For Immediate Release
October 27, 2004
GIBRALTAR REPORTS THIRD-QUARTER 2004 RESULTS
The per share information contained in this news release does not consider the effects of the 3-for2 stock split to be effected in the form of a stock dividend that was announced on October 5.
BUFFALO, NEW YORK (October 27, 2004) - Gibraltar (Nasdaq: ROCK) said today that its sales in the third quarter of 2004 were $279 million, compared to $208 million in the third quarter of 2003. Sales in the first nine months of 2004 were $748 million, compared to $573 million in the first nine months of 2003.
Net income of $16.2 million in the third quarter of 2004 increased by $8.2 million when compared to results from the third quarter of 2003. During the first nine months of 2004, net income was $41.0 million, compared to $21.1 million in 2003.
Earnings per diluted share in the third quarter of 2004 were $.82, compared to $.49 in the third quarter of 2003. During the first nine months of 2004, earnings per diluted share were $2.08, compared to $1.31 in 2003.
"During the third quarter, all three of our business segments once again generated double-digit sales increases from the comparable period in the prior year. The majority of these gains came from organic growth in our existing business units with higher unit volumes, as we won additional business with existing customers, gained new accounts, and continued to introduce a steady stream of new products and services. The balance of our sales increase was the result of recent acquisitions (Gibraltar has made four acquisitions thus far in 2004) and higher overall selling prices, driven primarily by increased costs for steel and other commodity raw materials, which we passed on," said Brian J. Lipke, Gibraltar's Chairman and Chief Executive Officer.
"As a result of moving more of our business into higher value-added, higher-margin products, processes, and services, as well as our continuous improvement and cost-reduction initiatives, we generated even stronger improvements in operating income. Our operating margin in the third quarter was 10.4 percent - the second straight quarter above our 10 percent goal," said Mr. Lipke.
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Gibraltar Reports Third-Quarter 2004 Results
Page Two
"Yesterday, our shareholders approved changing the name of our company to Gibraltar Industries, Inc., which better reflects our current business mix and markets .We take great pride and satisfaction in the results we generated during our first 11 years as a public company, and we believe we are well positioned to continue transforming Gibraltar into an even larger, stronger, and more valuable company for our customers, employees, and shareholders. That is the clear focus of all 4,000 people on the Gibraltar Team," said Mr. Lipke.
Looking ahead to the fourth quarter, Mr. Lipke said that even though the fourth quarter is historically the slowest period for Gibraltar (as a result of holidays and automotive plant shutdowns and seasonal slowing in the building industry), the Company expects to continue its positive revenue and earnings growth momentum.
"Barring a significant change in business conditions, we expect our fourth-quarter earnings per diluted share will be in the range of $.43 to $.47, compared to $.35 in the fourth quarter of 2003," said Mr. Lipke.
Gibraltar Industries, Inc. is a leading manufacturer, processor, and distributor of metals and other engineered materials for the building products, vehicular, and other industrial markets. The Company serves approximately 10,000 customers in a variety of industries in all 50 states, Canada, Mexico, Europe, Asia, and Central and South America, and is approaching $1 billion in annual sales. It has approximately 4,000 employees and operates 74 facilities in 26 states, Canada, and Mexico.
Information contained in this release, other than historical information, should be considered forward-looking, and may be subject to a number of risk factors, including: the impact of the availability and the effects of changing steel prices on the Company's results of operations; changing demand for the Company's products and services; risks associated with the integration of acquisitions; and changes in interest or tax rates.
Gibraltar will review its third-quarter results and discuss its outlook for the fourth quarter during its quarterly conference call, which will be held at 2 p.m. Eastern Time on October 28. Investors and the general public are invited to listen to an Internet Web cast of the call, details of which can be found on Gibraltar's Web site,"http://www.gibraltar1.com/".
CONTACT: Kenneth P. Houseknecht, Vice President of Communications and Investor Relations, at 716/826-6500 khouseknecht@gibraltar1.com.
Gibraltar's news releases, along with comprehensive information about the Company, are available on the Internet, at www.gibraltar1.com.
