Raytech Corporation Announces First Quarter Results for 2005
20 Juni 2005 - 11:25PM
Business Wire
Raytech Corporation (NYSE:RAY) today announced net income of $1.6
million for the thirteen-week period ended April 3, 2005, amounting
to $.04 per basic and diluted share compared to a net income of
$1.4 million or $.03 per basic and diluted share for the same
period in the prior year. The Company recorded sales for the
thirteen-week period ended April 3, 2005 of $63.4 million compared
to $56.6 million in the same period in the prior year, an increase
of 11.9 percent. On May 19, 2005, in connection with a notification
of late filing for the first quarter, the Company reported an
estimated net loss of $675 thousand, subject to the completion of
purchase accounting for the acquisition of a minority interest in
Allomatic Products Company ("APC"). The notification also indicated
that the estimated net loss was partially due to the recognition of
a $1.3 million product liability claim in the International
segment. Completion of purchase accounting for the APC acquisition
resulted in, among other things, the reduction of certain deferred
tax assets and consequently, a $995 thousand reduction in amounts
payable to the Raytech Asbestos Personal Injury Settlement Trust
("PI Trust"), recorded as non-operating income. In addition, upon
further review of the product liability claim described above, it
was determined that, while a loss is reasonably possible, no
liability should be recognized at this time. The increase in net
income over the prior year was primarily due to the recognition of
non-operating income related to the decrease in amounts payable to
the PI Trust, partially offset by restructuring expense and a
decline in operating profit, primarily in the Domestic OEM segment
which, despite achieving 8.9 percent sales growth, realized a 32
percent decrease in gross profit compared to the same period in
2004. Reduced gross profit in the Domestic OEM segment was
primarily the result of the increased price of steel, a key raw
material used in that segment. First quarter 2005 operating results
were also negatively impacted in all segments by costs incurred to
transfer certain production from the Company's facilities to be
closed during 2005 to facilities to remain open as part of the
Company's facility restructuring program. The increase in sales was
driven by increased demand for the Company's heavy-duty wet
friction products, its commercial dry friction products and its
aftermarket products. On March 21, 2005, the Company, through its
majority owned subsidiary, APC, purchased shares of APC owned by
Raymark Corporation in exchange for a ten-year unsecured promissory
note of $7.2 million which increased the Company's indirect
ownership of APC from approximately 57 percent of its outstanding
common stock to approximately 96 percent of its outstanding common
stock. Raytech Corporation is a worldwide manufacturer of wet and
dry clutch, power transmission and brake systems as well as
specialty engineered polymer matrix composite products and related
services for vehicular applications, including automotive OEM,
heavy duty on-and-off highway vehicles and aftermarket vehicular
power transmission systems. Through two technology and research
centers and five manufacturing operations worldwide, Raytech
develops and delivers energy absorption, power transmission and
custom-engineered components focusing on niche applications where
its expertise and technological excellence provide a competitive
edge. Raytech Corporation, headquartered in Shelton, Connecticut,
operates manufacturing facilities in the United States, Germany and
China as well as technology and research centers in Indiana and
Germany. The Company's operations are strategically situated in
close proximity to major customers and within easy reach of
geographical areas with demonstrated growth potential. Raytech
common stock is listed on the New York Stock Exchange and trades
under the symbol "RAY." Company information may be accessed on our
Internet website http://www.raytech.com. -0- *T RAYTECH CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (000's omitted,
except share data) Comparative results are as follows: For the 13
Weeks Ended April 3, 2005 March 28, 2004 ---------------
---------------- (Unaudited) Net Sales $ 63,352 $ 56,598 Net income
$ 1,620 $ 1,351 Basic and diluted earnings per share: Earnings per
share $ .04 $ .03 Weighted average shares 41,737,306 41,737,306 *T
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