share data)
1999 1998 % Change
---- ---- --------
Second Quarter
Sales $425.8 $395.6 8%
Net Earnings 28.0 24.6 14%
Basic E.P.S. 0.93 0.81 15%
Diluted E.P.S. 0.91 0.80 14%
1999 1998 % Change
---- ---- --------
Six Months
Sales $815.8 $758.7 8%
Net Earnings 49.8 43.5 14%
Basic E.P.S. 1.65 1.44 15%
Diluted E.P.S. 1.62 1.42 14%
1999 SEGMENT FINANCIAL DATA
(In Millions)
JUNE - QTR 1999 1998 1998
----------------------------- ------------------------
EBIT EBIT
Sales EBIT % Sales Sales EBIT % Sales
Construction
Materials $111.2 $16.6 14.9% $93.9 $15.1 16.1%
Industrial
Components 143.9 20.0 13.9% 144.6 19.0 13.1%
Automotive
Components 83.4 6.1 7.3% 68.6 4.8 7.0%
All Other 87.3 10.5 12.0% 88.5 9.1 10.3%
---- ---- ---- --- -- - -- -
Subtotal 425.8 53.2 12.5% 395.6 48.0 12.1%
Corporate/Elims (2.9) --- (2.5) ---
---- ----- ----- -----
Total $425.8 $50.3 11.8% $395.6 $45.5 11.5%
===== ===== ===== =====
JUNE - YTD 1999 1998
--------------------------- -------------------------
Sales EBIT Assets Sales EBIT Assets
Construction
Materials $187.5 $24.9 $203.0 $163.3 $23.3 $219.8
Industrial
Components 289.0 40.4 336.5 284.0 37.2 306.3
Automotive
Components 165.3 12.8 225.2 137.0 10.8 202.2
All Other 174.0 17.9 236.8 174.4 16.0 240.7
----- ---- ----- ----- ---- -----
Subtotal 815.8 96.0 1001.5 758.7 87.3 969.0
Corporate/Elims --- (5.6) 77.8 --- (5.9) 27.6
--- --- ----- - ---- -- --- ----- ----
Total $815.8 $90.4 $1079.3 $758.7 $81.4 $996.6
===== ==== ====== ===== ==== =====
Carlisle Companies Incorporated
June 30, 1999
Discussion of Results
Summary
Carlisle Companies Incorporated reported record quarterly sales
of $426 million and net earnings of $28 million or $.91 per share
(diluted) for the second quarter of 1999. For the six-months ended
June 30, 1999, sales were $816 million and net earnings were $50
million or $1.62 per share.
Second quarter sales represented an increase of 8% over 1998.
Eliminating the impact of the Perishable Cargo operation, which the
Company exited in January 1999, sales were up 12%. Higher sales in
Construction Materials and Automotive Components were offset slightly
by lower sales in Industrial Components.
Second quarter net earnings were above 1998 by 14%. Excluding the
Perishable Cargo business, net earnings were up 18%. All segments
contributed to this increase.
Six months sales were 8% above 1998. Excluding the Perishable
Cargo business, sales were up 10%. Increases in Construction Materials
and Automotive Components offset declines in the aerospace wire and
friction operations of the Industrial Components segment.
Net earnings for the six months ended June 30, 1999 increased
14%. Excluding the Perishable Cargo business, net earnings were 17%
over last year. Carlisle Tire and Wheel, of the Industrial Components
segment, led the increase with Carlisle SynTec (Construction
Materials) and Carlisle Systems & Equipment (General Industry) also
contributing.
Second Quarter Discussion
Construction Materials sales of $111 million reflect an 18%
increase over 1998. Earnings before interest and taxes ("EBIT") for
this segment increased 10%. Domestic roofing sales were up over 1998,
with TPO and insulation product lines contributing to the increase.
The higher level of lower-margin insulation sales, coupled with raw
material price increases dampened margins for the period. The Company
has announced a price increase for EPDM rubber membrane roofing, which
will be effective October 1, 1999.
Industrial Components experienced a slight decrease in sales for
the quarter with EBIT up 5% on improved margins. Sales and earnings
gains at Carlisle Tire and Wheel and the cable assembly operations of
Tensolite were offset by lower sales activity of wire at Tensolite,
and at the friction and braking systems operations. This decline was
due to reduced demand in the aerospace and mining industries, coupled
with lower heavy-duty aftermarket sales.
Automotive Components sales increased 22% over 1998 and EBIT
increased 27%. 1998 results were negatively impacted by the strike at
General Motors. Strong demand at the automotive OEM assembly plants
continued through the second quarter. Absorption improvements were
partially offset by continued operational inefficiencies due to the
high production volume requirements.
Carlisle Companies Incorporated
The General Industry (All Other) segment reported sales of $87
million, down slightly from 1998 second quarter. After eliminating the
sales of the Perishable Cargo operation, sales of this segment were up
19% over the second quarter of 1998. EBIT increased 38% excluding the
perishable cargo operation. Increased sales and operational
improvements at Scherping Systems, the Company's cheese systems
operations, and Walker Stainless' in-plant processing equipment
operations contributed to the higher sales and earnings of this
segment. Trail King, the Company's specialized trailer operation,
remains strong, particularly in the construction market, aided by
increased spending on state and federal highway projects. The
foodservice operations continue to show improvement in sales and
earnings.
Acquisitions
The Company announced the acquisition of Johnson Truck Bodies, a
manufacturer of fiberglass custom truck bodies serving the foodservice
distribution market and the emerging market for on-line ordering of
food for delivery to homes. This business will be reported in the All
Other/General Industry segment. The impact of this acquisition was not
material in the quarter. The Company continues to evaluate
complementary and supplementary acquisitions in each of its business
segments.
