WHEELING, W.Va., March 14 /PRNewswire-FirstCall/ -- Wheeling-Pittsburgh
Corporation (Nasdaq: WPSC), the holding company of Wheeling-Pittsburgh Steel
Corporation, today reported its financial results for the year ended December
31, 2005.
For 2005, the Company reported a net loss of $33.8 million, or $(2.37) per
basic and diluted share. This compares to net income of $62.2 million for
2004, or $5.78 per basic share and $5.66 per diluted share. For the fourth
quarter of 2005, the Company reported a net loss of $23.4 million, or $(1.61)
per basic and diluted share. This compares with net income of $6.4 million in
the fourth quarter of 2004, or $.46 per basic share and $.45 per diluted
share.
Net sales for 2005 totaled $1,560.5 million as compared to net sales of
$1,405.8 million for 2004. Net sales of steel products for 2005 totaled
$1,484.7 million on steel shipments of 2,164,404 tons, or $686 per ton. Net
sales of steel products for 2004 totaled $1,405.8 million on steel shipments
of 2,125,434 tons, or $661 per ton. The increase in net sales resulted from
an increase in the average selling price of steel products of $25 per ton, an
increase in the volume of steel products sold and $75.8 million from the sale
of excess raw materials.
Cost of sales for 2005 totaled $1,479.5 million as compared to cost of
sales of $1,206.8 million for 2004. Cost of sales for steel products sold in
2005 totaled $1,434.3 million, or $663 per ton. Cost of sales for steel
products sold in 2004 totaled $1,209.6 million, or $569 per ton. The increase
in the cost of steel products sold of $224.7 million, or $94 per ton, resulted
principally from an increase in the cost of raw materials and fuels used in
our steelmaking process.
Net sales for the fourth quarter of 2005 totaled $370.9 million as
compared to net sales of $373.7 million for the fourth quarter of 2004. Net
sales of steel products for the fourth quarter of 2005 totaled $356.0 million
on steel shipments of 527,336 tons, or $675 per ton. Net sales of steel
products for the fourth quarter of 2004 totaled $373.7 million on steel
shipments of 502,684, or $743 per ton.
Cost of sales for the fourth quarter of 2005 totaled $365.6 million as
compared to cost of sales of $336.4 million for the fourth quarter of 2004.
Cost of sales for steel products sold in the fourth quarter of 2005 totaled
$354.8 million, or $673 per ton. Cost of sales for steel products sold in the
fourth quarter of 2004 totaled $336.4 million, or $669 per ton.
On March 10, 2006, the Company reached agreement with both the lenders
under its term loan agreement and the Emergency Steel Loan Guarantee Board,
the Federal loan guarantor, to waive compliance with the leverage, interest
coverage and fixed charge coverage ratios under its term loan agreement
through the quarter ending June 30, 2007. The term loan amendment requires
the Company to maintain minimum borrowing availability of at least $50 million
under its revolving credit agreement at all times or to comply with a minimum
fixed charge coverage ratio, similar to the existing provision in its
revolving credit agreement, as well as post a standby letter of credit in the
amount of $12.5 million in favor of the term loan lenders, among other things.
As a result, the long-term portion of the term loan that was previously
classified as a current liability has been reclassified to long-term.
"Our 2005 results were adversely affected by a number of unusual items:
namely, the lingering effects of the BOF ductwork collapse in December 2004,
the startup of our new Electric Arc Furnace, and the failure of our primary
coal supplier to perform under its supply contract, as well as by significant
increases in the cost of raw materials and fuels," said James G. Bradley,
Wheeling-Pittsburgh Chairman and Chief Executive Officer.
"We have been working on a substantial insurance claim related to the
ductwork collapse throughout 2005. The property damage portion of the claim
was satisfactorily resolved and progress has been made with regard to the
business interruption portion as we continue to work toward a resolution.
Recent performance of our EAF has improved, with production approaching 90% of
capacity, compared with 73% during the fourth quarter. Lastly, while
deliveries from our primary coal supplier have improved since the filing of
the lawsuit in April 2005, deliveries have remained erratic."
Management will conduct a live call today at 11 a.m. ET to review the
Company's financial results and business prospects. Individuals wishing to
participate can join the conference call by dialing 800-219-6110 or
303-275-2170 for international participants. A replay will be available until
March 21, 2006 by dialing 800-405-2236 or 303-590-3000, and using the pass
code 11055683. The call can also be accessed via the Internet live or as a
replay through http://www.earnings.com.
This release may contain projections or other forward-looking statements
regarding future events or the future financial performance of Wheeling-
Pittsburgh Corporation that involve risks and uncertainties. Readers are
cautioned that these forward-looking statements are only predictions and may
differ materially from actual future events or results. Readers are referred
to the "Item 1A - Risk Factors" section of the Company's Annual Report on Form
10-K for the year ended December 31, 2005, and other reports and filings with
the SEC, which identify important risk factors that could cause actual results
to differ from those contained in the forward-looking statements. These risk
factors include, among others, the Company's potential inability to generate
sufficient operating cash flow to service or refinance its indebtedness,
concerns relating to financial covenants and other restrictions contained in
its credit agreements, intense competition, dependence on suppliers of raw
materials, the remaining issues related to the successful completion of the
full ramp up of production from our electric arc furnace, and cyclical demand
for steel products. In addition, any forward-looking statements represent
Wheeling-Pittsburgh Corporation's views only as of today and should not be
relied upon as representing the Company's views as of any subsequent date.
