Bairnco Announces Improved Fourth Quarter and Full Year 2004
Results, and New Credit Agreement LAKE MARY, Fla., Jan. 27
/PRNewswire-FirstCall/ -- Bairnco Corporation (NYSE:BZ) today
reported improved sales and income from continuing operations for
the fourth quarter and full year 2004 as compared to the same
periods last year. Sales for 2004 were up 8.4% to $165,496,000 from
$152,696,000 in 2003. Income from continuing operations excluding
the gain on sale of facility increased to $4,329,000 in 2004 from
$2,649,000 in 2003. Fourth quarter 2004 sales were up 9.2% to
$40,544,000 from $37,135,000 and income from continuing operations
excluding the gain on sale of facility increased to $1,084,000 from
$589,000 in the fourth quarter of 2003. Included in the 2004 fourth
quarter and full year income from operations is approximately
$790,000 ($1.2 million pre-tax) of gain on the sale of Arlon's East
Providence, Rhode Island facility. Bairnco also reported today that
it had reached an agreement in principle with a group of banks to
establish a three year unsecured credit facility (the "Agreement")
for $25 million, including a $15 million revolving credit facility
and a $10 million letter of credit facility. The Agreement will
replace the Corporation's current credit facility which expires on
February 22, 2005. Performance -- Fourth Quarter 2004 Sales in the
fourth quarter 2004 were $40,544,000, an increase of 9.2% from
$37,135,000 in the fourth quarter 2003. Arlon's Electronic
Materials sales increased 4.0% as strong sales in the electronics
and industrial markets offset slow sales to its wireless
communications markets. Arlon's Coated Materials sales increased
12.2% from growth in both its graphics and industrial markets.
Kasco sales increased 10.4% from the fourth quarter 2003 from
increased service and repair revenues in the U.S., slightly
improved European sales and the currency translation effect of the
weakened U.S. dollar versus the British Pound and the Euro. Gross
profit increased 11.3% to $11,610,000 from $10,427,000 as a result
of increased sales and improved efficiencies from increased
production volumes. Gross profit margin as a percent of sales
increased slightly to 28.6% from 28.1% in 2003. Selling and
administrative expenses increased 8.8% to $10,194,000 from
$9,367,000 in the fourth quarter 2003 from increased sales. As a
percent of sales, selling and administrative expenses were down
slightly to 25.1% in 2004 as compared to 25.2% in 2003. Net
interest expense decreased to $18,000 in the fourth quarter 2004 as
compared to $190,000 in the fourth quarter 2003 due to reduced
outstanding borrowings. The effective tax rate for the fourth
quarter 2004 was 27.8% as compared to 32.3% in the fourth quarter
2003. The reduced tax rate reflects the impact of the usage of a
net operating loss carry forward from Kasco's French operations.
Income from continuing operations increased to $1,874,000 in the
fourth quarter 2004 including the gain on sale of facility of
$790,000. Excluding the gain on sale of facility, income from
continuing operations increased 84.2% to $1,084,000 as compared to
$589,000 in the fourth quarter of 2003. Diluted earnings per common
share from continuing operations, which includes $.10 from the gain
on sale of facility, increased to $.24 from $.08 in the fourth
quarter 2003. No shares were repurchased on the open market during
the fourth quarter of 2004. Performance -- Year Ended December 31,
2004 Sales for the year ended December 31, 2004 increased 8.4% to
$165,496,000 from $152,696,000 in 2003. Arlon's Electronic
Materials sales increased 15.1% and Arlon's Coated Materials sales
increased 4.7% as all of Arlon's US served markets experienced
growth with the improved economy. Kasco's sales increased 7.2% as
compared to last year. Kasco's North American sales were up 5.4%
due to increased service and repair revenues. Kasco's European
operations' sales were up 9.0% due to the positive currency
translation effect of the weakened US dollar versus the British
Pound and the Euro. Gross profit increased 11.7% to $47,884,000
from $42,871,000 in 2003 due to the increased sales and improved
efficiencies from higher production volumes. The gross profit
margin as a percent of sales increased to 28.9% from 28.1%. Selling
and administrative expenses increased 7.3% to $41,023,000 from
$38,248,000 in 2003 from increased sales. As a percent of sales,
selling and administrative expenses decreased to 24.8% in 2004 as
compared to 25.0% in 2003. Net interest expense decreased to
$566,000 in 2004 as compared to $768,000 in 2003 due to the reduced
outstanding borrowings. Excluding the gain on sale of facility,
income before income taxes in 2004 increased 63.3% to $6,295,000 as
compared to $3,855,000 in 2003. Income from continuing operations
increased to $5,119,000 in 2004 including the gain on sale of
facility of $790,000. Excluding the gain on sale of facility,
income from continuing operations increased 63.4% to $4,329,000 as
compared to $2,649,000 in 2003. Diluted earnings per common share
from continuing operations, which includes $.10 from the gain on
sale of facility, increased to $.68 from $.36 in 2003. No shares
were repurchased on the open market during 2004. Net income was
$29,814,000 and diluted earnings per common share were $3.94 in
2004 reflecting the impact of the $24,695,000 settlement of the NOL
Lawsuit in the third quarter 2004. Stockholders Meeting The Company
