<PAGE>
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 20, 1998
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HUNTCO INC.
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(Exact name of registrant as specified in its charter)
Missouri 1-13600 43-1643751
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(State or other (Commission File Number) (IRS Employer
jurisdiction of Identification No.)
incorporation)
14323 S. Outer Forty, Suite 600N, Town & Country, Missouri 63017
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (314) 878-0155
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Not applicable
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(Former name or former address, if changed since last report)
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Item 5. Other Events
Huntco Inc. (the "Company") issued a news release on July 20, 1998, with
respect to its release of earnings for its three and six months ended June 30,
1998. This news release is incorporated herein by reference to Exhibit 99
attached hereto.
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SIGNATURE
Pursuant to the requirements of the Securities and Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
HUNTCO INC.
By:
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Robert J. Marischen,
Vice Chairman & Chief Financial Officer
Date: July 20, 1998
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EXHIBIT INDEX
These Exhibits are numbered in accordance with the Exhibit Table of Item
601 of Regulation S-K:
Exhibit No. Description
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99 News release of July 20, 1998
<PAGE> 1
HUNTCO INC.
14323 SOUTH OUTER FORTY - SUITE 600N
TOWN & COUNTRY, MISSOURI 63017
FOR IMMEDIATE RELEASE:
HUNTCO REPORTS NET SALES AND NET INCOME FOR SECOND QUARTER. $.035 DIVIDEND
DECLARED.
TOWN & COUNTRY, MISSOURI, July 20, 1998 . . . . . Huntco Inc. (NYSE:"HCO"), an
intermediate steel processor, today announced results of operations for its
second quarter which ended June 30, 1998. Net sales for the quarter were
$104.7 million, an increase of 11.8% in comparison to net sales of $93.7
million for the three months ended June 30, 1997. Net income available for
common shareholders for the quarter was $.4 million, or $.05 per share both
basic and diluted, which compares to net income available for common
shareholders of $1.5 million, or $.17 per share, both basic and diluted, in the
prior year's second quarter. Net sales for the six months ended June 30, 1998
were $215.1 million, an increase of 20.1% in comparison to net sales of $179.2
million for the six months ended June 30, 1997. Net income available for
common shareholders for the six months ended June 30, 1998 was $1.0 million, or
$.12 per share, both basic and diluted, which compares to net income available
for common shareholders of $2.7 million, or $.30 per share, both basic and
diluted, in the six month period ended June 30, 1997.
The Company declared a dividend of $.035 per common share for common
shareholders of record on July 31, 1998 and payable on August 14, 1998.
The Company attributes the increase in net sales to higher levels of tons
processed, with these volume driven increases in net sales being partially
offset by lower average selling prices. The Company processed and shipped
330,731 and 670,833 tons of steel in the three and six month periods ended June
30, 1998, an increase of 21.9% and 29.1%, respectively, in comparison to the
comparable periods in the prior year. Approximately 24.3% and 24.0% of the tons
processed in the three and six month periods ended June 30, 1998, represented
customer-owned material processed on a per ton, fee basis, versus a tolling
percentage of 21.6% and 21.9% in the comparable periods of the prior year. The
Company sold 72,204 and 158,044 tons of cold rolled products during the three
and six month periods ended June 30, 1998, which compares to 60,475 and 109,321
tons in the comparable 1997 periods. Average per ton selling values declined
6.5% in both the three and six month periods ended June 30, 1998, in comparison
to prior year levels, reflecting lower prices for hot rolled steel coils
charged by the Company's suppliers.
Gross profit expressed as a percentage of net sales was 7.4% and 7.2% for the
three and six month periods ended June 30, 1998, respectively, which compares
to 9.7% and 9.2% for the comparable prior year periods. The lower gross profit
margins in 1998 primarily reflect the continuing declines in steel prices.
