Exide Announces Profitable Results for Its Second Fiscal Quarter
4 November 1999
Exide Announces Profitable Results for Its Second Fiscal Quarter
READING, Pa., Nov. 3 -- Exide Corporation , the
global leader in the lead-acid battery business, today reported its results
for its second fiscal quarter ended October 3, 1999, the company's first
profitable quarter in a year.
Net income for the quarter was $4.2 million, or $.20 per diluted share, as
compared to net income of $2.3 million, or $.11 per diluted share in the
comparable period last year.
James M. Diasio, chief financial officer at Exide Corporation, said, "The
progress we have announced today is a direct result of our commitment to sell
a better mix of batteries to a better mix of customers in North America, as
well as our continued efforts at creating more efficient operations on a
global basis."
Revenues for the quarter were $556.4 million, as compared to revenues of
$601.1 million for the comparable period last year. Management noted that
currency negatively impacted second quarter and six-month European revenues by
approximately 5%. In addition, during the first fiscal six-month period last
year the company recorded a substantial amount of low-margin sales through its
former Sears relationship.
Primarily as a result of a shift to a demand-pull manufacturing process --
which sacrifices operating earnings early in the year for benefits later in
the year -- as well as continued pricing pressure in its European operations,
the company's quarterly operating earnings dropped to $35.5 million, as
compared to $40.1 million for the second fiscal quarter last year. During and
after the end of the quarter the company made significant progress in other
areas, including:
-- The appointment of Alan C. Johnson as the company's president and chief
operating officer.
-- An amendment to the company's loan covenants to allow the sale of
certain assets, potential acquisitions, outsourcing of some
manufacturing functions and additional time to reduce indebtedness.
-- An agreement to purchase a majority share of Lion Compact Energy, the
developers of a potential breakthrough dual-graphite battery
technology.
-- An agreement with Wal-Mart to launch sales of Exide's high-technology
Orbital Select batteries, with an initial order of 12,000 units.
Robert A. Lutz, chairman and chief executive officer at Exide Corporation,
said, "It is very clear that we have made great progress over the past nine
months in turning the company around. It is just as clear to those of us
managing the company that there is much more progress to be made."
Revenues for the six months ended October 3, 1999, were $1,075.1 million,
as compared to revenues of $1,145.7 million for the first six months of the
prior fiscal year.
Net loss for the first six months of the fiscal year was $(5.1) million,
or $(0.24) per diluted share, as compared to $(4.1) million, or $(0.19) per
diluted share for the first six months of the prior year.
Exide Corporation, with annual revenues of approximately $2.4 billion and
operations in 19 countries, is the world's largest manufacturer of automotive
and industrial lead-acid batteries. Further information about Exide's
businesses and products is available at http://www.exideworld.com.
Certain statements in this press release may constitute forward-looking
statements as defined by the Securities Litigation Reform Act of 1995. As
such, they involve known and unknown risks, uncertainties and other factors
which may cause the actual results of the Company to be materially different
from any results expressed or implied by such forward-looking statements.
These are enumerated in further detail in the Company's Form 10-K.
EXIDE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS(Unaudited)
(Amounts in thousands, except share and per-share data)
For the Three For the Six
Months Ended Months Ended
Oct. 3, Sept. 27, Oct. 3, Sept. 27,
1999 1998 1999 1998
NET SALES $556,434 $601,136 $1,075,149 $1,145,668
COST OF SALES 406,670 440,102 796,216 844,480
Gross profit 149,764 161,034 278,933 301,188
OPERATING EXPENSES:
Selling, marketing
and advertising 76,627 80,014 154,729 158,545
General and
administrative 33,367 36,203 64,884 73,184
Goodwill amortization 4,268 4,672 8,525 8,848
114,262 120,889 228,138 240,577
Operating income 35,502 40,145 50,795 60,611
INTEREST EXPENSE, net 25,279 26,912 51,978 53,455
OTHER (INCOME)
EXPENSE, net 1,439 3,547 2,749 5,961
Income (loss) before
income taxes, minority
interest and
extraordinary loss 8,784 9,686 (3,932) 1,195
INCOME TAX EXPENSE 4,207 7,505 543 5,167
Income (loss) before
minority interest and
extraordinary loss 4,577 2,181 (4,475) (3,972)
MINORITY INTEREST 351 (102) 601 (202)
Income (loss) before
extraordinary loss 4,226 2,283 (5,076) (3,770)
EXTRAORDINARY LOSS RELATED
TO EARLY RETIREMENT OF DEBT,
net of income tax
benefit of $0 -- -- -- (301)
Net income (loss) $4,226 $2,283 $(5,076) $(4,071)
BASIC EARNINGS PER SHARE:
Income (loss) before
extraordinary loss $0.20 $0.11 $(0.24) $(0.18)
Extraordinary loss -- -- -- (0.01)
Net income (loss) $0.20 $0.11 $(0.24) $(0.19)
DILUTED EARNINGS PER SHARE:
Income (loss) before
extraordinary loss $0.20 $0.11 $(0.24) $(0.18)
Extraordinary loss -- -- -- (0.01)
Net income (loss) $0.20 $0.11 $(0.24) $(0.19)
WEIGHTED AVERAGE SHARES:
Basic 21,064,473 21,238,526 21,065,981 21,195,561
Diluted 21,359,481 21,259,065 21,065,981 21,195,561