also announced today that the Annual Meeting of Stockholders in
Bairnco Corporation will be held on Thursday, April 21, 2005, at
9:00 a.m., local time, at Bairnco's corporate offices, Lake Mary,
Florida. The record date for determination of Stockholders is March
7, 2005. Bairnco Corporation is a diversified multinational company
that operates two distinct businesses -- Arlon (Electronic
Materials and Coated Materials segments) and Kasco (Replacement
Products and Services segment). Arlon's principal products include
high technology materials for the printed circuit board industry,
cast and calendered vinyl film systems, custom-engineered laminates
and special silicone rubber compounds and components. Kasco's
principal products include replacement band saw blades for cutting
meat, fish, wood and metal, and on site maintenance primarily in
the meat and deli departments. Kasco also distributes equipment to
the food industry in France. CONTACT: Lawrence C. Maingot, Bairnco
Corporation Telephone: (407) 875-2222, ext. 230 "Safe Harbor"
Statement under the Private Securities Litigation Reform Act of
1995 Statements in this press release referring to the expected
future plans and performance of the Corporation are forward-looking
statements. Actual future results may differ materially from such
statements. Factors that could affect future performance include,
but are not limited to, changes in US or international economic or
political conditions, such as inflation or fluctuations in interest
or foreign exchange rates; disruptions in operations due to labor
disputes; renegotiation of the Corporation's Credit Agreement;
changes in the pricing of the products of the Corporation or its
competitors; the impact on production output and costs from the
availability of energy sources and related pricing; the market
demand and acceptance of the Corporation's existing and new
products; the impact of competitive products; changes in the market
for raw or packaging materials which could impact the Corporation's
manufacturing costs; changes in the product mix; the loss of a
significant customer or supplier; production delays or
inefficiencies; the costs and other effects of legal and
administrative cases and proceedings, settlements and
investigations; the ability to achieve anticipated revenue growth,
synergies and other cost savings in connection with acquisitions
and plant consolidations; the costs and other effects of complying
with environmental regulatory requirements; and losses due to
natural disasters where the Corporation is self-insured. While the
Corporation periodically reassesses material trends and
uncertainties affecting the Corporation's results of operations and
financial condition in connection with its preparation of its press
releases, the Corporation does not intend to review or revise any
particular forward-looking statement referenced herein in light of
future events. Comparative Consolidated Results of Operations
(Unaudited) Quarter Ended Year Ended Condensed Income Dec. 31, Dec.
31, Dec. 31, Dec. 31, Statements 2004 2003 2004 2003 Net sales
$40,544,000 $37,135,000 $165,496,000 $152,696,000 Cost of sales
28,934,000 26,708,000 117,612,000 109,825,000 Gross profit
11,610,000 10,427,000 47,884,000 42,871,000 Selling and
administrative expenses 10,194,000 9,367,000 41,023,000 38,248,000
Operating profit 1,416,000 1,060,000 6,861,000 4,623,000 Gain on
sale of facility (1,196,000) -- (1,196,000) -- Interest expense,
net 18,000 190,000 566,000 768,000 Income before income taxes
2,594,000 870,000 7,491,000 3,855,000 Provision for income taxes
720,000 281,000 2,372,000 1,206,000 Income from continuing
operations 1,874,000 589,000 5,119,000 2,649,000 Income from spun
off subsidiary -- -- 24,695,000 -- Net income $1,874,000 $589,000
$29,814,000 $2,649,000 Basic Earnings Per Share of Common Stock
from Continuing Operations 0.25 0.08 0.70 0.36 Basic Earnings per
Share of Common Stock from Spun Off Subsidiary -- -- 3.35 -- Basic
Earnings per Share of Common Stock 0.25 0.08 4.05 0.36 Diluted
Earnings per Share of Common Stock from Continuing Operations $0.24
$0.08 $0.68 $0.36 Diluted Earnings per Share of Common Stock from
Spun Off Subsidiary -- -- 3.26 -- Diluted Earnings per Share of
Common Stock $0.24 $0.08 $3.94 $0.36 Basic Average Common Shares
7,386,000 7,342,000 7,362,000 7,338,000 Diluted Average Common
Shares 7,660,000 7,436,000 7,569,000 7,391,000 Condensed Balance
Sheets Dec. 31, 2004 Dec. 31, 2003 ASSETS Cash $ 3,451,000 $
796,000 Accounts receivable, net 24,912,000 23,511,000 Inventories
24,964,000 25,516,000 Other current assets 6,687,000 7,873,000
Total current assets 60,014,000 57,696,000 Plant and equipment, net
34,429,000 36,476,000 Cost in excess of net assets of purchased
14,542,000 14,360,000 businesses Other assets 8,781,000 9,697,000
Total $117,766,000 $118,229,000 LIABILITIES AND STOCKHOLDERS'
INVESTMENT Short-term debt $ 1,030,000 $ 1,875,000 Current
maturities of long-term debt 663,000 2,173,000 Accounts payable
10,601,000 10,159,000 Accrued expenses 10,515,000 10,916,000 Total
current liabilities 22,809,000 25,123,000 Long-term debt 231,000
27,785,000 Other liabilities 10,974,000 11,023,000 Stockholders'
investment 83,752,000 54,298,000 Total $117,766,000 $118,229,000
DATASOURCE: Bairnco Corporation CONTACT: Lawrence C. Maingot,
Bairnco Corporation, +1-407-875-2222, ext. 230 Web site:
http://www.bairnco.com/
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