AMCAST INDUSTRIAL CORPORATION
NEWS RELEASE
AMCAST REPORTS FISCAL 2004 SECOND QUARTER RESULTS
DAYTON, OHIO, March 23, 2004 - Amcast Industrial Corporation, (AICO.OB) today
reported financial results for its fiscal 2004 second quarter ended February 29,
2004.
Sales of $94.4 million in the second quarter were 4.7% lower than the prior year
quarter sales of $99.1 million. Operating income in the second quarter of $2.4
million was up by almost 31% over the prior-year quarter. The operating income
improvement was the result of an improved gross margin due to reduced
manufacturing costs and lower selling, general and administrative costs. The
profit improvement at the operating level was much more dramatic than the
after-tax level because tax benefits were significantly higher in the prior
year. The net loss of $1.2 million, or $0.13 per share, improved by 6.7% over
the net loss from continuing operations in last year's quarter of $1.3 million,
or $0.15 per share.
The quarterly sales decline resulted from lower aluminum components sales,
primarily in the gravity-cast operations. This decline was partly offset by
strong demand for plumbing products and pistons for automotive air conditioning
compressors. By segment, Flow Control sales grew by over 18%, but Engineered
Components sales fell by almost 15%.
During the second quarter last year, the Company recorded a loss on the sale of
Speedline, its European wheel business. Accordingly, Speedline was classified as
a discontinued operation. The after-tax loss in fiscal 2003 from discontinued
operations was $54.6 million, or $6.17 per share, for the second quarter and
$56.7 million, or $6.82 per share, for the first six months.
Amcast Industrial Corporation
News Release - Page 2 of 5
March 23, 2003
Year-to-date sales were $207.4 million, down by 1.9% versus the prior year.
Sales in the Flow Control segment were up by 14%, while Engineered Components
sales declined by 8%. Year-to-date operating income of $7.3 million grew from
$2.7 million last year, or by 165%. Both an improved gross margin and lower
selling, general and administrative expenses contributed to the increase. Year
to date, the Company's net loss from continuing operations was $0.2 million, or
$0.02 per share, compared with a net loss from continuing operations of $3.2
million, or $0.36 per share, in the prior year.
Joseph R. Grewe, President and Chief Executive Officer, said, "The operating
income increase reflects better manufacturing performance, and it is important
to recognize that operating income increased during a period of declining sales.
We are still, however, turning the corner to profitability at the net income
line. Management has continued to focus on lower spending. During the quarter
selling, general and administrative expenses decreased by almost 7%, and fell to
9.1% of sales from 9.3% of sales in the prior-year quarter. Year-to-date
selling, general and administrative expenses were 8.1% of sales. Productivity
increased over last year by almost 14% year to date as measured by sales per
full-time-equivalent employee. Continued implementation of lean manufacturing
concepts as well as internal quality improvements helped improve performance."
Byron Pond, Chairman, commented, "Amcast's balance sheet continued to improve in
the quarter. Net operating assets decreased by 1% during the quarter as capital
spending was held to 34% of depreciation. Amcast also reduced debt by $3 million
in the quarter, and debt has been lowered by over $5 million year to date."
Mr. Grewe concluded, "Amcast just missed net income break-even for the first six
months. However, this was the Company's ninth consecutive quarter of positive
operating income. Traditionally, the second quarter is our most difficult
quarter, and this year was no exception. Clearly, the Amcast Production System,
and our relentless efforts to reduce costs are producing operating and financial
benefits. Our plans are to continue these successful programs as well as focus
on process improvements, better quality, and improved customer service."
Amcast Industrial Corporation
News Release - Page 3 of 5
March 23, 2003
A conference call to discuss the fiscal 2004 second quarter financial
performance will be held Wednesday, March 24 at 3 p.m. EST. The webcast can be
accessed through www.amcast.com.
Amcast Industrial Corporation is a leading manufacturer of technology-intensive
metal products. Its two business segments are brand name Flow Control Products
marketed through national distribution channels and Engineered Components for
original equipment manufacturers. The company serves the automotive,
construction, and industrial sectors of the economy.
