SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------------
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) July 29, 1998
Birmingham Steel Corporation
(Exact name of registrant as specified in its charter)
Delaware 1-9820 13-3213634
- ------------------- ------------------------- -----------------------
State or other (Commission File Number) (IRS Employer
jurisdiction of Identification No.)
incorporation
1000 Urban Center Drive, Suite 300
Birmingham, Alabama 35242-2516
- -------------------------------------------- --------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (205) 970-1200
<PAGE>
Item 5. Other Events
On July 29, 1998, Birmingham Steel Corporation (the "Company") issued a
press release announcing its decision to write off the net carrying value of its
equity investment in Laclede Steel Company, and announcing the resignations of
Robert A. Garvey, Joseph Alvarado, and William R. Lucas, Jr. from the Laclede
Board of Directors. The press release is set forth as Exhibit 99-1.
On August 12, 1998, the Company issued a press release announcing final
results for the fourth quarter, and announcing earnings for the fiscal year
ended June 30, 1998. The press release is set forth as Exhibit 99-2.
<PAGE>
Item 7. Financial Statements and Exhibits
(c) Exhibits
99-1 Press release dated July 29, 1998.
99-2 Press release dated August 12, 1998.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
BIRMINGHAM STEEL CORPORATION
(Registrant)
Date: August 27, 1998 By: William R. Lucas, Jr.
---------------------
William R. Lucas, Jr.
Its: Executive Vice President -
Administration and General Counsel
<PAGE>
EXHIBIT INDEX
99 Certain press releases issued by Birmingham Steel Corporation
<PAGE>
EXHIBIT 99-1
FOR IMMEDIATE RELEASE Contact:William R. Lucas, Jr.
Executive Vice President -
Administration and General
Counsel
(205) 970-1231
BIRMINGHAM STEEL WRITES DOWN INVESTMENT IN LACLEDE;
COMMENTS ON EXPECTED RESULTS FOR FOURTH QUARTER 1998
BIRMINGHAM, Ala. (July 29, 1998) - Laclede Steel today announced that a
significant restructuring of Laclede would result in substantial losses in their
second quarter. As a result, Birmingham Steel Corporation has decided that it
will write off the net carrying value of its 25.4 percent equity investment in
Laclede in its fourth quarter financial results and fiscal year ended June 30,
1998. Final results will be released on August 12, after completion of
Birmingham Steel's annual audit.
Birmingham Steel had expected to report net income for the quarter
ended June 30, 1998, of approximately $2.5 million to $3.0 million, or $.08 to
$.10 per share. These results included gains from the sale of property and
income from settlements with electrode suppliers relating to price fixing issues
in the electrode industry. Excluding special items, the Company had anticipated
net income from operations of approximately $.02 to $.04 per share, which was in
line with the expectations of most analysts. As a result of the Laclede
write-off, however, Birmingham Steel will record a fourth quarter charge of
$12.3 million, or approximately $.25 per share, resulting in a net loss of
approximately $3.9 million to $4.4 million, or $(.13) to $(.15) per share, for
the quarter. Birmingham Steel now estimates its net income for the fiscal year
in a range of $1.0 million to $1.5 million, or $.03 to $.05 per share. Fiscal
1998 final results will be released on August 12.
Robert A. Garvey, Chairman and Chief Executive Officer of Birmingham
Steel Corporation, commented, "We had expected improved financial results for
our fourth quarter. However, given the operating challenges and financial
uncertainties facing Laclede, we believe that it is in the best interest of
Birmingham Steel's shareholders to fully discount the Laclede investment at this
time. Birmingham Steel will continue to hold 25.4 percent of the outstanding
shares of Laclede. However, pursuant to the accounting provisions for equity
investments, future Laclede financial results will not adversely impact
Birmingham Steel's financial statements in the future."
Birmingham Steel also announced that Garvey, Joseph Alvardo and William
Lucas, three of the Company's officers, have resigned as directors of Laclede
effective immediately. Following this action, no representatives of Birmingham
Steel will hold positions on the Laclede board of directors. In addition, the
Company has advised Ivaco, Inc., which through an affiliate owns 25 percent of
Laclede's common stock, that Birmingham Steel intends to cancel its proxy over
the Ivaco shares and vote Birmingham Steel's shares neutrally in the future.
Birmingham Steel operates in the mini-mill sector of the steel industry
and conducts operations at facilities located across the United States. The
Company produces steel reinforcing bar, merchant products and SBQ (special bar
quality) bar, rod and wire. The common stock of Birmingham Steel Corporation is
traded on the New York Stock Exchange under the symbol "BIR."
Notice: Except for historical information, the matters described in this
document, including statements concerning the Company's results for the fourth
fiscal quarter ended June 30, 1998, are forward-looking statements within the
meaning of the safe-harbor provisions of the Private Securities Litigation
Reform Act of 1995. These forward-looking statements are subject to risks and
uncertainties that may cause actual results to differ materially, including
economic conditions, market demand factors, unanticipated start-up and operating
expenses, equipment breakdowns or failures, financing considerations, the
completion of the review of the Company's financial records and reports by its
outside auditors, and the performance of the various joint ventures in which the
Company is involved, as well as other risks described from time to time in the
Company's periodic and special filings with the Securities and Exchange
Commission. Any forward-looking statements contained in this document speak only
as of the date hereof, and the Company disclaims any intent or obligation to
update such forward-looking statements.
