Exhibit 19
INVESTOR CONTACT:
FREDERICK C. FLYNN, JR.
203/238-8847
FFLYNN@CUNO.COM
AUGUST 20, 2003
FOR IMMEDIATE RELEASE
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CUNO REPORTS RECORD THIRD QUARTER RESULTS
o Record third quarter Sales of $75.0 million (up 9%)
o Record third quarter diluted EPS of $0.44 (up 13%)
o Record third quarter Operating Margin of 14.9%
o Record third quarter Orders of $76.0 million (up 13%)
Meriden, CT: CUNO Incorporated (Nasdaq:CUNO) today reported record
third quarter results for the period ended July 31, 2003. Sales were $75.0
million, up 9% versus the same period in 2002 and up 4% in local currency. Net
income for the third quarter increased by 13% to $7.5 million from $6.6 million
reported in the same period in 2002. Diluted earnings per share for the period
were a third quarter record $0.44, up 13% compared to $0.39 in the prior year
quarter.
Commenting on the Company's third quarter results, Mark G. Kachur,
Chairman and Chief Executive Officer, said "Our record third quarter results
reflect the strength and resilience of our business model, particularly
considering the current challenging macroeconomic environment. Our sales growth
was led by double-digit increases in both our Healthcare and Potable Water
businesses. Our geographic diversity also contributed to our strong overall
results, as international sales
increased by 19% (up 8% in local currency), reflecting double-digit growth in
Europe, the Asia/Pacific region and Latin America."
For the first nine months of fiscal 2003, sales were a record $210.7 million, up
11% (up 7% in local currency), and net income was $19.2 million versus $16.6
million in the prior year period. Strong sales in our international operations
helped offset modest growth in North America. Diluted earnings per share were a
record $1.13, up 15% from $0.98 in the first nine months of 2002.
Commenting on business conditions and the outlook for CUNO, Mr. Kachur added,
"Our incoming orders were a third quarter record $76.0 million and our backlog
remains strong. As a result, despite the near term likelihood of continued weak
business conditions in the U.S. and Japan, we expect to achieve strong financial
results in fiscal 2003, and are comfortable with the current $1.52-$1.56 range
of analysts' EPS estimates for the year."
A conference call will be held Thursday, August 21 at 10:00 a.m. (EST) to review
the Company's third quarter financial results and business outlook. The call-in
number is 1-888-273-9889 for interested analysts and investors. Alternatively,
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: those items described in our reports filed with the SEC as
well as volumes of shipments of CUNO's products; changes in product mix and
product pricing; relationships with customers and suppliers; 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,
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 and per-share amounts)
THREE MONTHS ENDED NINE MONTHS ENDED
JULY 31, JULY 31,
2003 2002 2003 2002
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Net sales $ 74,965 $ 68,932 $ 210,707 $ 190,685
Less costs and expenses:
Cost of products sold 41,088 37,920 115,798 105,312
Selling, general and administrative 18,826 17,186 54,853 49,224
Research, development and engineering 3,855 3,729 10,897 10,850
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63,769 58,835 181,548 165,386
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Operating income 11,196 10,097 29,159 25,299
Nonoperating income (expense):
Interest expense (159) (94) (440) (335)
Interest and other income, net 180 31 361 229
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21 (63) (79) (106)
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Income before income taxes 11,217 10,034 29,080 25,193
Income taxes 3,750 3,405 9,921 8,631
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Net income $ 7,467 $ 6,629 $ 19,159 $ 16,562
============ ============ ============ ============
Basic earnings per common share $ 0.45 $ 0.40 $ 1.15 $ 1.01
Diluted earnings per common share $ 0.44 $ 0.39 $ 1.13 $ 0.98
Basic shares outstanding 16,685,602 16,525,092 16,629,302 16,449,402
Diluted shares outstanding 17,088,250 16,958,674 17,000,649 16,877,245
CUNO INCORPORATED
CONSOLIDATED CONDENSED BALANCE SHEETS
(dollars in thousands)
JULY 31, OCTOBER 31,
2003 2002
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Assets
Current assets
Cash and cash equivalents $ 41,952 $ 40,872
Accounts receivable, net 59,382 50,862
Inventories, net 28,527 26,173
Deferred income taxes 8,424 7,998
Prepaid expenses and other current assets 5,421 4,233
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Total current assets 143,706 130,138
Noncurrent assets
Deferred income taxes 1,507 1,482
Intangible assets, net 30,653 28,758
Prepaid pension costs 2,669 --
Other noncurrent assets 1,234 1,742
Property, plant and equipment, net 82,035 74,759
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Total assets $ 261,804 $ 236,879
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Current portion of long-term debt $ 705 $ 714
Bank loans 11,953 16,374
Accounts payable 19,343 16,256
Accrued payroll and related taxes 11,636 13,633
Other accrued expenses 10,455 10,093
Accrued income taxes 4,866 497
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Total current liabilities 58,958 57,567
Noncurrent liabilities
Long-term debt, less current portion 322 2,030
Deferred income taxes 6,119 5,924
Retirement benefits 5,685 8,945
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Total noncurrent liabilities 12,126 16,899
STOCKHOLDERS' EQUITY
Preferred Stock -- --
Common Stock 17 17
Treasury Stock, at cost (57) (57)
Additional paid-in-capital 49,770 46,375
Unearned compensation (698) (551)
Accumulated other comprehensive loss --
Foreign currency translation adjustments 387 (5,533)
Minimum pension liability (5,153) (5,153)
Change in fair value of derivative financial instruments (28) (8)
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(4,794) (10,694)
Retained earnings 146,482 127,323
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Total stockholders' equity 190,720 162,413
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Total liabilities and stockholders' equity $ 261,804 $ 236,879
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