Exide Technologies Announces Results for Its Second Fiscal Quarter
31 October 2000
Exide Technologies Announces Results for Its Second Fiscal Quarter
PRINCETON, N.J., Oct. 30 Exide Technologies ,
the global leader in providing electrical energy storage solutions, announced
results for its second fiscal quarter today.
Net income, excluding non-recurring items, was $3.8 million, or $.18 per
diluted share, as compared to net income of $4.2 million, or $.20 per diluted
share, for the same period last year. Including non-recurring charges of
$18.3 million (pre-tax $30.0 million), the company reported a net loss of
$14.5 million or $.68 per share. The non-recurring charges were related to
costs associated with the company's previously announced restructuring plans,
including actions related to the acquisition of GNB Technologies ("GNB"). The
company completed its acquisition of GNB on September 29, 2000.
Operating earnings, excluding non-recurring items, were $36.3 million for
the quarter compared to $35.5 million last year. Strong operating performance
by the industrial business, including the network and motive power markets,
and cost reduction programs offset the decline in automotive aftermarket
volume and the weakness in the Euro.
Operating earnings in the company's transportation group, excluding non-
recurring items, were $25.6 million in the second quarter, down from
$32.6 million a year ago. Operating earnings in the industrial business were
$14.8 million this year, up 68 percent from last year's $8.8 million.
Revenues for the second fiscal quarter were $494.2 million, as compared to
revenues of $556.4 million for the same period last year. The decline in
revenue is attributable to the negative effects of the Euro currency
translation.
Earnings before interest, taxes, depreciation and amortization (EBITDA),
excluding non-recurring items, were $57.0 million for the second fiscal
quarter as compared to EBITDA of $60.3 million last year.
Excluding non-recurring items of $18.3 million, the company reported a net
loss for the first six months of the current fiscal year of $5.6 million, or
$.26 per diluted share, as compared to a net loss of $5.1 million, or $.24 per
diluted share, for the first six months last year.
Revenues for the six-month period were $960.0 million, as compared to
revenues of $1,075.1 million for the same period last year. The decline in
revenue is due to the negative effects of currency translation.
The company has been pursuing its strategy of growing its industrial
business and restructuring its transportation business to improve earnings and
cashflow. As part of that strategy, the company, on September 29, 2000,
announced the first stage of its restructuring plans following the GNB
acquisition. The initial plan included the closure of the Dallas facility,
closure of distribution centers and branches and reduction in sales, marketing
and support staff.
The company also announced, on August 28, 2000, actions to improve the
profitability of its automotive operations, including the closing of a
manufacturing facility in Maple, Ontario; merging its Canadian and U.S. sales
organizations; closing 11 North American distribution facilities and the
restructuring of its motorsports sponsorships.
These actions resulted in a second quarter pre-tax charge aggregating
$30.0 million ($18.3 million after-tax). There will be additional
restructuring charges in subsequent periods when additional initiatives are
announced.
Robert A. Lutz, Chairman and Chief Executive Officer at Exide
Technologies, said, "We have made excellent progress in establishing Exide as
the world leader in electrical energy storage solutions. The recently
completed acquisition of GNB Technologies, the strong performance of our
industrial businesses and the ability to move quickly to offset automotive
aftermarket volume declines are examples of our commitment to create value for
our shareholders, our customers and our employees. There are many challenges
that we must continue to overcome but I am confident that we will be
successful in our efforts."
