Gibraltar Reports Record Sales and Earnings for Third Quarter
18 October 1999
Gibraltar Reports Record Sales and Earnings for Third Quarter; Third Quarter Net Income Up 40 Percent
BUFFALO, N.Y., Oct. 18 -- Gibraltar today
reported record sales and earnings for the quarter and nine months ended
September 30, 1999. The Company also said its gross profit margin exceeded
20 percent for the second consecutive quarter.
Sales in the third quarter of 1999 were $162.9 million, an increase of
seven percent from $152.6 million in the third quarter of 1998. For the first
nine months of the year, sales were $467.0 million in 1999, up 13 percent from
$413.9 million in 1998.
Net income in the third quarter of 1999 increased by 40 percent to
$7.2 million, versus $5.1 million in the third quarter of 1998. Earnings per
fully diluted share were $.56 in the third quarter of 1999, up 37 percent from
$.41 in the third quarter of 1998. For the first nine months of the year, net
income grew by 30 percent to $19.5 million in 1999, compared to $15.0 million
in the first nine months of 1998. Earnings per fully diluted share were
$1.52 in the first nine months of 1999, an increase of 28 percent from $1.19
in the first nine months of 1998.
"This was another outstanding quarter for our company," said Brian J.
Lipke, Chairman and Chief Executive Officer. "We were pleased with the
performance of our 1998 acquisitions. We generated steady growth at our
existing operations. We successfully completed two immediately accretive
acquisitions (Weather Guard Building Products on July 1 and Hi-Temp
Incorporated on August 1). And we made continued progress in our efforts to
bolster our margins.
"Particularly noteworthy were our strong and growing sales of manufactured
end products, which today account for approximately 45 percent of our total
sale compared to 14 percent of total sales in 1993. (Note: The second and
third quarters are historically the strongest periods for the sale of these
products).
"We expect to generate record sales and earnings in 1999 -- which will be
our eighth straight year of sales and earnings growth -- and we are well
positioned to surpass our goal of 20 percent annual earnings growth this
year," said Mr. Lipke.
"Looking ahead to next year, we see many of the factors that have fueled
our growth continuing. Demand trends in our major businesses, including
automotive and building products, are strong. We are beginning to capture
many of the synergies available to us in our growing family of companies, and
we have identified many other opportunities in that area. And our pipeline of
potential acquisitions has never been fuller," said Mr. Lipke.
Gibraltar has made three immediately accretive acquisitions thus far in
1999. The Company acquired a heat-treating facility in Arden, North Carolina,
in April, which now operates as part of Carolina Commercial Heat Treating. In
July, Gibraltar acquired Weather Guard Building Products, a manufacturer and
distributor of a full line of metal building products for industrial,
residential, and commercial applications, which is located in Denver,
Colorado. On August 1, the Company acquired Hi-Temp Incorporated, one of the
leading commercial heat treaters in the Midwest, with four facilities in
Illinois and Indiana.
"A major priority at Gibraltar this year has been to intensify the focus
of every part of our company on improving our return on investment. We've
done that by maximizing asset utilization, divesting operations that did not
meet our return targets, and more fully utilizing the capacity in all of our
facilities," said Mr. Lipke.
Information contained in this release, other than historical information,
should be considered forward-looking, and may be subject to a number of risk
factors, including: the impact of changing steel prices on the Company's
results of operations; changing demand for the Company's products; the impact
of the Year 2000 issue; and changes in interest or tax rates.
Gibraltar is a growth-oriented company, with expanding operations in the
building and construction products, metal processing, and commercial
heat-treating markets. The Company serves approximately 9,000 customers in a
variety of industries. It has approximately 3,100 employees and operates
48 facilities in 19 states and Mexico.
