Exhibit 99.1
Tecumseh Products Company 100 E. Patterson Street
Press Release Tecumseh, MI 49286
TECUMSEH PRODUCTS COMPANY REPORTS SECOND QUARTER 2006 RESULTS
Tecumseh, Michigan, August 15, 2006 . . . . Tecumseh Products Company
(NASDAQ-TECUA, TECUB) announced today its 2006 second quarter consolidated
results as summarized in the following Consolidated Condensed Statements of
Operations.
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED)
Three Months Ended Six Months Ended
June 30, June 30,
------------------ ------------------
(Dollars in millions except per share amounts) 2006 2005 2006 2005
------- -------- ------- --------
NET SALES $ 456.3 $ 432.8 $ 902.4 $ 873.0
Cost of sales 432.3 402.2 843.9 815.1
Selling and administrative expenses 44.3 40.9 89.5 84.2
Impairments, restructuring charges and other items 5.0 109.8 5.6 109.9
------- -------- ------- --------
OPERATING LOSS (25.3) (120.1) (36.6) (136.2)
Interest expense (11.0) (5.5) (19.4) (11.6)
Interest income and other, net 2.9 1.7 7.9 5.0
------- -------- ------- --------
LOSS FROM CONTINUING OPERATIONS BEFORE TAXES (33.4) (123.9) (48.1) (142.8)
Tax provision (benefit) (4.3) 0.4 (9.9) (6.1)
------- -------- ------- --------
Loss from continuing operations (29.1) (124.3) (38.2) (136.7)
Income from discontinued operations, net of tax 62.8 1.8 62.3 1.9
------- -------- ------- --------
NET INCOME (LOSS) $ 33.7 ($122.5) $ 24.1 ($134.8)
------- -------- ------- --- ----
Basic and diluted income (loss) per share:
Continuing operations ($1.58) ($6.73) ($2.07) ($7.40)
Discontinued operations $ 3.40 $ 0.10 $ 3.37 $ 0.10
------- -------- ------- --------
NET INCOME (LOSS) PER SHARE $ 1.82 ($6.63) $ 1.30 ($7.30)
------- -------- ------- --------
WEIGHTED AVERAGE SHARES (in thousands of shares) 18,480 18,480 18,480 18,480
======= ======== ======= ========
Consolidated net loss from continuing operations for the second quarter of
2006 was $29.1 million ($1.58 per share) compared to a loss of $124.3 million
($6.73 per share) in the second quarter of 2005. The change in loss from
continuing operations reflected a $94.8 million reduction in operating loss
before interest and taxes, including lower impairments and restructuring charges
of $104.8 million and improvement in the Engine & Power Train segment offset by
lower results in the Compressor and Electrical Components segments.
Reported results for the second quarter 2006 included restructuring and
asset impairment charges related to Electrical Components business for the
relocation of certain electric motor production from Australia to Thailand of
$2.4 million ($0.13 per share) and restructuring and asset impairment charges
related to the Engine & Power Train business primarily for the consolidation of
transmission production into a single U.S. facility of $2.6 million ($0.14 per
share). Reported results for the second quarter 2005 included a goodwill
impairment charge related to the Electrical Components business of $108.0
million ($5.84 per share) and restructuring and asset impairment charges of $1.8
million ($1.6 million net of tax or $0.09 per share) related to the Engine &
Power Train ($1.1 million), Compressor ($0.2 million) and Electrical Components
($0.5 million) segments.
1
Loss from continuing operations before taxes improved by $90.5 million. The
increase to interest expense primarily reflected the higher average interest
rates associated with the Company's current borrowing arrangements.
In determining loss from continuing operations, the Company recognized a
tax benefit of $4.3 million. The benefit resulted from U.S. accounting rules
that specify allocation methods, which are applied by tax jurisdiction, between
items recognized in the Statement of Operations versus the other comprehensive
income portion of stockholders' equity, as well as between continuing and
discontinued operations. The benefit reflected in continuing operations was more
than offset by tax expense of $6.2 million recognized in conjunction with the
gain on sale of a subsidiary which is included in discontinued operations. The
Company's effective income tax rate was 4.4% for the first half of 2005. This
rate was primarily due to non-deductibility of the goodwill impairment
recognized in the second quarter of 2005.
During the second quarter of 2006, the Company completed the sale of 100%
of its ownership in Little Giant Pump Company. The operating results of Little
Giant Pump Company for 2006 and the comparable prior year periods have been
reclassified from continuing operations to income from discontinued operations.
