Insilco Holding Reports Sales
5 May 2000
Insilco Holding Co. Reports Solid Sales and EBITDA Growth for its First Quarter 2000
COLUMBUS, Ohio, May 4 Insilco Holding Co.
(OTC Bulletin Board: INSL) today reported substantially higher sales and
operating results for its first quarter ended March 31, 2000. The Company said
that results for its Taylor Publishing business unit, which was divested in
February 2000, are being reported as discontinued operations and are therefore
not included in consolidated sales and adjusted EBITDA (earnings before
interest, taxes, depreciation, amortization and non-operating items plus
regular cash dividends from Thermalex, the Company's 50% owned joint venture).
The Company is also providing comparative results including and excluding
Romac Metals and McKenica, which were divested in mid-1999.
The Company reported a 26% increase in first quarter sales for the
Company's core automotive and technologies businesses to $141.4 million from
$112.3 million recorded last year. Contributing to the double digit sales
performance were: increased demand for custom assemblies and precision
stampings from electronic and telecommunications Original Equipment
Manufacturers (OEMs) and Electronic Manufacturing Service (EMS) providers
worldwide; a rebound in demand from heavy equipment manufacturers for
specialty heat exchangers; and the benefit of $21.7 million in sales from
acquisitions completed after the first quarter 1999. Including sales from
divested operations of $8.1 million in the 1999 first quarter, consolidated
sales for the current quarter increased 17% from $120.4 million recorded last
year.
Adjusted EBITDA from ongoing operations for the current quarter increased
22% to $19.6 million from $16.1 million recorded last year. The Company
reported that consolidated adjusted EBITDA for the current quarter increased
17% to $19.6 million, compared to $16.8 million recorded last year, which
included EBITDA of $0.7 million from divested operations. Substantially
improved margins on power transformers, wire and cable assemblies, precision
stampings, and specialty heat exchangers, as well as the contribution from
businesses acquired after the first quarter 1999, all contributed to the
strong EBITDA performance.
BUSINESS DISCUSSION
The Company's Technologies Group reported 41% sales growth in the current
quarter to $78.4 million compared to $55.4 million recorded last year. Sales
increased across all product categories, with the strongest demand in
precision stampings (up 23%) and wire and cable assemblies (up 16%). First
quarter sales also benefited from $14.6 million in sales from acquisitions
completed after the 1999 first quarter. Adjusted EBITDA for the Group
increased 67% to $11.7 million in the current quarter, compared to
$7.0 million recorded last year. Operating margins for power transformers,
wire and cable assemblies and precision stampings all increased nicely from a
year ago, and the Company's TAT Technology acquisition made a strong
contribution to the substantial improvement in operating performance.
The Company's Automotive Components Group reported sales of $63.0 million
for the current quarter, compared to $56.9 million reported last year. First
quarter 2000 sales included $7.1 million from the Company's third quarter 1999
acquisition of Thermal Transfer Products, Ltd. Adjusted EBITDA was
$8.9 million and $8.2 million for the current and last year's first quarters,
respectively. Group results were positively impacted by the contribution from
Thermal Transfer and substantially higher margins for specialty heat
exchangers, however, the impact was somewhat moderated by lower domestic
tubing margins and a mix shift towards lower margin heat exchangers.
CEO COMMENTS
David A. Kauer, Insilco President and CEO, said, "Favorable market trends
across all of our technologies product segments, the full benefit of our 1999
cost restructuring, and a robust economy all contributed to our strong first
quarter performance. During the first quarter, we also completed the
divestiture of Taylor Publishing and redeployed the sale proceeds into the
acquisition of TAT Technology. TAT, a leading Montreal-based wire and cable
assembly business serving the rapidly growing telecommunications market,
performed well above our expectations for the first quarter and is on track to
be a solid contributor for the full year."
"In our Technologies businesses, we continue to see strong worldwide
demand from electronic OEMs and EMS providers and we continue to aggressively
reduce our cost structure. In our heat exchanger business, we completed the
consolidation of our Duncan, SC tube manufacturing facility into our
Montgomery, AL facility and expect improvements from this move to make a
positive contribution in the second quarter," Kauer concluded.
REPORTED RESULTS
The Company reported net income of $39.0 million for its current first
quarter, which included $40.2 million attributed to the sale of the Company's
Taylor Publishing business unit, compared to a net loss of ($2.4) million
recorded a year ago in the first quarter. Income/(loss) available to common
shareholders for the first quarters of 2000 and 1999 was $25.43 and ($1.50)
per diluted share, respectively.
