EXHIBIT 99.2
CONTACT: INVESTOR RELATIONS (NYSE: BMC)
(952) 851-6000 FOR IMMEDIATE RELEASE
BMC INDUSTRIES' 2ND QUARTER EARNINGS RISE; EPS UP 11% TO $0.20
July 27, 2000 -- Minneapolis, Minnesota, USA - BMC Industries, Inc. reported net
earnings for the second quarter ended June 30, 2000 of $5.5 million, or $0.20
per diluted share. This compares to net earnings of $5.0 million, or $0.18 per
diluted share, in the second quarter of 1999; an increase of 11%. Second quarter
2000 revenues increased 1% to $94.2 million from $93.3 million in 1999.
Excluding the negative impact from the translation of foreign currencies during
the quarter, consolidated revenues increased 4%.
For the six months ended June 30, 2000, total revenues increased to $183.0
million compared to $178.0 million for the same period in 1999; an increase of
3%. This increase was 5% without the negative impact of foreign currency
translation. Net earnings for the six months were $7.8 million or $0.28 per
diluted share, versus $8.2 million or $0.30 per diluted share in 1999.
"We are delighted with the overall performance of the Company in the second
quarter," said BMC Chairman and Chief Executive Officer Paul B. Burke.
"Buckbee-Mears, on the strength of favorable market dynamics and improved
operating efficiencies, had a strong quarter delivering earnings of $7.2
million. The group's operating margin of 13.0% was the best since third
quarter 1997. Vision-Ease recorded its highest quarterly revenues in company
history driven by the momentum of several high-end, value-added products.
Sales of Vision-Ease's higher-margin Tegra-Registered Trademark- coated
polycarbonate and Outlook-TM-polycarbonate progressive lenses increased
dramatically. Vision-Ease's sunwear products including SunSport-TM-
non-ophthalmic and SunRx-Registered Trademark- polarized polycarbonate lenses
also showed strong quarter-over-quarter growth."
Second quarter revenues from Buckbee-Mears, which includes Mask Operations and
Buckbee-Mears St. Paul ("BMSP"), were $55.6 million, a slight decrease of $0.3
million from the $55.9 million of revenues reported in 1999. Buckbee-Mears sales
were negatively impacted by foreign currency translation during the quarter.
Excluding the impact of foreign currency translation, revenues for the group
increased 4%.
On this revenue base, Buckbee-Mears' second quarter earnings increased $0.2
million from $7.0 million in 1999 to $7.2 million in 2000 and operating margins
increased to 13.0%. Favorable product mix, improved production yields across all
manufacturing lines, savings from automated inspection equipment installed on
both monitor mask lines, and lower selling and marketing costs all contributed
to the increase in quarter-over-quarter earnings. These operating improvements
were partially offset by higher product engineering and development spending
during the quarter to support the group's
advanced products efforts. Buckbee-Mears' second quarter operating results
were approximately $0.4 million lower in 2000 due to foreign currency
translation rate changes from 1999.
Sales of entertainment masks increased 10% in second quarter 2000 compared to
the prior year period. This increase was driven by a 40% rise in sales of jumbo
entertainment masks and a 9% increase in sales of large entertainments masks,
both of which are higher margin products. Sales of computer monitor masks
decreased 25% in second quarter 2000 as compared to second quarter 1999 as a
result of competitive price reductions and the temporary loss of volume from one
particular monitor customer. In addition, BMSP's second quarter sales and
profitability were down in 2000 as compared to a year ago. The focus for this
business continues to be diversification of its customer and product base.
During the quarter, BMC announced that it had been selected by THOMSON
multimedia as a supplier of shadow masks for its new lineup of digital
high-definition television ("HDTV") receivers. Thomson's selection of BMC
demonstrates our ability to support customers in the advanced products arena and
participate in trends that continue to drive the television display market. BMC
will build upon the strong relationships that exist with its customers and
continue to invest in advanced product development to expand its presence in the
growing HDTV, flat and other high-end mask and tube product segments.
BMC's Optical Products group generated revenues of $38.7 million in the second
quarter of 2000, up 3%, or $1.2 million, over the prior year quarter. This
revenue figure is the highest in company history. Sales of high-end, value-added
products increased 18% and accounted for 65% of total second quarter 2000
revenues, compared to 57% in second quarter 1999. Partially offsetting this
strong high-end product performance were glass and plastic sales, which were
down 15% and 19% for the quarter, respectively, due principally to market
dynamics and product sourcing issues.
