Exhibit 99.1
NEWS RELEASE | | 
|
| | |
CSL05006 | | 04/14/05 |
Carlisle Companies Reports a 29% Increase in First Quarter Income from Continuing Operations on Record First Quarter Sales
CHARLOTTE, NORTH CAROLINA, April 14, 2005…Carlisle Companies Incorporated (NYSE:CSL) reported income from continuing operations of $30.1 million, or $0.96 per diluted share for the quarter ended March 31, 2005, compared to $23.3 million or $0.75 per diluted share for the quarter ended March 31, 2004.
Net sales of $592.3 million in the first three months of 2005 were $89.1 million, or 18%, higher than net sales of $503.2 million recognized in the first three months of 2004. Organic sales contributed $79.1 million, or 16%, to the growth over the prior year, of which $2.3 million related to the favorable impact of changes in foreign exchange rates. Organic growth was primarily attributable to the Construction Materials and Industrial Components segments. Acquisitions contributed $10.0 million to the year-over-year increase in net sales.
Richmond McKinnish, Carlisle’s President and CEO commented, “We are satisfied with the 29% year-over-year improvement in income from continuing operations. Though our key markets remain strong and our outlook for improved pricing and margins is positive, we must temper our optimism. Uncertainties surrounding future costs of oil-based commodities and certain chemicals as well as the impact of rising interest rates require that we maintain our 2005 guidance of $4.10 to $4.25 per diluted share for income from continuing operations.”
Segment Results
The following segment discussion excludes the impact of discontinued operations.
Industrial Components: Net sales for the three months ended March 31, 2005 of $222.0 million increased 16% over $192.2 million reported in the same period of 2004. Most of the increase was attributed to growth in the tire and wheel business in the commercial power equipment and lawn care, ATV, and replacement supply chains. The acquisition of Trintex in June of 2004 accounted for approximately one-third of the sales improvement over the prior year. Earnings before interest and income taxes (“EBIT” or “earnings”) of $24.7 million were 9% above $22.7 million in the first quarter of 2004. Positive earnings related to Trintex were offset by unfavorable product mix, unabsorbed overhead on lower demand for high speed and styled wheel products as well as increased warehousing and freight costs.
Construction Materials: Net sales of $171.5 million in the first quarter were 40% above the first quarter 2004 net sales of $122.8 million driven by a combination of strong demand across most product lines and higher pricing implemented to offset corresponding increases in raw
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material costs. First quarter 2005 EBIT of $14.6 million was significantly higher than the first quarter 2004 EBIT of $6.6 million due primarily to the increases in sales volume and favorable product mix. Segment earnings also reflect a pre-tax loss of $4.2 million for the first quarter 2005 related to the Company’s equity share in the European roofing joint venture, Icopal. This loss compares to a $4.1 million loss in the first quarter 2004.
Transportation Products: Net sales of $40.2 million in the first quarter 2005 were 23% above first quarter 2004 net sales of $32.6 million. First quarter EBIT of $3.9 million was significantly above $0.9 million for the first quarter 2004. The improvement in net sales was the result of higher shipments of large construction trailers, pneumatic bulk tanks and construction live-bottom trailers. The increase in earnings reflects strong demand, favorable product mix, selling price increases and improved absorption of fixed overhead costs.
Specialty Products: Net sales of $37.6 million were 18% above $31.8 million in the first quarter 2004 on higher sales of braking systems for off-highway and industrial equipment as well as increased demand for on-highway heavy friction and relined brake shoes. First quarter 2005 EBIT of $3.9 million was 63% higher than first quarter 2004 EBIT of $2.4 million, primarily a result of improved demand, selling price increases and manufacturing efficiencies.