EXIDE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)
(In thousands, except per-share data)
For the Three Months Ended For the Six Months Ended
October 1, October 3, October 1, October 3,
2000 1999 2000 1999
NET SALES $494,174 $556,434 $959,974 $1,075,149
COST OF SALES 358,771 406,670 701,133 796,216
Gross profit 135,403 149,764 258,841 278,933
OPERATING EXPENSES:
Selling, marketing
and advertising 71,290 76,627 147,130 154,729
General and
administrative 24,238 33,367 53,436 64,884
Restructuring and
other 30,000 -- 30,000 --
Goodwill amortization 3,535 4,268 7,090 8,525
129,063 114,262 237,656 228,138
Operating income 6,340 35,502 21,185 50,795
INTEREST EXPENSE, net 25,870 25,279 50,557 51,978
OTHER EXPENSE, net 1,468 1,439 3,831 2,749
Income (loss) before
income taxes and
minority interest (20,998) 8,784 (33,203) (3,932)
INCOME TAX EXPENSE
(BENEFIT) (6,811) 4,207 (10,009) 543
Income (loss) before
minority interest (14,187) 4,577 (23,194) (4,475)
MINORITY INTEREST 347 351 695 601
Net income (loss) $(14,534) $4,226 $(23,889) $(5,076)
EARNINGS PER SHARE:
Basic $(0.68) $0.20 $(1.12) $(0.24)
Diluted $(0.68) $0.20 $(1.12) $(0.24)
WEIGHTED AVERAGE SHARES:
Basic 21,408 21,064 21,404 21,066
Diluted 21,408 21,359 21,404 21,066
EXIDE CORPORATION AND SUBSIDIARIES
SEGMENT INFORMATION (unaudited)
(In thousands)
For the Three Months Ended October 1, 2000
Industrial Transportation Other Consolidated
Net sales $166,522 $327,652 $- $494,174
Gross profit 50,735 84,668 - 135,403
Operating earnings 14,774 (4,361) (4,073) 6,340
For the Three Months Ended October 3, 1999
Industrial Transportation Other Consolidated
Net Sales $165,907 $390,527 $- $556,434
Gross profit 49,962 99,802 - 149,764
Operating earnings 8,766 32,641 (5,905) 35,502
For the Six Months Ended October 1, 2000
Industrial Transportation Other Consolidated
Net sales $331,612 $628,362 $- $959,974
Gross profit 102,100 156,741 - 258,841
Operating earnings 27,477 3,462 (9,754) 21,185
For the Six Months Ended October 3, 1999
Industrial Transportation Other Consolidated
Net Sales $337,392 $737,757 $- $1,075,149
Gross profit 98,842 180,091 - 278,933
Operating earnings 15,688 46,881 (11,774) 50,795
EXIDE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)
(In thousands, except per-share data)
October 1, March 31,
2000 2000
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $58,615 $28,110
Receivables, net of allowance for doubtful
accounts of $44,927 and
$64,177 respectively 452,371 379,490
Inventories 505,931 405,720
Prepaid expenses and other 25,847 16,026
Deferred income taxes 31,281 20,138
Total current assets 1,074,045 849,484
PROPERTY, PLANT AND EQUIPMENT 1,017,291 790,791
Less - Accumulated depreciation (323,155) (347,447)
Property, plant and equipment, net 694,136 443,344
OTHER ASSETS:
Goodwill, net 513,869 501,117
Investments in affiliates 29,827 20,665
Deferred financing costs, net 26,666 12,796
Deferred income taxes 37,781 37,583
Other 35,437 36,472
643,580 608,633
Total assets $2,411,761 $1,901,461
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Short-term borrowings $24,948 $24,666
Current maturities of long-term debt 32,213 32,047
Accounts payable 334,877 260,352
Accrued expenses 424,949 318,951
Total current liabilities 816,987 636,016
LONG-TERM DEBT 1,325,715 1,061,672
NONCURRENT RETIREMENT OBLIGATIONS 129,430 128,827
OTHER NONCURRENT LIABILITIES 192,778 123,329
MINORITY INTEREST 17,518 17,993
Total liabilities 2,482,428 1,967,837
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock, $.01 par value 60,000
shares authorized; 25,417 and 21,401 shares
issued and outstanding 263 214
Additional paid-in capital 530,333 490,399
Accumulated deficit (344,263) (319,530)
Notes receivable - stock award plan (708) (734)
Accumulated other comprehensive loss (256,292) (236,725)
Total stockholders' equity (deficit) (70,667) (66,376)
Total liabilities and
stockholders' equity (deficit) $2,411,761 $1,901,461
EXIDE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)
(In thousands)
For the Six Months Ended
October 1, October 3,
2000 1999
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $(23,889) $(5,076)
