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UNITED STATES
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: JULY 23, 1998
INSILCO CORPORATION
(Exact Name of Registrant as specified in its charter)
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<S> <C> <C>
DELAWARE 0-22098 06-0635844
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(State or other jurisdiction of (Commission File No.) (IRS Employer Identification
incorporation or organization) Number)
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425 METRO PLACE NORTH
FIFTH FLOOR
DUBLIN, OHIO 43017
(614) 792-0468
(Address, including zip code, and telephone number
including area code of Registrant's
principal executive offices)
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ITEM 5. OTHER EVENTS.
On July 23, 1998 Insilco Corporation (the "Company") issued its second quarter
earnings release. The Company reported net income of $4.4 million, or $1.02 per
diluted share, for its second quarter ended June 30, 1998, compared to $11.2
million, or $1.14 per diluted share, for the 1997 second quarter. Sales for the
1998 second quarter were $170.0 million, compared to $169.7 million recorded in
the year ago second quarter.
The 1998 second quarter results included expenses of $1.3 million related to the
previously announced merger between Insilco and an affiliate of DLJ Merchant
Banking. The Company also reported a significant increase in its effective tax
rate for the quarter, to 53% versus 38% in the 1997 second quarter, resulting
from the fact that certain expenses to be incurred in connection with the
pending merger will not be deductible for tax purposes.
For the six months ended June 30, 1998, the Company reported income from
continuing operations of $7.2 million, or $1.69 per diluted share, compared to
$15.6 million, or $1.58 per diluted share, for the six months ended June 30,
1997. Sales were $287.3 million for the first six months of 1998, compared to
$276.2 million recorded in the first six months of 1997.
The Company's press release issued July 23, 1998 is attached as an exhibit and
is incorporated herein by reference.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits.
Exhibit No. Description
99 (a) Press release of the Company issued July 23, 1998.
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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 thereunto duly authorized.
INSILCO CORPORATION
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Registrant
Date: July 24, 1998 By: /s/ DAVID A. KAUER
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David A. Kauer
Vice President and Chief Financial Officer
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EXHIBIT INDEX
Exhibit No. Description
99 (a) Press release of the Company issued July 23, 1998.
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Exhibit 99(a)
Excellence in Electronics, Telecommunications, Automotive, Publishing
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NEWS RELEASE
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FOR IMMEDIATE RELEASE CONTACT: DAVID A. KAUER
VICE PRESIDENT AND
CHIEF FINANCIAL OFFICER
(614) 792-0468
INSILCO CORPORATION REPORTS SECOND QUARTER RESULTS
COLUMBUS, OHIO, JULY 23, 1998 -- INSILCO CORPORATION (NASDAQ:INSL)
today reported net income of $4.4 million, or $1.02 per diluted share, for its
second quarter ended June 30, 1998, compared to $11.2 million, or $1.14 per
diluted share, for the 1997 second quarter. Sales for the 1998 second quarter
were $170.0 million, compared to $169.7 million recorded in the year ago second
quarter.
The 1998 second quarter results included expenses of $1.3 million
related to the previously announced merger between Insilco and an affiliate of
DLJ Merchant Banking. The Company also reported a significant increase in its
effective tax rate for the quarter, to 53% versus 38% in the 1997 second
quarter, resulting from the fact that certain expenses to be incurred in
connection with the pending merger will not be deductible for tax purposes.
For the six months ended June 30, 1998, the Company reported income
from continuing operations of $7.2 million, or $1.69 per diluted share, compared
to $15.6 million, or $1.58 per diluted share, for the six months ended June 30,
1997. Sales were $287.3 million for the first six months of 1998, compared to
$276.2 million recorded in the first six months of 1997.
CEO COMMENTS
"Our core automotive heat exchanger businesses posted solid results for
the second quarter," said Insilco Chairman and CEO, Robert L. Smialek. "Sales at
our German heat exchanger tubing unit were also up quite sharply in the quarter.
However, earnings growth for the Group was held back by weak sales at the
Company's heat exchanger equipment unit which in recent years has had a
significant portion of its sales in developing countries in Asia. In addition,
performance for our Automotive Components Group was affected by the seasonal
shutdown of a major automotive OEM, which occurred a week earlier than last year
and, due to this timing difference, reduced our second quarter sales. The
General Motors strike had only a marginal impact on the Group in the quarter. A
prolonged strike will impact Thermalex, our unconsolidated joint venture, which
generates a substantial portion of its revenue from GM."
"Our technologies businesses were impacted in the second quarter by the
general slowdown in electronics components markets. This is compared to a very
strong quarter in the prior year when both our wire and cable assembly unit and
our power transformer unit posted sales growth in excess of 14%. We do
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not believe this slowdown is indicative of a long-term trend and is largely a
result of the industry-wide inventory correction in the global electronics
markets. Despite this general slowdown, our data grade connector sales were up
over 7% from the prior year's quarter, reflecting strength in European sales and
strong demand from a major domestic telecommunications customer. We also look
forward to accelerating revenues from new product releases throughout the
balance of 1998."
"As we reported in May, we were very pleased with the $25.2 million
judgment in connection with our Taylor Publishing unit's lawsuit against
Jostens. However, despite higher sales at Taylor, litigation expenses associated
with the lawsuit, as well as higher than anticipated delivery costs for spring
yearbook production impacted Taylor's second quarter results. Having concluded
the lawsuit, and having completed the multi-year reengineering at Taylor with
significant investments in digital pre-press technologies, we are optimistic
about our ability to compete more effectively in the future."
"Insilco's second quarter earnings per share were affected by the
substantial merger related expenses. "Excluding the impact of this item, diluted
earnings per share in this year's second quarter would have been $0.30 higher."
"We look forward to closing our transaction with DLJ Merchant Banking
shortly after our Special Shareholders Meeting on August 13, 1998, and to
pursuing growth opportunities in our target markets," concluded Smialek.
The statements made in this press release which are not historical
facts may be deemed forward looking statements, and, as such, are subject to
certain risks and uncertainties. It is important to note that results could
differ materially from those projected in such forward-looking statements.
Factors which could cause results to differ materially include, but are not
limited to the following: delays in new product introductions, lack of market
acceptance for new products, changes in demand for the Company's products,
changes in market trends, general competitive pressures from existing and new
competitors, changes in interest rates, failure to consummate the proposed
merger with an affiliate of DLJ Merchant Banking, and adverse economic
conditions which could affect the amount of cash available for debt servicing
and capital investments. Further information concerning factors that could cause
actual results to differ materially from those in the forward looking statements
are contained from time to time in the Company's SEC filings, including but not
limited to the Company's report on Form 10-K/A No. 2 for the year ended December
31, 1997, Form 10-Q/A No. 1 for the quarter ended March 31, 1998. Copies of
these filings may be obtained by contacting the Company or the SEC.
Insilco Corporation, based in suburban Columbus, Ohio, is a diversified
manufacturer of industrial components and a supplier of specialty publications.
The Company's industrial business units serve the automotive, electronics,
telecommunications and other industrial markets, and its publishing business
serves the school yearbook market. It had revenues in excess of $500 million in
1997.
Investor Relations Contact: At the Company call David A. Kauer, Chief Financial
Officer or Stephen J. Smith, Treasurer at (614) 792-9468 or write to Insilco
Corporation, Investor Relations, 425 Metro Place North, Box 7196, Dublin, OH
43017 or call Melodye Demastus, Melrose Consulting (614) 771-0860.
