WORTHINGTON ENTERPRISES, INC. | Worthington Reports First Quarter Fiscal 2015 Results | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
COLUMBUS, OH -- (Marketwired) -- 09/24/14 -- Worthington Industries, Inc. (NYSE: WOR) today reported net sales of $862.4 million and net earnings of $44.2 million, or $0.63 per diluted share, for its fiscal 2015 first quarter ended August 31, 2014. In last year's first quarter, the Company reported net sales of $692.3 million and net earnings of $54.6 million, or $0.76 per diluted share. Net earnings in the current quarter include pre-tax impairment and restructuring charges totaling $2.1 million, which reduced earnings per diluted share by $0.02. Net earnings in the first quarter of the prior year included an $11.0 million pre-tax gain and a $4.5 million favorable tax adjustment related to the acquisition of an additional 10% interest in the laser welded blanks joint venture, TWB, in July of 2013. The impact of these two items netted with restructuring and impairment charges increased earnings by $0.18 per diluted share in the prior year quarter. Financial highlights for the current and comparative periods are as follows:
"Our company reported very good results for our first quarter as we work to deliver consistent earnings growth," John McConnell, Chairman and CEO, said. "Our Steel Processing business led the way with strong volumes from the automotive market. Pressure Cylinders' recent acquisitions in the oil and gas equipment market are helping drive their results along with increased volumes in the non-refillable refrigerant and heating systems products. While the Engineered Cabs business continues to operate in a weak market, we are seeing some improvement in their operations." McConnell added, "Our joint ventures performed well with Serviacero and WAVE as solid contributors." Consolidated Quarterly Results Net sales for the first quarter were $862.4 million, up 25% from the comparable quarter in the prior year, when net sales were $692.3 million. The increase was driven largely by the consolidation of TWB and increased volume in Steel Processing, and the acquisitions in Pressure Cylinders. Gross margin for the current quarter was $129.5 million, an increase of $18.5 million over the prior year quarter. Gross margin in the current quarter benefited from a higher spread between average selling prices and material cost due in part to a more favorable product mix in Pressure Cylinders and higher inventory holding gains in Steel Processing. Operating income for the current quarter was $52.2 million, an increase of $13.6 million from the prior year quarter, as the improvement in gross margin was partially offset by a $3.7 million increase in SG&A expense due to the impact of acquisitions. Operating income in the current period included a pre-tax impairment charge of $2.0 million related to the Company's stainless steel business, Precision Specialty Metals. Interest expense was $9.5 million for the current quarter, compared to $6.2 million in the comparable period in the prior year. The increase was due to the impact of higher average debt levels and higher average interest rates resulting from an increase in the usage of long-term debt versus short-term debt. Equity in net income from unconsolidated joint ventures increased $1.0 million over the prior year quarter to $27.9 million on net sales of $392.6 million. The overall increase was driven by Serviacero and WAVE, where Worthington's portion of equity income increased by $1.9 million and $1.3 million, respectively. However, income from ClarkDietrich decreased $0.9 million on lower volumes. Additionally, the consolidation of TWB lowered equity income by $1.8 million in the current quarter. Income tax expense was $22.1 million in the current quarter compared to $13.9 million in the comparable quarter in the prior year. The increase was due primarily to the favorable tax impact associated with the consolidation of TWB in the prior year quarter. The current quarter tax expense reflected an effective rate of 32.8% compared to 28.9% for the prior year quarter. Balance Sheet Total debt of $666.6 million at quarter end was essentially flat from May 31, 2014. The Company had $146.9 million of cash at quarter end, a portion of which will be used to repay $100.0 million of current notes due in December 2014. Quarterly Segment Results Steel Processing's net sales of $552.3 million were up 37%, or $149.9 million, from the prior year quarter primarily due to the consolidation of TWB and increased sales in the automotive market. Operating income increased by $13.2 million to $35.9 million due primarily to the increase in volume, the consolidation of TWB, and higher inventory holding gains. Pressure Cylinders' net sales of $249.0 million were up 15%, or $32.1 million, from the comparable prior year quarter driven by recent acquisitions and higher average selling prices. Operating income increased slightly over the prior year quarter to $19.6 million, as the combined favorable impact of our improved product mix, higher selling prices and recent acquisitions were offset by an increase in manufacturing and SG&A expense. Engineered Cabs' net sales increased $1.1 million in the current quarter to $49.6 million on higher volumes. Operating loss in the current quarter increased $1.8 million to $2.1 million as the overall increase in net sales was more than offset by higher manufacturing expense, related to the ramp up of new production and process improvement initiatives. The "Other" category includes the Construction Services and Energy Innovations operating segments, as well as non-allocated corporate expenses. Operations in the "Other" category reported net sales of $11.6 million, a decrease of $12.9 million from the prior year quarter, mostly due to reductions in the Construction Services business. The "Other" category reported an operating loss of $1.1 million driven by losses within Construction Services. Recent Business Developments
