-- Maytag Appliances performed well in Q3 on strong appliance industry
shipments
-- Floor care business marginally improved from Q2
-- Company's multiple product launch strategy remains on track for Q4 and
2004
-- Cash flow strong: Debt reduction on track and company achieves
$135 million year-end pension fund target
NEWTON, Iowa, Oct. 16 /PRNewswire-FirstCall/ -- Maytag Corporation
(NYSE: MYG) today reported third quarter consolidated sales of $1.221 billion
and operating income of $61.4 million. Reported net income for the period was
$36.6 million, or 46 cents per share, consistent with previously announced
management expectations. Third quarter earnings were negatively impacted by 10
cents per share due to an after-tax restructuring charge of $8.8 million for
the closing of the company's manufacturing plant in Galesburg, Ill., and other
discontinued operations. Reported results for discontinued operations
benefited from an after-tax gain of $1.2 million primarily related to a note
payment for the 2001 sale of Maytag's Blodgett line of cooking products.
Partially offsetting this amount was an additional loss recorded on the
company's anticipated sale of its joint venture in China.
(Logo: http://www.newscom.com/cgi-bin/prnh/20000505/MYGLOGO )
A year ago, Maytag reported third quarter operating income of
$108.7 million on consolidated sales of $1.168 billion. Reported net income
for the period was $60.8 million, or 77 cents per share. These results
included a $5.5 million after-tax gain, or 7 cents per share, on the sale of a
distribution center.
"We are encouraged by a strong third quarter for major appliances," said
Ralph F. Hake, Maytag Chairman and Chief Executive Officer. "Maytag Appliances
witnessed solid gains in market share as a result of new product introductions
within an environment of strong industry shipments."
Hake also noted that Maytag Appliances achieved a record quarter for unit
sales. However, as compared to the second quarter 2003, increases in
advertising spend to correspond with the introduction of several new products
and burden absorption tied to lower production levels reduced profitability.
For floor care products, sales volume, pricing and mix were dramatically
lower year-over-year. Unit sales and earnings improved marginally from the
second quarter 2003.
"Hoover continues its recovery strategy and is planning to introduce two
new, low-end upright products -- one bagless and the other a bagged unit -- in
the fourth quarter," Hake said. "We are implementing a plan for innovation at
the high-end, have developed diversified product and service offerings and are
working to reduce the overall cost structure."
Hake added that the introduction of new, innovative product lines from
across the company is proceeding very well. "This has been an exciting
quarter for the company in terms of new product launches," Hake said. "In
September, we introduced the Neptune Drying Center (DC) and we have high
expectations for this category-defining product. The Neptune DC, coupled with
the new top-load Neptune washer, continues our refreshed suite of home laundry
products."
Also in the third quarter, Maytag experienced strong response to its new
line of cooking products. At the end of the fourth quarter, the company will
begin selling new products, including a stainless steel version of the three-
rack Jetclean dishwasher, the Jenn-Air Attrezzi blender and mixer and the
category-exclusive SkyBox home vender.
Maytag International and Maytag Services both experienced revenue growth
in the quarter. In Maytag's commercial segment, vending products continued to
perform well even in an industry where sales are declining. Corporate-wide
cost reduction initiatives, including the restructuring efforts announced
earlier in 2003, are in place and having the expected impact.
Maytag's strong cash flow this year has enabled the company to reduce its
debt by $85 million to date and is well on track to meet the $100 million
target in 2003. In addition, Maytag has already met its 2003 goal of
contributing $135 million to the company's pension plan.
The company expects fourth quarter earnings to be in the range of 40 to 45
cents per share, which includes after-tax restructuring charges of
approximately $8.5 million or 11 cents per share. Full-year 2003 reported
earnings are expected to be in the range of $1.62 to $1.67 per share which
includes after-tax restructuring charges of approximately $42 million, or 53
cents per share, for the Galesburg closing and salaried workforce reduction.
Also included in these expected results is a 1 cent per share gain in
discontinued operations.
Third Quarter 2003 Financial Highlights
-- Maytag's home appliances segment, which includes major appliances and
floor care products, had third quarter 2003 sales of $1.155 billion,
up 4.8 percent from $1.101 billion in the third quarter of 2002.