General Industry: Net sales of $121.0 million in the first quarter were below net sales of $123.8 million in the first quarter 2004. Segment EBIT of $8.6 million for the first three months of 2005 was 11% below $9.7 million in 2004. A slight increase in net sales at Tensolite was offset by declines at Carlisle FoodService and Johnson Truck Bodies. The decline at Carlisle FoodService reflects lower sanitary maintenance product sales. Johnson Truck Bodies net sales fell below 2004 levels due to reduced demand for insulated temperature-controlled truck bodies and trailers. Net sales for Carlisle Systems and Equipment, which includes Carlisle Process Systems, Carlisle Walker Stainless and CPS Pharma, were flat as compared with the first quarter 2004. Earnings improvements at Tensolite were more than offset by a year-over-year decline in earnings for Carlisle Systems and Equipment, Carlisle FoodService and Johnson Truck Bodies.
Discontinued Operations
Losses from discontinued operations, net of tax, in the first quarter 2005 were $1.8 million compared to income of $0.4 million in the first quarter 2004. Current assets held for sale as of March 31, 2005 increased by $43.7 million over 2004 year-end, reflecting an increase in receivables as the Company’s discontinued automotive components business is no longer participating in the securitization program. The Company is actively engaged in the disposition of the automotive components operations and expects to complete the disposition in 2005.
Net Income
Net income for the first three months of 2005 of $28.3 million, or $0.90 per diluted share, was 19% above net income of $23.7 million, or $0.76 per diluted share, for the first three months of 2004.
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Cash Flow
Cash flow used in continuing operations of $39.6 million for the first three months of 2005 compares with cash provided of $4.9 million for the same period in 2004. Decreased utilization of the securitization program in 2005 reduced operating cash by $10.0 million compared to a contribution of $23.0 million resulting from increased utilization of the securitization program in 2004. Increased working capital was primarily the result of a planned build of inventory levels to meet the projected sales demand in the second quarter of 2005. Cash used in investing activities was $23.4 million in 2005 compared to $6.2 million in 2004. Capital expenditures of $23.8 million were 41% above $16.8 million in 2004. The increase in capital expenditures was due to new production plants for the Construction Materials segment and a new distribution center for Carlisle FoodService. Proceeds from the sale of investments, property and equipment in 2004 included the sale of properties acquired with the acquisition of Flo-Pac. Cash flow from financing activities of $63.8 million in the first quarter 2005 compared with $2.6 million in 2004 as a result of increased short-term borrowings required to fund organic growth.
Backlog
The March 31, 2005 backlog from continuing operations of $373.9 million was 9% below $410.1 million at December 31, 2004 reflecting decreased backlog for the Construction Materials, Industrial Components and General Industry segments.
Conference Call and Webcast
The company will discuss first quarter 2005 results on a conference call for investors on Thursday, April 14, 2005 at 11:00 a.m. Eastern. The call may be accessed live at http://www.carlisle.com/investors/conference_call.html, or the taped call may be listened to shortly following the live call at the same website location until April 28, 2005.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management’s current expectations and are subject to uncertainty and changes in circumstances. Actual results may differ materially from these expectations due to changes in global economic, business, competitive, market and regulatory factors. More detailed information about these factors is contained in the Company’s filings with the Securities and Exchange Commission. The Company undertakes no duty to update forward-looking statements.
Carlisle is a diversified global manufacturing company serving the construction materials, commercial roofing, specialty tire and wheel, power transmission, heavy-duty brake and friction, foodservice, data transmission, and process systems industries.
