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: NOVEMBER 4, 1999
INSILCO CORPORATION
(Exact Name of Registrant as Specified in its Charter)
Delaware 0-22098 06-0635844
-------- ------- ----------
(State or other jurisdiction (Commission (IRS Employer
of incorporation or organization) File No.) Identification Number)
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)
<PAGE>
ITEM 5. OTHER EVENTS.
Insilco Holding Co.'s press release issued November 4, 1999 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 Insilco Holding Co. issued
November 4, 1999.
2
<PAGE>
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
-------------------------------
Registrant
Date: November 4, 1999 By: /S/ Michael R. Elia
---------------------------
Michael R. Elia
Vice President and Chief
Financial Officer
3
<PAGE>
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION
----------- -----------
99 (a) Press release of Insilco Holding Co. issued
November 4, 1999.
4
EXHIBIT 99 (a)
Excellence in Electronics, Telecommunications, Automotive, Publishing
- --------------------------------------------------------------------------------
NEWS RELEASE
- --------------------------------------------------------------------------------
FOR IMMEDIATE RELEASE
INVESTORS: MICHAEL R. ELIA MEDIA: MELODYE DEMASTUS
SR. VICE PRESIDENT & CFO MELROSE CONSULTING
(614) 791-3117 (614) 771-0860
INSILCO HOLDING CO. REPORTS THIRD QUARTER 1999 RESULTS
COLUMBUS, OHIO, NOVEMBER 4, 1999 - INSILCO HOLDING CO. (OTC BULLETIN
BOARD: INSL) today reported sales and operating results for its third quarter
ended September 30, 1999.
Sales of $144.3 million were up 7% for the 1999 third quarter, compared
to $135.1 million recorded in the year ago third quarter. Third quarter sales
for 1999 included $17.0 million from acquisitions completed after the 1998 third
quarter. The Company reported a 13% increase in EBITDA (earnings before
interest, taxes, depreciation, amortization and non-operating items plus regular
cash dividends from Thermalex, the Company's 50% owned joint venture) of $16.2
million for the 1999 third quarter, compared to $14.4 million recorded in the
1998 third quarter. Excluding the impact of the previously announced
divestitures of the Company's Romac Metals and McKenica divisions, sales for the
1999 and 1998 third quarters were $141.1 million and $126.5 million,
respectively, and EBITDA was $16.0 million and $13.7 million, respectively.
For the first nine months of 1999 sales were up 6% to $449.6 million,
compared to $422.4 million recorded in the comparable nine months of 1998.
Year-to-date 1999 sales included $30.7 million from acquisitions completed after
the 1998 third quarter. The Company reported a 6% increase in EBITDA to $56.3
million for the first nine months of 1999, compared to $53.3 million recorded
for the nine months ended September 30, 1998. Excluding the results of the
divested businesses, sales for the first nine months of 1999 and 1998 were
$431.5 million and $398.6 million, respectively and EBITDA was $55.2 million and
$51.6 million, respectively.
Net income available to common for the 1999 third quarter was $6.3
million, or $3.80 per diluted share, compared to a net loss available to common
of ($17.9) million, or ($6.53) per diluted share, recorded in the 1998 third
quarter. The 1999 third quarter included a gain of $9.6 million related to the
previously announced divestitures and the 1998 third quarter included $24.2
million in merger-related expenses. For the first nine months of 1999 and 1998
the Company reported net losses available to common of ($2.7) million, or
($1.65) per diluted share, and ($10.7) million, or ($2.90) per diluted share,
respectively.
David A. Kauer, Insilco President and CEO, said, "We're very pleased
with the EBITDA improvement for the quarter, which reflects improving margins at
both our Technologies and Specialty Publishing segments. Moreover, we are also
beginning to see the benefits of our Company-wide cost reduction initiatives."
<PAGE>
BUSINESS DISCUSSION
The Company's Automotive Components Group reported 5% sales growth in
the 1999 third quarter to $56.2 million, from $53.4 million reported in the year
earlier third quarter. EBITDA for the Group was $6.7 million and $7.5 million
for the third quarters of 1999 and 1998, respectively. Group performance
reflected continued weakness in demand for aftermarket heat exchangers and
tubing and lower sales of transmission components, offset by $5.5 million of
revenues from the Company's third quarter acquisition of Thermal Transfer
Products, Ltd.
The Company's Technologies Group reported 29% sales growth in the 1999
third quarter to $58.9 million, compared to $45.8 million recorded in the 1998
third quarter. While third quarter 1999 sales included $11.5 million from
acquisitions completed after the 1998 third quarter, the Company also posted
modest organic sales growth in each of its Technologies Group product lines.
EBITDA for the Technologies Group was $8.1 million in the 1999 third quarter,
compared to $6.6 million recorded in the 1998 third quarter. Group performance
was positively impacted by a number of factors, including: substantially
improved power transformer margins, increased utilization of lower-cost
manufacturing facilities, ongoing cost reduction efforts and results from the
acquired businesses.
Sales at the Company's Taylor Publishing business unit were $26.0
million and $27.4 million for the third quarters of 1999 and 1998, respectively.
