QUINCY, Ill., April 21 /PRNewswire/ -- Gardner Denver, Inc. (NYSE: GDI), a
leading manufacturer of compressors and blowers for industrial applications
and pumps for the petroleum and industrial markets, announced that revenues
for the three months ended March 31, 1999 were $70.2 million and earnings per
share for the same period were $0.21.
Revenues for the three month period declined approximately $19.6 million
compared to the same period in 1998. This reduction was due to depressed
demand for petroleum products resulting from lower oil prices in 1998, as well
as slowing industrial production which began in the second half of 1998 and
negatively impacted orders for compressor products. Acquisitions provided
approximately $6.8 million of incremental revenues in the three month period
of 1999, compared to the previous year. As a result of the significant
revenue reduction, net income declined to $3.2 million ($0.21 diluted earnings
per share) for the three months ended March 31, 1999, from $8.1 million
($0.49 diluted earnings per share) for the same period of the previous year.
Ross J. Centanni, Chairman, President and CEO, said "I am pleased with the
first quarter results, despite the unfavorable comparison in revenues and
earnings per share to the first quarter of 1998. We have acknowledged since
last October that Gardner Denver is facing a difficult first half in 1999.
The significant decline in the price of oil which occurred in 1998 has
presented a challenging period for our company."
"However, several indicators are encouraging and could enhance our
financial results earlier than we had originally anticipated. Localized
demand for compressor products has improved recently and the decline in the
order rate for this segment appears to have stabilized during the first
quarter of 1999. In fact, backlog for this segment increased approximately 5%
during the quarter. Furthermore, the recent increase in oil prices is
promising. I believe if prices remain at these elevated levels for three to
six more months, we may begin to see a recovery in demand for petroleum
products. Nevertheless, current demand is consistent with our expectations
and backlog for these products continued to decline during the first quarter."
"Gardner Denver is continuing to pursue its growth strategy. The benefits
of two key components of this strategy are visible in our first quarter's
activities. Cost reductions enhanced financial results for the three month
period of 1999, as manpower was reduced and discretionary spending was cut.
Our focus on growth through acquisitions was demonstrated by the recent
completion of two acquisitions which we believe could add modestly to our
earnings per share in 1999, and more substantially in 2000."
In early April 1999, Gardner Denver acquired the Allen-Stuart Equipment
Company, with approximately $14 million in annual revenues, and Butterworth
Jetting Systems, Inc., with approximately $12 million in annual revenues.
Allen-Stuart enhances Gardner Denver's ability to supply engineered packages,
incorporating the Company's wide range of compressor and blower products.
Butterworth adds to Gardner Denver's presence in the rapidly growing water jet
market, serving the industrial cleaning and maintenance market. These
acquisitions enhance Gardner Denver's product offerings, further diversify the
markets served and make the Company less dependent on the petroleum industry.
"We continued to be active buyers of our stock during the last three
months and have repurchased a total of 1.5 million of the 1.6 million shares
authorized by our Board of Directors. We have also continued to reinvest in
operations, spending approximately $3.5 million in capital in the three month
period. I expect this rate of investment to continue through the remainder of
the year and plan to aggressively seek other beneficial acquisitions to
further enhance our market position and achieve our growth objectives," Mr.
Centanni concluded.
All of the statements in this release, other than historical facts, are
forward-looking statements made in reliance upon the safe harbor of the
Private Securities Litigation Reform Act of 1995. Such forward-looking
statements are subject to uncertainties and factors relating to Gardner
Denver's operations and business environment, all of which are difficult to
predict and many of which are beyond the control of the Company, that could
cause actual results to differ materially from those matters expressed in or
implied by such forward-looking statements. The following factors, among
others, could affect future performance and cause actual results to differ
materially from those expressed in or implied by forward-looking statements:
the successful integration of recent acquisitions; the level of oil prices and
oil and gas drilling and production, which affects demand for the Company's
petroleum products; pricing of Gardner Denver products; changes in the
industrial production and industrial capacity utilization rates, which affect
demand for the Company's compressed air products; the degree to which the
Company is able to penetrate niche markets; the successful implementation of
cost reduction efforts; and the extent to which the Company is able to operate
without disruption due to Year 2000 Issues.
Comparisons of the financial results for the three month periods ended
March 31, 1999 and March 31, 1998 follow.
Gardner Denver, with 1998 revenues of $385 million, is a leading
manufacturer of reciprocating, rotary and vane compressors and blowers for
various industrial applications and pumps used in the petroleum and industrial
markets. Gardner Denver's news releases are available by fax by calling
800-758-5804, extension 303875, or by visiting the Company's home page on the
Internet (http://www.gardnerdenver.com).
GARDNER DENVER, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
(in thousands, except per share amounts and percentages)
(Unaudited)
Three Months Ended
March 31,
%
1999 1998 Change
Revenues $70,224 $89,792 (22)
Costs and Expenses:
Cost of sales 48,360 59,398 (19)
Depreciation and amortization 3,519 2,895 22
Selling and administrative 11,798 12,954 (9)
Interest expense 1,207 1,179 2
Other expense 123 155 (21)
Income before income taxes 5,217 13,211 (61)
Provision for income taxes 2,014 5,130 (61)
Net income $3,203 $8,081 (60)
Basic earnings per share $0.21 $0.51 (59)
Diluted earnings per share $0.21 $0.49 (57)
Basic weighted average
number of shares outstanding 15,245 15,940 (4)
Diluted weighted average
number of shares outstanding 15,577 16,637 (6)
Shares outstanding as of 3/31 14,867 16,101 (8)
GARDNER DENVER, INC.
BUSINESS SEGMENT RESULTS
(in thousands, except percentages)
(Unaudited)
Three Months Ended
March 31,
%
1999 1998 Change
Compressed Air Products
Revenues $63,590 $ 70,030 (9)
Operating earnings 6,579 10,678 (38)
% of Revenues 10.3% 15.2%
Petroleum Products
Revenues 6,634 19,762 (66)
Operating earnings 398 4,412 (91)
% of Revenues 6.0% 22.3%
CONDENSED BALANCE SHEET ITEMS
(Unaudited) (Audited) %
03/31/99 12/31/98 Change
Cash and equivalents $15,220 $ 24,474 (38)
Receivables, net 62,768 69,617 (10)
Inventories, net 56,004 53,115 5
Current assets 140,021 151,805 (8)
Total assets 327,119 342,130 (4)
Current liabilities 55,770 63,258 (12)
Short-term debt and
curr. maturities 279 2,452 (89)
Long-term debt, excl.
curr. maturities 78,011 81,058 (4)
Total liabilities 188,533 199,444 (5)
Total stockholders' equity 138,586 142,686 (3)
SOURCE Gardner Denver, Inc.
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Related links:
http://www.gardnerdenver.com
Company News On-Call:
http://www.prnewswire.com/comp/303875.html or fax,
800-758-5804, ext. 303875
CONTACT:
Helen W. Cornell, Vice President, Corporate
Secretary and Treasurer of Gardner Denver, 217-228-8209
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