Burnham Announces Record Earnings
13 March 2000
Burnham Announces Record Earnings
LANCASTER, Pa., March 13 Burnham Corporation (OTC Bulletin Board: BURCA) , a leading manufacturer of
boilers, furnaces, radiators and related equipment for domestic and
international residential, commercial and industrial markets, today reported
record results for 1999.
The company reported record earnings of $9.6 million on sales of
$215.7 million for the year of 1999. This was an increase of 29.1% in
earnings and 17.7% in sales over the prior year. Basic earnings per share for
1999 were a record $4.24 versus $3.28 in 1998, an increase of 29.3%.
Burnham attributed the improved performance to stronger sales, increased
productivity and operating efficiencies in its manufacturing operations and
lower materials costs. The addition of Bryan Steam Boiler, acquired in
November 1998, and the full-scale introduction of the company's commercial
copper boiler accounted for $27.7 million of the $32.4 million in increased
sales volume. Manufacturing costs dropped from 72.8% to 70.7% of sales in
1999 due to the improved operations.
As the only company in the heating industry offering a complete line of
boilers and accessories for all residential, commercial and industrial
hydronics applications, Burnham expects on-going growth in its market shares
through the introduction of new products and its innovative marketing
programs. The company has also penetrated the HVAC market through its
acquisition of the Thermo Pride line of premium warm air furnaces and air
conditioners.
After three consecutive mild winters, the recent severe weather in the
northeast United States has caused the residential and commercial heating
markets to rebound. The demand for large industrial boilers remains soft and
is not anticipated to recover in 2000. The international business is expected
to continue its slow recovery as many foreign economies are improving. All in
all, Burnham recorded its fifth consecutive quarter of sales and earnings
growth since the industry downturn in the first three-quarters of 1998 due to
the cumulative effects of the warm winters. The company expects this growth
trend to continue in 2000.
On March 1, 2000, the company paid an increased regular quarterly dividend
of $0.49 per share for both classes of common stock. The new annual rate of
$1.96 per share is 8.9% over the 1999 rate of $1.80 per share. Burnham has
increased its dividend rate for 19 consecutive years, averaging an 8.5% per
year increase over that period.
FINANCIAL HIGHLIGHTS
Consolidated Income Statements
(In thousands of dollars, except per share amounts)
1999 1998 1999 1998
3 Months 3 Months 12 Months 12 Months
Ended Ended Ended Ended
Dec 31 Dec 31 Dec 31 Dec 31
Net sales $65,636 $60,581 $215,689 $183,306
Cost of goods sold 46,387 42,494 152,415 133,458
19,249 18,087 63,274 49,848
Selling, administrative
and general expense 11,504 10,620 44,946 36,483
Income from operations 7,745 7,467 18,328 13,365
Other income (expense)
Interest income 150 92 445 426
Interest expense (672) (512) (2,901) (1,468)
(522) (420) (2,456) (1,042)
Income before
income taxes 7,223 7,047 15,872 12,323
Income tax expense 2,809 2,772 6,268 4,882
Net income for period $4,414 $4,275 $9,604 $7,441
Basic earnings per share $1.95 $1.88 $4.24 $3.28
Diluted earnings
per share $1.95 $1.88 $4.22 $3.25
Dividends paid $0.45 $0.43 $1.80 $1.72
Basic earnings per share are based upon weighted average shares
outstanding for the period. Diluted earnings per share assume the conversion
of outstanding rights into common stock.
Consolidated Balance Sheets
($ thousands)
December 31
1999 1998
ASSETS
Current Assets
Cash and cash equivalents $12,743 $10,555
Trade and other accounts
receivable 34,294 36,181
Inventories 33,267 29,261
Prepayments and other assets 5,194 4,657
Total current assets 85,498 80,654
Property, plant and
equipment, net 56,770 58,831
Other assets, net 20,816 20,222
$163,084 $159,707
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable and accrued
expenses $26,263 $26,202
Accrued taxes 2,337 1,475
Current long term debt 3,347 2,751
Total current liabilities 31,947 30,428
Long term liabilities 36,430 39,248
Other postretirement
benefit obligations 5,062 4,841
Deferred income taxes 10,943 10,978
Commitments and contingencies
Stockholders' equity
Preferred stock 530 530
Class A common stock 1,625 1,596
Class B common stock 1,016 1,039
Additional paid-in capital 12,756 12,574
Retained earnings 78,556 69,750
Treasury stock, at cost (15,781) (14,566)
Total stockholders' equity 78,702 74,212
$163,084 $159,707