-- Operating income for the home appliances segment was $68.5 million,
compared with $112.8 million a year earlier. Current year operating
income includes $13.1 million in charges for the Galesburg closing.
-- The corporation's commercial appliances segment, composed of Dixie-
Narco vending equipment and Jade Products, had third quarter sales of
$66.7 million, flat compared with the third quarter of 2002.
-- The commercial segment reported operating income of $4.7 million,
versus $6.0 million in last year's third quarter.
-- Cash flow continued strong, resulting in an $85 million reduction in
debt to date.
Nine-Month Performance
Maytag's sales in the first nine months of 2003 amounted to
$3.520 billion, nearly flat from sales of $3.539 billion in the first nine
months of 2002. Operating income was $181 million, down 46 percent from
$337.7 million in the year-earlier period.
Reported net income was $96.3 million, or $1.22 per share. Included in
these results are after-tax restructuring charges of approximately
$33.8 million, or 43 cents per share, for the Galesburg closing and salaried
workforce reduction. Also included in these results in discontinued
operations is a 1 cent per share gain.
In the first nine months of 2002, Maytag's reported net income was
$185.5 million, or $2.36 per share, which included a gain on the sale of a
distribution center of 7 cents per share and a loss from discontinued
operations of 2 cents per share.
Maytag's home appliances segment had nine-month sales of $3.315 billion,
down slightly from sales of $3.337 billion in the first nine months of 2002.
Operating income for the segment was $203.6 million, down 43 percent from
$359.6 million in last year's nine-month period. Current year operating
income includes $49.1 million of restructuring charges for the Galesburg
closing and salaried workforce reduction. Included in prior year operating
income was a pretax gain of $8.3 million for the sale of a distribution
center.
The commercial appliances segment reported nine month sales of
$205.6 million and an operating income of $14.5 million. In the first nine
months of 2002, commercial sales were $202 million and operating income for
the segment was $14.9 million.
Quarterly Conference Call
Maytag will host a conference call today, Oct. 16, to discuss its business
performance with members of the investment community. The call will be at
8:30 a.m. CT, and those wishing to participate should telephone 800-633-8942
(international callers: 303-957-1094) about 10 minutes prior to the start of
the call. Additionally, the conference call will be broadcast live over the
Internet. It can be accessed in the Corporate News Center on Maytag's Web
site, http://www.maytagcorp.com , or by going to CCBN's Investor Distribution Network
at http://www.fulldisclosure.com . Replays of the call will be available on both Web
sites. A summary of the key messages from the quarterly conference call can
also be accessed in the Corporate News Center on Maytag's Web site.
Maytag Corporation is a leading producer of home and commercial
appliances. Its products are sold to customers throughout North America and
in international markets. The corporation's principal brands include Maytag,
Amana, Jenn-Air, Jade, Hoover and Dixie-Narco.
Forward-Looking Statements: Certain statements in this news release,
including any discussion of management expectations for future periods,
constitute "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. Such forward-looking statements
involve known and unknown risks, uncertainties and other factors that may
cause actual results to differ materially from the future results expressed or
implied by those statements. For a description of such factors, refer to
"Forward Looking Statements" in the Management's Discussion and Analysis
section of Maytag's Annual Report on Form 10-K for the year ended December 31,
2002, and each quarter's 10-Q.
