CLEVELAND, OHIO, May 11, 2004 -- Park-Ohio Holdings Corp. (NASDAQ:PKOH), today announced results for its first quarter ended March 31, 2004.
Park-Ohio reported net income of $5.8 million or $.52 per share dilutive for the first quarter of 2004, a 140% increase from net income of $2.4 million or $.22 per share dilutive for the same period of 2003. Park-Ohio reported net sales of $192.4 million for the first quarter of 2004, a 24% increase on sales of $154.9 million for the same quarter of 2003.
Edward F. Crawford, Chairman and Chief Executive Officer, stated, “Significant revenue enhancement in each of our business segments has resulted in a great start for 2004. Although we are not prepared to issue additional guidance at this time, the strength in our core customer base and improved operating efficiency appear likely to produce better 2004 results than previously forecast.”
A conference call reviewing Park-Ohio’s first quarter results will be broadcast live over the Internet on Wednesday, May 12, commencing at 10:00 a.m. ET. Simply log on to http://www.firstcallevents.com/service/ajwz406610434gf12.html.
Park-Ohio is a leading provider of supply chain logistics services, and a manufacturer of highly engineered products for industrial original equipment manufacturers. Headquartered in Cleveland, Ohio, the Company operates 21 manufacturing sites and 32 supply chain logistics facilities.
CONSOLIDATED CONDENSED STATEMENTS OF INCOME (UNAUDITED)
PARK-OHIO HOLDINGS CORP. AND SUBSIDIARIES
(In Thousands, Except per Share Data)
Three Months Ended
March 31,
2004 2003
Net sales $192,370 $154,851
Cost of products sold 162,133 130,441
Gross profit 30,237 24,410
Selling, general and administrative expenses 17,696 15,079
Operating income 12,541 9,331
Interest expense 6,136 6,757
Income before income taxes 6,405 2,574
Income taxes 591 137
Net Income $5,814 $2,437
Amounts per common share:
Basic $0.55 $0.23
Diluted $0.52 $0.22
Common shares used in the computation
Basic 10,564 10,434
Diluted 11,116 10,852
Other financial data:
EBITDA, as defined $16,542 $13,591
Note A--The effective income tax rate for the first quarter of 2004 is less than the statutory Federal income tax rate due primarily to the non-recognition of net operating loss carryforwards.
Note B--EBITDA, as defined, reflects earnings before interest, income taxes, and excludes depreciation, amortization,certain non-cash charges and corporate-level expenses as defined in the Company's Revolving Credit Agreement. EBITDA is not a measure of performance under generally accepted accounting principles ("GAAP") and should not be considered in isolation or as a substitute for net income, cash flows from operating, investing and financing activities and other income or cash flow statement data prepared in accordance with GAAP or as a measure of profitability or liquidity. The Company presents EBITDA because management believes that EBITDA could be useful to investors as an indication of the Company's satisfaction of its Debt Service Ratio covenant in its revolving credit agreement and because EBITDA is a measure used under the Company's revolving credit facility to determine whether the Company may incur additional debt under such facility. EBITDA as defined herein may not be comparable to other similarly titled measures of other companies.
The following table reconciles net income to EBITDA, as defined:
Three Months Ended
March 31,
2004 2003
Net income $5,814 $2,437
Add back:
Income taxes 591 137
Interest expense 6,136 6,757
Depreciation and amortization 3,967 4,202
Restructuring and other unusual charges 0 0
Miscellaneous 34 58
EBITDA, as defined $16,542 $13,591
CONSOLIDATED CONDENSED BALANCE SHEETS
PARK-OHIO HOLDINGS CORP. AND SUBSIDIARIES
March 31 December 31
2004 2003
(Unaudited) (Audited)
(In Thousands)
ASSETS
Current Assets
Cash and cash equivalents $1,761 $3,718
Accounts receivable, net 129,994 100,938
Inventories 154,309 149,075
Other current assets 7,740 10,780
Total Current Assets 293,804 264,511
Property, Plant and Equipment 228,009 225,710
Less accumulated depreciation 133,184 129,559
Total Property Plant and Equipment 94,825 96,151
Other Assets
Goodwill 82,220 82,278
Net assets held for sale 2,239 2,321
Other 64,218 62,191
Total Other Assets 148,677 146,790
Total Assets $537,306 $507,452
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Trade accounts payable $80,156 $66,158
Accrued expenses 52,992 46,623
Current portion of long-term liabilities 2,830 2,811
Total Current Liabilities 135,978 115,592
Long-Term Liabilities, less current portion
9.25% Senior Subordinated Notes due 2007 199,930 199,930
Revolving credit maturing on July 30,2007 104,400 101,000
Other long-term debt 8,354 8,234
Other postretirement benefits and other long-term liabilities 25,983 26,671
Total Long-Term Liabilities 338,667 335,835
Shareholders' Equity 62,661 56,025
Total Liabilities and Shareholders' Equity $537,306 $507,452
BUSINESS SEGMENT INFORMATION (UNAUDITED)
PARK-OHIO HOLDINGS CORP. AND SUBSIDIARIES
(In Thousands)
Three Months Ended March 31
2004 2003
NET SALES
ILS $116,265 $92,352
Aluminum Products 27,581 24,042
Manufactured Products 48,524 38,457
$192,370 $154,851
INCOME BEFORE INCOME TAXES
ILS $9,209 $5,848
Aluminum Products 1,587 3,578
Manufactured Products 3,292 1,148
14,088 10,574
Corporate and Other Costs (1,547) (1,243)
Interest Expense (6,136) (6,757)
$6,405 $2,574
This news release contains forward-looking statements that are subject to certain risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or projected. Among the key factors that could cause actual results to differ materially from expectations are the cyclical nature of the vehicular industry, timing of cost reductions, labor availability and stability, changes in economic and industry conditions, adverse impacts to the Company, its suppliers and customers from acts of terrorism or hostilities, the uncertainties of environmental, litigation or corporate contingencies, and changes in regulatory requirements. These and other risks and assumptions are described in the Company’s reports that are available from the United States Securities and Exchange Commission. The Company assumes no obligation to update the information in this release.
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