GIBRALTAR STEEL CORPORATION
Financial Highlights
(in thousands, except per share data)
Three Months Ended
September 30, 1999 September 30, 1998
(unaudited)
Net Sales $162,909 $152,628
Net Income $7,205 $5,146
Net Income
Per Share
- Basic $ .57 $.41
Weighted Average
Shares Outstanding
- Basic 12,563 12,477
Net Income Per Share
- Diluted $ .56 $.41
Weighted Average
Shares Outstanding
- Diluted 12,862 12,612
Nine Months Ended
September 30, 1999 September 30, 1998
(unaudited)
Net Sales $466,954 $413,893
Net Income $19,470 $ 15,018
Net Income
Per Share
- Basic $1.55 $1.21
Weighted Average
Shares Outstanding
- Basic 12,530 12,446
Net Income Per Share
- Diluted $1.52 $1.19
Weighted Average
Shares Outstanding
- Diluted 12,790 12,640
GIBRALTAR STEEL CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEET
(in thousands)
September 30, December 31,
1999 1998
(unaudited) (audited)
Assets
Current assets:
Cash and cash equivalents $3,819 $1,877
Accounts receivable 91,570 71,070
Inventories 94,753 99,351
Other current assets 4,230 3,536
Total current assets 194,372 175,834
Property, plant and
equipment, net 203,926 176,221
Other assets 96,286 86,380
$ 494,584 $ 438,435
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable $54,389 $38,601
Accrued expenses 23,615 11,646
Current maturities
of long-term debt 1,279 1,351
Total current liabilities 79,283 51,598
Long-term debt 205,431 199,395
Deferred income taxes 27,650 25,289
Other non-current liabilities 2,218 1,845
Shareholders' equity
Preferred shares -- --
Common shares 126 125
Additional paid-in
capital 68,089 66,613
Retained earnings 111,787 93,570
Total shareholders' equity 180,002 160,308
$ 494,584 $ 438,435
GIBRALTAR STEEL CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF INCOME
(in thousands, except per share data)
Three Months Ended Nine Months Ended
September 30, September 30,
1999 1998 1999 1998
(unaudited) (unaudited)
Net sales $ 162,909 $ 152,628 $ 466,954 $ 413,893
Cost of sales 128,664 124,937 371,290 339,149
Gross profit 34,245 27,691 95,664 74,744
Selling, general
and administrative
expense 18,819 15,777 53,202 42,026
Income from operations 15,426 11,914 42,462 32,718
Interest expense 3,318 3,337 9,740 7,688
Income before taxes 12,108 8,577 32,722 25,030
Provision for
income taxes 4,903 3,431 13,252 10,012
Net income $7,205 $5,146 $19,470 $15,018
Net income per
share - Basic $.57 $.41 $1.55 $1.21
Weighted average
number of shares
outstanding - Basic 12,563 12,477 12,530 12,446
Net income per share
- Diluted $.56 $.41 $1.52 $1.19
Weighted average number
of shares outstanding
- Diluted 12,862 12,612 12,790 12,640
GIBRALTAR STEEL CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(in thousands)
Nine Months Ended
September 30,
1999 1998
(unaudited)
Cash flows from operating activities
Net income $ 19,470 $ 15,018
Adjustments to reconcile
net income to net cash
provided by operating
activities:
Depreciation and
amortization 12,699 9,368
Provision for deferred
income taxes 1,921 1,329
Undistributed equity
investment income (293) (259)
Other noncash adjustments 587 275
Increase (decrease) in cash
resulting from changes in
(net of acquisitions):
Accounts receivable (15,912) (18,238)
Inventories 6,286 (18,958)
Other current assets (597) (1,356)
Accounts payable and
accrued expenses 21,849 16,111
Other assets (955) (757)
Net cash provided by
operating activities 45,055 2,533
Cash flows from investing activities
Acquisitions, net of cash
acquired (31,484) (86,799)
Purchases of property,
plant and equipment (17,917) (16,807)
Net proceeds from sale
of property and equipment 2,425 108
Net cash used in investing
activities (46,976) (103,498)
Cash flows from financing activities
Long-term debt reduction (62,727) (28,002)
Proceeds from long-term
debt 66,953 128,778
Payment of dividends (1,253) --
Net proceeds from issuance
of common stock 890 66
Net cash provided by
financing activities 3,863 100,842
Net increase (decrease)
in cash and cash
equivalents 1,942 (123)
Cash and cash equivalents
at beginning of year 1,877 2,437
Cash and cash equivalents
at end of period $3,819 $2,314
Gibraltar's news releases, along with comprehensive information about the
Company, are available on the Internet, at http://www.gibraltar1.com.