EPS Hits Record 59 Cents vs. 45 Cents Last Year
SIOUX FALLS, S.D., May 19 /PRNewswire-FirstCall/ -- Management of Raven
Industries, Inc. (Nasdaq: RAVN) reported today that the industrial
manufacturer was "off to a great start" for its fiscal first quarter ended
April 30, 2004, reporting both record sales and net earnings. Net income
climbed 29 percent to $5.4 million, or 59 cents per share, from the year-ago
period. Sales rose four percent over a year earlier to $38.4 million.
Raven President and CEO Ronald M. Moquist said: "Our first quarter was
driven by our Flow Controls Division thanks to revitalized agricultural
markets and strong demand for our precision ag products. Aerostar and
Engineered Films also showed impressive operating gains during the quarter."
Moquist said he believes that the market trends that drove first-quarter
results should continue. "We're now projecting positive second-quarter
per-share earnings growth over the prior year. This is in spite of last
year's second-quarter deliveries of $3.9 million under a special order for
chemical-injection systems which will not be repeated." For the full fiscal
year, the executive added, the company is forecasting strong increases in both
sales and net earnings.
Segment Performance
"Flow Controls Division (FCD) results reflect the impact of our new
precision ag marketing strategy and the increased optimism in our agricultural
markets," Moquist said. Sales of $13.2 million were up $1.4 million.
Operating profits jumped 41 percent to $5.1 million on a sales increase of
12 percent. "Reception of new products into the marketplace, including our
GPS-based tractor steering systems, was outstanding," Moquist added. "Our
newer products generally carry our best profit margins."
The Engineered Films Division (EFD) experienced an 11 percent rise in
operating income to $3.0 million with sales up four percent to $10.4 million.
Improved efficiencies and increasing stability in EFD's raw material pricing
accounted for much of the margin improvement. "Engineered Films is continuing
to build on the sales momentum of last year," Moquist said. Sales were up in
the agriculture and manufactured housing markets.
Results for EFD's high-altitude research balloon business are now being
reported in Aerostar, and current and year-earlier results were adjusted for
the transfer of this operation.
Raven's Electronic Systems Division (ESD) experienced a falloff of
10 percent in sales to $9.1 million while operating income decreased
36 percent to $702,000. "There was some push-out of customer demand and we
had spot shortages of materials," Moquist explained. "Our inability to ship
in the first quarter affected both sales and margins, but we continue to look
to this division for significant revenue growth for the full year."
Aerostar reported operating income -- including the results of the
company's high-altitude research balloon business, which was formerly part of
EFD -- almost doubled from the first quarter of last year to $1.2 million as
sales rose 11 percent to $5.7 million. Shipments on US Army cargo-parachute
contracts and large inflatable military decoys were responsible for much of
the gain. "Aerostar's decision to exit the commercial outerwear market and
focus on higher-margin products has made it a solid profit contributor,"
Moquist noted. "The addition of our high-altitude research balloon business
into this operation should benefit both organizations."
Balance Sheet
Cash and short-term investments of $19.3 million will fund the
$11.3 million special cash dividend payable on May 20, 2004, and any other
anticipated capital needs. The balance sheet reflects the liability for this
cash payout. This dividend should improve returns on equity and assets in
future periods without affecting the company's growth prospects. Cash flows
from operations were $2.5 million, compared to $5.2 million last year. The
company's strong earnings performance was partially offset by the timing of
sales and accounts receivable collections.
Conference Call Information
Raven has scheduled a conference call today at 2:00 p.m. Central Time to
discuss its fiscal first quarter 2005 performance and related trends in its
business. To access this call, log on to http://www.ravenind.com or http://www.vcall.com
15 minutes before the call to download the necessary software. Replays will
be available through this website for 90 days.
Forward-Looking Statements
The Private Securities Litigation Reform Act provides a "safe harbor" for
forward-looking statements. Certain information included in this Press
Release and materials filed or to be filed by the company with the Securities
and Exchange Commission (as well as information included in statements made or
to be made by the company) contains statements that are forward-looking.
Although the company believes that the expectations reflected in such
forward-looking statements are based on reasonable assumptions, there is no
assurance that such expectations will be achieved. Such assumptions involve
important risks and uncertainties that could significantly affect results in
the future. These risks and uncertainties include, but are not limited to,
those relating to weather conditions, which could affect certain of the
company's primary markets, such as agriculture and construction, or changes in
competition, material availability, technology or relationships with the
company's largest customers, any of which could adversely impact any of the
company's product lines. The foregoing list is not exhaustive and the company
disclaims any obligation to subsequently revise any forward-looking statements
to reflect events or circumstances after the date of such statements.