Under accounting rules, the Company has also allocated the portion of its
interest expense associated with this operation to the discontinued operations
line item. Proceeds from the sale were approximately $121 million. The Company
recognized a pre-tax gain on the sale of $69.5 million. The gain on the sale,
plus earnings during the Company's period of ownership, net of taxes and
interest, is presented in income from discontinued operations and amounted to
$62.3 million net of tax ($3.37 per share). In addition, gains of $8.5 million
associated with curtailment of employee benefits formerly provided to Little
Giant employees will be reflected in third quarter financial results. As
required by the Company's lending agreements, the proceeds were utilized to
repay a portion of the Company's debt.
Consolidated net loss from continuing operations for the first half of 2006
was $38.2 million ($2.07 per share) compared to a loss of $136.7 million ($7.40
per share) for the same period in 2005. Year-to-date results reflected a $99.6
million reduction in operating loss before interest and taxes including lower
restructuring charges of $104.3 million and better results in the Engine & Power
Train and Electrical Components segments offset by lower results in the
Compressor segment.
Consolidated net sales from continuing operations in the second quarter of
2006 increased to $456.3 million from $432.8 million in 2005. Excluding the
increase in sales due to the effects of foreign currency translation of $10.9
million, 2006 second quarter sales increased by 2.9%. The sales increases were
attributable to the Compressor and Electrical Components segments, partially
offset by a decline in sales in the Engine & Power Train segment.
Consolidated net sales from continuing operations for the first six months
of 2006 increased to $902.4 million from $873.0 million. Excluding the increase
in sales due to the effects of foreign currency translation of $20.0 million,
2006 six month sales increased by 1.1%. Like the second quarter, increases were
attributable to the Compressor and Electrical Components segments offset by the
Engine & Power Train segment.
COMPRESSOR BUSINESS
Second quarter 2006 sales in the Compressor business increased to $273.3
million from $247.6 million in the prior year. Compressor business sales in the
first six months of 2006 increased to $524.8 million from $488.6 million in the
first six months of 2005. Excluding the increase in sales due to the effects of
foreign currency translation of $10.3 million for the second quarter and $19.6
million for the
2
first six months, sales increased by 6.2% and 3.4% in the second quarter and
first six months, respectively. The balance of the increases were primarily
attributable to higher unit volumes in aftermarket and commercial distribution
markets in the U.S. and Europe as a result of favorable weather conditions that
occurred during the current quarter.
Compressor business operating results for the second quarter of 2006 was a
loss of $3.8 million compared to income of $7.4 million in the second quarter of
2005. Operating income for the six months ended June 30, 2006 amounted to $2.8
million compared to $16.0 million for the first six months of 2005. The lower
operating income was attributable to lower average selling prices, unfavorable
foreign currency rates and higher material and other input costs partially
offset by better volumes, headcount reductions, and productivity improvements.
For the second quarter, the Brazilian Real was on average 12% stronger against
the U.S. Dollar in 2006 versus 2005, and the results of hedging activities were
less favorable year over year in the second quarter than compared to the first
quarter. Including the effects of hedging activities, the Company estimates that
changes in foreign exchange rates decreased operating income by approximately
$10.3 million compared to the second quarter 2005. Copper was also a significant
factor as spot copper prices were on average 122% higher during the second
quarter 2006 versus 2005.
ELECTRICAL COMPONENTS BUSINESS
Electrical Components business sales were $106.9 million for the second
quarter of 2006, an increase of 4.4% over sales of $102.4 million in the same
quarter last year. Electrical Components business sales in the first six months
of 2006 increased 6.6% to $216.0 million from $202.6 million. Second quarter
trends were consistent with those of the first quarter of 2006 with higher sales
in the residential and commercial markets (up 13.3% year-to-date) due to strong
HVAC related sales being partially offset by lower sales (down 9% year-to-date)
in the automotive motor market as a result of lower build schedules and market
share losses by the Company's customers at their respective OEM customers.
Electrical Components operating results for the second quarter of 2006 was
a loss of $1.7 million compared to income of $0.2 million in the second quarter
of 2005. For the first six months 2006, operating income was $3.2 million
compared to an operating loss of $0.8 million in the first six months of 2005.
The decline during the second quarter was primarily due to higher commodity
costs, production inefficiencies associated with a facility in Mexico and costs
associated with a product warranty issue. This represented a reversal of first
quarter results which had improved $6.0 million over the prior year due to the
higher sales volumes, improved operational efficiencies and pricing actions
taken in 2005. Like the Compressor business, copper is a significant input into
the cost of an electric motor. The cost of copper acquisitions were estimated to
be approximately $3.7 million higher in the second quarter when compared to
prices at the beginning of the year.
