Autocam Reports Fourth Quarter and Year-End Results
12 August 1999
Autocam Reports Fourth Quarter and Year-End Results
KENTWOOD, Mich., Aug. 12 -- Autocam Corporation
today reported its financial results for the three and twelve
months ended June 30, 1999. The Kentwood, Michigan-based manufacturer of
precision-machined parts reported net income for the three months ended
June 30, 1999 of $1,951,000, or 30 cents per diluted share, on sales of
$50,121,000, versus net income of $2,019,000, or 30 cents per diluted share,
on sales of $26,347,000 for the three months ended June 30, 1998. For the
year ended June 30, 1999, the Company earned $6,270,000, or 96 cents per
diluted share, on sales of $179,726,000, versus earnings of $7,741,000, or
$1.18 per diluted share, on sales of $90,361,000 for the year ended June 30,
1998.
The near-doubling of sales when comparing the fiscal 1999 periods reported
to the fiscal 1998 periods reported was due primarily to the acquisition of
Frank & Pignard SA ("F&P"), a French manufacturer of precision-machined
components, in October 1998. F&P added $22 million and $73 million in sales,
primarily of diesel fuel, power steering and braking system components, during
the three and twelve months ended June 30, 1999, respectively, versus the same
period in fiscal 1998.
Autocam President John C. Kennedy indicated the results for the quarter
were consistent with the Company's expectations. "We improved our operating
margin by 10% during the fourth quarter of fiscal 1999 as compared to the
third quarter by continuously improving processes on several new fuel
injection and braking system programs which have allowed for better labor and
equipment utilization and reduced temporary labor and premium freight costs,"
Kennedy said. "Nearly all of the programs we began production on in fiscal
1998 are now generating profits for the Company."
The Company's North American operations generated improved operating
profits from those reported in the third quarter as substantial continuous
improvement initiatives yielded cost savings in its Kentwood and Marshall,
Michigan facilities. These improvements helped to offset the poor operating
performance of the Company's Dowagiac, Michigan facility which produces
braking system components. "We are very excited about the profitability
advancements we're making on new programs that have not been contributors to
earnings in the past," Kennedy said. "New management and more sophisticated
equipment have been added at the Dowagiac facility and we expect meaningful
contribution to North American profits beginning in the latter part of the
first quarter of fiscal 2000."
The Company's European operations reported an improvement in operating
margins from 11.8% of sales to 13.4% of sales when comparing the third and
fourth quarters of fiscal 1999. "Continuous improvement efforts from the
implementation of Toyota Production Systems (TPS) have resulted in cost
savings in excess of the investment that has been necessary to train employees
on TPS principles and concepts and reconfigure the manufacturing floor."
Looking toward fiscal 2000, the Company expects increases in sales and
operating profits over those reported this year. "Sales will be positively
impacted by reporting a full year of sales for F&P which is expected to add
$16 million alone," Kennedy indicated. "We also expect internal growth in
Europe, North America and South America as the Company ramps up on several
fuel and braking system programs initiated in fiscal 1999." Management
anticipates a significant improvement in profitability during fiscal 2000. As
it continues implementation of TPS techniques at all domestic and
international facilities, management expects to reap further benefits in the
areas of labor efficiency, manufacturing floor utilization and inventory
management.
Autocam manufactures precision-machined components primarily used in fuel,
power steering and braking systems and electric motor assemblies for the
transportation industry, and ophthalmic and cardiovascular devices for the
medical industry. Autocam's common stock trades on the Nasdaq National Market
under the symbol "ACAM". For more information on the Company, visit our
Internet website at http://www.autocam.com .
This release may contain forward-looking statements relating to future
financial and other results. Forward-looking statements include statements
concerning plans, objectives, goals, strategies, future events or performance
and underlying assumptions and other statements that are other than statements
of historical facts. Such forward-looking statements may be identified by the
use of the words "anticipates," "estimates," "expects," "intends," "plans,"
"predicts," "projects," and similar expressions. These cautionary statements
and any other cautionary statements that may accompany the forward-looking
statements expressly qualify all such statements. Forward-looking statements
involve risk and uncertainties that could cause actual results or outcomes to
differ materially form those expressed in the forward-looking statements.
AUTOCAM CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
All dollar amounts in thousands, except per share data
For the Three Months Ended
June 30,
1999 1998
$$ % $$ %
Sales $50,121 100.0% $26,347 100.0%
Cost of sales 41,288 82.4% 20,650 78.4%
Gross profit 8,833 17.6% 5,697 21.6%
Selling, general and
administrative 3,009 6.0% 1,942 7.4%
Income from operations 5,824 11.6% 3,755 14.2%
Interest and other
expense, net 2,965 5.9% 662 2.5%
Minority interest in
net income 71 0.1% 85 0.3%
Income before tax
provision 2,788 5.6% 3,008 11.4%
Tax provision 837 1.7% 989 3.7%
Net income $1,951 3.9% $2,019 7.7%
Basic net income
per share $0.31 $0.32
Diluted net income
per share $0.30 $0.30
Basic weighted average
shares outstanding 6,307 6,340
Diluted weighted average
shares outstanding 6,404 6,653
For the Year Ended
June 30,
1999 1998
$$ % $$ %
Sales $179,726 100.0% $90,361 100.0%
Cost of sales 150,742 83.9% 69,436 76.8%
Gross profit 28,984 16.1% 20,925 23.2%
Selling, general and
administrative 10,208 5.7% 6,086 6.8%
Income from operations 18,776 10.4% 14,839 16.4%
Interest and other
expense, net 8,054 4.5% 2,719 3.0%
Minority interest in
net income 695 0.3% 166 0.2%
Income before tax
provision 10,027 5.6% 11,954 13.2%
Tax provision 3,757 2.1% 4,213 4.6%
Net income $6,270 3.5% $7,741 8.6%
Basic net income
per share $0.99 $1.22
Diluted net income
per share $0.96 $1.18
Basic weighted average
shares outstanding 6,352 6,342
Diluted weighted average
shares outstanding 6,512 6,558
CONSOLIDATED BALANCE SHEETS
All amounts in thousands
June 30, June 30,
1999 1998
Assets:
Cash $3,654 $1,644
Accounts receivable 40,781 11,680
Inventories 15,237 6,389
Other current assets 2,103 1,088
Total current assets 61,775 20,801
Fixed assets, net 130,477 64,421
Goodwill and other
intangible assets 28,376 14,366
Other assets 9,062 13,861
Total assets $229,690 $113,449
Liabilities and shareholders' equity:
Current maturities of
long-term debt $4,478 $6,554
Accounts payable 22,130 7,831
Accrued liabilities 13,262 3,290
Total current liabilities 39,870 17,675
Long-term obligations,
net of current maturities 109,560 37,851
Deferred taxes and other
liabilities 31,045 10,612
Minority interest 2,813 2,250
Shareholders' equity 46,402 45,061
Total liabilities and
shareholders' equity $229,690 $113,449