EXHIBIT 99.1
For immediate release July 28, 2005 | Eric R. Graef Preformed Line Products (440) 473-9249 |
PREFORMED LINE PRODUCTS ANNOUNCES IMPROVED FINANCIAL RESULTS
FOR THE SECOND QUARTER AND FIRST SIX MONTHS OF 2005
• | Earnings per diluted share increased 56% from the second quarter of 2004 and 88% for the first six months |
• | Net sales increased 15% for the second quarter and 21% for the first six months |
Cleveland, Ohio, July 28, 2005 –Preformed Line Products Company (Nasdaq: PLPC)today reported financial results for the second quarter and the first six months of 2005.
Net income for the quarter ended June 30, 2005 was $3,696,000, or $.64 per diluted share, compared to $2,371,000, or $.41 per diluted share, for the comparable period in 2004. Net sales in the second quarter 2005 were $52,692,000, an increase of 15% from last year’s $45,884,000.
Net income for the six months ended June 30, 2005 was $6,924,000, or $1.20 per diluted share, an 85% increase from the prior year’s $3,735,000, or $.64 per diluted share. Net sales increased 21% to $103,464,000 for the first six months of 2005 compared to $85,414,000 in 2004.
Rob Ruhlman, Chairman and Chief Executive Officer, said, “We continue to improve on our strengths of international diversity, innovative product designs and lean manufacturing combined with cost containment. Our second quarter improvement was primarily driven by our international operations. Our year-to-date domestic improvement continues to be driven by our innovative products for fiber to the premise. Meanwhile our controlled expenses are leveraged over higher volumes. Currency had a favorable impact on sales of $1.8 million for the quarter and $2.9 million for the year.”
On Wednesday, June 8, 2005, the Board of Directors declared a regular quarterly dividend in the amount of $.20 per share on the Company’s common shares, payable July 28, 2005 to shareholders of record July 1, 2005.
PAGE 2 / PLP ANNOUNCES SECOND QUARTER RESULTS
Founded in 1947, Preformed Line Products is an international designer and manufacturer of products and systems employed in the construction and maintenance of overhead and underground networks for energy, communications and broadband network companies.
Preformed’s world headquarters are in Cleveland, Ohio, and the Company operates three domestic manufacturing centers located in Rogers, Arkansas, Albemarle, North Carolina, and Asheville, North Carolina. The Company serves its worldwide market through international operations in Australia, Brazil, Canada, China, England, Mexico, New Zealand, South Africa, Spain and Thailand.
This news release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 regarding the Company, including those statements regarding the Company’s and management’s beliefs and expectations concerning the Company’s future performance or anticipated financial results, among others. Except for historical information, the matters discussed in this release are forward-looking statements that involve risks and uncertainties which may cause results to differ materially from those set forth in those statements. Among other things, factors that could cause actual results to differ materially from those expressed in such forward-looking statements include the strength of the economy and demand for the Company’s products, increases in raw material prices, the Company’s ability to identify, complete and integrate acquisitions for profitable growth, and other factors described under the heading “Forward-Looking Statements” in the Company’s Form 10-K filed with the SEC on March 24, 2005. The Form 10-K and the Company’s other filings with the SEC can be found on the SEC’s website at http://www.sec.gov. The Company assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.
