NEWS FROM EXHIBIT 99.1
TRANS-INDUSTRIES
Trans-Industries, Inc. - 2637 S. Adams Road - Rochester Hills, MI 48309
- --------------------------------------------------------------------------------
FOR FURTHER INFORMATION:
AT TRANS-INDUSTRIES:
Kai Kosanke
Chief Financial Officer
(248) 852-1990
FOR IMMEDIATE RELEASE
MONDAY AUGUST 16, 2004
TRANS-INDUSTRIES, INC. REPORTS
2004 SECOND-QUARTER AND SIX-MONTH RESULTS
ROCHESTER HILLS, MICHIGAN -- AUGUST 16, 2004 - TRANS-INDUSTRIES, INC. (NASDAQ:
TRNI), a manufacturer of bus lighting systems and information display products,
announced results for the second quarter and six months ending June 30, 2004.
Sales were $7.7 million for the quarter. This represented a decline of 9.9
percent from sales of $8.5 million for the three months ended June 30, 2003.
This decline was concentrated in the lighting products business segment and
resulted primarily from a decrease in the level of bus production from that of
the previous year. Moreover, in the current quarter, the Company shipped a
limited number of luggage lofts, which have higher dollar content per bus than
regular lighting products. While sales of digital information products improved,
such sales were insufficient to offset the decrease in lighting shipments noted
above. These same factors resulted in a sales decrease of $2.0 million, or 11.4
percent, to $15.2 million for the current period from $17.2 million for the
six-month period ended June 30, 2003.
A loss of $2.6 million was incurred for the quarter, consisting of $344,000 from
operations in addition to $2.3 million from the establishment of an additional
inventory reserve. This inventory reserve resulted from several factors that
impacted the Company's operations during the quarter. In early March, management
changes were effected including the appointment of a new President and Chief
Operating Officer. The Company's existing product offerings were analyzed and
some have been curtailed, and personnel has been further reduced, thereby
reducing product absorption. In light of a decline in sales during the second
quarter and the changed business direction, it was determined a portion of the
inventory would not be used going forward. Cost reduction opportunities
continued to be emphasized with formal programs initiated in all cost segments.
However, savings from these programs are not expected to be realized in full
until later in the year as legacy costs in the form of severance payments
continued throughout the quarter.
The Company believes its system for purchasing materials, particularly in the
digital information systems operation, improved in the period as better
utilization of the material requirements production system initiated last year
provided needed information for enhanced scheduling against available inventory.
The Company has been operating under a forbearance agreement with Comerica Bank,
its present lender until January 2005. Efforts to locate another lender to
replace the Comerica credit have been ongoing and the Company anticipates
finalizing credit arrangements with a new lender by September 1, 2004.
ABOUT THE COMPANY:
The Company is a leading provider of lighting systems and related components to
the mass transit market as well as a supplier of information hardware and
software solutions on Intelligent Transportation Systems (ITS) and mass transit
projects. ITS utilizes integrated networks of electronic sensors, signs and
software to monitor road conditions, communicate information to drivers and help
transportation authorities better manage traffic flow across their existing
infrastructures.
Forward-Looking Statements:
Except for statements of historical fact, this news release contains certain
forward-looking statements about the Company. Such statements are subject to
significant risks and uncertainties including changes in economic and market
conditions, management of growth, and other risks noted in the Company's SEC
filings, which may cause actual results to differ materially. We have used words
such as "may," "will," "expect," "anticipate," "believe," "estimate," "plan,"
"intend," and similar expressions in this press release to identify
forward-looking statements. The Company's actual results may differ from those
set forth in such statements. Significant changes in economic conditions,
regulatory or legislative changes affecting Trans-Industries, Inc., its
competitors, or the markets in which it is active, or changes in other factors
may cause future results to vary from those expected by the Company. The Company
believes any forward-looking statements it has made are based on current
management expectations and they are subject to risks and uncertainties. These
risks and uncertainties include, but are not limited to the following:
- The potential inability to close the refinancing of the Company's bank
debt;
- The continued forbearance by the Company's bank lender of their right
to call the debt now due;
- A further decline of economic conditions in general and in the mass
transit industry in particular;
- Changes in customer requirements or reduced demand for the Company's
products and services;
- The inability of the Company to successfully implement its
restructuring program in the informational systems business;
- Competitive factors (including the introduction or enhancement of
competitive products and their successful introduction into the
marketplace);
- Product pricing decreased and component price increases that may
result in materially reduced gross profit margins for the Company's
product;
- Unforeseen increases in operating expenses;
- The inability to attract or retain management, sales, or engineering
talent; and
- The success of management's decision to change the business direction.
VISIT TRANS-INDUSTRIES AT www.transindustries.com
FINANCIAL TABLES FOLLOW.....
TRANS-INDUSTRIES, INC.
SALES AND EARNINGS REPORT (UNAUDITED)
JUNE 30, 2004
--------------------------------------
SECOND QUARTER ENDING SIX MONTHS ENDING
JUNE 30 JUNE 30
------------------------ ------------------------
2004 2003 2004 2003
---- ---- ---- ----
Sales $ 7,697,537 $ 8,542,959 $ 15,232,466 $ 17,192,759
Cost of Sales* 7,988,935 5,862,470 13,594,809 11,921,401
------------ ------------ ------------ ------------
Gross Profit (291,398) 2,680,489 1,637,657 5,271,358
Selling, Gen. & Admin. Exp 2,141,985 2,657,598 4,107,318 5,295,986
Interest 161,068 161,720 323,576 331,769
Restructuring Costs 53,397 0 128,998 272,859
Other (4,280) (1,999) (11,211) (2,008)
------------ ------------ ------------ ------------
Total Expenses 2,352,170 2,817,319 4,548,681 5,898,606
Loss Before Income Taxes (2,643,568) (136,830) (2,911,024) (627,248)
Income Taxes 0 0 0 (17,000)
------------ ------------ ------------ ------------
Net Loss (2,643,568) (136,830) (2,911,024) (610,248)
Preferred Dividend (24,792) 0 (24,792) 0
------------ ------------ ------------ ------------
Net Loss Available to Common
Shareholders $ (2,668,360) $ (136,830) $ (2,935,816) $ (610,248)
============ ============ ============ ============
Loss Per Share
Basic $ (0.85) $ (0.04) $ (0.94) $ (0.19)
============ ============ ============ ============
*2004, includes set-up of inventory reserves of $2.3 million
Weighted Average Number of
Shares Outstanding 3,139,700 3,139,700 3,139,700 3,139,700
******************************************************************************************************************
CONSOLIDATED BALANCE SHEET (UNAUDITED)
--------------------------------------
SECOND QUARTER ENDING
JUNE 30
---------------------
ASSETS: 2004 2003
- ------- ---- ----
Total Current Assets $13,162,987 $21,190,924
Net Fixed Assets 3,476,926 3,966,894
Other Assets 159,442 282,523
----------- -----------
Total Assets $16,799,355 $25,440,341
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY:
- -------------------------------------
Total Current Liabilities $13,010,078 $16,367,399
Deferred Income Taxes 0 458,000
Long Term Debt 292,896 322,816
Shareholders' Equity 3,496,381 8,292,126
----------- -----------
Total Liabilities and Shareholders' Equity $16,799,355 $25,440,341
=========== ===========