GRIFFON CORPORATION ANNOUNCES RECORD
OPERATING RESULTS FOR THE FIRST QUARTER OF FISCAL 2004
AND INCREASE IN STOCK BUYBACK PROGRAM
Jericho, New York, February 5, 2004 - Griffon Corporation (NYSE:GFF) today
reported record operating performance for the first quarter of fiscal 2004,
ended December 31, 2003. Net sales for the quarter increased to $338,502,000, up
from $302,154,000 for the first quarter of fiscal 2003. Income before income
taxes grew to $25,658,000 from $21,081,000. Net income was $13,115,000 in the
current quarter compared to $10,920,000 last year. Basic earnings per share for
the quarter was $.44 compared to $.33 last year and diluted earnings per share
was $.41 compared to $.32 in 2003.
Sales and earnings growth in the first quarter reflects continued strong
operating performance by each of the company's segments. Specialty plastic films
had another solid quarter with improved product mix, higher unit volume and
increased manufacturing efficiencies driving profitability gains in spite of
higher raw material costs. The effect of a weaker U.S. dollar on foreign
operations also contributed to the sales and earnings gains. In the building
products operations, strong demand buoyed sales at both the garage doors and the
installation services segments. Garage doors enjoyed higher unit sales during
the quarter and also benefited from a favorable product mix, resulting in
operating profit and margin increases. Installation services' profitability and
operating margins improved on higher sales attributable to positive market
conditions and the elimination last year of an underperforming location. The
electronic information and communication systems segment, Telephonics, continued
to build momentum in
the first quarter, reporting higher sales and operating profit due to recently
awarded contracts and good performance in military production programs. Higher
consolidated earnings in the quarter also absorbed increased interest expense
associated with the company's convertible subordinated notes, which were sold in
the latter part of fiscal 2003.
Strong cash flow from operations generated $25,000,000 for the quarter
which was used for capital expenditures of $14,000,000, principally for the
specialty plastic films segment capital expansion programs, and $6,000,000 to
acquire 300,000 shares of the company's common stock under its buyback program.
Since the end of the first quarter the company has purchased an additional
200,000 shares of its Common Stock for $4,000,000 and announced today that it
has increased its stock buyback program by 1,000,000 shares. This brings the
current authorization to 1,900,000 shares. Since 1993, the company has expended
$165,000,000 to purchase 14,000,000 shares of its capital stock. Additional
purchases will be made from time to time, depending on market conditions, at
prices deemed appropriate by management.
Griffon Corporation -
o is a leading manufacturer and marketer of residential, commercial
and industrial garage doors sold to professional installing
dealers and major home center retail chains;
o installs and services specialty building products and systems,
primarily garage doors, openers, fireplaces and cabinets, for new
construction markets through a substantial network of operations
located throughout the country;
o is an international leader in the development and production of
embossed and laminated specialty plastic films used in the baby
diaper, feminine napkin, adult incontinent, surgical and patient
care markets; and
o develops and manufactures information and communication systems
for government and commercial markets worldwide.
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of
1995: All statements other than statements of historical fact included in this
release, including without limitation statements regarding the company's
financial position, business strategy and the plans and objectives of the
company's management for future operations, are forward-looking statements. When
used in this release, words such as "anticipate", "believe", "estimate",
"expect", "intend", and similar expressions, as they relate to the company or
its management, identify forward-looking statements. Such forward-looking
statements are based on the beliefs of the company's management, as well as
assumptions made by and information currently available to the company's
management. Actual results could differ materially from those contemplated by
the forward-looking statements as a result of certain factors, including but not
limited to, business and economic conditions, competitive factors and pricing
pressures, capacity and supply constraints. Such statements reflect the views of
the company with respect to future events and are subject to these and other
risks, uncertainties and assumptions relating to the operations, results of
operations, growth strategy and liquidity of the company. Readers are cautioned
not to place undue reliance on these forward-looking statements. The company
does not undertake to release publicly any revisions to these forward-looking
statements to reflect future events or circumstances or to reflect the
occurrence of unanticipated events.
GRIFFON CORPORATION
-------------------
OPERATING HIGHLIGHTS
--------------------
(Unaudited)
For the Three Months Ended
December 31,
------------------------------
2003 2002
Net sales:
Garage Doors $ 121,860,000 $ 113,463,000
Installation Services 76,705,000 72,320,000
Specialty Plastic Films 104,001,000 87,342,000
Electronic Information and Communication Systems 41,640,000 35,761,000
Intersegment eliminations (5,704,000) (6,732,000)
------------- -------------
$ 338,502,000 $ 302,154,000
============= =============
Operating income:
Garage Doors $ 13,260,000 $ 10,917,000
Installation Services 3,006,000 1,679,000
Specialty Plastic Films 12,940,000 10,666,000
Electronic Information and Communication Systems 2,030,000 1,722,000
------------- -------------
Segment operating income 31,236,000 24,984,000
Unallocated amounts (3,728,000) (3,134,000)
Interest expense, net (1,850,000) (769,000)
------------- -------------
Income before income taxes 25,658,000 21,081,000
Provision for income taxes (9,493,000) (8,011,000)
------------- -------------
Income before minority interest 16,165,000 13,070,000
Minority interest (3,050,000) (2,150,000)
------------- -------------
Net income $ 13,115,000 $ 10,920,000
============= =============
Earnings per share of common stock:
Basic $ .44 $ .33
===== =====
Diluted $ .41 $ .32
===== =====