THIRD QUARTER SALES AND EARNINGS COMPARISON (UNAUDITED)
NET SALES (in thousands)
2003 2002 % Change
Home appliances $1,154,607 $1,101,269 4.8
Commercial appliances 66,660 66,763 (0.2)
Consolidated $1,221,267 $1,168,032 4.6
OPERATING INCOME (LOSS) (in thousands)
2003 2002 % Change
Home appliances $68,510 $112,786 (39.3)
Commercial appliances 4,701 5,999 (21.6)
General corporate (11,848) (10,060) 17.8
Reported $61,363 $108,725 (43.6)
Included in operating income (loss)
Restructuring charge-Home
appliances $13,060 $-
Restructuring charge-Commercial
appliances 83 -
Gain on sale of distribution
center - (8,276)
$13,143 $(8,276)
NET INCOME (in thousands)
2003 2002 % Change
Reported $36,565 $60,789 (39.8)
Included in net income
Restructuring charge (net of
tax) $8,806 $-
(Gain) loss from discontinued
operations (1,247) 231
Gain on sale of distribution
center (net of tax) - (5,462)
Total $7,559 $(5,231)
BASIC EARNINGS PER SHARE
2003 2002 % Change
Reported $0.47 $0.78 (39.7)
Included in basic earnings per
share
Restructuring charge (net of
tax) $0.11 $-
Discontinued Operations (0.02) -
Gain on sale of distribution
center (net of tax) - (0.07)
Total* $0.10 $(0.07)
Basic weighted-average shares
outstanding (thousands) 78,588 78,014
DILUTED EARNINGS PER SHARE
2003 2002 % Change
Reported $0.46 $0.77 (40.3)
Included in diluted earnings per
share
Restructuring charge (net of
tax) $0.11 $-
Discontinued Operations (0.02) -
Gain on sale of distribution
center (net of tax) - (0.07)
Total* $0.10 $(0.07)
Diluted weighted-average shares
outstanding (thousands) 78,813 78,538
*Earnings per share totals may not be additive due to rounding
NINE MONTHS SALES AND EARNINGS COMPARISON (UNAUDITED)
NET SALES (in thousands)
2003 2002 % Change
Home appliances $3,314,610 $3,336,674 (0.7)
Commercial appliances 205,556 201,956 1.8
Consolidated $3,520,166 $3,538,630 (0.5)
OPERATING INCOME (LOSS) (in thousands)
2003 2002 % Change
Home appliances $203,562 $359,580 (43.4)
Commercial appliances 14,475 14,901 (2.9)
General corporate (37,076) (36,735) 0.9
Reported $180,961 $337,746 (46.4)
Included in operating income (loss)
Restructuring charge-Home
appliances $49,104 $-
Restructuring charge-Commercial
appliances 215 -
Restructuring charge-General
Corporate 1,139 -
Gain on sale of distribution
center - (8,276)
$50,458 $(8,276)
NET INCOME (in thousands)
2003 2002 % Change
Reported $96,279 $185,541 (48.1)
Included in net income
Restructuring charge (net of
tax) $33,806 $-
(Gain) loss from discontinued
operations (844) 1,889
Gain on sale of distribution
center (net of tax) - (5,462)
Total $32,962 $(3,573)
BASIC EARNINGS PER SHARE
2003 2002 % Change
Reported $1.23 $2.39 (48.5)
Included in basic earnings per
share
Restructuring charge (net of
tax) $0.43 $-
Discontinued Operations (0.01) 0.02
Gain on sale of distribution
center (net of tax) - (0.07)
Total* $0.42 $(0.05)
Basic weighted-average shares
outstanding (thousands) 78,473 77,599
DILUTED EARNINGS PER SHARE
2003 2002 % Change
Reported $1.22 $2.36 (48.3)
Included in diluted earnings per
share
Restructuring charge (net of
tax) $0.43 $-
Discontinued Operations (0.01) 0.02
Gain on sale of distribution
center (net of tax) - (0.07)
Total* $0.42 $(0.05)
Diluted weighted-average shares
outstanding (thousands) 78,669 78,543
*Earnings per share totals may not be additive due to rounding
MAYTAG CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (unaudited)
(In thousands, except per share data)
Third Quarter Ended Nine Months Ended
September 30 September 30
2003 2002 2003 2002
Net sales $1,221,267 $1,168,033 $3,520,166 $3,538,630
Cost of sales 1,000,269 923,608 2,885,035 2,766,971
Gross profit 220,998 244,425 635,131 771,659
Selling, general and
administrative expenses 146,492 135,700 403,712 433,913
Restructuring charges 13,143 - 50,458 -
Operating income 61,363 108,725 180,961 337,746
Interest expense (12,728) (14,560) (40,786) (47,644)
