Raytech Corporation Announces Second Quarter Results for 2000
15 August 2000
Raytech Corporation Announces Second Quarter Results for 2000
SHELTON, Conn. - Raytech Corporation today announced results for the thirteen-week period and twenty-six-week period ended July 2, 2000. In addition to the normal operating results, the Company recorded a charge of $7.2 billion related to the bankruptcy process. This charge, accounted for as liabilities subject to compromise, represents an estimate of the aggregate amount of allowed claims, which will be discharged in the bankruptcy confirmation process as part of the settlement with its creditors and equity holders with respect to the plan of reorganization. The Plan is expected to be confirmed near the end of August 2000 with an effective date prior to year-end at which time the discharge of substantially all the liabilities subject to compromise will occur in exchange for 90% of stock of reorganized Raytech, while the current equity holders will retain a 10% ownership position.Excluding this charge, pretax earnings for the thirteen-week period ended July 2, 2000 amounted to $6.4 million compared to $7.8 million in the prior year. Excluding the bankruptcy charge noted above, pretax earnings for the twenty-six week period ended July 2, 2000 were $15.6 million as compared to $15.4 million in the same period in the prior year. The improved performance was achieved in the face of a sales decrease of $4.6 million which is explained below.
The Company recorded a loss for the thirteen-week period ended July 2, 2000 of $7.06 billion or $2,023.70 loss per basic share as compared to income of $5.3 million or $1.56 per share for the comparable period of the prior year. For the twenty-six-week period ended July 2, 2000, the Company recorded a net loss of $7.06 billion or $2,025.12 loss per basic share as compared to income of $9.8 million or $2.87 income per basic share for the same period in the prior year.
"Our determination to resolve the bankruptcy issue has brought us near closure at this time. Other than the recognition of the estimated amount of allowed claims in connection with the bankruptcy, we continue to perform at levels equal to 1999. We are very near the end of the Chapter 11 process and look forward to operating the reorganized Raytech in the near future in a normal business environment," said President and Chief Executive Officer Albert A. Canosa.
Net Sales
Worldwide net sales for the thirteen-week period ended July 2, 2000 were $61.1 million as compared to $65.8 for the same period in the prior year. Net sales for the 26-week period ended July 2, 2000 of $128.6 million reflects a decrease of $4.6 million compared to reported sales of $133.2 million in the corresponding period for 1999. The reduced sales reflect a slowdown in the Aftermarket which is being experienced industry wide. In addition, the European dry friction market continues to be below the prior year amount as the euroland countries continue slow economic growth.
"We continue to see growth in our U.S. wet friction sales as the automobile original equipment manufacturers and heavy duty manufacturers continue to perform well. We consider the slower sales in the aftermarket to be a temporary situation," continued Canosa.
Raytech Corporation is headquartered in Shelton, Connecticut, with operations serving world markets for energy absorption and power transmission products, as well as custom-engineered components.
RAYTECH CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(000's omitted, except share data)
Comparative results are as follows:
For the 13 Weeks Ended
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July 2, 2000 July 4, 1999
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Net sales $ 61,122 $ 65,833
Pretax (loss) income $(7,201,306) $ 7,831
Net (loss) income(a) $(7,063,828) $ 5,339
Basic (loss) earnings per share:
(Loss) earnings per share $ (2,023.70) $ 1.56
Weighted average shares 3,490,559 3,421,395
Diluted (loss) earnings per share:
(Loss) earnings per share $ (2,023.70) $ 1.53
Weighted average shares 3,490,559 3,483,342
For the 26 Weeks Ended
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July 2, 2000 July 4, 1999
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Net sales $ 128,597 $ 133,176
Pretax (loss) income $(7,192,200) $ 15,430
Net (loss) income(a) $(7,059,008) $ 9,827
Basic (loss) earnings per share:
(Loss) earnings per share $ (2,025.12) $ 2.87
Weighted average shares 3,485,731 3,421,395
Diluted (loss) earnings per share:
(Loss) earnings per share $ (2,025.12) $ 2.82
Weighted average shares 3,485,731 3,477,646
(a) The Company has been under the protection of the U.S. Bankruptcy
Court relating to asbestos personal injury and environmental
liabilities since March 1989.