Outlook "We anticipate continued steady volumes from the automotive markets, as light vehicle sales have increased, due to some strengthening in parts of the economy and improving consumer confidence," McConnell said. "In Pressure Cylinders, we are well positioned to deliver natural gas storage and production equipment at the well site, through transportation and distribution solutions in LNG, and with products that convert natural gas to fuel. We believe that there are excellent growth opportunities across many of the energy-related markets, which we will continue to pursue organically and through acquisitions." Conference Call Worthington will review first quarter results during its quarterly conference call on September 25, 2014, at 10:30 a.m., Eastern Daylight Saving Time. Details regarding the conference call can be found on the Company web site at www.WorthingtonIndustries.com. About Worthington Industries Worthington Industries is a leading global diversified metals manufacturing company with 2014 fiscal year sales of $3.1 billion. Headquartered in Columbus, Ohio, Worthington is North America's premier value-added steel processor providing customers with wide ranging capabilities, products and services for a variety of markets including automotive, construction and agriculture; a global leader in manufacturing pressure cylinders for industrial gas and cryogenic applications, CNG and LNG storage, transportation and alternative fuel tanks, oil and gas equipment, and brand consumer products for camping, grilling, hand torch solutions, scuba diving and helium balloon kits; and a manufacturer of operator cabs for heavy mobile industrial equipment; laser welded blanks for light weighting applications; automotive racking solutions; and through joint ventures, complete ceiling grid solutions; automotive tooling and stampings; and steel framing for commercial construction. Worthington employs approximately 10,000 people and operates 80 facilities in 10 countries. Founded in 1955, the Company operates under a long-standing corporate philosophy rooted in the golden rule. Earning money for its shareholders is the first corporate goal. This philosophy serves as the basis for an unwavering commitment to the customer, supplier, and shareholder, and as the Company's foundation for one of the strongest employee-employer partnerships in American industry. Safe Harbor Statement The Company wishes to take advantage of the Safe Harbor provisions included in the Private Securities Litigation Reform Act of 1995 (the "Act"). Statements by the Company relating to outlook, strategy or business plans; future or expected growth, performance, sales, volumes, cash flows, earnings, balance sheet strengths, debt, financial condition or other financial measures; projected profitability potential, capacity, and working capital needs; demand trends for the Company or its markets; additions to product lines and opportunities to participate in new markets; pricing trends for raw materials and finished goods and the impact of pricing changes; anticipated capital expenditures and asset sales; anticipated improvements and efficiencies in costs, operations, sales, inventory management, sourcing and the supply chain and the results thereof; the ability to make acquisitions and the projected timing, results, benefits, costs, charges and expenditures related to acquisitions, newly-created joint ventures, headcount reductions and facility dispositions, shutdowns and consolidations; the alignment of operations with demand; the ability to operate profitably and generate cash in down markets; the ability to maintain margins and capture and maintain market share and to develop or take advantage of future opportunities, new products and new markets; expectations for Company and customer inventories, jobs and orders; expectations for the economy and markets or improvements therein; expected benefits from transformation plans, cost reduction efforts and other new initiatives; expectations for increasing volatility or improving and sustaining earnings, earnings potential, margins or shareholder value; effects of judicial rulings and other non-historical matters constitute "forward-looking statements" within the meaning of the Act. Because they are based on beliefs, estimates and assumptions, forward-looking statements are inherently subject to risks and uncertainties that could cause actual results to differ materially from those projected. Any number of factors could affect actual results, including, without limitation, the effect of national, regional and worldwide economic conditions generally and within major product markets, including a recurrent slowing economy; the effect of conditions in national and worldwide financial markets; product demand and pricing; changes in product mix, product substitution and market acceptance of the Company's products; fluctuations in the pricing, quality or availability of raw materials (particularly steel), supplies, transportation, utilities and other items required by operations; effects of facility closures and the consolidation of operations; the effect of financial difficulties, consolidation and other changes within the steel, automotive, construction and other industries in which the Company participates; failure to maintain appropriate levels of inventories; financial difficulties (including bankruptcy filings) of original equipment manufacturers, end-users and customers, suppliers, joint venture partners and others with whom the Company does business; the ability to realize targeted expense reductions from headcount reductions, facility closures and other cost reduction efforts; the ability to realize other cost savings and operational, sales and sourcing improvements and efficiencies, and other expected benefits from transformation initiatives, on a timely basis; the overall success of, and the ability to integrate newly-acquired businesses and joint ventures, maintain and develop their customers, and achieve synergies and other expected benefits and cost savings therefrom; capacity levels and efficiencies, within facilities, within major product markets and within the industry as a whole; the effect of disruption in the business of suppliers, customers, facilities and shipping operations due to adverse weather, casualty events, equipment breakdowns, acts of war or terrorist activities or other causes; changes in customer demand, inventories, spending patterns, product choices, and supplier choices; risks associated with doing business internationally, including economic, political and social instability, foreign currency exposure and the acceptance of our products in these markets; the ability to improve and maintain processes and business practices to keep pace with the economic, competitive and technological environment; the outcome of adverse claims experience with respect to workers' compensation, product recalls or product liability, casualty events or other matters; deviation of actual results from estimates and/or assumptions used by the Company in the application of its significant accounting policies; level of imports and import prices in the Company's markets; the impact of judicial rulings and governmental regulations, both in the United States and abroad, including those adopted by the United States Securities and Exchange Commission and other governmental agencies as contemplated by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010; the effect of changes to healthcare laws in the United States which may increase our healthcare and other costs and negatively impact our operations and financial results; and other risks described from time to time in the Company's filings with the United States Securities and Exchange Commission, including those described in "Part I - Item 1A. - Risk Factors" of our Annual Report on Form 10-K for the fiscal year ended May 31, 2014.
CONTACTS: Source: Worthington Industries, Inc. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
distributed by
|
