DALLAS, Aug. 14 /PRNewswire/ -- Global Industrial Technologies, Inc.
(NYSE: GIX) reported earnings for the fiscal third quarter ended July 31,
1997, of $13.7 million, or $.61 per share, before special charges previously
disclosed. The results represent a 20% increase over 1996's third quarter.
For the nine months ended July 31, 1997, Global reported earnings of
$27.9 million, or $1.24 per share, excluding special charges.
After the special charge, Global recorded a loss for the fiscal third
quarter of $.64 per share, and for the nine months ended July 31, 1997 of
$0.69 per share. These results reflect approximately $26 million in
previously disclosed charges to earnings for the third quarter, $23 million
including a special charge related to the disposition of the Marion Power
Shovel Company and $3 million write-down at the Specialty Equipment Products
segment.
Revenues for the third fiscal quarter were $155.1 million, versus
$171.1 million in the same period last year. Revenues for the nine months
ended July 31, 1997 were $441 million, versus $476.2 million for the same 1996
period.
"As we indicated in our July release on The Marion Power Shovel Company
disposition, our performance for the year is being affected by a number of
temporary business issues, including short-term production disruptions at
Ameri-Forge. It also reflects a weaker-than-anticipated demand for certain
refractory raw materials sold by Global's Mineral's segment, and the impact of
a strong U.S. dollar versus European currencies," Chairman and Chief Executive
Officer J.L. Jackson said. "We are encouraged however, by the positive
effects of several operating factors. Harbison-Walker operating profits
reflect recent cost reduction measures and significant new business. We
believe its profits for fiscal 1997 will continue to be up significantly
versus year-ago levels. Industrial Tool is enjoying record sales and
operating profits. In addition, replacement equipment is now operational at
Ameri-Forge and production levels are returning to normal."
Mr. Jackson added that "Our previous estimate of fiscal 1997 earnings in
the range of $1.60 to $1.75 assumed an effective tax rate of 25%. The results
announced today make no provision for taxes due to the effects of the Marion
disposition. Adjusting the estimate for this development would result in an
expected earnings range of $2.13 to $2.33 for fiscal 1997.
Refractory Products is having a record year, reporting strong third
quarter revenues of $88.8 million, 17.3% ahead of 1996 and $246.5 million for
the year-to-date, an increase of 12.5% over the same period a year ago.
Operating profits for the third quarter were $8.9 million, a 21.9% increase
compared to the same time last year.
Industrial Tool is also producing record sales with robust third quarter
revenues of $28.7 million, 7.9% ahead of 1996, and $80.6 million for the year-
to-date, an improvement of 15.8%. All segments within Industrial Tool are
showing strong results on broad-based market demand with particularly
significant percentage increases at its ITD-Automation profit center. Third
quarter operating profits of $4.6 million are up 7.0% compared to the same
time last year.
While third quarter revenues at Ameri-Forge, at $12.1 million, are 4.7%
behind 1996, the subsidiary is rebounding as replacement equipment begins to
restore production levels. Operating profits for the third quarter, hampered
by equipment problems, were $2 million versus $3.7 million in the same period
last year, and $8.2 million for the year-to-date versus $10 million for the
first three fiscal quarters of 1996.
Minerals reported third quarter operating earnings of $1.3 million on
revenues of $12.3 million. These revenues are 8.2% less than those for the
same time last year. Minerals reported year-to-date operating earnings of
$4.9 million, 43% lower than 1996 due primarily to a strong U.S. dollar versus
European currencies, as well as weak domestic demand early in the year.
Specialty Equipment Products reported an operating loss of $1.2 million on
revenues of $18.6 million for the quarter versus operating profits of $1.8
million for the prior year. These results reflect a previously announced
write-down of certain assets (primarily inventory). Third quarter revenues
for the segment are up 23.2% over 1996. Year-to-date revenues of $50.5
million reflect an improvement of 33.6% over last year.
The Company also reported that the previously announced contract for the
sale of The Marion Power Shovel Company to Bucyrus International Inc. for
$40.1 million has been given Hart-Scott-Rodino anti-trust clearance. The sale
is expected to close by August 26th.
Global Industrial Technologies is a major manufacturer of technologically
advanced industrial products that support high-growth markets around the
world.
Forward-looking statements concerning divestitures, earnings and results
from operations are contained in this announcement. The following important
factors could cause actual results to differ materially from those described
in such statements: the timing of completion of a divestiture transaction and
its resultant value to the Company; recouping delayed business on a schedule
different than anticipated; additional unanticipated production or shipment
delays; and significant variances in sales or costs at a major business unit.
GLOBAL INDUSTRIAL TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS
(in millions except per share data)
Three months Nine months
ended ended
July 31, July 31,
1997 1996 1997 1996
(Unaudited) (Unaudited)
Revenues
Net sales and operating revenues $154.7 $170.7 $440.0 $474.9
Other 0.4 0.4 1.0 1.3
Total Revenues 155.1 171.1 441.0 476.2
Costs and Expenses
Cost of sales 110.2 121.6 311.9 344.0
Selling, engineering, administrative
and general expenses 30.8 33.5 91.7 97.4
Interest expense 2.7 1.0 7.8 4.8
Special charges 23.0 0.0 43.5 0.0
Other - net 2.3 (0.9) 1.7 (5.2)
Total Costs and Expenses 169.0 155.2 456.6 441.0
Earnings before income taxes (13.9) 15.9 (15.6) 35.2
Income tax (provision) benefit (0.5) (2.8) 0.0 (6.3)
Net earnings $(14.4) $ 13.1 $(15.6) $ 28.9
Earnings per common share excluding
special charges $0.61 $0.58 $1.24 $1.28
Earnings per common share $(0.64) $ 0.58 $(0.69) $ 1.28
Average common shares outstanding 22.4 22.7 22.6 22.6
Depreciation, Depletion & Amortization 5.9 4.5 16.8 14.1
Capital Expenditures 20.1 19.4 47.6 43.6
Global Industrial Technologies, Inc.
