Exhibit 99
FOR IMMEDIATE RELEASE
FOR: QUIXOTE CORPORATION | ||||
CONTACT: |
| Daniel P. Gorey |
| Investor Relations: |
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| Chief Financial Officer |
| Christine Mohrmann/Jim Olecki |
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| Joan R. Riley |
| Financial Dynamics |
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| Director of Investor Relations |
| (212) 850-5600 |
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| (312) 467-6755 |
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QUIXOTE CORPORATION REPORTS FISCAL 2004 FOURTH QUARTER RESULTS
CHICAGO, IL, August 16, 2004 — Quixote Corporation (Nasdaq: QUIX) today reported results for its fourth quarter ended June 30, 2004.
Net sales for the fourth quarter of fiscal 2004 were $39,443,000, compared with $38,838,000 in the fourth quarter of fiscal 2003. The acquisitions of U.S. Traffic Corporation and Peek Traffic Corporation contributed net sales of $11,328,000 in the fourth quarter of fiscal 2004. In the fourth quarter of fiscal 2003, the acquisition of U.S. Traffic Corporation contributed net sales of $5,977,000. Peek Traffic Corporation was not part of the prior year’s results. For the fourth quarter of fiscal 2004 the Company reported an operating loss of $30,479,000, compared with operating profit of $7,175,000 in the fourth quarter of fiscal 2003. The net loss for the fourth quarter of fiscal 2004 was $20,260,000, or $2.32 per diluted share, compared with net income of $4,583,000, or $0.56 per diluted share, in the same period last year.
As previously announced, the Company’s results for the fourth quarter of fiscal 2004 include a non-cash impairment charge related to goodwill, intangible assets and other long-lived assets in the Company’s Inform Group of $32,600,000, which is $21,266,000, or $2.43 per diluted share, net of an income tax benefit of $11,334,000. Excluding this charge, the Company would have reported an operating profit of $2,121,000 and net income of $1,006,000, or $0.11 per diluted share.
Net sales for fiscal 2004 increased 31% to $150,290,000, compared with $114,310,000 for fiscal 2003. The operating loss for fiscal 2004 was $25,602,000, compared with operating profit of $15,154,000 in fiscal 2003. For fiscal 2004, the Company reported a net loss of $17,027,000, or $1.99 per diluted share, compared with net income of $9,472,000, or $1.17 per diluted share, for fiscal 2003.
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Included in the Company’s fiscal 2004 results were the previously mentioned non-cash impairment charge of $32,600,000 in the fourth quarter of fiscal 2004 and a benefit for income taxes of $1,249,000, or $0.14 per diluted share, related to the favorable settlement of a tax audit during the third quarter of fiscal 2004. Excluding these items, the Company would have reported an operating profit for fiscal 2004 of $6,998,000 and net income for fiscal 2004 of $2,990,000, or $0.34 per diluted share.
Leslie J. Jezuit, Chairman and Chief Executive Officer, commented, “Our fiscal 2004 fourth quarter results reflect the ongoing softness in our business, as delays in passing the federal highway funding bill and state budgetary issues continue to affect demand in our markets. The result was a 12% decline in revenues in the Protect and Direct Group, and a 20% organic revenue decline within the Inform Group during what is typically a seasonally strong period for our business. This also led to a decline in profitability, as our fixed costs were absorbed over a smaller than expected revenue base.”
Mr. Jezuit continued, “While Peek Traffic continues to exceed our expectations, U.S. Traffic is still performing below our standards. We are focused on addressing this issue and are implementing a number of strategic initiatives to improve our operational execution. Specifically, we have integrated the sales, marketing and distribution operations of our Peek Traffic and U.S. Traffic businesses under one name, Quixote Traffic Corporation, with both companies operating under one management team. In addition, we are undertaking other initiatives to further reduce operational costs. These include rationalizing our product offerings, outsourcing non-critical component parts, and better focusing our manufacturing facilities to obtain greater synergies. We believe these efforts will improve operating efficiencies and lead to positive contributions to the Company’s long-term profitability.”
“Looking forward, we continue to have a great deal of confidence in Quixote’s strong fundamentals and long-term prospects, and we continue to take actions to position Quixote for the future. While we still believe that the federal highway funding bill may be passed in 2004 and that it will have a significant, positive impact on our performance, we do not anticipate realizing the full benefit of the bill’s passage until the later half of fiscal 2005. In the near-term, our focus will remain on process improvements, cost management and new product development to enhance our strong market position. As a result of this environment, we currently expect a loss for the first quarter of fiscal 2005 of between $0.05 and $0.09 per diluted share.”
Quixote Corporation will be hosting a telephone conference call at 10 a.m. EST today, August 16, 2004, to further discuss its quarterly results and corporate developments. This conference call will be broadcast simultaneously over the Internet at www.quixotecorp.com and may be accessed and listened to by clicking the icon on the Company’s homepage.
