EXHIBIT 99.1
NEWS RELEASE
June 27, 2003
Torrance, California
Summa Reports 3rd Quarter Earnings
Summa Industries (Nasdaq NM:SUMX) reports net income of $768,000, or $.13 per common share, on sales of $28,342,000 for the three months ended May 31, 2003, versus net income of $1,326,000, or $.25 per share, on sales of $32,861,000 for the three months ended May 31, 2002.
| | Three months ended May 31 | |
| | 2003 | | 2002 | |
Sales | | $ | 28,342,000 | | $ | 32,861,000 | |
Net income | | $ | 768,000 | | $ | 1,326,000 | |
Diluted earnings per common share | | $ | .13 | | $ | .25 | |
The sales decline of 14% was primarily due to weak sales of the Company’s lighting products, which are used in commercial and industrial construction, as previously reported. Income declined, despite the elimination of goodwill amortization and reduced interest expense, due to lower sales volumes and non-recurring relocation expenses of approximately $500,000, or $.07 per share.
A conference call to discuss the results will be held at 9:00 a.m., Pacific Time, Friday, June 27. The call-in number is (800) 915-4836. The conference call will also be simulcast and archived by www.vcall.com.
Summa Industries manufactures proprietary engineered plastic products for a broad spectrum of industrial and commercial markets. The Company has manufacturing facilities across North America. Products, many of which are unique or patented, are shipped to customers worldwide.
For further information, contact Jim Swartwout, (310) 792-7024; Fax (310) 792-7079; ir@summaindustries.com or visit www.summaindustries.com.
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Summa Industries
CONDENSED CONSOLIDATED BALANCE SHEETS
| | May 31, 2002 | | August 31, 2002 | | May 31, 2003 | |
ASSETS | | | | | | | |
Current assets: | | | | | | | |
Cash and cash equivalents | | $ | 49,000 | | $ | 690,000 | | $ | 52,000 | |
Accounts receivable | | 19,227,000 | | 17,594,000 | | 17,222,000 | |
Inventories | | 13,243,000 | | 12,313,000 | | 12,572,000 | |
Prepaid expenses and other | | 3,468,000 | | 3,181,000 | | 2,825,000 | |
| | | | | | | |
Total current assets | | 35,987,000 | | 33,778,000 | | 32,671,000 | |
Property, plant and equipment, net | | 28,619,000 | | 26,820,000 | | 26,647,000 | |
Goodwill and other assets, net | | 37,272,000 | | 36,967,000 | | 12,463,000 | |
| | | | | | | |
Total assets | | $ | 101,878,000 | | $ | 97,565,000 | | $ | 71,781,000 | |
| | | | | | | |
LIABILITIES AND STOCKHOLDERS’ EQUITY | | | | | | | |
Current liabilities: | | | | | | | |
Accounts payable | | $ | 6,159,000 | | $ | 6,410,000 | | $ | 6,491,000 | |
Accrued liabilities | | 6,172,000 | | 6,001,000 | | 5,680,000 | |
Current maturities of long-term debt | | 5,930,000 | | 5,066,000 | | 4,133,000 | |
| | | | | | | |
Total current liabilities | | 18,261,000 | | 17,477,000 | | 16,304,000 | |
Long-term debt, net of current maturities | | 25,398,000 | | 19,845,000 | | 18,284,000 | |
Other long-term liabilities | | 3,967,000 | | 4,658,000 | | 2,635,000 | |
Manditorily redeemable convertible preferred and common stock | | 5,819,000 | | 5,366,000 | | 5,919,000 | |
Total stockholders’ equity | | 48,433,000 | | 50,219,000 | | 28,639,000 | |
| | | | | | | |
Total | | $ | 101,878,000 | | $ | 97,565,000 | | $ | 71,781,000 | |
Summa Industries
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
| | Three months ended May 31 | | Nine months ended May 31 | |
| | 2002 | | 2003 | | 2002 | | 2003 | |
Net sales | | $ | 32,861,000 | | $ | 28,342,000 | | $ | 85,135,000 | | $ | 84,452,000 | |
Cost of sales | | 24,152,000 | | 21,296,000 | | 62,985,000 | | 63,039,000 | |
| | | | | | | | | |
Gross profit | | 8,709,000 | | 7,046,000 | | 22,150,000 | | 21,413,000 | |
Selling, general, administrative and other expenses | | 6,104,000 | | 5,524,000 | | 16,756,000 | | 16,351,000 | |
| | | | | | | | | |
Operating income | | 2,605,000 | | 1,522,000 | | 5,394,000 | | 5,062,000 | |
Interest expense | | 584,000 | | 389,000 | | 1,980,000 | | 1,167,000 | |
| | | | | | | | | |
Income before income taxes and cumulative effect of a change in accounting principle | | 2,021,000 | | 1,133,000 | | 3,414,000 | | 3,895,000 | |
Provision for income taxes | | 695,000 | | 365,000 | | 1,190,000 | | 1,285,000 | |
| | | | | | | | | |
Income before cumulative effect of a change in accounting principle | | 1,326,000 | | 768,000 | | 2,224,000 | | 2,610,000 | |
Cumulative effect of a change in accounting principle | | — | | — | | — | | (22,343,000 | ) |
Net income (loss) | | $ | 1,326,000 | | $ | 768,000 | | $ | 2,224,000 | | $ | (19,733,000 | ) |
| | | | | | | | | |
Preferred stock accretion | | $ | 173,000 | | $ | 184,000 | | $ | 289,000 | | $ | 553,000 | |
| | | | | | | | | |
Net income (loss) available to common stockholders: | | | | | | | | | |
before cumulative effect of a change in accounting principle | | $ | 1,153,000 | | $ | 584,000 | | $ | 1,935,000 | | $ | 2,057,000 | |
after cumulative effect of a change in accounting principle | | $ | 1,153,000 | | $ | 584,000 | | $ | 1,935,000 | | $ | (20,286,000 | ) |
| | | | | | | | | |
Earnings per common share before cumulative effect of a change in accounting principle | | | | | | | | | |
Basic | | $ | .26 | | $ | .14 | | $ | .44 | | $ | .47 | |
Diluted | | $ | .25 | | $ | .13 | | $ | .43 | | $ | .46 | |
| | | | | | | | | |
Earnings (loss) per common share after cumulative effect of a change in accounting principle | | | | | | | | | |
Basic | | $ | .26 | | $ | .14 | | $ | .44 | | $ | (4.61 | ) |
Diluted | | $ | .25 | | $ | .13 | | $ | .43 | | $ | (4.51 | ) |
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