- -END-
<PAGE>
EXHIBIT 99-2
Contact: J. Daniel Garrett
Vice President-
Finance & Control
(205) 970-1213
FOR IMMEDIATE RELEASE
BIRMINGHAM STEEL CORPORATION
ANNOUNCES FOURTH QUARTER AND FISCAL 1998 RESULTS
BIRMINGHAM, Ala. (August 12, 1998) Birmingham Steel Corporation (NYSE:BIR) today
announced final results for the fourth quarter and earnings for the fiscal year
ended June 30, 1998. Consistent with statements in a Company press release
issued July 29, Birmingham Steel reported a net loss for the fourth quarter of
$4,245,000, or $(.14) per share. Included in the fourth quarter results were
one-time pre-tax charges of $12.4 million, or $.25 per share after tax, related
to the write-off of the Company's 25.4% equity investment in Laclede Steel; and
$2.1 million, or $.04 per share after tax, related to the write-down of other
assets. Fourth quarter results also included pre-tax gains of $6.3 million, or
$.11 per share after tax, from the sale of property and income from settlements
with electrode suppliers. In addition, the Company incurred pre-tax start-up
expenses primarily related to the Company's Memphis melt shop of $10.5 million,
or $.20 per share after tax. For the same period of the previous fiscal year,
net income was $1,555,000, or $.05 per share, including pre-tax charges for
unusual items of $4.5 million, or $.09 per share after tax.
Net sales for the fiscal 1998 fourth quarter were $282,820,000 compared
with net sales of $277,528,000 reported for the same period last year. Shipments
increased to 830,000 tons compared with 811,000 tons shipped in the fourth
quarter of fiscal 1997.
For the fiscal year ended June 30, 1998, the Company reported net
income of $1,629,000, or $.05 per share. Results for the year included pre-tax
charges of $15.1 million, or $.30 per share after tax, related to the Company's
share of operating losses at Laclede and the write-off of the Laclede
investment; and $2.1 million, or $.04 per share after tax, related to the
write-down of other assets. Fiscal 1998 results also included pre-tax gains of
$9.6 million, or $.17 per share after tax, from the sale of property and income
from settlements with electrode suppliers. Pre-operating and start-up expenses,
primarily related to the Memphis melt shop, totaled $34.2 million before tax, or
$.69 per share after tax. For the prior fiscal year, the Company reported net
income of $14,417,000, or $.50 per share, including pre-tax charges for unusual
items of $15.2 million, or $.30 per share after tax.
Net sales for fiscal 1998 increased 16% to $1,136,019,000 compared with
$978,948,000 for fiscal 1997. Steel shipments for fiscal 1998 were 3,329,000
tons, up 17% from 2,836,000 tons in the prior fiscal year.
Robert A. Garvey, Chairman and Chief Executive Officer, stated, "Fiscal
1998 was a record year for sales and shipments. The Company's net sales exceeded
$1 billion for the first time, reflecting strong business conditions and
continued diversification of our product mix. With the exception of previously
reported start-up problems at our new Memphis melt shop and operating losses at
our West Coast scrap facility, we achieved overall solid performance at our
operating divisions.
"As we reported earlier, given the operating challenges and financial
uncertainties facing Laclede, we believe it was in the best interest of
Birmingham Steel's shareholders to fully discount the Laclede investment. As a
result of this action, Laclede financial results will not adversely impact
Birmingham Steel's financial statements in the future, although Birmingham Steel
will continue to hold 25.4% of the outstanding shares of Laclede."
Birmingham Steel operates in the mini-mill sector of the steel industry
and conducts operations at facilities located across the United States. The
Company produces steel reinforcing bar, merchant products and SBQ (special bar
quality) bar, rod and wire. The common stock of Birmingham Steel Corporation is
traded on the New York Stock Exchange under the symbol "BIR."
Notice: Except for historical information, the matters described in this
document are forward-looking statements within the meaning of the safe-harbor
provisions of the Private Securities Litigation Reform Act of 1995. These
forward-looking statements are subject to risks and uncertainties that may cause
actual results to differ materially, including economic conditions, market
demand factors, unanticipated start-up and operating expenses, equipment
breakdowns or failures, financing considerations, and the performance of the
various joint ventures in which the Company is involved, as well as other risks
described from time to time in the Corporation's periodic and special filings
with the Securities and Exchange Commission. Any forward-looking statements
contained in this document speak only as of the date hereof, and the Corporation
disclaims any intent or obligation to update such forward-looking statements.
Comparisons of results for current and prior periods are not necessarily
indicative of future performance and should not be relied on for any purpose
other than as historical data.
BIRMINGHAM STEEL CORPORATION
Financial Highlights
(in thousands, except per share amounts)
Three Months Ended Twelve Months Ended
June 30, June 30,
-------------------- ----------------------
1998 1997 1998 1997
--------- --------- ---------- ---------
Revenues $282,820 $277,528 $1,136,019 $ 978,948
Net income (loss) $ (4,245) $ 1,555 $ 1,629 $ 14,417
Earnings (loss) per share $ (.14) $ .05 $ .05 $ .50
Average shares outstanding 29,647 29,677 29,674 29,091
-END-
