EXHIBIT 99.1
CONTACT: Robert K. Hynes
Monica Burrows
(212) 355-5200
RELEASE DATE: August 4, 2003
FOR IMMEDIATE RELEASE
WHX ANNOUNCES 2003 SECOND QUARTER RESULTS
NEW YORK - WHX CORPORATION (NYSE: WHX)
WHX today reported a net loss of $4.1 million, on sales of $83.5
million, for the second quarter of 2003 compared to net income of $7.8 million,
on sales of $109.2 million, in the same period in 2002. The 2003 results include
a gain on the retirement of debt of $2.0 million compared to a gain of $11.2
million in the second quarter of 2002. After deducting preferred dividend
requirement, basic and diluted loss per common share was $1.67 for the second
quarter of 2003 compared with basic and diluted income per common share of $.57
for the second quarter of 2002. Included in the 2002 results is income from
discontinued operations of $6.5 million, or $1.23 per diluted share.
As previously announced, a Chapter 11 Plan of Reorganization (the
"POR") for Wheeling-Pittsburgh Corporation and its debtor affiliates
(collectively, the "WPC Group") was consummated on August 1, 2003. The POR had
been confirmed by the United States Bankruptcy Court for the Northern District
of Ohio on June 18, 2003. Among other things, as a result of the consummation of
the POR, each member of the WPC Group is no longer a subsidiary of WHX
Corporation. In addition, in connection with the consummation of the POR, the
Pension Benefit Guarantee Corporation has agreed to withdraw its action to
terminate the WHX Pension Plan.
SECOND QUARTER OPERATING RESULTS AND OTHER INCOME/EXPENSE
Sales in the second quarter of 2003 were $83.5 million compared with
$109.2 million in 2002. Sales decreased by $21.4 million at the Precious Metal
Segment and by $4.8 million at the Wire & Tubing Segment. These sales declines
are primarily related to the closure of several facilities in 2002. Sales
increased by $.6 million at the Engineered Materials Segment due to new products
and market share gains in this segment's fastener business, offset by a sales
decline in this segment's electro-galvanizing business.
For the second quarter of 2003, operating income was a loss of $4.4
million, compared to a loss of $5.0 million in the second quarter of 2002.
Operating income from the Precious Metal segment increased by $7.6 million from
a loss of $7.8 million in the second quarter of 2002 to a loss of $.2 million in
the second quarter of 2003. The 2002 operating results include a $10.7 million
restructuring charge related to the closure of the Fairfield, CT facility.
Excluding this charge operating income declined by $3.1 million. This decline is
primarily attributable to costs incurred in 2003 of $1.4 million related to the
closure of facilities, and to lower sales at the remaining operating units
reflecting weak U.S. industrial output. Operating income at the Wire & Tubing
segment declined by $2.1 million from $2.3 million in 2002 to $0.2 million in
2003. The decrease in operating income is due to increased raw material costs
and declining sales prices associated with this segment's refrigeration
business, lower margins in the stainless steel tubing markets, and costs
incurred in 2003 of $1.2 million related to the closure of certain specialty
wire facilities. Operating income at the Engineered Materials segment decreased
by $1.6 million from $4.5 million in 2002 to $2.9 million in 2003. The decrease
in operating income is due to a decline in sales in the construction and
appliance markets in this segment's electro-galvanizing business. Unallocated
corporate expenses increased from $4.0 million to $7.3 million. This increase is
primarily related to increased pension expense of $2.1 million and increased
legal and professional fees related to the PBGC action. The increased pension
expense is primarily related to a reduction in the discount rate and the
lowering of the assumed long-term rate of return on the WHX Pension Plan assets
from 9.25% to 8.5%.
Other income was $1.7 million in the second quarter of 2003 compared
to expense of $1.6 million in 2002. Included in 2003 is net investment income of
$.7 million, an unrealized gain on short-term investments of $2.6 million, loss
on interest rate swap of $0.2, and loss on disposal of assets of $.8 million.
LIQUIDITY AND CAPITAL
At June 30, 2003, total liquidity, comprising cash, short-term
investments and funds available under bank credit arrangements, totaled $102.7
million. At June 30, 2003, funds available under credit arrangements totaled
$10.7 million.
This press release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended, which are intended to be
covered by the safe harbors created thereby. Investors are cautioned that all
forward-looking statements involve risks and uncertainty, including without
limitation, general economic conditions, the ability of the Company to market
and sell its products, and the effects of competition and pricing. Although the
Company believes that the assumptions underlying the forward-looking statements
are reasonable, any of the assumptions could be inaccurate, and therefore, there
cannot be assurance that any forward-looking statements included in this press
release will prove to be accurate. In light of the significant uncertainties
inherent in any forward-looking statements included herein, the inclusion of
such information should not be regarded as a representation by the Company or
any other person that the objectives and plans of the Company will be achieved.