Gibraltar Reports Third-Quarter 2004 Results
Page Three
GIBRALTAR INDUSTRIES, INC.
| |||||
| Three Months Ended | ||||
|
| September 30, 2004 |
|
| September 30, 2003 |
Net Sales | $ | 278,762 |
| $ | 208,033 |
Net Income | $ | 16,220 |
| $ | 7,978 |
Net Income Per Share-Basic | $ | .83 |
| $ | .50 |
Weighted Average Shares Outstanding-Basic |
| 19,632 |
|
| 16,041 |
Net Income Per Share-Diluted | $ | .82 |
| $ | .49 |
Weighted Average Shares Outstanding-Diluted |
| 19,795 |
|
| 16,229 |
| Nine Months Ended | ||||
|
| September 30, 2004 |
|
| September 30, 2003 |
Net Sales | $ | 748,242 |
| $ | 572,971 |
Net Income | $ | 41,009 |
| $ | 21,133 |
Net Income Per Share-Basic | $ | 2.10 |
| $ | 1.32 |
Weighted Average Shares Outstanding-Basic |
| 19,534 |
|
| 15,967 |
Net Income Per Share-Diluted | $ | 2.08 |
| $ | 1.31 |
Weighted Average Shares Outstanding-Diluted |
| 19,693 |
|
| 16,122 |
GIBRALTAR INDUSTRIES, INC. CONDENSED CONSOLIDATED BALANCE SHEETS | |||||
(in thousands) | |||||
| |||||
|
| September 30, December 31, | |||
|
| 2004 |
|
| 2003 |
|
| (unaudited) |
|
| (audited) |
Assets |
|
|
|
|
|
Current assets: |
|
|
|
|
|
Cash and cash equivalents | $ | 11,068 |
| $ | 29,019 |
Accounts receivable, net |
| 169,433 |
|
| 102,591 |
Inventories |
| 177,433 |
|
| 107,531 |
Other current assets |
| 11,410 |
|
| 10,309 |
Total current assets |
| 369,344 |
|
| 249,450 |
|
|
|
|
|
|
Property, plant and equipment, net |
| 268,306 |
|
| 250,029 |
Goodwill |
| 288,679 |
|
| 267,157 |
Investments in partnerships |
| 10,751 |
|
| 5,044 |
Other assets |
| 7,223 |
|
| 6,063 |
| $ | 944,303 |
| $ | 777,743 |
|
|
|
|
|
|
Liabilities and Shareholders' Equity |
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
Accounts payable | $ | 76,049 |
| $ | 49,879 |
Accrued expenses |
| 56,347 |
|
| 29,029 |
Current maturities of long-term debt |
| 15,592 |
|
| 19,848 |
Total current liabilities |
| 147,988 |
|
| 98,756 |
|
|
|
|
|
|
Long-term debt |
| 285,049 |
|
| 222,402 |
Deferred income taxes |
| 62,384 |
|
| 55,982 |
Other non-current liabilities |
| 5,141 |
|
| 6,422 |
Shareholders' equity: |
|
|
|
|
|
Preferred stock, $.01 par value; authorized: 10,000,000 shares; none outstanding |
|
- |
|
|
- |
Common stock, $.01 par value; authorized 50,000,000 shares; issued 19,748,723 and 19,274,069 shares in 2004 and 2003, respectively 2003, respectively |
|
197 |
|
|
193 |
Additional paid-in capital |
| 208,971 |
|
| 199,206 |
Retained earnings |
| 234,296 |
|
| 196,138 |
Unearned compensation |
| (610) |
|
| (818) |
Accumulated other comprehensive income (loss) |
| 887 |
|
| (538) |
|
| 443,741 |
|
| 394,181 |
Less: cost of 27,000 and 19,000 common shares held in treasury in 2004 and 2003, respectively |
|
- |
|
|
- |
Total shareholders' equity |
| 443,741 |
|
| 394,181 |
| $ | 944,303 |
| $ | 777,743 |
|
GIBRALTAR INDUSTRIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME
| ||||||||||||||
|
Three Months Ended |
Nine Months Ended | ||||||||||||
|
| 2004 |
| 2003 |
| 2004 |
| 2003 |
| |||||
| (unaudited) | (unaudited) | (unaudited) | (unaudited) |
| |||||||||
Net sales | $ | 278,762 | $ | 208,033 | $ | 748,242 | $ | 572,971 |
| |||||
|
|
|
|
|
|
|
|
|
| |||||