Taylor's EBITDA increased 41% to $2.4 million from $1.7 million recorded a year
ago, reflecting improved margins as a result of the Company's cost reduction
activities and productivity improvements.
The Company also noted that it received a special cash dividend of $2.4
million from its Thermalex joint venture during the 1999 third quarter and will
receive another special dividend of $5.2 million in the fourth quarter.
Thermalex' sales were up 21% from the year earlier third quarter. For the nine
months of 1999, the Company has received both regular and special cash dividends
of $5.2 million.
CEO COMMENTS
"We are encouraged by the EBITDA improvement posted in the quarter,
which demonstrates that we are making progress along a number of fronts. We are
quite pleased to report that both our EFI stamping and Thermal Transfer heat
exchanger acquisitions were nicely accretive to earnings in the quarter. We also
posted solid improvement at our power transformer business, both in sales and
margin.
"Industrial heat exchanger sales were up slightly in the quarter after
several quarters of declining sales resulting from weak demand, however, lower
sales and margin compression for our automotive tubing and weaker demand for
aftermarket heat exchangers moderated the positive impact to consolidated
results. Unfortunately, during the month of July, we also experienced temporary
production inefficiencies at our transmission component plant, which impacted
both sales and operating income. While the plant was back on track by August, it
was unable to fully overcome the impact July's production problems had on third
quarter operating results. Nonetheless, our outlook for our automotive
businesses remains quite positive. We continue to take appropriate steps to
lower the Automotive Group's cost structure, such as plant rationalizations and
further streamlining of manufacturing processes."
<PAGE>
Kauer concluded, "We remain focused on improving our operating
performance and reducing our leverage by lowering our overall cost structure and
by continuing to focus on potential divestitures of business units that no
longer meet our long-term strategic goals."
Insilco Holding Co., 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. The Company had 1998 revenues in excess of
$535 million.
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, including statements with respect to the
Company's long-term outlook; growth prospects; slowdown in the electronics
markets; the ability to improve operating efficiencies and to further reduce
expenses; possible acquisitions and divestitures. 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, adverse changes in operating performance, changes in
interest rates, 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-KA for the year ended December 31, 1998 and the Company's report on Form 10-Q
for March 31 and June 30, 1999. Copies of these filings may be obtained by
contacting the Company or the SEC.
Investor Relations Contact: Michael R. Elia, (614) 791-3117 or write to Insilco
Holding Co., Investor Relations, 425 Metro Place North, Box 7196, Dublin, OH
43017 or call Melodye Demastus, Melrose Consulting (614) 771-0860. You may also
visit our web site at http://www.insilco.com.
<PAGE>
INSILCO HOLDING CO.
Condensed Consolidated Statements of Operations
(Unaudited)
(Amounts in millions except per share data)
FOR THE QUARTER ENDED
Actual
September 30,
---------------------
1999 1998
-------- --------
Sales $ 144.3 $ 135.1
Cost of sales, excluding depreciation 107.3 97.7
Selling, general and administrative expenses,
excluding depreciation 20.8 23.0
Depreciation and amortization expense 5.7 5.1
Significant legal, professional and merger fees - 24.6
Severance, writedown & other 0.2 1.0
Restructuring charge 1.1 -
-------- --------
Operating income 9.2 (16.3)
Interest expense, net (12.0) (8.0)
Equity in net income of Thermalex 0.6 0.7
Other income, net 9.8 0.4
-------- --------
Income (loss) before income taxes 7.6 (23.2)
Income tax benefit (expense) 0.2 6.0
-------- --------
Net income (loss) 7.8 (17.2)
Preferred stock dividend (1.5) (0.7)
======== ========
Net income (loss) available to common $ 6.3 $ (17.9)
======== ========
Regular cash dividend from Thermalex $ - $ -
======== ========
Earnings before other income, interest,
taxes, depreciation, amortization and
one-time items, plus regular cash
dividend from Thermalex $ 16.2 $ 14.4
======== ========
Capital expenditures $ (3.0) $ (4.8)
======== ========
Income (loss) per share available to common $ 3.80 $ (6.53)
======== ========
<PAGE>
INSILCO HOLDING CO.
Condensed Consolidated Statements of Operations
(Unaudited)
(Amounts in millions except per share data)
FOR YEAR TO DATE
Actual
September 30,
---------------------
1999 1998
-------- --------
Sales $ 449.6 $ 422.4
Cost of sales, excluding depreciation
(1999 includes $3.2 of restructuring expenses) 327.1 298.3
Selling, general and administrative expenses,
excluding depreciation (1999 includes $0.2 of
restructuring expenses) 72.4 72.1
Depreciation and amortization expense 17.5 15.8
Significant legal, professional and merger fees 2.5 26.9
Severance, writedown & other 0.8 1.7
Restructuring charge 6.5 -
-------- --------
Operating income 22.8 7.6
Interest expense, net (35.4) (21.7)
Equity in net income of Thermalex 2.6 2.1
Other income, net 10.2 2.5
-------- --------
Income (loss) before income taxes 0.2 (9.5)
Income tax benefit (expense) 1.5 (0.5)
-------- --------
Net income (loss) 1.7 (10.0)
Preferred stock dividend (4.4) (0.7)
======== ========
Net income (loss) available to common $ (2.7) $ (10.7)
======== ========
Regular cash dividend from Thermalex $ 2.8 $ 1.3
======== ========
Earnings before other income, interest, taxes,
depreciation, amortization, and one-time items,
plus regular cash dividend from Thermalex $ 56.3 $ 53.3
======== ========
Capital expenditures $ (10.7) $ (15.7)
======== ========
Income (loss) per share available to common $ (1.65) $ (2.90)
======== ========
<PAGE>
INSILCO HOLDING CO.