ENGINE & POWER TRAIN BUSINESS
Engine & Power Train business sales were $71.5 million in the second
quarter of 2006 compared to $78.7 million for the same period a year ago. First
half 2006 sales amounted to $152.4 million compared to $173.6 million in the
first half of 2005. The decline in sales for the second quarter and first six
months was due primarily to the loss of sales of $4.9 million and $21.9 million,
respectively, into the European market from the Company's former Italian
subsidiary and lower sales of transmission products in the second quarter. As
previously disclosed on December 28, 2005, the Company closed the engine
manufacturing operations of its wholly owned subsidiary, Tecumseh Europa S.p.A.,
located in Turin, Italy. The shutdown was accomplished through an Italian form
of court-supervised liquidation.
3
The effects of the liquidation were reflected in the Company's 2005 results. The
Italian subsidiary was the primary, but not sole, source of engines for sales
into the European market. This decline in unit volumes sold into Europe was
partially offset by an increase in engine volumes sold into the United States
that were primarily attributable to the placement of the Company's engines on
additional product applications at existing customers. North American
year-to-date engine unit deliveries were approximately 11% greater than those of
the prior year.
Engine & Power Train business operating loss for the second quarter of 2006
was $11.2 million compared to a loss of $15.5 million during the same period a
year ago. For the first half of 2006, the business incurred an operating loss of
$29.7 million compared to an operating loss of $36.4 million in 2005. Included
in the 2006 loss were AlixPartners' fees of $4.1 million in the second quarter
and $13.1 million in the first six months and a $3.5 million ($2.5 million net
of tax or $0.13 per share) gain from the sale of the Douglas, Georgia engine
facility. Exclusive of these two items, operating results improved by
approximately 56% and 46% in the second quarter and first half of 2006,
respectively, versus the comparable prior year periods. The improvement in the
second quarter reflected lower fixed costs associated with plant closures,
higher productivity levels in Brazil, and higher U.S. volumes, partially offset
by higher commodity and transportation costs and a less favorable value of the
Brazilian Real.
LIQUIDITY AND CAPITAL RESOURCES
For the first six months of 2006, cash used by operations amounted to $93.8
million, reflecting both an operating loss and net investments in working
capital and other items, particularly recoverable non-income taxes in Brazil.
The cash used to fund operations and capital expenditures was provided by
proceeds from the sale of Little Giant Pump Company. Proceeds from the sale of
Little Giant were also used to repay amounts borrowed under the Company's new
financing arrangements.
During the first quarter of 2006, the Company's Senior Guaranteed Notes and
Revolving Credit Facility outstanding at December 31, 2005 were replaced by a
new financing package that included a $275 million First Lien Credit Agreement
and a $100 million Second Lien Credit Agreement. The agreements provide for
security interests in substantially all of the Company's assets and specific
financial covenants related to EBITDA, capital expenditures, and fixed charge
coverage. The EBITDA covenant is applicable through September 30, 2007 and,
thereafter, the fixed charge coverage covenant applies. Additionally, under the
terms of the agreements, no dividends can be paid prior to December 31, 2006 and
minimum amounts of credit availability are required before dividends can be paid
thereafter. The new arrangements bore a weighted average annual interest rate of
9.0% based upon outstanding balances at closing versus the rate of 6.6%
applicable to the $250 million Senior Guaranteed Notes.
As previously noted, during the second quarter the Company completed the
sale of Little Giant Pump Company and proceeds from the sale were used to repay
portions of the Company's new debt arrangements. Approximately, 63% of the
proceeds were applied against the First Lien borrowing and 37% against the
Second Lien borrowing. After giving affect to the repayments, the weighted
average annual interest rate of these borrowings was 8.8% at the time of
repayment. During the second quarter, the Company entered into interest rate
swap agreements, effectively converting $90.0 million (or 48% of outstanding
borrowings in the First and Second Lien Credit Agreements) of variable rate debt
to fixed rate debt. Including the effect of these swap agreements, the effective
weighted average interest rate of these borrowings was 8.8% at June 30, 2006.
4
As of June 30, 2006, the Company was required to have a minimum last twelve
months EBITDA (as defined under the agreement which provides adjustments for
certain items, and hereafter referred to as "Adjusted EBITDA") of $27.0 million
and capital expenditures not to exceed $125.0 million. The Company is currently
in compliance with the covenants of the debt agreement, including the minimum
Adjusted EBITDA and capital expenditure limits. The last twelve months Adjusted
EBITDA was calculated to be $27.2 million and expenditures were $86.9 million.