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Quixote Corporation, (www.quixotecorp.com), through its wholly-owned subsidiary, Quixote Transportation Safety, Inc., is the world’s leading manufacturer of energy-absorbing highway crash cushions, electronic wireless measuring and sensing devices, weather forecasting stations, computerized highway advisory radio transmitting systems, intelligent intersection control systems, automated red light enforcement systems, mobile and permanent variable electronic message signs, flexible post delineators and other transportation safety products.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: Except for historical information contained herein, the matters set forth in this news release are forward-looking statements. The forward-looking statements set forth above involve a number of risks and uncertainties that could cause actual results to differ materially from any such statement, including the risks and uncertainties discussed in the Company’s Form 10-K for its fiscal year ended June 30, 2003, under the caption “Forward-Looking Statements” in Management’s Discussion and Analysis of Financial Condition and Results of Operations, which discussion is incorporated herein by this reference. Other factors may be described from time to time in the Company’s public filings with the Securities and Exchange Commission, news releases and other communications. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The Company does not undertake any obligation to release publicly any revisions to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
(2 Tables to Follow)
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Quixote Corporation
Earnings Summary
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| Three Months Ended |
| Year ended |
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| 2004 |
| 2003 |
| 2004 |
| 2003 |
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Net sales |
| $ | 39,443,000 |
| $ | 38,838,000 |
| $ | 150,290,000 |
| $ | 114,310,000 |
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Cost of sales |
| 25,970,000 |
| 23,106,000 |
| 102,987,000 |
| 68,070,000 |
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Gross profit |
| 13,473,000 |
| 15,732,000 |
| 47,303,000 |
| 46,240,000 |
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Operating expenses: |
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Selling & administrative |
| 10,296,000 |
| 7,744,000 |
| 36,700,000 |
| 28,730,000 |
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Impairment charge |
| 32,600,000 |
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| 32,600,000 |
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Research & development |
| 1,056,000 |
| 813,000 |
| 3,605,000 |
| 2,356,000 |
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| 43,952,000 |
| 8,557,000 |
| 72,905,000 |
| 31,086,000 |
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Operating profit (loss) |
| (30,479,000 | ) | 7,175,000 |
| (25,602,000 | ) | 15,154,000 |
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Other income (expense): |
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Interest income |
| 5,000 |
| 38,000 |
| 30,000 |
| 104,000 |
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Interest expense |
| (554,000 | ) | (269,000 | ) | (2,144,000 | ) | (906,000 | ) | ||||
Other |
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| (212,000 | ) |
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| (549,000 | ) | (231,000 | ) | (2,326,000 | ) | (802,000 | ) | ||||
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Earnings before income taxes |
| (31,028,000 | ) | 6,944,000 |
| (27,928,000 | ) | 14,352,000 |
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Income tax provision (benefit) |
| (10,768,000 | ) | 2,361,000 |
| (10,901,000 | ) | 4,880,000 |
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Net earnings (loss) |
| $ | (20,260,000 | ) | $ | 4,583,000 |
| $ | (17,027,000 | ) | $ | 9,472,000 |
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Per share data - basic: |
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Net earnings (loss) |
| $ | (2.32 | ) | $ | 0.57 |
| $ | (1.99 | ) | $ | 1.21 |
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Average common shares outstanding |
| 8,734,993 |
| 7,978,871 |
| 8,567,741 |
| 7,847,169 |
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Per share data - diluted: |
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Net earnings (loss) |
| $ | (2.32 | ) | $ | 0.56 |
| $ | (1.99 | ) | $ | 1.17 |
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Average diluted common shares outstanding |
| 8,734,993 |
| 8,238,996 |
| 8,567,741 |
| 8,062,397 |
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Quixote Corporation
Balance Sheet
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| As of June 30, |
| As of June 30, |
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Assets |
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Current assets |
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Cash and cash equivalents |
| $ | 2,389,000 |
| $ | 3,753,000 |
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Accounts receivable, net |
| 33,606,000 |
| 36,835,000 |
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Inventories, net |
| 25,308,000 |
| 22,967,000 |
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Other current assets |
| 6,938,000 |
| 3,533,000 |
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| 68,241,000 |
| 67,088,000 |
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Property, plant and equipment, net |
| 27,512,000 |
| 26,237,000 |
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Intangible assets and other, net |
| 44,129,000 |
| 57,500,000 |
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| $ | 139,882,000 |
| $ | 150,825,000 |
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Liabilities and Shareholders’ Equity |
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Current liabilities |
| $ | 28,268,000 |
| $ | 30,999,000 |
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Long-term debt, net |
| 46,354,000 |
| 39,789,000 |
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Other long-term liabilities |
| 1,353,000 |
| 4,482,000 |
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Shareholder’s equity |
| 63,907,000 |
| 75,555,000 |
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| $ | 139,882,000 |
| $ | 150,825,000 |
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# # #
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