CONTACT: | | Carol P. Lowe |
| | Vice President and Chief Financial Officer |
| | Carlisle Companies Incorporated |
| | (704) 501-1100 |
| | http://www.carlisle.com |
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CARLISLE COMPANIES INCORPORATED
Financial Results
Quarter ended March 31, 2005
(In millions, except per share data)
| | 2005 | | 2004 | | % Change | |
Net sales | | $ | 592.3 | | $ | 503.2 | | 18 | % |
| | | | | | | |
Income from continuing operations, net of tax | | $ | 30.1 | | $ | 23.3 | | 29 | % |
(Loss) Income from discontinued operations, net of tax | | (1.8 | ) | 0.4 | | NM | |
Net income | | $ | 28.3 | | $ | 23.7 | | 19 | % |
| | | | | | | |
Basic earnings per share | | | | | | | |
Continuing operations | | $ | 0.97 | | $ | 0.75 | | 29 | % |
Discontinued operations | | (0.06 | ) | 0.02 | | NM | |
Net income | | $ | 0.91 | | $ | 0.77 | | 18 | % |
| | | | | | | |
Diluted earnings per share | | | | | | | |
Continuing operations | | $ | 0.96 | | $ | 0.75 | | 28 | % |
Discontinued operations | | (0.06 | ) | 0.01 | | NM | |
Net income | | $ | 0.90 | | $ | 0.76 | | 18 | % |
SEGMENT FINANCIAL DATA
(In millions)
First Quarter | | 2005 | | 2004 | |
| | Sales | | EBIT | | % Sales | | Sales | | EBIT | | % Sales | |
Industrial Components | | $ | 222.0 | | $ | 24.7 | | 11.1 | % | $ | 192.2 | | $ | 22.7 | | 11.8 | % |
Construction Materials | | 171.5 | | 14.6 | | 8.5 | % | 122.8 | | 6.6 | | 5.4 | % |
Transportation Products | | 40.2 | | 3.9 | | 9.7 | % | 32.6 | | 0.9 | | 2.8 | % |
Specialty Products | | 37.6 | | 3.9 | | 10.4 | % | 31.8 | | 2.4 | | 7.5 | % |
General Industry | | 121.0 | | 8.6 | | 7.1 | % | 123.8 | | 9.7 | | 7.8 | % |
Subtotal | | 592.3 | | 55.7 | | 9.4 | % | 503.2 | | 42.3 | | 8.4 | % |
Corporate | | — | | (7.1 | ) | | | — | | (4.2 | ) | | |
Total | | $ | 592.3 | | $ | 48.6 | | 8.2 | % | $ | 503.2 | | $ | 38.1 | | 7.6 | % |
NM = Not Meaningful
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CARLISLE COMPANIES INCORPORATED
Consolidated Statement of Earnings
For the periods ended March 31
(In thousands except per share data)
| | First Quarter | |
| | 2005 | | 2004 | | % Change | |
Net sales | | $ | 592,328 | | $ | 503,206 | | 17.7 | % |
Cost and expenses: | | | | | | | | | |
Cost of goods sold | | 474,605 | | 402,739 | | 17.8 | % |
Selling and administrative expenses | | 59,823 | | 54,641 | | 9.5 | % |
Research and development expenses | | 4,202 | | 4,132 | | 1.7 | % |
Other expense, net | | 5,106 | | 3,518 | | 45.1 | % |
| | | | | | | |
Earnings before interest & income taxes | | 48,592 | | 38,176 | | 27.3 | % |
| | | | | | | |
Interest expense, net | | 4,204 | | 3,601 | | 16.7 | % |
| | | | | | | |
Earnings before income taxes | | 44,388 | | 34,575 | | 28.4 | % |
| | | | | | | |
Income taxes | | 14,316 | | 11,251 | | 27.2 | % |
| | | | | | | |
Income from continuing operations | | 30,072 | | 23,324 | | 28.9 | % |
% of Net Sales | | 5.1 | % | 4.6 | % | | |
| | | | | | | |
(Loss) Income from discontinued operations, net of tax | | (1,817 | ) | 401 | | NM | |
| | | | | | | |
Net Income | | $ | 28,255 | | $ | 23,725 | | 19.1 | % |
| | | | | | | |
Basic earnings per share | | | | | | | |
Continuing operations | | $ | 0.97 | | $ | 0.75 | | 29.3 | % |
Discontinued operations | | (0.06 | ) | 0.02 | | NM | |
Basic earnings per share | | $ | 0.91 | | $ | 0.77 | | 18.2 | % |
| | | | | | | |
Diluted earnings per share | | | | | | | |
Continuing operations | | $ | 0.96 | | $ | 0.75 | | 28.0 | % |
Discontinued operations | | (0.06 | ) | 0.01 | | NM | |
Diluted earnings per share | | $ | 0.90 | | $ | 0.76 | | 18.4 | % |
| | | | | | | |
Average shares outstanding (000’s) - basic | | 30,943 | | 30,971 | | | |