The Company expects that tons sold in the second half of 1998 should
approximate the level of tons sold during the first half of 1998, but
anticipates that the amount of net sales dollars will likely decline somewhat
depending on the magnitude of any further reductions in steel prices. The
Company also believes, notwithstanding the expected continuing decline in steel
prices, that its gross profit margins should continue to improve slowly during
the second half of 1998, due to operational improvements and more favorable
feed stock costs at the cold mill. Further, the Company believes that recent
improvements to the filtration system at the cold mill should allow it to sell
its cold rolled products to a broader segment of the market.
This press release contains certain statements that are forward-looking and
involve risks and uncertainties. Words such as "expects", "believes", and
"anticipates", and variations of such words and similar expressions are
intended to identify such forward-looking statements. These statements are
based on current expectations and projections concerning the Company's plans
for 1998 and about the steel processing industry in general, as well as
assumptions made by Company management and are not guarantees of future
performance. Therefore, actual events, outcomes, and results may differ
materially from what is expressed or forecasted in such forward-looking
statements. The Company encourages those who make use of this forward-looking
data to make reference to a complete discussion of the factors which may cause
the forward-looking data to differ materially from actual results which is
contained in the Company's Transitional Annual Report and in Form 10-K, both
for the eight month transition period ended December 31, 1997.
Huntco Inc. is a major, intermediate steel processor, specializing in the
processing of flat rolled carbon steel.
* * * * *
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HUNTCO INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(unaudited, in thousands, except per share amounts)
<TABLE>
<CAPTION>
Six Months Three Months
Ended June 30 Ended June 30
1998 1997 1998 1997
------- ------- ------- ------
<S> <C> <C> <C> <C>
Net sales $215,097 $179,158 $104,724 $93,657
Cost of sales 199,579 162,753 96,962 84,601
------- ------- ------ ------
Gross profit 15,518 16,405 7,762 9,056
Selling, general and
administrative expenses 9,718 8,316 5,000 4,701
------- ------- ------ ------
Income from operations 5,800 8,089 2,762 4,355
Interest, net (4,017) (3,581) (1,997) (1,826)
------- ------- ------ ------
Income before income taxes 1,783 4,508 765 2,529
Provision for income taxes 650 1,712 283 957
------- ------- ------ ------
Net income 1,133 2,796 482 1,572
Preferred dividends 100 83 50 50
------- ------- ------ ------
Net income available
for common shareholders $ 1,033 $ 2,713 $ 432 $ 1,522
======= ======= ====== ======
Earnings per common share
(basic and diluted) $ .12 $ .30 $ .05 $ .17
===== ===== ===== =====
Weighted average
common shares outstanding:
Basic 8,942 8,942 8,942 8,942
===== ===== ===== =====
Diluted 8,972 8,942 8,946 8,942
===== ===== ===== =====
</TABLE>
<PAGE>
HUNTCO INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
<TABLE>
<CAPTION>
June 30, December 31,
1998 1997
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(unaudited) (audited)
<S> <C> <C>
ASSETS
Current assets:
Cash $ 19 $ 27
Accounts receivable, net 52,758 41,643
Inventories 90,591 81,612
Other current assets 2,862 5,015
-------- --------
146,230 128,297
Property, plant and equipment, net 147,138 145,777
Other assets 11,424 11,191
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$304,792 $285,265
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LIABILITIES & SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 48,572 $ 40,027
Accrued expenses 4,188 3,879
Current maturities of long-term debt 215 209
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52,975 44,115
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Long-term debt 120,527 110,730
Deferred income taxes 9,565 9,415
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130,092 120,145
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Shareholders' equity:
Series A preferred stock (issued and
outstanding, 225; stated at liquidation value) 4,500 4,500
Common stock:
Class A (issued and outstanding, 5,292) 53 53
Class B (issued and outstanding, 3,650) 37 37
Additional paid-in-capital 86,530 86,530
Retained earnings 30,605 29,885
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121,725 121,005
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$304,792 $285,265
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</TABLE>
