March 25, 1998
For immediate release: Budget National and Analyst Wire
Contacts: Gary Wagner, Senior Vice President, Chief Financial Officer,
and Dan Stracner, Vice President, Public Affairs: 626/683-4000
Ameron's First-Quarter 1998 Result
Pasadena, Calif.--Ameron International Corporation (NYSE: AMN)
today reported a loss of 23 cents per share, or $940,000, on sales
of $102.5 million for its first quarter, which ended Feb. 28, 1998.
For the similar period in 1997, the company reported earnings of 23 cents
per share, or $938,000, on sales of $108.3 million, Ameron's highest
first-quarter earnings in more than a decade.
The company attributed the loss primarily to project delays caused
by unusually severe weather in major domestic markets. "As previously
reported, El Nino-related weather delays impacted some of our operations,
especially our concrete and steel pipe business in the West and our
protective coatings business in the United States," said James S. Marlen,
chairman, president and chief executive officer. First-quarter rainfall
in Southern California, an important market for Ameron, was the heaviest
in more than a century. Severe thunderstorms in the Gulf region curtailed
coatings work on offshore platforms and other major projects throughout
the quarter. Also, the military buildup in the Arabian Gulf, which delayed
scheduled drydockings and maintenance for U.S. Navy ships, contributed to
a shortfall in Ameron's coatings business. In addition, a strike at
Ameron's main steel fabrication plant in Southern California delayed
shipments of welded steel pipe toward the end of the quarter.
Compared to 1997, the company's construction products business in
Hawaii reported a strong first-quarter improvement, even though the
outlook for the construction sector in Hawaii is still sluggish.
Ameron's worldwide fiberglass pipe business posted a healthy
improvement in sales and earnings for the quarter, in part because of an
increase in sales from Ameron's European operation. Centron International,
acquired by Ameron in 1996, continued to make a strong contribution with
shipments of high-pressure oilfield pipe to markets around the world.
"The first quarter is traditionally our weakest, and this year we
had to contend with unusual factors that worsened the situation," Marlen
said. "The lower results are due primarily to weather conditions and
project delays; however, we anticipate accelerated deliveries throughout
the rest of the year." Marlen added, "Management remains confident about
Ameron's overall strategic direction."
Ameron International Corporation
Consolidated Statements of Income
First Quarter Ended February 28,
(in thousands except share and per share data)
1998 1997
--------- ---------
Sales $102,526 $108,261
Cost of Sales 78,324 80,578
--------- ---------
Gross Profit 24,202 27,683
Selling, General and Administrative Expenses 25,046 26,283
--------- ---------
Operating Profit/(Loss) (844) 1,400
Royalty, Equity and Other Income 1,771 2,619
--------- ---------
Income before Interest and Income Taxes 927 4,019
Interest, net 2,493 2,456
--------- ---------
Income/(Loss) before Income Taxes (1,566) 1,563
Income Taxes Provision/(Benefit) (626) 625
--------- ---------
Net Income/(Loss) $ (940) $ 938
========= =========
Diluted Net Income/(Loss) Per
Share (based on average of
4,005,956 shares in 1998 and
4,067,138 shares in 1997) $ (.23) $ .23
========= =========
Cash Dividends Paid $ .32 $ .32
========= =========
Ameron International Corporation
Consolidated Statements of Cashflow
Three Months Ended February 28,
(in thousands)
1998 1997
--------- ---------
Operating Activities
Net Income/(Loss) $ (940) $ 938
Adjustments to reconcile
net income/(loss) to net cash 4,740 4,905
Changes in operating assets
and liabilities (267) (18,716)
--------- ---------
Cash Provided (Used) By Operations 3,533 (12,873)
Investing Activities
Proceeds from sale of assets 58 41
Additions to property, plant
and equipment, and Acquisitions (6,832) (5,290)
Other, net (333) (253)
--------- ---------
Net Cash Used in Investing Activities (7,107) (5,502)
Financing Activities
Short and long-term borrowings, net 2,022 12,460
Dividends on common stock (1,282) (1,280)
Other, net 31 566
--------- ---------
Net Cash Provided by Financing Activities 771 11,746
Effect of exchange rate changes on cash (72) (315)
--------- ---------
Net change in cash $ (2,875) $ (6,944)
========= =========
Ameron International Corporation
Consolidated Balance Sheets
(in thousands)
February 28, November 30,
1998 1997
--------- ---------
ASSETS
Current Assets
Cash and equivalents $ 6,973 $ 9,848
Receivables, net 105,169 122,352
Inventories 107,958 95,752
Other 13,606 13,340
--------- ---------
Total current assets 233,706 241,292
Investments and Advances -
Affiliated Companies 33,541 33,777
Property, Plant and Equipment, net 128,149 127,678
Other Assets 28,494 30,478
--------- ---------
Total Assets $423,890 $433,225
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Short-term borrowings $ 585 $ 715
Current portion of long-term debt 17,635 17,654
Trade payables 35,868 31,988
Accrued liabilities and other 33,283 36,908
--------- ---------
Total current liabilities 87,371 87,265
Long-Term Debt, less current portion 142,733 140,917
Other Liabilities 45,832 52,061
--------- ---------
Total Liabilities 275,936 280,243
Stockholders' Equity
Common stock 12,948 12,946
Additional paid-in capital 16,998 16,969
Retained earnings 169,347 171,569
Cumulative translation adjustments (8,560) (5,723)
Treasury stock (42,779) (42,779)
--------- ---------
Total Stockholders' Equity 147,954 152,982
--------- ---------
Total Liabilities and Stockholders' Equity $423,890 $433,225
========= =========
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