Average shares outstanding (000’s) - diluted | | 31,331 | | 31,268 | | | |
| | | | | | | |
Dividends | | $ | 7,141 | | $ | 6,827 | | | |
Per share | | $ | 0.230 | | $ | 0.220 | | 4.3 | % |
NM = Not Meaningful
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CARLISLE COMPANIES INCORPORATED
Comparative Condensed Consolidated Balance Sheet
(In thousands)
| | March 31,
2005 | | December 31,
2004 | |
Assets | | | | | |
Current Assets | | | | | |
Cash and cash equivalents | | $ | 26,507 | | $ | 25,018 | |
Receivables | | 235,087 | | 227,423 | |
Inventories | | 366,018 | | 315,528 | |
Prepaid expenses and other | | 62,257 | | 67,845 | |
Current assets held for sale | | 60,193 | | 16,455 | |
Total current assets | | 750,062 | | 652,269 | |
Property, plant and equipment, net | | 419,275 | | 409,704 | |
Other assets | | 375,533 | | 388,734 | |
Non-current assets held for sale | | 53,227 | | 50,534 | |
| | $ | 1,598,097 | | $ | 1,501,241 | |
| | | | | |
Liabilities and Shareholders’ Equity | | | | | |
Current Liabilities | | | | | |
Short-term debt, including current maturities | | $ | 126,803 | | $ | 59,990 | |
Accounts payable | | 175,295 | | 167,950 | |
Accrued expenses | | 133,617 | | 130,373 | |
Current liabilities associated with assets
held for sale | | 26,095 | | 25,709 | |
Total current liabilities | | 461,810 | | 384,022 | |
Long-term debt | | 257,886 | | 259,554 | |
Other liabilities | | 158,978 | | 157,208 | |
Non-current liabilities associated with assets held for sale | | 2,514 | | 1,970 | |
Shareholders’ equity | | 716,909 | | 698,487 | |
| | $ | 1,598,097 | | $ | 1,501,241 | |
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CARLISLE COMPANIES INCORPORATED
Comparative Condensed Consolidated Statement of Cash Flows
For the Three months ended March 31
(In thousands)
| | 2005 | | 2004* | |
Operating activities | | | | | |
Net income | | $ | 28,255 | | $ | 23,725 | |
Reconciliation of net earnings to cash flows: | | | | | |
Loss (income) from discontinued operations, net of tax | | 1,817 | | (401 | ) |
Depreciation and amortization | | 13,839 | | 13,351 | |
Loss on equity investments | | 3,878 | | 4,050 | |
Foreign exchange loss | | 398 | | — | |
Deferred taxes | | 1,495 | | (707 | ) |
Loss (gain) on investments, property and equipment, net | | 33 | | (373 | ) |
Receivables under securitization program | | (10,000 | ) | 23,000 | |
Working capital | | (78,045 | ) | (57,346 | ) |
Other | | (1,272 | ) | (414 | ) |
Net cash (used in) provided by operating activities | | (39,602 | ) | 4,885 | |
Investing activities | | | | | |
Capital expenditures | | (23,753 | ) | (16,821 | ) |
Acquisitions, net of cash | | — | | (566 | ) |
Proceeds from investments, property and equipment | | 30 | | 11,929 | |
Other | | 315 | | (787 | ) |
Net cash used in investing activities | | (23,408 | ) | (6,245 | ) |
Financing activities | | | | | |
Net change in short-term debt and revolving credit lines | | 67,035 | | 8,200 | |
Reductions of long-term debt | | (223 | ) | (1,624 | ) |
Dividends | | (7,141 | ) | (6,827 | ) |
Treasury shares and stock options, net | | 4,119 | | 2,890 | |
Net cash provided by financing activities | | 63,790 | | 2,639 | |
Net cash provided by (used in) discontinued operations | | 427 | | (40 | ) |
Effect of exchange rate changes on cash | | 282 | | (53 | ) |
Change in cash and cash equivalents | | 1,489 | | 1,186 | |
Cash and cash equivalents | | | | | |
Beginning of period | | 25,018 | | 23,361 | |
End of period | | $ | 26,507 | | $ | 24,547 | |
* Reflects reclassification of cash flows from discontinued operations
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