Cost of sales |
| 216,742 |
| 165,144 |
| 585,160 |
| 460,503 |
| |||||
|
|
|
|
|
|
|
|
|
| |||||
Gross profit |
| 62,020 |
| 42,889 |
| 163,082 |
| 112,468 |
| |||||
|
|
|
|
|
|
|
|
|
| |||||
Selling, general and administrative expense |
| 33,117 |
| 25,776 |
| 88,389 |
| 67,394 |
| |||||
|
|
|
|
|
|
|
|
|
| |||||
Income from operations |
| 28,903 |
| 17,113 |
| 74,693 |
| 45,074 |
| |||||
|
|
|
|
|
|
|
|
|
| |||||
Other (income) expense: |
|
|
|
|
|
|
|
|
| |||||
Equity in partnerships' income |
| (1,766) |
| (177) |
| (3,492) |
| (385) |
| |||||
Interest expense |
| 3,859 |
| 3,994 |
| 10,401 |
| 10,238 |
| |||||
Total other expense |
| 2,093 |
| 3,817 |
| 6,909 |
| 9,853 |
| |||||
|
|
|
|
|
|
|
|
|
| |||||
Income before taxes |
| 26,810 |
| 13,296 |
| 67,784 |
| 35,221 |
| |||||
|
|
|
|
|
|
|
|
|
| |||||
Provision for income taxes |
| 10,590 |
| 5,318 |
| 26,775 |
| 14,088 |
| |||||
|
|
|
|
|
|
|
|
|
| |||||
Net income | $ | 16,220 | $ | 7,978 | $ | 41,009 | $ | 21,133 |
| |||||
|
|
|
|
|
|
|
|
|
| |||||
Net income per share - Basic | $ | .83 | $ | .50 | $ | 2.10 | $ | 1.32 |
| |||||
|
|
|
|
|
|
|
|
|
| |||||
Weighted average shares outstanding - Basic |
| 19,632 |
| 16,041 |
| 19,534 |
| 15,967 |
| |||||
|
|
|
|
|
|
|
|
|
| |||||
Net income per share - Diluted | $ | .82 | $ | .49 | $ | 2.08 | $ | 1.31 |
| |||||
|
|
|
|
|
|
|
|
|
| |||||
Weighted average shares outstanding - Diluted |
| 19,795 |
| 16,229 |
| 19,693 |
| 16,122 |
| |||||
GIBRALTAR INDUSTRIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||
| Nine Months Ended September 30, | |||||
|
|
| 2004 |
| 2003 | |
|
|
| (unaudited) |
| (unaudited) | |
|
|
|
|
|
| |
Cash flows from operating activities |
|
|
|
|
| |
Net income |
| $ | 41,009 | $ | 21,133 | |
Adjustments to reconcile net income to net cash used in |
|
|
|
|
| |
Depreciation and amortization |
|
| 18,323 |
| 16,711 | |
Provision for deferred income taxes |
|
| 3,659 |
| 3,577 | |
Equity in partnerships' income |
|
| (3,492) |
| (385) | |
Distributions from partnerships |
|
| 1,314 |
| 503 | |
Tax benefit from exercise of stock options |
|
| 794 |
| 823 | |
Unearned compensation, net of restricted stock forfeitures |
|
| 120 |
| 176 | |
Other noncash adjustments |
|
| 133 |
| 165 | |
Increase (decrease) in cash resulting from changes |
|
|
|
|
| |
in (net of acquisitions): |
|
|
|
|
| |
Accounts receivable |
|
| (51,071) |
| (22,282) | |
Inventories |
|
| (59,979) |
| 5,784 | |
Other current assets |
|
| 911 |
| (1,212) | |
Accounts payable and accrued expenses |
|
| 48,771 |
| 16,993 | |
Other assets |
|
| (1,253) |
| (105) | |
|
|
|
|
|
| |
Net cash provided by (used in) operating activities |
|
| (761) |
| 41,881 | |
| �� |
|
|
|
| |
Cash flows from investing activities |
|
|
|
|
| |
Acquisitions, net of cash acquired |
|
| (64,985) |
| (84,228) | |
Purchases of property, plant and equipment |
|
| (17,035) |
| (16,544) | |
Net proceeds from sale of property and equipment |
|
| 492 |
| 356 | |
|
|
|
|
|
| |
Net cash used in investing activities |
|
| (81,528) |
| (100,416) | |
|
|
|
|
|
| |
Cash flows from financing activities |
|
|
|
|
| |
Long-term debt reduction |
|
| (27,506) |
| (56,491) | |
Proceeds from long-term debt |