Cash Flows
Cash generated from operations was $22 million for the first six
months of 1999 compared to $37 million for the same period of 1998.
The decrease is attributable to the payment of deferred taxes
associated with the divestiture of the Company's Perishable Cargo
business in the first quarter of 1999. Working capital was $256
million at June 30, 1999, compared to $250 million at March 31, 1999
and $251 million at June 30, 1998. Working capital turnover increased
from 6.31 turns in 1998 to 6.65 turns in 1999. Capital expenditures of
$24.3 million are down significantly from the unusually high
expenditures made in 1998.
Backlog
Backlog of $229 million at June 30, 1999 is up 11% over June 30,
1998, excluding the one-time contract at the container manufacturing
operations. Stronger backlog positions at the Automotive Components
business, Scherping Systems, as well as the addition of Johnson Truck
Bodies, are the main reasons for the increase. Also, the backlog shows
continued weak aerospace wire purchases as well as soft friction and
off highway brake business.
Overall
The second quarter results set yet another milestone for
Carlisle's quarterly sales and earnings. Favorable competitive
position allows us to meet performance objectives in most of our
markets. The Company continues to be optimistic about achieving its
1999 targets.
CARLISLE COMPANIES INCORPORATED
Comparative Balance Sheet
As of June 30,
(Dollars in Thousands)
1999 1998
---- ----
Assets
Cash and cash equivalents $ 6,651 $ 26,757
Receivables 265,445 225,332
Inventories 206,927 190,056
Prepaid expenses & other 54,763 52,030
------ ------
Total current assets 533,786 494,175
Plant and equipment, net 344,336 327,539
Other assets 201,218 174,903
------- -------
$1,079,340 $996,617
========= =======
Liabilities and Equity
Short-term borrowings $ 22,171 $11,322
Accounts payable 116,753 108,459
Accrued expenses 138,589 123,735
------- -------
Total current liabilities 277,513 243,516
Long-term debt 280,171 298,617
Other liabilities 75,314 78,677
Shareholders' equity 446,342 375,807
------- -------
$1,079,340 $996,617
========= =======
Supplemental Information 1999 1998
---- ----
Working capital $256,273 $250,659
Working capital turnover(a) 6.65 6.31
Net debt $295,691 $283,182
Total capitalization $742,033 $658,989
Net Debt/Total capitalization 39.8% 43.0%
======== ========
(a) Quarterly sales annualized divided by June working capital
CARLISLE COMPANIES INCORPORATED
Comparative Statement of Earnings
For the period ended June 30,
(In thousands, except for per share data)
Second Quarter Six Months
--------------------------------------------------
1999 1998 % Change 1999 1998 % Change
---- ---- ---- ----
Net sales $425,813 $395,580 7.6% $815,837 $758,670 7.5%
Cost of
goods sold 327,712 307,217 6.7% 633,113 591,752 7.0%
Selling and
administrative
expenses 44,248 40,451 9.4% 87,193 80,558 8.2%
Research and
development
expenses 4,052 4,192 -3.4% 7,977 8,078 -1.3%
Gain on
divestiture of
business and
special charges
($16.6m), net
of other
charges
($15.9m) -- -- -- 696 -- --
Other income &
expense, net 502 1,771 -71.7% 2,170 3,151 -31.1%
-- ----- ----- -----
Earnings before
interest &
income taxes 50,303 45,491 10.6% 90,420 81,433 11.0%
Interest, net (4,778) (4,891) -2.3% (9,435) (9,462) -0.3%
------- ------- ------- -------
Earnings
before tax 45,525 40,600 12.1% 80,985 71,971 12.5%
Income taxes 17,527 16,049 9.2% 31,179 28,441 9.6%
------ ------ ------ ------
Net
earnings $ 27,998 $ 24,551 14.0% $ 49,806 $ 43,530 14.4%
======= ======= ======== ========
% of Net
Sales 6.6% 6.2% 6.1% 5.7%
Basic
earnings
per share $ 0.93 $ 0.81 14.8% $ 1.65 $ 1.44 14.6%
Diluted
earnings
per share $ 0.91 $ 0.80 13.8% $ 1.62 $ 1.42 14.1%
Dividends $4,820 $4,225 14.1% $9,650 $8,450 14.2%
Per share $0.1600 $0.1400 --- $0.3200 $0.2800 ---
Average shares
outstanding -
basic 30,178 30,181 --- 30,181 30,179 ---
Average shares
outstanding -
diluted 30,651 30,725 --- 30,644 30,730 ---
CARLISLE COMPANIES INCORPORATED
Comparative Statement of Cash Flows
For the six month period ended June 30,
(In Thousands of Dollars)
1999 1998
Operating Activities
Net earnings $ 49,806 $43,530
Reconciliation of net earnings to cash flows:
Depreciation and amortization 25,117 23,742
Working capital (52,738) (30,674)
Other (457) 525
21,728 37,123
Investing Activities
Capital expenditures (24,324) (52,297)
Acquisitions, net of cash (28,228) (17,474)
Sales of property, equipment & business 53,830 4,892
Other (7,449) (1,005)
(6,171) (65,884)
Financial Activities
Net change in short-term borrowings (9,285) (13,458)
Proceeds from long-term debt 8,441 100,000
Reductions of long-term debt (1,577) (10,605)
Dividends (9,650) (8,450)
Purchases of treasury shares (718) (13,701)
(12,789) 53,786
Change in cash and cash equivalents 2,768 25,025
Cash and cash equivalents
Beginning of period 3,883 1,732
End of period $ 6,651 $ 26,757