U.S. Automotive Manufacturing, Inc. Results of the Three and Six Months
16 August 1999
U.S. Automotive Manufacturing, Inc. Results of the Three and Six Months ended June 30, 1999NEW YORK, Aug. 16 -- U.S. Automotive Manufacturing, Inc. reported that for the three months ended June 30, 1999, it made a profit of $152,291 or $0.14 per share on net sales of $8,043,361 compared to a loss of $(638,839) or $(0.61) per share on sales of $5,937,296 for the three months ended June 30, 1998. Net loss for the six months ended June 30,1999, was $(82,175) or $(0.08) per share compared to a net loss of $(1,613,079) or $(1.54) per share for the comparable 1998 period. Sales for the six-month period in 1999 were $15,364,316 compared to $9,357,169 for the 1998 period. According to Martin Chevalier, President and CEO, "the Company has made significant progress in the quarter ended June 30, 1999 toward its goal of achieving sustained profitability. Sales increased 35% over the comparable quarter in 1998. and 10% when compared to the 1999 first quarter. Gross Profit favorably compared with a 51% increase over the year to year comparable period but lagged behind sales growth relative to the first quarter, with an increase of only 6%. Notwithstanding, second quarter, 1999 performance was sufficient for the Company to post its first quarterly profit from operations since 1993." Mr. Chevalier cautioned that "the road to a full and permanent turnaround is rarely a straight line. He noted that efficiency problems continue at one of our facilities and sales for the second quarter (specifically June) were somewhat below expectation. While there is normally a turndown of the Company's business during the summer months, the level of business appears to reflect a greater reduction than normal." Mr. Chevalier noted that "the Company has analyzed its order flow and believes such level to be reflective of its customers maintaining leaner inventories as distinct from lost business. Management anticipates the normal fall upturn and believes calendar 1999 sales will be between $30-$35 million. While management is not in the position to guarantee future performance", he added," it believes that the Company will be profitable for the year ended December 31, 1999." Mr. Chevalier concluded by stating that "for the past two years the Company has had to build capacity before booking new business. During that time sales have doubled and the Company is currently reporting its first quarterly profit in twenty two quarters. The current level of sales gives the Company more flexibility to manage the costs of production ultimately improving profitability." U.S. Automotive Manufacturing, Inc., through its wholly-owned subsidiaries, Quality Automotive Company and U.S. Automotive Friction, Inc., manufactures, assembles and distributes new and rebuilt automotive products (brake pads, linings and remanufactured brake shoes) to other automotive manufacturers and to the automotive after-market. The Company intends to position itself to compete more formidably in the manufacture and sale of friction materials as well as other "under car" automotive parts through both acquisition and internal growth. "Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: The Statements which are not historical facts contained herein are forward looking statements that relate to plans for future activities. Such forward-looking information involves a number of important known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements of the Company expressed or implied by such forward looking statements. Such risks, uncertainties and factors, include, but are not limited to, those relating to the integration of recently acquired companies, industry competition, the ability of critical third parties to be Year 2000 compliant, the possible need for future financing and possible obsolescence of equipment and other risks detailed in the Company's filings with the Securities and Exchange Commission. The words "believe", "expect", "intend", "plan" and similar expressions identifying forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which only speak as of the date the statement was made.