Oilgear Reports Quarterly Earnings Increase On Lower Sales
10 November 1999
Oilgear Reports Quarterly Earnings Increase On Lower Sales
MILWAUKEE--Nov. 9, 1999--The Oilgear Company (NASDAQ/NMS:OLGR) today reported an increase in earnings on lower sales for the third quarter ended September 30, 1999.For the third quarter of 1999, Oilgear reported net earnings of $301,000 or $0.15 per share, compared to earnings of $169,000 or $0.09 per share for the comparable prior period. Net sales for the third quarter of 1999 were $22,294,000, compared to sales of $25,920,000 for the same period in 1998.
For the first nine months of 1999, net earnings were $1,124,000 or $0.57 per share, compared to earnings of $1,256,000 or $0.65 per share for the same period in the prior year. Net sales for the first three quarters of 1999 were $67,861,000, compared to sales of $72,970,000 for the first nine months of 1998.
"Our third quarter earnings increase is primarily due to an improved product mix and certain projects sold into the international markets. We're also beginning to see the results of our efforts to address manufacturing costs," said David A. Zuege, president and chief executive officer. "While the U.S. fluid power market remains soft, we feel that we have hit the bottom of the market during the third quarter. Although we don't expect to see a significant rebound during the last quarter of the year, we also don't see another disastrous quarter like the final period of 1998."
Orders for the third quarter of 1999 totaled $23.4 million, slightly ahead of orders of $22.3 million for the third quarter of 1998. Orders totaled $70.0 million for the first nine months of 1999, compared to orders of $76.6 million for the same period in 1998. The company's backlog was $24.3 million at the end of the third quarter of 1999, compared to a backlog of $27.7 million at the same time last year.
Zuege indicated that third quarter 1999 orders were enhanced by a sizeable contract for the hydraulics and electronic controls for the fixed umbilical tower associated with the rocket launch capabilities at Cape Canaveral Air Station. "We are very pleased to have been selected to provide the hydraulics and controls for this very sophisticated equipment," Zuege said. "This is a tribute to the level of technology we offer in fluid power components and electrohydraulic systems."
Oilgear serves customers in the primary metals, machine tool, automobile, petroleum, construction equipment, chemicals, plastics, glass, lumber, rubber and food industries. Products include piston pumps, motors, valves, manifolds, hydraulic and electric systems, as well as aftermarket sales and service.
Certain matters discussed in this press release are "forward-looking statements" intended to qualify for the safe harbors from liability established by the Private Securities Litigation Reform Act of 1995. These forward-looking statements can generally be identified as such because the context of the statement will include words such as the company "believes," "anticipates," "expects" or words of similar import. Similarly, statements that describe the company's future plans, objectives or goals are also forward-looking statements. Such forward-looking statements are subject to certain risks and uncertainties which could cause actual results to differ materially from those currently anticipated. Shareholders, potential investors and other readers are urged to consider these factors carefully in evaluating the forward-looking statements. The forward-looking statements made herein are only made as of the date of this press release and the company undertakes no obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances.
News releases and product information from The Oilgear Company are available 24 hours a day on-line at: http://www.oilgear.com
The Oilgear Company
Consolidated Condensed Earnings Statement
(Unaudited)
Three Months Ended September 30,
--------------------------------
1999 1998
---- ----
Net sales $ 22,294,000 25,920,000
Cost of sales 15,886,000 19,482,000
------------ ------------
Gross profit 6,408,000 6,438,000
Operating expenses 5,322,000 5,544,000
------------ ------------
Operating income 1,086,000 894,000
Interest expense (391,000) (564,000)
Other income (expense) (120,000) 92,000
------------ ------------
Earnings before income taxes 575,000 422,000
Income taxes 223,000 200,000
Net earnings of minority interest 51,000 53,000
------------ ------------
Net earnings $ 301,000 169,000
------------ ------------
Basic earnings per share of
common stock $ 0.15 0.09
------------ ------------
Diluted earnings per share of
common stock 0.15 0.09
------------ ------------
Dividends per share $ 0.07 0.07
------------ ------------
Basic weighted average
outstanding shares 1,989,000 1,953,000
Diluted weighted average
outstanding shares 1,989,000 1,959,000
Nine Months Ended September 30,
-------------------------------
1999 1998
---- ----
Net sales $ 67,861,000 72,970,000
Cost of sales 48,613,000 53,002,000
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Gross profit 19,248,000 19,968,000
Operating expenses 16,378,000 16,963,000
------------ ------------
Operating income 2,870,000 3,005,000
Interest expense (1,262,000) (1,559,000)
Other income (expense) 84,000 364,000
------------ ------------
Earnings before income taxes 1,692,000 1,810,000
Income taxes 481,000 505,000
Net earnings of minority interest 87,000 49,000
------------ ------------
Net earnings $ 1,124,000 1,256,000
------------ ------------
Basic earnings per share of
common stock $ 0.57 0.65
------------ ------------
Diluted earnings per share of
common stock 0.57 0.64
------------ ------------
Dividends per share $ 0.21 0.21
------------ ------------
Basic weighted average
outstanding shares 1,981,000 1,943,000
Diluted weighted average
outstanding shares 1,981,000 1,954,000
The Oilgear Company
Consolidated Condensed Balance Sheet
(Unaudited)
September 30, 1999 December 31, 1998
------------------ -----------------
ASSETS
Current Assets
Cash and cash equivalents $ 4,720,000 4,059,000
Accounts receivable 19,724,000 18,055,000
Inventories 25,639,000 28,661,000
Other current assets 2,320,000 3,514,000
------------ ------------
Total current assets 52,403,000 54,289,000
------------ ------------
Net property plant and equipment 27,579,000 29,480,000
Other assets 6,638,000 6,814,000
------------ ------------
$ 86,620,000 90,583,000
------------ ------------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Current debt $ 1,980,000 2,142,000
Accounts payable 5,198,000 7,785,000
Other current liabilities 9,696,000 8,880,000
------------ ------------
Total current liabilities 16,874,000 18,807,000
------------ ------------
Long-term debt 22,326,000 24,558,000
Unfunded employee benefit costs 12,455,000 12,455,000
Other non-current liabilities 1,419,000 1,284,000
------------ ------------
Total liabilities 53,074,000 57,104,000
------------ ------------
Minority interest in consolidated
subsidiaries 717,000 632,000
Stockholders' equity 32,829,000 32,847,000
------------ ------------
$ 86,620,000 90,583,000
------------ ------------
Note: Certain amounts reported in 1998 have been reclassified to conform with the 1999 presentation.