(Unaudited)
(Amounts in millions)
SUPPLEMENTAL SEGMENT DATA
<TABLE>
<CAPTION>
Quarter Ended Year to Date
September 30, September 30,
-------------------- --------------------
1999 1998 1999 1998
-------- -------- -------- --------
<S> <C> <C> <C> <C>
SALES
Industrial Businesses:
Technologies Group $ 58.9 $ 45.8 $ 170.2 $ 144.8
Automotive Components 56.2 53.4 169.3 162.3
-------- -------- -------- --------
Total Industrial Businesses 115.1 99.2 339.5 307.1
Specialty Publishing 26.0 27.4 92.0 91.9
Other 3.2 8.5 18.1 23.4
======== ======== ======== ========
Total Sales $ 144.3 $ 135.1 $ 449.6 $ 422.4
======== ======== ======== ========
EBITDA
Industrial Businesses:
Technologies Group $ 8.1 $ 6.6 $ 22.3 $ 22.6
Automotive Components 6.7 7.5 23.1 24.8
-------- -------- -------- --------
Total Industrial Businesses 14.8 14.1 45.4 47.4
Specialty Publishing 2.4 1.7 11.9 9.0
Other 0.2 0.7 1.1 1.7
Unallocated Corporate (1.2) (2.1) (4.9) (6.1)
Regular Thermalex Cash Dividend - - 2.8 1.3
======== ======== ======== ========
Total EBITDA $ 16.2 $ 14.4 $ 56.3 $ 53.3
======== ======== ======== ========
SALES GROWTH VS. PRIOR YEAR
Industrial Businesses:
Technologies Group 28.6% 17.5%
Automotive Components 5.2% 4.3%
-------- --------
Total Industrial Businesses 16.0% 10.6%
Specialty Publishing -5.1% 0.1%
Other -62.4% -22.6%
======== ========
Total Sales 6.8% 6.4%
======== ========
EBITDA % OF SALES
Industrial Businesses:
Technologies Group 13.8% 14.4% 13.1% 15.6%
Automotive Components 11.9% 14.0% 13.6% 15.3%
-------- -------- -------- --------
Total Industrial Businesses 12.9% 14.2% 13.4% 15.4%
Specialty Publishing 9.2% 6.2% 12.9% 9.8%
Other 6.3% 8.2% 6.1% 7.3%
======== ======== ======== ========
Total EBITDA 11.2% 10.7% 12.5% 12.6%
======== ======== ======== ========
</TABLE>
<PAGE>
INSILCO HOLDING CO.
Condensed Consolidated Balance Sheets
(Unaudited)
(Amounts in millions)
<TABLE>
<CAPTION>
September September December
30, 1999 30, 1998 31, 1998
-------- -------- --------
<S> <C> <C> <C>
ASSETS
------
Current assets:
Cash and cash equivalents $ 14.7 $ 4.7 $ 7.4
Receivables, net 106.8 87.8 84.2
Inventories, net 64.4 61.0 64.6
Current portion of deferred taxes 1.9 4.6 6.1
Prepaid expenses 4.6 4.1 4.4
-------- -------- --------
Total current assets 192.4 162.2 166.7
Property, plant and equipment, net 125.0 114.1 114.7
Goodwill, net 26.3 13.2 14.5
Deferred taxes 8.9 2.6 1.9
Investment in unconsolidated subsidiaries 4.0 11.1 9.0
Other assets and deferred charges 19.2 20.0 20.5
======== ======== ========
Total assets $ 375.8 $ 323.2 $ 327.3
======== ======== ========
LIABILITIES AND STOCKHOLDERS' DEFICIT
-------------------------------------
Current liabilities:
Accounts payable $ 38.6 $ 36.6 $ 34.5
Accrued expenses and other 50.7 41.9 56.6
Accrued interest payable 2.8 3.5 4.2
Current portion of deferred taxes 0.5 0.1 1.6
Current portion of long-term debt 1.3 - 1.3
Current portion of long-term obligations 1.1 2.1 1.9
-------- -------- --------
Total current liabilities 95.0 84.2 100.1
Long-term debt 435.4 383.9 383.1
Other long-term obligations 45.0 45.2 46.3
Deferred taxes 1.9 2.6 -
Minority interest 0.1 - -
Preferred stock 38.5 32.7 34.1
Stockholders' deficit (240.1) (225.4) (236.3)
======== ======== ========
Total liabilities and stockholders' deficit $ 375.8 $ 323.2 $ 327.3
======== ======== ========
</TABLE>
