WHEELING, W.Va., May 12 /PRNewswire-FirstCall/ -- Wheeling Pittsburgh
Corporation (Nasdaq: WPSC), the holding company of Wheeling-Pittsburgh Steel
Corporation, today reported its financial results for the period ending March
31, 2004.
The Company emerged from bankruptcy pursuant to a plan of reorganization
that became effective on August 1, 2003. Accordingly, for accounting purposes,
unaudited consolidated financial statements for periods after August 1, 2003
related to a new reporting entity (the "Reorganized Company") and comparisons
to prior period performance in many respects are not directly comparable to
prior periods of the old reporting entity (the "Predecessor Company"). Among
other changes, there have been substantial reductions in employment levels,
changes in employee and retiree benefits, and the revaluation of assets and
liabilities. A black line has been shown on the financial statements to
separate current results from pre-reorganization information since they are
not prepared on a comparable basis. Comparisons noted are made on a sequential
basis.
The Company reported an operating loss of $4.5 million in the first
quarter of 2004. These results represent a significant improvement over the
operating loss of $21 million reported in the fourth quarter of 2003. On a per
share basis, the reported loss for the first quarter equaled $0.70 per share
vs. a reported loss of $2.49 per share in the previous quarter. Net sales for
the period totaled $274.2 million on shipments of 538,701 tons of steel
products, as compared to net sales of $237.1 million on shipments of 542,211
tons of steel products shipped in the previous quarter.
The average selling price for steel shipped during the quarter was $509
per ton vs. $437 in the previous quarter. Cost of goods sold per ton averaged
$475 in the first quarter, up from the $436 per ton reported in the fourth
quarter of 2003. Depreciation and SG&A expenses totaled $7.7 million and $14.9
million respectively, compared to $6.9 million and $14.5 million reported in
the fourth quarter. Interest expense declined to $5.2 million versus $6.3
million in the previous quarter.
"We are pleased with our improved operating performance in the first
quarter," said James G. Bradley, President and CEO of Wheeling Pittsburgh
Steel. "In addition to surcharges going into effect, we worked through our
backlog of orders in the quarter. We feel that despite higher input costs, we
hit our stride in the last month of the quarter, which was a strong
improvement over January and February."
Bradley added, "As a result of continued high demand, we expect pricing to
continue to be significantly higher in the second quarter than in the first
quarter. While we expect that costs will rise as well, we do not expect that
rise to be nearly as dramatic. With the improvement in both pricing and
demand, we look forward to an advantageous environment for the balance of
2004."
Management will conduct a live call today at 11:00 a.m. ET to review the
company's financial results and business prospects. Individuals wishing to
participate can join the conference call by dialing 1-800-257-2101.
International callers may access the call by dialing 1-303-262-2193. A replay
of the call will be available until March 31, 2004 by dialing 1-800-405-2236,
domestic, or, 1-303-590-3000, international, and using pass code 571153. The
call can also be accessed via the Internet live or as a replay
through http://www.fulldisclosure.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 "Business - Risk Factors" section of the Company's Annual Report on
Form 10-K for the year ended Dec. 31, 2003, as filed with the SEC, which
identifies 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 difficulties involved in constructing an electric arc furnace,
and cyclical demand for steel products. In addition, any forward-looking
statements represent the 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 an integrated steel company engaged in the making,
processing and fabrication of steel and steel products. The Company's products
include hot rolled and cold rolled sheet and coated products such as
galvanized, pre-painted and tin mill sheet. 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 consolidated statements of operations and balance sheet are
attached.