PREFORMED LINE PRODUCTS COMPANY
STATEMENTS OF CONSOLIDATED OPERATIONS
(Unaudited)
Three Months | Six months | |||||||||||||||
Thousands, except per share data | ended June 30, | ended June 30, | ||||||||||||||
2005 | 2004 | 2005 | 2004 | |||||||||||||
Net sales | $ | 52,692 | $ | 45,884 | $ | 103,464 | $ | 85,414 | ||||||||
Cost of products sold | 35,275 | 30,785 | 69,420 | 58,245 | ||||||||||||
GROSS PROFIT | 17,417 | 15,099 | 34,044 | 27,169 | ||||||||||||
Costs and expenses Selling | 5,519 | 4,550 | 10,574 | 9,037 | ||||||||||||
General and administrative | 5,552 | 5,272 | 10,479 | 9,789 | ||||||||||||
Research and engineering | 1,527 | 1,457 | 3,070 | 2,934 | ||||||||||||
Other operating (income) expenses — net | (185 | ) | 256 | (70 | ) | 128 | ||||||||||
12,413 | 11,535 | 24,053 | 21,888 | |||||||||||||
Royalty income — net | 345 | 321 | 537 | 747 | ||||||||||||
OPERATING INCOME | 5,349 | 3,885 | 10,528 | 6,028 | ||||||||||||
Other income (expense) Interest income | 241 | 116 | 454 | 243 | ||||||||||||
Interest expense | (86 | ) | (117 | ) | (180 | ) | (203 | ) | ||||||||
Other expense | (27 | ) | (37 | ) | (54 | ) | (73 | ) | ||||||||
128 | (38 | ) | 220 | (33 | ) | |||||||||||
INCOME BEFORE INCOME TAXES AND EQUITY IN NET (LOSS) INCOME OF JOINT VENTURES | 5,477 | 3,847 | 10,748 | 5,995 | ||||||||||||
Income taxes | 1,781 | 1,439 | 3,824 | 2,281 | ||||||||||||
NET INCOME BEFORE JOINT VENTURES | 3,696 | 2,408 | 6,924 | 3,714 | ||||||||||||
Equity in net (loss) income of joint ventures | — | (37 | ) | — | 21 | |||||||||||
NET INCOME | $ | 3,696 | $ | 2,371 | $ | 6,924 | $ | 3,735 | ||||||||
Net income per share — basic | $ | 0.65 | $ | 0.41 | $ | 1.21 | $ | 0.65 | ||||||||
Net income per share — diluted | $ | 0.64 | $ | 0.41 | $ | 1.20 | $ | 0.64 | ||||||||
Cash dividends declared per share | $ | 0.20 | $ | 0.20 | $ | 0.40 | $ | 0.40 | ||||||||
Average number of shares outstanding — basic | 5,726 | 5,715 | 5,723 | 5,748 | ||||||||||||
Average number of shares outstanding — diluted | 5,784 | 5,764 | 5,778 | 5,802 | ||||||||||||
PREFORMED LINE PRODUCTS COMPANY
CONSOLIDATED BALANCE SHEETS
(Unaudited)
June 30, | December 31, | |||||||
Thousands of dollars, except share data | 2005 | 2004 | ||||||
ASSETS | ||||||||
Cash and cash equivalents | $ | 31,219 | $ | 29,744 | ||||
Accounts receivable, less allowance of $2,171 ($2,396 in 2004) | 32,449 | 29,217 | ||||||
Inventories-net | 35,337 | 36,264 | ||||||
Deferred income taxes | 3,998 | 3,727 | ||||||
Prepaids and other | 3,314 | 2,651 | ||||||
TOTAL CURRENT ASSETS | 106,317 | 101,603 | ||||||
Property and equipment — net | 47,697 | 48,169 | ||||||
Deferred income taxes | 739 | 1,213 | ||||||
Goodwill — net | 2,076 | 2,130 | ||||||
Patents and other intangibles — net | 3,058 | 3,247 | ||||||
Other assets | 2,445 | 2,446 | ||||||
TOTAL ASSETS | $ | 162,332 | $ | 158,808 | ||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
Notes payable to banks | $ | 1,290 | $ | 735 | ||||
Current portion of long-term debt | 1,303 | 1,272 | ||||||
Trade accounts payable | 10,723 | 11,111 | ||||||
Accrued compensation and amounts withheld from employees | 5,566 | 4,879 | ||||||
Accrued expenses and other liabilities | 4,969 | 4,368 | ||||||
Accrued profit-sharing and pension contributions | 2,741 | 3,639 | ||||||
Dividends payable | 1,144 | 1,141 | ||||||
Income taxes | 849 | 777 | ||||||
TOTAL CURRENT LIABILITIES | 28,585 | 27,922 | ||||||
Long-term debt, less current portion | 2,501 | 2,362 | ||||||
Deferred income taxes | 223 | 187 | ||||||
SHAREHOLDERS’ EQUITY | ||||||||
Common shares — $2 par value, 15,000,000 shares authorized, 5,721,597 and 5,706,713 outstanding, net of 511,159 and 491,159 treasury shares at par, respectively | 11,443 | 11,413 | ||||||
Paid in capital | 1,026 | 545 | ||||||
Retained earnings | 132,712 | 128,738 | ||||||
Accumulated other comprehensive loss | (14,158 | ) | (12,359 | ) | ||||
TOTAL SHAREHOLDERS’ EQUITY | 131,023 | 128,337 | ||||||
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ | 162,332 | $ | 158,808 | ||||