This release includes "forward-looking statements" which are subject to change
based on various factors and uncertainties that may cause actual results to
differ significantly from expectations. These factors include, among others:
general economic conditions less favorable than expected, fluctuating demand in
the automotive and housing industries, competitive pricing pressures in the
Company's automotive and flow control businesses, effectiveness of production
improvement plans, inherent uncertainties in connection with international
transactions, and labor availability and relations at the company and its
customers, and the impact of homeland security measures.
Contact--
Media and Investors: Michael Higgins 937/291-7015
Amcast Industrial Corporation
News Release - Page 4 of 5
March 23, 2003
STATEMENTS OF OPERATIONS
($ in thousands except per share amounts)
Three Months Ended Six Months Ended
February 29 March 2 February 29 March 2
2004 2003 2004 2003
----------- ----------- ----------- -----------
Net Sales $ 94,444 $ 99,145 $ 207,380 $ 211,367
Cost of sales 83,503 88,143 183,251 189,236
----------- ----------- ----------- -----------
Gross Profit 10,941 11,002 24,129 22,131
Selling, general, and administrative expenses 8,575 9,194 16,802 19,363
----------- ----------- ----------- -----------
Operating Income 2,366 1,808 7,327 2,768
Other (income) expense (15) 9 (18) (23)
Interest expense 3,694 3,888 7,551 7,859
----------- ----------- ----------- -----------
Loss Before Income Taxes, Discontinued Operations,
and Cumulative Effect of Accounting Change (1,313) (2,089) (206) (5,068)
Income taxes (benefit) (65) (752) (4) (1,891)
----------- ----------- ----------- -----------
Loss From Continuing Operations (1,248) (1,337) (202) (3,177)
Discontinued Operations
Loss from operations, net of tax - (4,766) - (10,118)
Loss on sale of assets, net of tax - (49,822) - (49,822)
----------- ----------- ----------- -----------
Loss Before Cumulative Effect of Accounting Change (1,248) (55,925) (202) (63,117)
Cumulative effect of accounting change, net of tax - - - (46,536)
----------- ----------- ----------- -----------
Net Loss $ (1,248) $ (55,925) $ (202) $(109,653)
=========== =========== =========== ===========
Basic and Diluted Earnings (Loss) Per Share
Continuing operations $ (0.13) $ (0.15) $ (0.02) $ (0.36)
Discontinued operations - (6.17) - (6.82)
----------- ----------- ----------- -----------
Before cumulative effect of accounting change (0.13) (6.32) (0.02) (7.18)
Cumulative effect of accounting change - - - (5.30)
----------- ----------- ----------- -----------
Net earnings (loss) $ (0.13) $ (6.32) $ (0.02) $ (12.48)
=========== =========== =========== ===========
Average number of shares outstanding - Basic and Diluted 9,290 8,852 9,280 8,784
Amcast Industrial Corporation
News Release - Page 5 of 5
March 23, 2003
CONDENSED BALANCE SHEETS
($ in thousands)
February 29 August 31
2004 2003
---------- ----------
ASSETS
Current Assets
Cash and cash equivalents $ 7,039 $ 5,697
Accounts receivable 39,364 39,979
Inventories 19,163 19,004
Other current assets 4,069 5,338
---------- ----------
Total Current Assets 69,635 70,018
Fixed Assets, (net) 130,668 139,397
Restricted Cash 6,000 7,078
Deferred Taxes 4,204 4,204
Other Assets 8,484 9,627
---------- ----------
Total Assets $ 218,991 $ 230,324
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)
Current Liabilities
Accounts payable $ 27,820 $ 31,419
Current debt 5,900 2,456
Other current liabilities 19,967 21,011
---------- ----------
Total Current Liabilities 53,687 54,886
Long-Term Debt 166,690 175,184
Deferred Liabilities 40,619 42,189
Shareholders' Equity (Deficit) (42,005) (41,935)
---------- ----------
Total Liabilities and Shareholders' Equity (Deficit) $ 218,991 $ 230,324
========== ==========