Adjustments to reconcile net loss to net
cash used in operating activities -
Depreciation and goodwill amortization 40,530 50,428
Amortization of deferred
financing costs 1,757 1,750
Deferred income taxes (10,218) (5,501)
Amortization of original issue
discount on notes 5,468 5,000
Provision for losses on
accounts receivable 2,741 3,579
Provision for restructuring and other 30,000 -
Minority interest 696 601
Net proceeds from (payments on)
sale of receivables 122,371 (18,850)
Changes in assets and liabilities
excluding effects of acquisitions
and divestitures -
Receivables (28,299) (52,589)
Inventories 892 10,066
Prepaid expenses and other 3,609 1,803
Payables (19,677) (17,935)
Accrued expenses (24,803) (33,151)
Other, net (16,271) (12,228)
Net cash provided by (used in)
operating activities 84,907 (72,103)
CASH FLOWS FROM INVESTING ACTIVITIES:
GNB acquisition, net of cash
acquired of $17,098 (320,902) -
Capital expenditures (19,845) (29,385)
Proceeds from sale of assets 6,353 11,883
Insurance proceeds from fire damage - 807
Net cash used in investing activities (334,394) (16,695)
CASH FLOWS FROM FINANCING ACTIVITIES:
Increase in short-term borrowings 5,049 15,145
Borrowings under Global Credit
Facilities Agreement 310,875 365,662
Repayments under Global Credit
Facilities Agreement (271,920) (278,487)
GNB acquisition debt 250,000 -
Decrease in other debt - (4,618)
Debt issuance costs (12,000) (679)
Dividends paid (855) (854)
Net cash provided by
financing activities 281,149 96,169
EFFECT OF EXCHANGE RATE CHANGES
ON CASH AND CASH EQUIVALENTS (1,157) 114
NET INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS 30,505 7,485
CASH AND CASH EQUIVALENTS,
BEGINNING OF PERIOD 28,110 20,596
CASH AND CASH EQUIVALENTS,
END OF PERIOD $58,615 $28,081
SUPPLEMENTAL DISCLOSURES OF
CASH FLOW INFORMATION:
Cash paid during the period for -
Interest $47,965 $46,579
Income taxes (net of refunds) $3,972 $3,056
EXIDE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)
SUPPLEMENTAL INFORMATION: EXCLUDING NON-RECURRING ITEMS
(In thousands, except per-share data)
For the Three Months Ended For the Six Months Ended
October 1, October 3, October 1, October 3,
2000 1999 2000 1999
NET SALES $494,174 $556,434 $959,974 $1,075,149
COST OF SALES 358,771 406,670 701,133 796,216
Gross profit 135,403 149,764 258,841 278,933
OPERATING EXPENSES:
Selling, marketing
and advertising 71,290 76,627 147,130 154,729
General and
administrative 24,238 33,367 53,436 64,884
Goodwill amortization 3,535 4,268 7,090 8,525
99,063 114,262 207,656 228,138
Operating income 36,340 35,502 51,185 50,795
INTEREST EXPENSE, net 25,870 25,279 50,557 51,978
OTHER EXPENSE, net 1,468 1,439 3,831 2,749
Income (loss) before
income taxes and
minority interest 9,002 8,784 (3,203) (3,932)
INCOME TAX EXPENSE 4,889 4,207 1,691 543
Income (loss)
before minority
interest 4,113 4,577 (4,894) (4,475)
MINORITY INTEREST 347 351 695 601
Net income (loss) $3,766 $4,226 $(5,589) $(5,076)
EARNINGS PER SHARE:
Basic $0.18 $0.20 $(0.26) $(0.24)
Diluted $0.18 $0.20 $(0.26) $(0.24)
WEIGHTED AVERAGE SHARES:
Basic 21,408 21,064 21,404 21,066
Diluted 21,408 21,359 21,404 21,066
EXIDE CORPORATION AND SUBSIDIARIES
SEGMENT INFORMATION (unaudited)
SUPPLEMENTAL INFORMATION EXCLUDING NON-RECURRING ITEMS
(In thousands)
For the Three Months Ended October 1, 2000
Industrial Transportation Other Consolidated
Net sales $166,522 $327,652 $- $494,174
Gross profit 50,735 84,668 - 135,403
Operating earnings 14,774 25,639 (4,073) 36,340
For the Three Months Ended October 3, 1999
Industrial Transportation Other Consolidated
Net Sales $165,907 $390,527 $- $556,434
Gross profit 49,962 99,802 - 149,764
Operating earnings 8,766 32,641 (5,905) 35,502
For the Six Months Ended October 1, 2000
Industrial Transportation Other Consolidated
Net sales $331,612 $628,362 $- $959,974
Gross profit 102,100 156,741 - 258,841
Operating earnings 27,477 33,462 (9,754) 51,185
For the Six Months Ended October 3, 1999
Industrial Transportation Other Consolidated
Net Sales $337,392 $737,757 $- $1,075,149
Gross profit 98,842 180,091 - 278,933
Operating earnings 15,688 46,881 (11,774) 50,795