Other - net 4,078 (1,710) 2,265 (462)
Income from continuing
operations before income
taxes and minority interest 52,713 92,455 142,440 289,640
Income taxes 17,395 31,435 47,005 98,478
Income from continuing
operations before minority
interest 35,318 61,020 95,435 191,162
Minority interest - - - (3,732)
Income from continuing
operations 35,318 61,020 95,435 187,430
Gain (loss) from
discontinued operations,
net of tax 1,247 (231) 844 (1,889)
Net income $36,565 $60,789 $96,279 $185,541
Basic earnings (loss) per
common share:
Income from continuing
operations $0.45 $0.78 $1.22 $2.42
Discontinued operations 0.02 - 0.01 (0.02)
Net income $0.47 $0.78 $1.23 $2.39
Basic weighted-average
shares outstanding 78,588 78,014 78,473 77,599
Diluted earnings (loss)
per common share:
Income from continuing
operations $0.45 $0.78 $1.21 $2.39
Discontinued operations 0.02 - 0.01 (0.02)
Net income $0.46 $0.77 $1.22 $2.36
Diluted weighted-average
shares outstanding 78,813 78,538 78,669 78,543
Earnings per share totals may not be additive due to rounding
MAYTAG CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
September 30 December 31 September 30
2003 2002 2002
(Unaudited) (Unaudited)
ASSETS
Current assets
Cash and cash equivalents $3,145 $8,106 $3,932
Accounts receivable - net 704,390 586,447 681,509
Inventories 482,822 468,433 505,815
Deferred income taxes 67,558 66,911 63,250
Other current assets 43,391 116,803 21,623
Discontinued current assets 72,873 76,899 78,698
Total current assets 1,374,179 1,323,599 1,354,827
Noncurrent assets 598,683 653,337 630,975
Discontinued noncurrent assets 59,623 61,205 61,223
Total noncurrent assets 658,306 714,542 692,198
Property, plant and equipment 1,054,881 1,066,108 1,073,051
Total assets $3,087,366 $3,104,249 $3,120,076
LIABILITIES AND SHAREOWNERS' EQUITY
Current liabilities
Accounts payable and accrued
liabilities $756,107 $687,439 $672,268
Notes payable and
current portion of long-term debt 128,869 373,871 468,808
Discontinued current liabilities 102,719 102,430 104,228
Total current liabilities 987,695 1,163,740 1,245,304
Long-term debt, less current portion 898,372 738,767 741,942
Postretirement benefit liability 533,918 517,510 507,816
Accrued pension cost 403,938 488,751 255,024
Other noncurrent liabilities 127,447 131,525 139,433
Total discontinued noncurrent
liabilities and minority interest 18,766 21,817 21,817
Shareowners' equity 117,230 42,139 208,740
Total liabilities and
shareowners' equity $3,087,366 $3,104,249 $3,120,076
MAYTAG CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW
(In thousands)
Nine Months Ended
September 30
2003 2002
Operating activities
Net income $96,279 $185,541
Net (Income) Loss from discontinued
operations (844) 1,889
Depreciation and amortization 122,185 121,684
Change in working capital (98,224) (120,374)
Pension and postretirement (73,791) (87,359)
Other - net 190,226 75,273
Net cash provided by continuing
operating activities 235,831 176,654
Investing activities
Proceeds from Business Disposition - Net 13,168 -
Capital expenditures (133,082) (156,912)
Investing activities-continuing
operations (119,914) (156,912)
Financing activities
Increase (reduction) in financing
obligations (77,211) (102,073)
Dividends (including minority
interest) (42,351) (47,498)
Stock repurchase (1,021) -
Other (331) 24,144
Financing activities-continuing
operations (120,914) (125,427)
Effect of exchange rates 36 247
Decrease in cash and cash
equivalents (4,961) (105,438)
Cash and cash equivalents at
beginning of period 8,106 109,370
Cash and cash equivalents at end
of period $3,145 $3,932
SOURCE Maytag Corporation
 back to top
Related links:
http://www.maytagcorp.com
Photo Notes:http://www.newscom.com/cgi-bin/prnh/20000505/MYGLOGO
AP Archive: http://photoarchive.ap.org
PRN Photo Desk, +1-888-776-6555 or +1-212-782-2840
CONTACT:
Kevin Waetke, Maytag Corporate
Communications, +1-641-787-8853
|