INSILCO HOLDING CO.
Condensed Consolidated Statements of Operations
(Unaudited)
(Amounts in millions except per share data)
For the Quarter Ended
Actual
March 31,
2000 1999
Sales $141.4 $120.4
Cost of sales, excluding depreciation 105.7 91.5
Selling, general and administrative expenses,
excluding depreciation 16.1 15.0
Depreciation and amortization expense 5.6 4.7
Severance, writedown & other 0.9 0.3
Operating income 13.1 8.9
Interest expense, net (12.4) (11.3)
Equity in net income of Thermalex 0.5 1.0
Other income, net (0.2) 0.3
Income (loss) before income taxes, discontinued
operations and extraordinary item 1.0 (1.1)
Income tax (expense) benefit (0.6) 0.6
Net income (loss) before discontinued operations 0.4 (0.5)
Income (loss) from discontinued operations,
net of tax 40.2 (0.5)
Net income (loss) 40.6 (1.0)
Preferred stock dividend (1.6) (1.4)
Net income (loss) available to common $39.0 $(2.4)
Regular cash dividend from Thermalex $-- $2.9
Earnings before other income, interest,
taxes, depreciation, amortization,
and one-time items, plus regular cash
dividend from Thermalex $19.6 $16.8
Capital expenditures $(3.5) $(3.1)
Income (loss) per share available to common $25.43 $(1.50)
INSILCO HOLDING CO.
(Unaudited)
(Amounts in millions)
Supplemental Segment Data
Quarter Ended
March 31,
2000 1999
Sales
Industrial Businesses:
Technologies Group $78.4 $55.4
Automotive Components 63.0 56.9
Total Industrial Businesses 141.4 112.3
Other -- 8.1
Total Sales $141.4 $120.4
EBITDA
Industrial Businesses:
Technologies Group $11.7 $7.0
Automotive Components 8.9 8.2
Total Industrial Businesses 20.6 15.2
Other -- 0.7
Unallocated Corporate (1.0) (2.0)
Regular Thermalex Cash Dividend -- 2.9
Total EBITDA $19.6 $16.8
Sales Growth vs. Prior Year
Industrial Businesses:
Technologies Group 41.5% --
Automotive Components 10.7% --
Total Industrial Businesses 25.9% --
Other -- --
Total Sales 17.4% --
EBITDA % of Sales
Industrial Businesses:
Technologies Group 14.9% 12.6%
Automotive Components 14.1% 14.4%
Total Industrial Businesses 14.6% 13.5%
Other -- 8.6%
Total EBITDA 13.9% 14.0%
INSILCO HOLDING CO.
Condensed Consolidated Balance Sheets
(Unaudited)
(Amounts in millions)
March 31, March 31, December 31,
2000 1999 1999
Assets
Current assets:
Cash and cash equivalents $21.4 $8.5 $6.6
Receivables, net 103.1 74.0 79.5
Inventories, net 67.3 58.0 58.3
Current portion of deferred taxes 9.6 2.1 9.6
Net assets of Discontinued
Operations -- 7.6 0.2
Prepaid expenses 2.9 3.9 2.7
Total current assets 204.3 154.1 156.9
Property, plant and equipment, net 109.4 105.1 109.6
Goodwill, net 108.9 24.9 25.7
Deferred taxes -- 6.7 7.3
Investment in unconsolidated
subsidiaries 5.1 9.9 4.5
Other assets and deferred charges 18.0 17.8 18.0
Total assets $445.7 $318.5 $322.0
Liabilities and Stockholders' Deficit
Current liabilities:
Accounts payable $49.2 $35.3 $39.2
Accrued expenses and other 43.5 25.7 24.7
Accrued interest payable 3.8 2.6 7.5
Current portion of deferred taxes 15.0 1.3 1.3
Current portion of long-term debt 1.3 1.3 1.3
Current portion of long-term
obligations 0.9 1.0 0.9
Total current liabilities 113.7 67.2 74.9
Long-term debt 439.3 408.9 400.6
Other long-term obligations 47.2 45.3 45.8
Deferred taxes 4.4 -- 1.6
Minority interest 0.1 -- 0.1
Preferred stock 41.8 35.5 40.1
Stockholders' deficit (200.8) (238.4) (241.1)
Total liabilities and
stockholders' deficit $445.7 $318.5 $322.0