|
| 85,418 |
| 115,471 | |
Payment of dividends |
|
| (2,734) |
| (2,002) | |
Net proceeds from issuance of common stock |
|
| 9,160 |
| 3,122 | |
|
|
|
|
|
| |
Net cash provided by financing activities |
|
| 64,338 |
| 60,100 | |
|
|
|
|
|
| |
Net increase (decrease) in cash and cash equivalents |
|
| (17,951) |
| 1,565 | |
|
|
|
|
|
| |
Cash and cash equivalents at beginning of year |
|
| 29,019 |
| 3,662 | |
|
|
|
|
|
| |
Cash and cash equivalents at end of period |
| $ | 11,068 | $ | 5,227 | |
| ||||||
GIBRALTAR INDUSTRIES, INC. |
| ||||||||||||||||
| Three Months Ended September 30, |
| |||||||||||||||
|
|
|
|
|
| Increase (Decrease) |
| ||||||||||
| 2004 |
| 2003 |
| $ |
| % |
| |||||||||
|
| (unaudited) |
| (unaudited) |
|
|
|
|
| ||||||||
|
|
|
|
|
|
|
|
|
| ||||||||
Net Sales |
|
|
|
|
|
|
|
|
| ||||||||
Processed metals | $ | 97,319 | $ | 62,658 | $ | 34,661 |
| 55.3% |
| ||||||||
Building products |
| 142,444 |
| 123,421 |
| 19,023 |
| 15.4% |
| ||||||||
Thermal processing |
| 38,999 |
| 21,954 |
| 17,045 |
| 77.6% |
| ||||||||
|
|
|
|
|
|
|
|
|
| ||||||||
Total Sales |
| 278,762 |
| 208,033 |
| 70,729 |
| 34.0% |
| ||||||||
|
|
|
|
|
|
|
|
|
| ||||||||
Income (loss) from Operations |
|
|
|
|
|
|
|
|
| ||||||||
Processed metals | $ | 11,696 | $ | 4,451 | $ | 7,245 |
| 162.8% |
| ||||||||
Building products |
| 22,153 |
| 15,946 |
| 6,207 |
| 38.9% |
| ||||||||
Thermal processing |
| 3,402 |
| 1,712 |
| 1,690 |
| 98.7% |
| ||||||||
Corporate |
| (8,348) |
| (4,996) |
| (3,352) |
| (67.1%) |
| ||||||||
|
|
|
|
|
|
|
|
|
| ||||||||
Total Operating Income |
| 28,903 |
| 17,113 |
| 11,790 |
| 68.9% |
| ||||||||
|
|
|
|
|
|
|
|
|
| ||||||||
Operating Margin |
|
|
|
|
|
|
|
|
| ||||||||
Processed metals |
| 12.0% |
| 7.1% |
|
|
|
|
| ||||||||
Building products |
| 15.6% |
| 12.9% |
|
|
|
|
| ||||||||
Thermal processing |
| 8.7% |
| 7.8% |
|
|
|
|
| ||||||||
| Nine Months Ended September 30, | ||||||||||||||||
|
|
|
|
|
| Increase (Decrease) | |||||||||||
|
| 2004 |
| 2003 |
| $ | % | ||||||||||
|
| (unaudited) |
| (unaudited) |
|
|
|
| |||||||||
|
|
|
|
|
|
|
|
| |||||||||
Net Sales |
|
|
|
|
|
|
|
| |||||||||
Processed metals | $ | 263,765 | $ | 203,371 | $ | 60,394 |
| 29.7% | |||||||||
Building products |
| 388,501 |
| 303,700 |
| 84,801 |
| 27.9% | |||||||||
Thermal processing |
| 95,976 |
| 65,900 |
| 30,076 |
| 45.6% | |||||||||
|
|
|
|
|
|
|
|
| |||||||||
Total Sales |
| 748,242 |
| 572,971 |
| 175,271 |
| 30.6% | |||||||||
|
|
|
|
|
|
|
|
| |||||||||
Income from Operations |
|
|
|
|
|
|
|
| |||||||||
Processed metals | $ | 30,172 | $ | 19,037 | $ | 11,135 |
| 58.5% | |||||||||
Building products |
| 53,187 |
| 31,936 |
| 21,251 |
| 66.5% | |||||||||
Thermal processing |
| 12,179 |
| 6,995 |
| 5,184 |
| 74.1% | |||||||||
Corporate |
| (20,845) |
| (12,894) |
| (7,951) |
| (61.7%) | |||||||||
|
|
|
|
|
|
|
|
| |||||||||
Total Operating Income |
| 74,693 |
| 45,074 |
| 29,619 |
| 65.7% | |||||||||
|
|
|
|
|
|
|
|
| |||||||||
Operating Margin |
|
|
|
|
|
|
|
| |||||||||
Processed metals |
| 11.4% |
| 9.4% |
|
|
|
| |||||||||
Building products |
| 13.7% |
| 10.5% |
|
|
|
| |||||||||
Thermal processing |
| 12.7% |
| 10.6% |
|
|
|
| |||||||||