SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
January 28, 1999
(Date of Report, date of earliest event reported)
TREMONT CORPORATION
(Exact name of Registrant as specified in its charter)
Delaware 1-10126 76-0262791
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification
incorporation) Number)
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1999 Broadway, Suite 4300, Denver, CO 80202
(Address of principal executive offices) (Zip Code)
(303) 296-5600
(Registrant's telephone number, including area code)
Not Applicable
(Former name or address, if changed since last report)
Item 5: Other Events
On January 28, 1999, the Registrant issued the press release attached
hereto as Exhibit 99.1, which is incorporated herein by reference. The press
release relates to an announcement by Registrant regarding Registrant's 1998
financial results.
Item 7: Financial Statements, Pro Forma Financial Information and Exhibits
(c) Exhibits
Item Exhibit List
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No.
99.1 Press release dated January 28, 1999 issued by
Registrant.
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SIGNATURES
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 hereunto duly authorized.
TREMONT CORPORATION
(Registrant)
By: /s/ Robert E. Musgraves
Robert E. Musgraves
Vice President, General Counsel
and Secretary
Date: February 1, 1999
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Exhibit 99.1
PRESS RELEASE
FOR IMMEDIATE RELEASE: CONTACT:
Tremont Corporation J. Thomas Montgomery, Jr.
1999 Broadway, Suite 4300 Vice President, Controller and Treasurer
Denver, Colorado 80202 (303) 296-5617
TREMONT REPORTS 1998 RESULTS
DENVER, COLORADO . . . January 28, 1999 . . . Tremont Corporation (NYSE:
TRE) reported fourth quarter net income of $9.7 million, or $1.49 per diluted
share, compared to $6.5 million, or $.89 per diluted share, for the same quarter
in 1997. For the full year of 1998, Tremont reported net income of $73.8
million, or $10.88 per diluted share, compared to $13.6 million, or $1.76 per
diluted share, for 1997.
The Company's equity in earnings of 33%-owned TIMET was a loss of $.8
million in the fourth quarter of 1998 compared to income of $7.8 million in the
fourth quarter of 1997. TIMET's net loss of $2.5 million in the fourth quarter
of 1998 included restructuring charges of $18 million pretax. These charges
relate to TIMET's actions to adjust capacity and personnel levels in response to
current market conditions for titanium metal products. TIMET's sales for the
fourth quarter were $156 million compared to $208 million in the 1997 quarter.
TIMET's results for the fourth quarter, excluding the special charges, were
below the record 1997 levels primarily due to (i) reductions in demand for both
aerospace and industrial products and (ii) higher general and administrative
expenses in 1998, primarily information technology costs, including
implementation of TIMET's enterprise-wide business information system and
addressing "Year 2000" issues.
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The Company's equity in earnings of 20%-owned NL Industries was $2.8
million in the fourth quarter of 1998 compared to $1.6 million in the fourth
quarter of 1997. NL reported income from continuing operations of $18.8 million
in the fourth quarter of 1998 on sales of $209 million compared to $9.8 million
on sales of $208 million in the fourth quarter of 1997. NL's fourth quarter
titanium dioxide pigments ("TiO2") sales volume decreased 11% from the year-
earlier period as demand weakened, particularly in Europe and Asia. NL's fourth
quarter average selling prices for TiO2 were even with the third quarter of 1998
and 11% higher than the fourth quarter of 1997.
The Company's equity in earnings of other joint ventures principally
represents earnings from its real estate development partnership. The Company's
effective income tax rate differs from the statutory rate because no tax
provision or benefit was recognized on its equity in NL's earnings or losses
during 1997 or 1998 and because a $7.4 million deferred tax benefit was
recognized in the fourth quarter of 1998 due to the reversal of the remaining
deferred tax asset valuation allowance related to the Company's investment in
NL, which tax asset the Company now believes meets the "more likely than not"
recognition criteria.
The statements in this release relating to matters that are not historical
facts are forward-looking statements that represent management's beliefs and
assumptions based on currently available information. Although the Company
believes that the expectations reflected in such forward-looking statements are
reasonable, it cannot assure that these expectations will prove to be correct.
Such statements involve risks and uncertainties, including, but not limited to,
the cyclicality of NL's and TIMET's business, TIMET's dependence on the
commercial aerospace industry, global economic conditions, global productive
capacity, changes in product pricing, "Year 2000" issues, and other risks and
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uncertainties included in the Company's, NL's and TIMET's filings with the
Securities and Exchange Commission. Should one or more of these risks
materialize (or the consequences of such a development worsen), or should the
underlying assumptions prove incorrect, actual results could differ materially
from those forecasted or expected. The Company assumes no duty to update any
forward-looking statements.
Tremont, headquartered in Denver, Colorado, is principally a holding
company with operations in the titanium metals business, conducted through
TIMET, in the TiO2 business, conducted through NL, and in real estate
development, conducted through Victory Valley Land Company, L.P.
oo o o o
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TREMONT CORPORATION
SUMMARY OF CONSOLIDATED OPERATIONS
(In millions, except per share data)
Quarter Ended Year Ended
December 31, December 31,
1997 1998 1997 1998
Equity in earnings (loss) of:
TIMET $7.8 $(.8) $25.2 $ 14.0
NL Industries 1.6 2.8 (5.1) 57.8
Other .5 .7 5.2 2.9
9.9 2.7 25.3 74.7
Corporate income (expenses), - .4 1.1 (.3)
net
Income before taxes and 9.9 3.1 26.4 74.4
minority interest
Income tax expense (benefit) 3.3 (7.9) 11.5 (2.0)
Minority interest .1 .2 1.3 .7
Income before 6.5 10.8 13.6 75.7
extraordinary item
Equity in extraordinary loss
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of NL-
early extinguishment of - (1.1) - (1.9)
debt
Net income $6.5 $ 9.7 $13.6 $ 73.8
Earnings per share:
Before extraordinary
item:
Basic $ .96 $ 1.69 $ 1.92 $ 11.55
Diluted $ .89 $ 1.66 $ 1.76 $ 11.18
Net income:
Basic $ .96 $ 1.52 $ 1.92 $ 11.25
Diluted $ .89 $ 1.49 $ 1.76 $ 10.88
Weighted average shares
outstanding:
Common shares 6.8 6.4 7.1 6.6
Diluted shares 7.0 6.5 7.2 6.7
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