The Company continues to monitor its future expected results in
relationship to the financial covenants specified under the terms of the
respective borrowing arrangements and the amount of availability of funds
provided by the computation of borrowing base. Based upon proceeds provided by
the sale of Little Giant and the total availability of funds, we believe the
Company has sufficient liquidity to complete its turnaround plans; however,
should operating performance fall short of plan, the Company may not remain in
compliance with the covenants under the agreements, or have sufficient
availability of funds. In this scenario, the Company would need to obtain
amendments to the borrowing arrangements. Subsequent to the third quarter,
current projections are highly sensitive to the price of copper and other
commodities and the Company's ability to recover higher commodity costs. As we
cannot predict the movement of commodity prices, which have been substantial in
recent history, we cannot predict with certainty that we can remain in
compliance with the Adjusted EBITDA covenant.
In addition, certain of the Company's foreign subsidiaries also rely on
local borrowing arrangements and parent company funding to fund operations and
capital expenditures. Some of these subsidiaries have losses from operations.
The Brazilian engine manufacturing subsidiary has its own financing arrangements
with Brazilian banks under which it is required to pay principal installments of
various amounts throughout the remainder of 2006 through 2009. Historically, the
subsidiary has experienced negative cash flows from operations indicating that
it may not have sufficient liquidity on its own to make all required debt
repayments as currently scheduled. In combination with a potential new credit
facility at one of the subsidiary's banks, the potential extension of maturity
dates at other of the subsidiary's banks and expected future positive cash flows
of the Engine and Transmissions Group, the Company expects that the subsidiary
will meet its obligations in the ordinary course of business. However, there can
be no assurance that the Company will be successful in achieving any or all of
these goals. If the Brazilian engine subsidiary were to default in making any of
the required payments, the cross-default provisions in its First and Second Lien
Credit Agreements would be triggered, which could result in the Company no
longer having the ability to borrow under the First Lien Credit Agreement to
meet its ongoing operating needs, as well as acceleration of its indebtedness
under the First and Second Lien Credit Agreements.
OUTLOOK
Information in this "Outlook" section should be read in conjunction with
the cautionary language and discussion of risks included below.
The outlook for the remainder of 2006 is subject to the same variables that
negatively impacted the Company during the first six months of 2006 and
throughout 2005. Commodity costs, key currency rates, weather and the overall
growth rates of the respective economies around the world are all important to
future performance. Overall, the Company does not expect these factors to become
any more favorable during the year. In fact, certain key commodities, including
copper, aluminum, and steel have risen precipitously in recent months. From
January 1, 2006 through July 29, 2006, the prices of copper and aluminum have
increased approximately 60% and 6%, respectively.
5
The Company expects 2006 results to reflect those actions it has been
taking to reduce costs and, potentially, the benefits of new product
introductions, to the extent they are accepted in the market, and has not
assumed any improvements from currencies or commodity costs. Given the recent
escalation in commodity costs, realization of net improvement in total results,
which was largely expected in the latter half of the year, will greatly depend
on the Company's ability to pass on to its customers the cost of these sizeable
commodity price increases, which are hedged to a lesser extent in the later
months of the year than compared to the first half of the year. The Compressor
and Electrical Components groups introduced both price increases and commodity
surcharges that took effect in the months of June and July. However, since such
increases were announced, commodity prices have continued to rise. As a result,
the lag between when the Company experiences higher input costs and when pricing
actions become effective is expected to impact future results if commodity
prices do not moderate in the near future. In addition, there are no guarantees
that the Company will be able to pass along future commodity increases to its
customers, thus making prediction of results difficult should commodities,
particularly copper, continue to escalate.
With respect to each of the Company's segments, results in the Compressor
business are expected to lag the results of 2005 throughout the year. The
Electrical Components business, which had demonstrated monthly year over year
improvement since August of 2005, experienced a decline in results in the second
quarter in part due to the cost of copper. Future improvement will largely be
dependent on the cost of copper and the factors discussed above. The Engine and
Power Train business has taken several major steps to eliminate overcapacity and
costs that will benefit 2006 and beyond. The Company expects the magnitude of
improvements in the latter half of the year to accelerate in comparison to the
first half.