High-end sales growth was due primarily to strong sales of Tegra-Registered
Trademark- coated polycarbonate lenses and Outlook-TM- progressive
polycarbonate lenses, which were introduced in 1999. Together, second quarter
2000 sales of these high-end products were up 185% over the same period last
year. In addition, sales of Vision-Ease's SunRx-Registered Trademark-
polarized polycarbonate lenses grew 40%.
Vision-Ease's SunSport-TM- non-ophthalmic polarizing lens business posted
another excellent quarter with sales growing 52% over the same period a year
ago. A strong broad trend to the use of polarizing lenses in premium sunwear
coupled with growing relationships with several prominent sunwear manufacturers
continue to produce strong results and assist Vision-Ease in diversifying its
revenue base.
Optical Product's second quarter earnings were $4.6 million in 2000 compared to
$5.5 million in the prior year. Operating margin for the quarter was 12%,
significantly improved from 6% in first quarter 2000, but down from 15% posted
for the second quarter last year. Second quarter 2000 earnings continue to be
negatively impacted by higher product costs related to lenses produced during
1999. Strategic investments in key research and development projects and the
expansion of Vision-Ease Europe's new business development efforts (including
laboratory infrastructure) also impacted the group's second quarter results.
Vision-Ease has implemented a number of measures designed to return its business
to its previous standards of operating performance, including expanding
production capabilities at its existing Jakarta, Indonesia facility and
optimizing lens production among all of its facilities.
Other income of $1.0 million for the second quarter included a $0.6 million gain
on the settlement of a cross-currency swap.
This press 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 that are intended to be covered by the safe harbors created
thereby. Statements made in this press release which are not strictly
historical, including statements regarding future performance, are
forward-looking statements and as such are subject to a number of risks and
uncertainties, including, among others, lower demand for televisions, computer
monitors and ophthalmic lenses; further mask and ophthalmic lens price declines
and imbalances of supply and demand; ability to meet customer new product
qualifications; consumer demand for direct-view high-definition television and
digital receivers; competition with alternative technologies and products,
including laser surgery for the correction of visual impairment and liquid
crystal, plasma, projection and other types of visual displays; ability to
implement the Optical Products group's initiatives in strategic polycarbonate
marketing and manufacturing sourcing; ability to grow European sales through the
operation of processing laboratories; new product development, introduction and
acceptance; cost reduction and reorganization efforts; continued slowdown at
BMSP; ability to partner with new and existing Buckbee-Mears customers or
transition development relationships into full-scale production; the effect of
regional or global economic slowdowns; adjustments to inventory valuations;
liability and other claims asserted against BMC; negative foreign currency
fluctuations; and ability to recruit and retain key personnel.
BMC Industries, Inc., through its Vision-Ease subsidiary, is a leading designer,
manufacturer and distributor of polycarbonate, glass and hard-resin plastic
eyewear lenses. BMC, through its Buckbee-Mears division, also manufactures
precision imaged products such as aperture masks and photo-etched metal and
electroformed parts. BMC is the only North American manufacturer of aperture
masks, which are used in color television and computer monitor picture tubes.
BMC's common stock is traded on the New York Stock Exchange under the symbol
"BMC". For more information about BMC Industries, Inc., visit the Company's
website: www.bmcind.com.
