CLEVELAND, April 8 /PRNewswire-FirstCall/ - Hawk Corporation (AMEX: HWK)
expects first quarter 2004 revenues from continuing operations to increase by
approximately 10% from 2003 revenues from continuing operations, driven
largely by an improving economy, new product introductions, market share gains
and foreign operations.
(Logo: http://www.newscom.com/cgi-bin/prnh/20001129/HWKLOGO )
In light of our expected first quarter results, Hawk remains confident in
its previous guidance that full year 2004 revenues from continuing operations
will increase by approximately 6% from 2003 levels.
Hawk's original equipment markets for friction products have displayed
strength during recent quarters. For example, 2004 revenues from its
construction market are anticipated to be up by approximately 13% and revenues
from its heavy-duty truck market are expected to be up by approximately 14%
compared to 2003 levels. Offsetting these increases is expected softness in
2004 revenues in its aircraft brake market representing a 6% to 8% decline
from 2003, and lower automotive revenues resulting from the divestiture of a
product line in 2003 with revenues of $2.5 million.
Hawk's powder metal segment expects 2004 revenues to increase
approximately 5% as the initial phase of its technology advancement program
begins contributing to the segment's results. Additionally, the division
anticipates that its 2003 investment in its China powder metal manufacturing
facility will positively impact 2004 revenues.
Led by expected sales revenue increases, more complete and efficient use
of its manufacturing capacity, and its continued focus on cost reductions,
Hawk anticipates 2004 operating income from continuing operations to grow
between 10% and 15% compared to 2003. This expected increase is after giving
effect to approximately $2.0 million of expected pre-tax expenses in 2004,
resulting from a new manufacturing plant being constructed in Oklahoma and the
move of Hawk's Brook Park, Ohio production to that location.
The Company
Hawk Corporation is a leading worldwide supplier of highly engineered
products. Its friction products group is a leading supplier of friction
materials for brakes, clutches and transmissions used in airplanes, trucks,
construction equipment, farm equipment and recreational vehicles. Through its
precision components group, the Company is a leading supplier of powder metal
and metal injected molded components for industrial, consumer and medical
applications, including pump, motor and transmission elements, lawn and garden
and telecommunication equipment. The Company's performance racing group
manufactures clutches and gearboxes for motorsport applications and
performance automotive markets. Headquartered in Cleveland, Ohio, Hawk has
approximately 1,550 employees and 15 manufacturing, research and
administrative sites in 4 countries at its continuing operations.
Forward-Looking Statements
This press release includes forward-looking statements within the meaning
of the federal securities laws with respect to the Company's financial results
and future operations and, as such, concerns matters that are not historical
facts. These statements are subject to risks and uncertainties that could
cause actual results to differ materially from those expressed in such
statements. These risks and uncertainties include, but are not limited to:
- the impact on our gross profit margins as a result of changes in our
product mix;
- our ability to effectively utilize all of our manufacturing capacity as
the industrial and commercial end-markets we serve gradually improve or
if improvement is not achieved as we anticipate;
- the timely completion of the construction of the new facility in our
friction products segment;
- the ability to hire and train qualified people at the new facility;
- the ability to transfer production to the new facility and commence
production at the new facility without causing customer delays or
dissatisfaction;
- the ability to achieve the projected cost savings at the new facility,
including whether the cost savings can be achieved in a timely manner;
- higher than anticipated costs related to the relocation of the friction
products segment facility;
- our ability to generate profits at our facilities in China and to earn
a profit at our start-up metal injection molding operation;
- the effect of competition by manufacturers using new or different
technologies;
- the effect on our international operations of unexpected changes in
legal and regulatory requirements, export restrictions, currency
controls, tariffs and other trade barriers, difficulties in staffing
and managing foreign operations, political and economic instability,
difficulty in accounts receivable collection and potentially adverse
tax consequences;
- the effect of fluctuations in foreign currency exchange rates as our
non-U.S. sales continue to increase;
- our ability to negotiate new agreements, as they expire, with our
unions representing certain of our employees, on terms favorable to us
or without experiencing work stoppages;
- the effect of any interruption in our supply of raw materials or a
substantial increase in the price of any of the raw materials; and
- the continuity of business relationships with major customers.
Actual results and events may differ significantly from those projected in
the forward-looking statements. Reference is made to Hawk's filings with the
Securities and Exchange Commission, including its annual report on Form 10-K
for the year ended December 31, 2003, its quarterly reports on Form 10-Q, and
other periodic filings, for a description of the foregoing and other factors
that could cause actual results to differ materially from those in the
forward-looking statements. Any forward-looking statement speaks only as of
the date on which such statement is made, and the Company undertakes no
obligation to update any forward-looking statement, whether as a result of new
information, future events or otherwise.
Hawk Corporation is online at: http://www.hawkcorp.com
SOURCE Hawk Corporation
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CONTACT:
Ronald E. Weinberg, Chairman, CEO and
President, +1-216-861-3553, or Thomas A. Gilbride, Vice President
- Finance, +1-216-861-3553, or Investor Relations, John
Baldissera, BPC Financial Marketing, +1-800-368-1217, all of Hawk
Corporation
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