Exhibit 99
FOR IMMEDIATE RELEASE
April 25, 2007
THE EASTERN COMPANY REPORTS RECORD RESULTS
FOR THE FIRST QUARTER OF 2007
Naugatuck, CT-The Eastern Company (AMEX-EML) today announced the results of its
operations for the first quarter of 2007. Sales for the quarter were $52.3
million, compared to $27.9 million for the same period in 2006, an 88% increase,
while net income was $6.8 million, or $1.14 per diluted share, compared to the
$1.1 million, or $0.20 per diluted share, reported in the first quarter of 2006,
a 491% increase.
Leonard F. Leganza, President and CEO stated, "The first quarter, the eighteenth
consecutive quarter of improved year-to-year sales, was an outstanding quarter
for the Company. Contributing heavily to these results was the final delivery of
the door latching system components for a military project which up-armored
existing Humvees. This contributed $18 million in sales in the quarter. In
addition, the final integration of the Royal Lock and Summit Manufacturing
acquisitions, which were made in the latter half of 2006, contributed $2.7
million in sales for the quarter. Despite the strong impact of the military
contract and the Royal Lock and Summit acquisitions, the Company's core
businesses experienced a 12.9% increase in sales as compared to the first
quarter of 2006. This increase was primarily in the Industrial Hardware
segment."
Mr. Leganza continued, "In 2007, as was the case in 2006, the Company continues
to face rapid increases in energy, health care and raw material costs. While
difficult, it will be necessary for us to overcome these obstacles by
continually improving our productivity, finding further cost reductions and
increasing prices wherever possible in order to maintain acceptable profit
margins. In addition to facing these operating challenges in our core
businesses, the Company will also continue its repositioning efforts and
intensify its growth objectives through acquisitions of complementary businesses
and product lines. Considering the present status of our backlogs and current
economic forecasts, all of our business units are on track for positive results
in 2007."
Mr. Leganza commented further, "Our Metal Products segment has been a particular
challenge in recent times brought on because of lower demand for Malleable Iron
products. Changes have also occurred in coal mining methods which resulted in
lower requirements, in the domestic market, for our proprietary mine roof anchor
products. These challenges have been approached, first by making the investment
required to produce and market Ductile Iron products in addition to Malleable
Iron, a project that has taken somewhat longer than we anticipated. We will also
continue our marketing efforts to introduce our roof anchor products into the
China mining industry. While that effort has not yet yielded great success, we
remain optimistic that the course of action we are taking will, in the future,
produce positive results."
Forward-Looking Statements: Information in this news release contains statements
which reflect the Company's current expectations regarding its future operating
performance and achievements. Actual results may differ due to the many economic
uncertainties that affect the Company's business environment. Further
information about the potential factors which could affect the Company's
financial results are included in the Company's reports and filings with the
Securities and Exchange Commission. The Company is not obligated to update or
revise the aforementioned statements for those new developments.
Contact: Leonard F. Leganza or John L. Sullivan III
(203) 729-2255
Statement of Consolidated Income
THE EASTERN COMPANY (AMEX - EML)
THREE Months Ended
13 wks 13 wks
March 31, 2007 April 1, 2006
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Net Sales $ 52,317,174 $ 27,860,183
Net Income After Tax 6,758,238 1,143,765
Net Income Per Share:
Basic 1.23 0.21
Diluted 1.14 0.20
Weighted average shares outstandings:
Basic 5,507,372 5,464,691
Diluted 5,932,044 5,711,137