WHEELING -PITTSBURGH CORPORATION
AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(Dollars in Thousands except per share and per ton data)
Predecessor
Reorganized Company Company
For the For the For the
Quarter Quarter Quarter
Ended March Ended December Ended March
31, 2004 31, 2003 31, 2003
Revenues:
Net sales $274,206 $237,113 $238,672
Costs and Expenses:
Cost of goods sold, excluding
depreciation 256,069 236,636 247,253
Depreciation 7,689 6,905 17,445
Selling, administration and general
expense 14,946 14,560 13,864
Reorganization and professional fee
expense - (35) 3,300
278,704 258,066 281,862
Operating loss (4,498) (20,953) (43,190)
Reorganization expense - - (9)
Interest expense on debt (5,219) (6,324) (3,651)
Other income 3,012 3,593 1,234
Loss before taxes (6,705) (23,684) (45,616)
Tax provision (benefit) (79) 9 9
Net loss ($6,626) ($23,693) ($45,625)
Basic and diluted loss per share
attributable to common stockholders ($0.70) ($2.49) -
Weighted average common shares
outstanding basic and diluted 9,500,000 9,500,000 -
WHEELING -PITTSBURGH CORPORATION
AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(Dollars in Thousands)
Reorganized Company
March 31, 2004 December 31, 2003
ASSETS
Current assets:
Cash and cash equivalents $3,346 $4,767
Trade receivables, less doubtful
accounts of $2,358 , and $2,061 119,933 104,025
Inventories 129,974 146,895
Prepaid expenses and deferred charges 9,466 11,583
Total current assets 262,719 267,270
Investment in associated company 42,154 42,857
Property, plant and equipment, at
cost less accumulated depreciation 405,210 387,765
Deferred income tax benefits 23,250 23,170
Restricted cash - long term 71,176 87,138
Goodwill 30,000 30,000
Deferred charges and other assets 28,171 30,686
Total assets $862,680 $868,886
LIABILITIES & STOCKHOLDERS' EQUITY
Current liabilities:
Trade payables $85,966 $76,108
Short term debt 71,898 79,251
Payroll and employee benefits payable 60,034 57,862
Accrued federal, state and local taxes 11,151 10,744
Deferred income tax liabilities 23,170 23,170
Accrued interest and other liabilities 5,971 9,672
Long term debt due in one year 1,916 2,698
Total current liabilities 260,106 259,505
Long term debt 340,318 340,696
Other employee benefit liabilities 142,237 142,433
Other liabilities 21,408 21,639
Total liabilities 764,069 764,273
STOCKHOLDERS' EQUITY
Common stock - $.01 par value; 10 million
shares issued and outstanding 100 100
Additional paid-in capital 149,901 149,901
Accumulated deficit (5,833) (6,458)
Retained earnings (45,557) (38,930)
Total stockholders' equity 98,611 104,613
Total liabilities and
stockholders' equity $862,680 $868,886
WHEELING-PITTSBURGH CORPORATION
AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Dollars in Thousands)
Predecessor
Reorganized Company Company
For the For the For the
Quarter Quarter Quarter
Ended March Ended December Ended March
31, 2004 31, 2003 31, 2003
Cash flows from operating activities:
Net loss ($6,626) ($23,693) ($45,625)
Items not affecting cash from
operating activities:
Depreciation 7,689 6,905 17,445
Other postretirement benefits (222) (1,552) 301
Income taxes (79) 312 -
Equity income of affiliated
companies (2,122) (1,348) (889)
Loss on disposition of assets 1 - -
Reorganization expense - - 9
Deferred compensation 625 624 -
Dividends from affiliated companies 2,500 - 2,500
Decrease (increase) from working
capital elements:
Trade receivables (15,908) 8,655 (5,845)
Inventories 16,921 7,423 3,443
Trade payables 9,348 9,229 14,196
Other current assets 2,118 (2,802) 2,784
Other current liabilities (1,122) (11,008) 262
Other items--net 1,307 4,881 (1,975)
Net cash provided by (used in)
operating activities 14,430 (2,374) (13,394)
Cash flows from investing activities:
Plant additions and
improvements (24,135) (25,784) (1,801)
Payments from affiliates 325 325 600
Construction of equipment using
restricted cash 15,962 14,850 -
Net cash used in investing
activities (7,848) (10,609) (1,201)
Cash flows from financing activities:
Long-term debt payments (1,160) 457 (473)
Short term debt payments (7,353) 6,136 -
Short term debt (DIP Facility)
borrowings - - 11,811
Book overdraft 510 2,035 1,184
Net cash provided by (used in)
financing activities ($8,003) $8,628 $12,522
Decrease in cash and cash
equivalents (1,421) (4,355) (2,073)
Cash and cash equivalents at
beginning of period 4,767 9,122 8,543
Cash and cash equivalents at end of
period $3,346 $4,767 $6,470
SOURCE Wheeling-Pittsburgh Steel Corporation
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