On the Internet, information is available at http://www.ravenind.com , the
company's website.
RAVEN INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except earnings per share) (Unaudited)
Three Months Ended April 30
Fav (Unfav)
2004 2003 Change
Net sales $38,408 $36,942 4 %
Cost of goods sold 26,730 27,505
Gross profit 11,678 9,437 24 %
Selling, general, and
administrative expenses 3,227 2,902
Gain on sale
of businesses and assets - (9)
Operating income 8,451 6,544 29 %
Other income (24) (12)
Income before income taxes 8,475 6,556 29 %
Income taxes 3,060 2,373
Net income $5,415 $4,183 29 %
Net income per common share:
-basic $0.60 $0.46 30 %
-diluted $0.59 $0.45 31 %
Weighted average common
shares outstanding:
-basic 9,038 9,074 0 %
-diluted 9,214 9,245 0 %
RAVEN INDUSTRIES, INC.
SALES AND OPERATING INCOME BY SEGMENT (1)
(In thousands)
Three Months Ended April 30
Fav (Unfav)
2004 2003 Change
(unaudited) (unaudited)
Net Sales:
Flow Controls $13,197 $11,761 12 %
Engineered Films 10,413 10,001 4 %
Electronic Systems 9,082 10,053 (10)%
Aerostar 5,716 5,127 11 %
Total Company $38,408 $36,942 4 %
Operating Income (Loss):
Flow Controls $5,111 $3,619 41 %
Engineered Films 2,986 2,692 11 %
Electronic Systems 702 1,097 (36)%
Aerostar 1,228 619 98 %
Sold Businesses - (20)
Total Segment Income 10,027 8,007
Corporate Expenses (1,576) (1,463) (8)%
Total Company $8,451 $6,544 29 %
(1) The company's high-altitude research balloon operation, formerly in
the Engineered Films segment, is included with Aerostar results as a
result of a change in the company's organizational structure. Prior
year results have been reclassified to reflect this change.
RAVEN INDUSTRIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands) (Unaudited)
April 30, January 31, April 30,
2004 2004 2003
ASSETS
Cash, cash equivalents and short-term
investments $19,282 $18,442 $12,248
Accounts receivable, net 22,007 18,454 17,422
Inventories 18,538 16,763 20,869
Prepaid expenses and other current
assets 2,463 2,051 2,378
Total current assets 62,290 55,710 52,917
Property, plant and equipment, net 15,712 15,950 15,918
Other assets, net 7,720 7,848 7,035
$85,722 $79,508 $75,870
LIABILITIES AND STOCKHOLDERS' EQUITY
Current portion of long-term debt $72 $72 $116
Accounts payable 4,470 3,666 3,440
Dividend payable 11,327 - -
Accrued and other liabilities 8,961 8,157 9,928
Total current liabilities 24,830 11,895 13,484
Long-term debt, less current portion 39 57 125
Other liabilities 1,218 1,085 1,281
Stockholders' equity 59,635 66,471 60,980
$85,722 $79,508 $75,870
RAVEN INDUSTRIES, INC.
CONDENSED CONSOLIDATED CASH FLOW STATEMENTS
(In thousands) (Unaudited)
Three Months Ended April 30
2004 2003
Cash flows from operating activities
Net income $5,415 $4,183
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation and amortization 1,026 1,074
Deferred income taxes 5 42
Other operating activities, net (3,909) (123)
Net cash provided by operating
activities 2,537 5,176
Cash flows from investing activities
Capital expenditures (662) (433)
Other investing activities, net (5) (120)
Net cash used in investing activities (667) (553)
Cash flows from financing activities
Dividend paid (993) (726)
Purchase of treasury stock (113) (889)
Long-term debt principal payments (18) (29)
Other financing activities, net 94 52
Net cash used in financing activities (1,030) (1,592)
Net increase in cash and cash
equivalents 840 3,031
Cash and cash equivalents at beginning
of period 14,442 5,217
Cash and cash equivalents at end of
period 15,282 8,248
Short-term investments 4,000 4,000
Cash, cash equivalents and short-term
investments $19,282 $12,248
SOURCE Raven Industries, Inc.
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Related links:
http://www.ravenind.com
CONTACT:
Tom Iacarella, VP & CFO of Raven Industries,
Inc., +1-605-336-2750; or Dennis Waite, General Inquiries,
+1-708-246-6265, or Leslie Loyet, Analyst Inquiries,
+1-312-640-6672, or Cindy Martin, Media Inquiries,
+1-312-640-6741, all of Financial Relations Board
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