CONFERENCE CALL
WHX Corporation invites all interested parties to the Company's
second quarter 2003 conference call scheduled for Wednesday, August 6, 2003 at
11:00 A.M. Eastern Time. Callers can listen in by dialing (800) 566-2250,
confirmation code "WHX Corporation."
WHX CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
Three Months Ended June 30, Six Months Ended June 30,
2003 2002 2003 2002
- ----------------------------------------------------------------------------------------------------------------------------
(in thousands - except per-share)
Net sales $ 83,519 $ 109,159 $ 164,519 $ 201,982
Cost of goods sold 67,131 86,030 134,080 161,221
--------- --------- --------- ---------
Gross profit 16,388 23,129 30,439 40,761
Selling, general and administrative expenses 20,772 17,413 42,758 34,431
Restructuring charges -- 10,700 -- 10,700
--------- --------- --------- ---------
Loss from operations (4,384) (4,984) (12,319) (4,370)
--------- --------- --------- ---------
Other:
Interest expense 4,903 6,537 9,920 15,340
Gain on early retirement of debt 1,966 11,218 2,999 40,235
Other income (expense) 1,696 (1,562) 188 (324)
--------- --------- --------- ---------
Income (loss) from continuing operations before taxes (5,625) (1,865) (19,052) 20,201
Tax provision (benefit) (1,567) (3,159) (6,146) (3,944)
--------- --------- --------- ---------
Income (loss) from continuing operations (4,058) 1,294 (12,906) 24,145
Income from discontinued operation - net of tax -- 6,492 -- 8,343
--------- --------- --------- ---------
Income (loss) before cumulative effect of an
accounting change (4,058) 7,786 (12,906) 32,488
Cumulative effect of an accounting change -- -- -- (44,000)
--------- --------- --------- ---------
Net income (loss) $ (4,058) $ 7,786 $ (12,906) $ (11,512)
========= ========= ========= =========
Dividend requirement for preferred stock $ 4,856 $ 4,737 $ 9,712 $ 9,512
========= ========= ========= =========
Net income (loss) applicable to common stock $ (8,914) $ 3,049 $ (22,618) $ (21,024)
========= ========= ========= =========
Basic per share of common stock
Income (loss) from continuing operations - net of preferred dividends $ (1.67) $ (0.66) $ (4.24) $ 2.75
Income from discontinued operation -- 1.23 -- 1.57
Cumulative effect of an accounting change -- -- -- (8.26)
--------- --------- --------- ---------
Net income (loss) per share $ (1.67) $ 0.57 $ (4.24) $ (3.94)
========= ========= ========= =========
Diluted per share of common stock
Income (loss) from continuing operations $ (1.67) $ (0.66) $ (4.24) $ 2.29
Income from discontinued operation -- 1.23 -- 0.79
Cumulative effect of an accounting change -- -- -- (4.18)
--------- --------- --------- ---------
Net income (loss) per share $ (1.67) $ 0.57 $ (4.24) $ (1.10)
========= ========= ========= =========
WHX CORPORATION
BUSINESS SEGMENT INFORMATION
(in thousands) Three Months Ended Six Months Ended
June 30, June 30,
2003 2002 2003 2002
--------- --------- ----------- ------------
Revenue
Precious Metal $ 21,365 $ 42,792 $ 43,719 $ 77,664
Wire & Tubing 30,759 35,528 62,907 70,141
Engineered Materials 31,395 30,839 57,893 54,177
--------- --------- --------- ---------
Consolidated revenue $ 83,519 $ 109,159 $ 164,519 $ 201,982
========= ========= ========= =========
Segment operating income
Precious Metal $ (177) $ (7,757) $ (1,376) $ (6,170)
Wire & Tubing 159 2,297 (566) 4,140
Engineered Materials 2,906 4,506 3,521 6,394
--------- --------- --------- ---------
2,888 (954) 1,579 4,364
--------- --------- --------- ---------
Unallocated corporate expenses 7,272 4,030 13,898 8,734
--------- --------- --------- ---------
Operating loss (4,384) (4,984) (12,319) (4,370)
Interest expense 4,903 6,537 9,920 15,340
Gain on early retirement of debt 1,966 11,218 2,999 40,235
Other income (expense) 1,696 (1,562) 188 (324)
--------- --------- --------- ---------
Income (loss) before taxes, discontinued operations
and cumulative effect of an accounting change (5,625) (1,865) (19,052) 20,201
Income tax expense (benefit) (1,567) (3,159) (6,146) (3,944)
Income from discontinued operations - net of tax -- 6,492 -- 8,343
--------- --------- --------- ---------
Income (loss) before cumulative effect of an
accounting change (4,058) 7,786 (12,906) 32,488
Cumulative effect of an accounting change - net of tax -- -- -- (44,000)
--------- --------- --------- ---------
Net income (loss) $ (4,058) $ 7,786 $ (12,906) $ (11,512)
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