Results of Operations By Segment
$ Millions
1996
1st 2nd 3rd 4th Total
Quarter Quarter Quarter Quarter Year
Refractory Products
Sales and Operating Revenues 69.4 74.1 75.7 81.3 300.5
Operating Profit 4.7 7.6 7.3 8.4 28.0
Minerals
Sales and Operating Revenues 13.9 13.4 13.4 10.9 51.6
Operating Profit 3.6 3.1 1.9 2.6 11.2
Industrial Tool
Sales and Operating Revenues 18.8 24.2 26.6 27.6 97.2
Operating Profit 1.6 3.8 4.3 4.5 14.2
Specialty Equipment Products
Sales and Operating Revenues 9.1 13.6 15.1 13.0 50.8
Operating Profit 0.5 1.2 1.8 1.3 4.8
Forged Products
Sales and Operating Revenues 11.9 12.8 12.7 13.2 50.6
Operating Profit 3.1 3.2 3.7 2.9 12.9
Total Continuing Operations
Sales and Operating Revenues 123.1 138.1 143.5 146.0 550.7
Inter-Segment Sales (5.0) (5.9) (4.9) (4.9) (20.7)
Consolidated Sales 118.1 132.2 138.6 141.1 530.0
Other Revenues 0.6 0.3 0.4 0.3 1.6
Consolidated Revenues 118.7 132.5 139.0 141.4 531.6
Operating Profit 13.5 18.9 19.0 19.7 71.1
Divested Operations (a)
Sales and Operating Revenues 31.2 22.7 32.1 30.3 116.3
Operating Profit (0.8) (0.1) 1.2 3.4 3.7
Total Consolidated Revenues 149.9 155.2 171.1 171.7 647.9
Segment Operating Profit 12.7 18.8 20.2 23.1 74.8
50% Share of Partnerships
Sales 11.2 13.9 11.3 18.9 55.3
Operating Profit 0.2 0.1 0.7 1.3 2.3
NET OPERATING PROFIT 12.9 18.9 20.9 24.4 77.1
GENERAL CORPORATE EXPENSE (6.1) (6.4) (5.0) (4.2) (21.7)
SPECIAL CHARGE
EARNINGS BEFORE TAXES 6.8 12.5 15.9 20.2 55.4
INCOME TAX (PROVISION)
BENEFIT (1.2) (2.3) (2.8) (3.7) (10.0)
NET EARNINGS 5.6 10.2 13.1 16.5 45.4
NET EARNINGS PER SHARE 0.25 0.45 0.58 0.73 2.01
AVERAGE SHARES OUTSTANDING 22,565 22,693 22,680 22,622 22,640
1997
1st 2nd 3rd
Quarter Quarter Quarter
Refractory Products
Sales and Operating Revenues 73.7 84.0 88.8
Operating Profit 4.8 8.6 8.9
Minerals
Sales and Operating Revenues 13.1 13.6 12.3
Operating Profit 1.9 1.7 1.3
Industrial Tool
Sales and Operating Revenues 23.3 28.6 28.7
Operating Profit 2.5 4.2 4.6
Specialty Equipment Products
Sales and Operating Revenues 13.2 18.7 18.6
Operating Profit (0.1) 1.6 (l.2)
Forged Products
Sales and Operating Revenues 12.7 14.8 12.1
Operating Profit 2.9 3.3 2.0
Total Continuing Operations
Sales and Operating Revenues 136.0 159.7 160.5
Inter-Segment Sales (4.0) (6.4) (5.8)
Consolidated Sales 132.0 153.3 154.7
Other Revenues 0.3 0.3 0.4
Consolidated Revenues 132.3 153.6 155.1
Operating Profit 12.0 19.4 15.6
Divested Operations (a)
Sales and Operating Revenues 0.0 0.0 0.0
Operating Profit 0.0 0.0 0.0
Total Consolidated Revenues 132.3 153.6 155.1
Segment Operating Profit 12.0 19.4 15.6
50% Share of Partnerships
Sales 0.0 0.0 0.0
Operating Profit 0.0 0.0 0.0
NET OPERATING PROFIT 12.0 19.4 15.6
GENERAL CORPORATE EXPENSE (6.7) (5.9) (6.5)
SPECIAL CHARGE (20.5) 0.0 (23.0)
EARNINGS BEFORE TAXES (15.2) 13.5 (13.9)
INCOME TAX (PROVISION) BENEFIT 3.8 (3.3) (0.5)
NET EARNINGS (11.4) 10.2 (14.4)
NET EARNINGS PER SHARE (0.50) 0.45 (0.64)
AVERAGE SHARES OUTSTANDING 22,690 22,547 22,429
(a) Divested business consists of the Marion Surface Mining Operation and
the underground mining portion of British Jeffrey Diamond.
SOURCE Global Industrial Technologies, Inc.
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CONTACT:
Investors, George Pasley, V.P.
Communications, 214-953-4510, or Media, Larry Nance, Manager,
Corporate Relations, Public Affairs, 214-953-4518, both of Global
Industrial Technologies, Inc.
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