While Wheeling-Pittsburgh Corporation may elect to update forward-looking
statements from time to time, the Company specifically disclaims any
obligation to do so.
About Wheeling-Pittsburgh:
Wheeling-Pittsburgh is a steel company engaged in the making, processing
and fabrication of steel and steel products using both integrated and electric
arc furnace technology. The Company manufactures and sells hot rolled, cold
rolled, galvanized, pre-painted and tin mill sheet products. The Company also
produces a variety of steel products including roll formed corrugated roofing,
roof deck, floor deck, bridgeform and other products used primarily by the
construction, highway and agricultural markets.
The Company's condensed consolidated statements of operations and
condensed consolidated balance sheets are attached.
WHEELING-PITTSBURGH CORPORATION AND SUBSIDIARIES
Consolidated Statements of Operations
(Dollars in thousands, except per share amounts)
Quarter Ended Year Ended
December 31, December 31,
2005 2004 2005 2004
Revenues
Net sales, including sales
to affiliates of $83,928,
$96,033, $343,546,
and $367,735 $370,877 $373,667 $1,560,513 $1,405,794
Cost and expenses
Cost of sales, including
cost of sales to
affiliates of $87,839,
$92,893, $346,057, and
$324,813, excluding
depreciation and
amortization expense 365,595 336,368 1,479,474 1,206,773
Depreciation and
amortization expense 8,363 10,476 33,984 33,433
Selling, general and
administrative expense 18,723 18,309 71,552 67,620
Total costs and expenses 392,681 365,153 1,585,010 1,307,826
Operating income (loss) (21,804) 8,514 (24,497) 97,968
Interest expense and other
financing costs (5,071) (5,109) (21,834) (19,778)
Other income 2,940 4,996 11,843 17,520
Income (loss) before
income taxes (23,935) 8,401 (34,488) 95,710
Income tax provision
(benefit) - 2,022 (71) 33,479
Income (loss) before
minority interest (23,935) 6,379 (34,417) 62,231
Minority interest in loss
of consolidated subsidiary 521 - 583 -
Net income (loss) $(23,414) $6,379 $(33,834) $62,231
Earnings (loss) per share:
Basic $(1.61) $0.46 $(2.37) $5.78
Diluted $(1.61) $0.45 $(2.37) $5.66
Weighted average shares
(in thousands):
Basic 14,499 13,917 14,302 10,759
Diluted 14,499 14,145 14,302 11,002
Shipments - tons 527,336 502,684 2,164,404 2,125,434
Production - tons 632,022 541,009 2,452,131 2,362,886
WHEELING-PITTSBURGH CORPORATION AND SUBSIDIARIES
Consolidated Balance Sheets
(Dollars in thousands)
December 31,
2005 2004
Assets
Current assets:
Cash and cash equivalents $8,863 $31,198
Accounts receivables, less allowance for
doubtful accounts of $2,594 and $2,697 132,643 144,509
Inventories 166,566 156,669
Prepaid expenses and deferred charges 21,732 29,953
Total current assets 329,804 362,329
Investment in and advances to
affiliated companies 55,100 53,016
Property, plant and equipment, less accumulated
depreciation of $75,977 and $42,536 557,500 487,308
Deferred income tax benefits 26,264 18,751
Restricted cash 13,691 12,502
Intangible assets, less accumulated
amortization of $1,795 and $1,346 4,725 5,174
Deferred charges and other assets 33,164 16,406
Total assets $1,020,248 $955,486
Liabilities
Current liabilities:
Accounts payable, including book
overdrafts of $21,020 and $8,894 $117,821 $92,434
Short-term debt 17,300 -
Payroll and employee benefits payable 41,125 48,611
Accrued income and other taxes 11,735 10,073
Deferred income taxes payable 26,264 18,751
Accrued interest and other liabilities 5,757 7,843
Deferred revenue 8,523 -
Long-term debt due in one year 31,357 31,427
Total current liabilities 259,882 209,139
Long-term debt 284,100 302,156
Employee benefits 123,498 135,608
Other liabilities 13,030 17,978
Total liabilities 680,510 664,881
Minority interest in consolidated subsidiary 74,234 -
Stockholders' equity
Preferred stock - $.001 par value;
20,000,000 shares authorized; no
shares issued or outstanding - -
Common stock - $.01 par value; 80,000,000
shares authorized; 14,686,354 and
14,437,223 shares issued; 14,679,688 and
14,433,223 shares outstanding 147 144
Additional paid-in capital 276,097 267,327
Accumulated (deficit) earnings (10,640) 23,194
Treasury stock, 6,666 and 4,000 shares, at cost (100) (60)
Total stockholders' equity 265,504 290,605
Total liabilities and
stockholders' equity $1,020,248 $955,486
SOURCE Wheeling-Pittsburgh Corporation
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http://www.wpsc.com
http://www.earnings.com
Company News On-Call:
http://www.prnewswire.com/comp/967451.html
CONTACT:
Media, Jim Kosowski, +1-304-234-2440, or
Financial, Dennis Halpin, +1-304-234-2421, both of
Wheeling-Pittsburgh Corporation
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