Exhibit 19
INVESTOR CONTACT:
FREDERICK C. FLYNN, JR.
203/238-8847
FFLYNN@CUNO.COM
MAY 21, 2003
FOR IMMEDIATE RELEASE
CUNO REPORTS RECORD SECOND QUARTER RESULTS
- Record second quarter Sales of $69.3 million (up 10%)
- Record second quarter diluted EPS of $0.37 (up 16%)
- Record second quarter Operating Margin of 13.9%
- Record second quarter Orders of $72.4 million
Meriden, CT: CUNO Incorporated (Nasdaq:CUNO) today reported record second
quarter results for the period ended April 30, 2003. Sales were $69.3 million,
up 10% versus the same period in 2002 and up 5% in local currency. Net income
for the second quarter increased by 16% to $6.3 million from $5.4 million
reported in the same period in 2002. Diluted earnings per share for the period
were a second quarter record $0.37, up 16% compared to $0.32 in the prior year
period.
Commenting on the Company's second quarter results, Mark G. Kachur,
Chairman and Chief Executive Officer, said "Our record second quarter results
reflect the strength and resilience of our business model, particularly
considering the current business environment. We achieved double-digit sales
growth in Healthcare and Fluid Processing and our Potable Water business
performed well. In addition, our geographic diversity contributed to our strong
results, as international sales increased by 23% (up 12% in local currency), led
by strong growth in Europe and the Asia/Pacific region."
For the first six months of 2003, sales were a record $135.7 million, up
12% (up 8% in local currency), and net income was $11.7 million versus $9.9
million in the prior year first half. Strong sales in our international
operations helped offset modest growth in North America. Diluted earnings per
share were a record $0.69, up 17% from $0.59 in the first six months of 2002.
Commenting on business conditions and the outlook for CUNO, Mr. Kachur
added, "Our incoming orders were a second quarter record $72.4 million and our
backlog remains strong. As a result, despite the likelihood of continued weak
business conditions in the U.S. and Japan, we expect to achieve strong financial
results in fiscal 2003, and remain comfortable with our previous EPS guidance in
the $1.50-$1.56 range for the year."
A conference call will be held Thursday, May 22 at 10:00 a.m. (EST) to
review the Company's second quarter financial results and business outlook. The
call-in number is 1-888-273-9885 for interested analysts and investors.
Alternatively, visit us at www.cuno.com/investors to access the webcast of our
conference call. Also, visit us at www.cuno.com for additional information about
the Company.
CUNO is a world leader in the design, manufacture and marketing of a
comprehensive line of filtration products for the separation, clarification and
purification of liquids and gases. CUNO's products, which include proprietary
depth filters and semi-permeable membrane filters, are used in the potable
water, healthcare, and fluid processing markets.
CUNO wants to provide shareowners and prospective investors with more
meaningful and useful information and, therefore, this press release includes
various comments regarding business conditions and the outlook for CUNO, which
reflect currently available information. These forward-looking statements are
subject to risks and uncertainties which could cause performance or actual
results to differ materially from those expressed herein. Such risks and
uncertainties include, among other things: volumes of shipments of CUNO's
products; changes in product mix and product pricing; costs of raw materials;
the rate of economic and industry growth in the U.S. and the other countries in
which CUNO conducts business; economic and political conditions in the foreign
countries in which CUNO conducts a substantial part of its operations and other
risks associated with international operations including exchange rate
fluctuations; CUNO's ability to protect its technology; continuing beneficial
relationships with customers; proprietary products and
manufacturing techniques; changes in technology; changes in legislative,
regulatory or industrial requirements and risks generally associated with new
product introductions and applications; and domestic and international
competition in CUNO's global markets. CUNO assumes no obligation to update the
information contained in this press release.
CUNO INCORPORATED
CONSOLIDATED STATEMENTS OF INCOME
(dollars in thousands, except share amounts)
THREE MONTHS ENDED SIX MONTHS ENDED
APRIL 30, APRIL 30,
2003 2002 2003 2002
------------ ------------ ------------ ------------
Net sales $ 69,305 $ 63,116 $ 135,742 $ 121,753
Less costs and expenses:
Cost of products sold 38,027 34,925 74,710 67,392
Selling, general and administrative 18,238 16,150 36,027 32,038
Research, development and engineering 3,372 3,696 7,042 7,121
------------ ------------ ------------ ------------
59,637 54,771 117,779 106,551
------------ ------------ ------------ ------------
Operating income 9,668 8,345 17,963 15,202
Nonoperating income (expense):
Interest expense (134) (111) (281) (241)
Interest and other income, net 90 27 181 198
------------ ------------ ------------ ------------
(44) (84) (100) (43)
------------ ------------ ------------ ------------
Income before income taxes 9,624 8,261 17,863 15,159
Income taxes 3,320 2,847 6,171 5,226
------------ ------------ ------------ ------------
Net income $ 6,304 $ 5,414 $ 11,692 $ 9,933
============ ============ ============ ============
Basic earnings per common share $ 0.38 $ 0.33 $ 0.70 $ 0.61
Diluted earnings per common share $ 0.37 $ 0.32 $ 0.69 $ 0.59
Basic shares outstanding 16,638,881 16,480,817 16,601,152 16,415,606
Diluted shares outstanding 17,014,779 16,962,435 16,956,848 16,852,399
CUNO INCORPORATED
CONSOLIDATED CONDENSED BALANCE SHEETS
(dollars in thousands)
APRIL 30, OCTOBER 31,
2003 2002
--------- ---------
ASSETS
Current assets
Cash and cash equivalents $ 37,662 $ 40,872
Accounts receivable, net 55,880 50,862
Inventories, net 29,475 26,173
Deferred income taxes 8,051 7,998
Prepaid expenses and other current assets 5,595 4,233
--------- ---------
Total current assets 136,663 130,138
Noncurrent assets
Deferred income taxes 1,528 1,482
Intangible assets, net 30,233 28,758
Prepaid pension costs 2,478 --
Other noncurrent assets 1,133 1,742
Property, plant and equipment, net 79,156 74,759
--------- ---------
Total assets $ 251,191 $ 236,879
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Current portion of long-term debt $ 663 $ 714
Bank loans 11,478 16,374
Accounts payable 19,178 16,256
Accrued payroll and related taxes 11,928 13,633
Other accrued expenses 11,020 10,093
Accrued income taxes 3,195 497
--------- ---------
Total current liabilities 57,462 57,567
Noncurrent liabilities
Long-term debt, less current portion 216 2,030
Deferred income taxes 5,702 5,924
Retirement benefits 5,568 8,945
--------- ---------
Total noncurrent liabilities 11,486 16,899
STOCKHOLDERS' EQUITY
Preferred Stock -- --
Common Stock 17 17
Treasury Stock, at cost (57) (57)
Additional paid-in-capital 48,915 46,375
Unearned compensation (616) (551)
Accumulated other comprehensive loss --
Foreign currency translation adjustments 207 (5,533)
Minimum pension liability (5,153) (5,153)
Change in fair value of derivative financial instruments (85) (8)
--------- ---------
(5,031) (10,694)
Retained earnings 139,015 127,323
--------- ---------
Total stockholders' equity 182,243 162,413
--------- ---------
Total liabilities and stockholders' equity $ 251,191 $ 236,879
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