NEWS RELEASE
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CONTACT: Kevin McDermed
913 367 2121
NYSE: FDY
ATCHISON CASTING CORPORATION COMPLETES
SALE OF SUBSIDIARY
Atchison, Kansas - December 20, 2001 - Atchison Casting Corporation
(NYSE:"FDY") today announced the sale of substantially all of the assets of its
Jahn Foundry Corp. subsidiary to New England Iron, LLC, a newly formed LLC
principally owned by Advanced Iron, LLC. Jahn Foundry manufactures shell-molded
gray iron castings for the agriculture, air conditioning, compressor, pump and
automotive markets.
"Jahn Foundry suffered a very serious industrial accident on February
25, 1999," said Hugh H. Aiken, CEO. "The employees of Jahn have put forth an
outstanding effort, but as yet have been unable to return to the productivity
and earnings levels experienced prior to the accident," continued Mr. Aiken.
"While we are confident that Jahn can recover, the lack of payments under our
business interruption insurance policy since June 2000 makes it difficult for
ACC to continue to finance Jahn's recovery," concluded Mr. Aiken. The cash
portion of the proceeds will be used to retire a portion of the Company's
outstanding indebtedness.
For fiscal years 2000 and 2001, Jahn Foundry recorded net sales of
$10.7 million and $8.4 million, respectively, and net losses of $113,000 and
$2.4 million, respectively, excluding an impairment charge of $13.9 million in
the fourth quarter of fiscal 2001 and a non-recurring gain of $10.9 million
recorded in the second quarter of fiscal 2001 relating to insurance claims
resulting from the industrial accident. For the first quarter of fiscal 2001 and
fiscal 2002, Jahn Foundry recorded a net loss of $723,000 and $383,000,
respectively, on sales of $2.1 million and $1.6 million, respectively.
As previously announced, the Company is negotiating the sale of Los
Angeles Die Casting. This transaction, if consummated, is now expected to close
during the third quarter of fiscal 2002.
ACC produces iron, steel and non-ferrous castings for a wide variety of
equipment, capital goods and consumer markets.
This press release contains forward-looking statements that involve
risks and uncertainties. Such statements include the Company's expectations as
to future performance. Among the factors that could cause actual results to
differ materially from the forward looking statements are the following: costs
of closing foundries, success in selling Los Angeles Die Casting, the impact
that terrorist activities on and after September 11, 2001 and any related
military responses may have on
ATCHISON CASTING CORPORATION
400 SOUTH FOURTH STREET o P.O. BOX 188 o ATCHISON, KANSAS 66002-0188
o (913) 367-2121 o FAX (913) 367-2155
the markets served by the Company, business conditions and the state of the
general economy, particularly the capital goods industry, the strength of the
U.S. dollar, British pound sterling and the Euro, interest rates, the Company's
ability to renegotiate or refinance its lending arrangements, utility rates, the
availability of labor, the successful conclusion of union contract negotiations,
the results of any litigation arising out of the accident at Jahn Foundry,
results of any litigation or regulatory proceedings arising from the accounting
irregularities at the Pennsylvania Foundry Group, the competitive environment in
the casting industry and changes in laws and regulations that govern the
Company's business, particularly environmental regulations.
ATCHISON CASTING CORPORATION
400 SOUTH FOURTH STREET o P.O. BOX 188 o ATCHISON, KANSAS 66002-0188
o (913) 367-2121 o FAX (913) 367-2155
