Bairnco Announces Improved First Quarter 2004 Results LAKE MARY,
Fla., April 19 /PRNewswire-FirstCall/ -- Bairnco Corporation today
reported improved operating results for the first quarter 2004 as
compared to the same period last year. Sales were up 6.5% to
$42,577,000, net income increased 41.2% to $1,255,000 and diluted
earnings per share increased 41.7% to $.17. Performance Sales in
the first quarter 2004 increased 6.5% to $42,577,000 from
$39,972,000 in 2003. Arlon's Electronic Materials sales were up
12.8% due to improvements in its wireless telecommunications,
electronics and certain industrial markets. Arlon's Coated
Materials sales increased 5.7% from growth in foreign sales.
Kasco's sales increased slightly from the first quarter 2003 from
the currency translation effect of the weakened US dollar versus
the British Pound and the Euro. Kasco's foreign sales were lower in
local currency but were up in US dollars due to the change in
exchange rates. Gross profit increased 9.6% to $12,697,000 from
$11,580,000 due to the increased sales and production volumes. The
gross profit margin as a percent of sales increased to 29.8% from
29.0%. The first quarter 2004 and 2003 gross profit was reduced by
$193,000 and $213,000, respectively, from relocation and closing
expenses related to the consolidation of Arlon's industrial
engineered coated product's businesses. Selling and administrative
expenses increased 4.7% to $10,564,000 from $10,093,000 due to the
increased sales. As a percent of sales, selling and administrative
expenses decreased to 24.8% from 25.3% in 2003. Interest expense
increased to $216,000 in 2004 as compared to $199,000 in 2003 due
to higher average debt outstanding as well as higher average
interest rates. Interest expense, net, of $202,000 reflected in the
income statement includes $14,000 of interest income. The effective
tax rate for the first quarter 2004 was 35.0% versus 31.0% for the
first quarter 2003. The increased tax rate assumes the
Extraterritorial Income Exclusion ("EIE"), a statutory exclusion
from taxable income, will expire in 2004. Legislation to replace
the EIE is currently in Congressional committee. Net income
increased 41.2% to $1,255,000 as compared to $889,000 in the first
quarter of 2003. Diluted earnings per common share increased 41.7%
to $.17 from $.12 as a result of increased earnings. Credit
Agreement The Corporation has in place a credit agreement that
expires in February 2005. Consequently, all borrowings under the
credit agreement are shown as current portion of long-term debt in
the accompanying condensed balance sheet for the quarter ended
April 3, 2004. It is our intent to structure a new financing
agreement prior to the end of 2004. Litigation On April 9, 2004 the
U.S. Court of Appeals for the Second Circuit affirmed the U.S.
District Court's decisions dismissing, in its entirety, the
Transactions Lawsuit against Bairnco and all the other defendants.
"Safe Harbor" Statement under the Private Securities 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, the costs and other effects of legal and
administrative cases and proceedings, settlements and
investigations; renegotiation of the Corporation's Credit
Agreement; 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; changes in the pricing of the products of the Corporation
or its competitors; 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 impact on production
output and costs from the availability of energy sources and
related pricing; 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. 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. Comparative Results of Operations
(Unaudited) Quarter Ended Condensed Income Statements Apr 3, 2004
Apr 5, 2003 Net sales $42,577,000 $39,972,000 Cost of sales
29,880,000 28,392,000 Gross profit 12,697,000 11,580,000 Selling
and administrative expenses 10,564,000 10,093,000 Operating profit
2,133,000 1,487,000 Interest expense, net 202,000 199,000 Income
before income taxes 1,931,000 1,288,000 Provision for income taxes
676,000 399,000 Net income $ 1,255,000 $889,000 Basic Earnings per
Share of Common Stock $0.17 $0.12 Diluted Earnings per Share of
Common Stock $0.17 $0.12 Basic Average Common Shares 7,342,000
7,334,000 Diluted Average Common Shares 7,431,000 7,336,000
Condensed Balance Sheets Apr 3, 2004 Dec 31, 2003 ASSETS Cash
$1,224,000 $796,000 Accounts receivable, net 26,973,000 23,511,000
Inventories 26,424,000 25,516,000 Other current assets 7,649,000
7,873,000 Total current assets 62,270,000 57,696,000 Plant and
equipment, net 35,377,000 36,476,000 Cost in excess of net assets
of purchased businesses, net 14,341,000 14,360,000 Other assets
9,264,000 9,697,000 Total $121,252,000 $118,229,000 LIABILITIES AND
STOCKHOLDERS' INVESTMENT Short-term debt $1,052,000 $1,875,000
Current maturities of long-term debt 29,926,000 2,173,000 Accounts
payable 12,557,000 10,159,000 Accrued expenses 11,209,000
10,916,000 Total current liabilities 54,744,000 25,123,000
Long-term debt 374,000 27,785,000 Other liabilities 11,015,000
11,023,000 Stockholders' investment 55,119,000 54,298,000 Total
$121,252,000 $118,229,000 DATASOURCE: Bairnco Corporation CONTACT:
Larry C. Maingot, Bairnco Corporation, +1-407-875-2222, ext. 230
Web site: http://www.bairnco.com/
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