-more-
BMC INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
(Unaudited)
(in thousands, except per share amounts)
Three Months Ended Six Months Ended
June 30 June 30
-----------------------------------------------------------------
2000 1999 2000 1999
- --------------------------------------------------------------------------------------------------------------------------------
Revenues $ 94,237 $ 93,339 $ 182,988 $ 177,984
Cost of products sold 78,346 75,866 155,033 146,944
- --------------------------------------------------------------------------------------------------------------------------------
Gross Margin 15,891 17,473 27,955 31,040
Selling 4,110 4,999 8,389 9,364
Administrative 1,507 1,486 2,797 2,719
- --------------------------------------------------------------------------------------------------------------------------------
Income from Operations 10,274 10,988 16,769 18,957
- --------------------------------------------------------------------------------------------------------------------------------
Other Income and (Expense)
Interest expense (3,368) (3,410) (6,583) (6,873)
Interest Income 64 81 86 86
Other income 1,027 69 1,027 459
- --------------------------------------------------------------------------------------------------------------------------------
Earnings Before Income Taxes 7,997 7,728 11,299 12,629
Income Taxes 2,522 2,721 3,523 4,431
- --------------------------------------------------------------------------------------------------------------------------------
Net Earnings $ 5,475 $ 5,007 $ 7,776 $ 8,198
- --------------------------------------------------------------------------------------------------------------------------------
Net Earnings Per Share:
Basic $ 0.20 $ 0.18 $ 0.28 $ 0.30
Diluted 0.20 0.18 0.28 0.30
================================================================================================================================
Number of Shares Included in Per Share Computation:
Basic 27,401 27,275 27,392 27,238
Diluted 27,582 27,769 27,590 27,587
================================================================================================================================
-more-
BMC INDUSTRIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(in thousands)
- ----------------------------------------------------------------------------------------------------------------------------------
JUNE 30 December 31
2000 1999
- ----------------------------------------------------------------------------------------------------------------------------------
ASSETS
Cash and cash equivalents $ 1,910 $ 1,146
Trade accounts receivable, net 48,129 42,025
Inventories 76,380 82,312
Deferred income taxes 12,129 11,588
Other current assets 13,890 12,580
- ----------------------------------------------------------------------------------------------------------------------------------
Total Current Assets 152,438 149,651
- ----------------------------------------------------------------------------------------------------------------------------------
Property, plant and equipment 279,326 278,807
Less accumulated depreciation 134,623 127,569
- ----------------------------------------------------------------------------------------------------------------------------------
Property, plant and equipment, net 144,703 151,238
- ----------------------------------------------------------------------------------------------------------------------------------
Deferred income taxes 9,095 9,221
Intangibles assets, net 66,598 68,232
Other assets 5,967 5,211
- ----------------------------------------------------------------------------------------------------------------------------------
TOTAL ASSETS $ 378,801 $ 383,553
==================================================================================================================================
LIABILITIES AND STOCKHOLDERS' EQUITY
- ----------------------------------------------------------------------------------------------------------------------------------
Short-term borrowings $ 1,242 $ 2,303
Accounts payable 32,859 30,342
Income taxes payable 8,675 8,093
Accrued expenses and other current liabilities 20,990 19,197
- ----------------------------------------------------------------------------------------------------------------------------------
Total Current Liabilities 63,766 59,935
- ----------------------------------------------------------------------------------------------------------------------------------
Long-term debt 152,049 165,959
Other liabilities 19,395 18,522
Deferred income taxes 2,582 2,715
Stockholders' equity
Common stock 49,174 49,077
Retained earnings 99,574 92,620
Accumulated other comprehensive income (loss) (6,016) (3,495)
Other (1,723) (1,780)
- ----------------------------------------------------------------------------------------------------------------------------------
TOTAL STOCKHOLDERS' EQUITY 141,009 136,422
- ----------------------------------------------------------------------------------------------------------------------------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 378,801 $ 383,553
==================================================================================================================================
-more-
BMC INDUSTRIES, INC.
SEGMENT INFORMATION
(Unaudited)
(in thousands)
Three Months Ended June 30
--------------------------------------------------------------------------------------------------------
Buckbee-Mears Optical Products Consolidated
--------------------------------------------------------------------------------------------------------
2000 1999 2000 1999 2000 1999
- ------------------------------------------------------------------------------------------------------------------------------------
Revenues $ 55,576 $ 55,851 $ 38,661 $ 37,488 $ 94,237 $ 93,339
Cost of Products Sold 47,156 47,250 31,190 28,616 78,346 75,866
- ------------------------------------------------------------------------------------------------------------------------------------
Gross Margin 8,420 8,601 7,471 8,872 15,891 17,473
Gross Margin % 15.2% 15.4% 19.3% 23.7% 16.9% 18.7%
Selling 1,191 1,591 2,919 3,408 4,110 4,999
Unallocated corporate
administration - - - - 1,507 1,486
- ------------------------------------------------------------------------------------------------------------------------------------
Income from Operations $ 7,229 $ 7,010 $ 4,552 $ 5,464 $ 10,274 $ 10,988
====================================================================================================================================
Operating income % 13.0% 12.6% 11.8% 14.6% 10.9% 11.8%
Capital spending $ 2,591 $ 2,747
Depreciation and
amortization $ 6,138 $ 5,730
EBITDA $ 17,503 $ 16,868
EBITDA % 18.6% 18.1%
-30-