The Company will continue to focus its efforts on improving the
profitability and competitiveness of its worldwide operations. It is possible
that additional production relocation and consolidation initiatives will take
place during 2006 and/or 2007 that could have an effect on the consolidated
financial position and future results of operations of the Company. In addition,
the Company continues to evaluate potential acquisitions, joint ventures and
dispositions that could improve the overall competitiveness and financial
position of the Company and enhance its product offerings. Such transactions
could also have an effect on future results of operations.
6
RESULTS BY BUSINESS SEGMENTS (UNAUDITED)
Three Months Ended Six Months Ended
June 30, June 30,
------------------ ------------------
(Dollars in millions) 2006 2005 2006 2005
------- -------- ------- --------
NET SALES:
Compressor Products $ 273.3 $ 247.6 $ 524.8 $ 488.6
Electrical Components Products 106.9 102.4 216.0 202.6
Engine & Power Train Products 71.5 78.7 152.4 173.6
Other (a) 4.6 4.1 9.2 8.2
------- -------- ------- --------
Total net sales $ 456.3 $ 432.8 $ 902.4 $ 873.0
======= ======== ======= ========
OPERATING INCOME (LOSS):
Compressor Products $ (3.8) $ 7.4 $ 2.8 $ 16.0
Electrical Components Products (1.7) 0.2 3.2 (0.8)
Engine & Power Train Products (11.2) (15.5) (29.7) (36.4)
Other (a) 0.4 0.2 0.7 --
Corporate expenses (4.0) (2.6) (8.0) (5.1)
Impairments, restructuring charges, and other items (5.0) (109.8) (5.6) (109.9)
------- -------- ------- --------
Total operating loss from continuing operations (25.3) (120.1) (36.6) (136.2)
Interest expense (11.0) (5.5) (19.4) (11.6)
Interest income and other, net 2.9 1.7 7.9 5.0
------- -------- ------- --------
LOSS FROM CONTINUING OPERATIONS BEFORE TAXES ($33.4) ($123.9) ($48.1) ($142.8)
======= ======== ======= ========
(a) "Other" consists of non-reportable business segments.
Previously, the Company also reported a Pump Products business segment. However,
as a result of the decision to sell Little Giant Pump Company, which represented
approximately 90% of the previously reported segment, such operations are no
longer included in loss from continuing operations before tax. As the Company's
remaining pump business does not meet the definition of an operating segment as
defined by SFAS No. 131, "Segment Reporting," the Company will no longer report
a Pump Products segment, and operating results of the remaining pump business
are included in Other for segment reporting purposes.
7
CONSOLIDATED CONDENSED BALANCE SHEETS (UNAUDITED)
JUNE 30, December 31,
(Dollars in millions) 2006 2005
-------- ------------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 104.5 $ 116.6
Accounts receivable, net 254.4 211.1
Inventories 349.6 346.8
Other current assets 96.2 132.6
-------- --------
Total current assets 804.7 807.1
PROPERTY, PLANT AND EQUIPMENT - NET 584.7 578.6
GOODWILL AND OTHER INTANGIBLES 180.4 185.7
OTHER ASSETS 294.1 229.1
-------- --------
TOTAL ASSETS $1,863.9 $1,800.5
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable, trade $ 209.3 $ 187.3
Short-term borrowings 135.8 82.5
Accrued liabilities 140.6 135.3
-------- --------
Total current liabilities 485.7 405.1
LONG-TERM DEBT 221.4 283.0
DEFERRED INCOME TAXES 20.8 25.0
PENSION AND POSTRETIREMENT BENEFITS 226.0 226.1
PRODUCT WARRANTY AND SELF-INSURED RISKS 12.0 14.5
OTHER NON-CURRENT LIABILITIES 37.1 32.4
-------- --------
Total liabilities 1,003.0 986.1
STOCKHOLDERS' EQUITY 860.9 814.4
-------- --------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $1,863.9 $1,800.5
======== ========
CONSOLIDATED CONDENSED STATEMENTS OF STOCKHOLDERS' EQUITY (UNAUDITED)
Three Months Ended Six Months Ended
June 30, June 30,
------------------ -----------------
(Dollars in millions) 2006 2005 2006 2005
------ -------- ------ --------
TOTAL STOCKHOLDERS' EQUITY
BEGINNING BALANCE $823.2 $1,001.2 $814.4 $1,018.3
Comprehensive income (loss):
Net income (loss) 33.7 (122.5) 24.1 (134.8)
Other comprehensive income 4.0 35.3 22.4 36.4
------ -------- ------ --------
Total comprehensive income (loss) 37.7 (87.2) 46.5 (98.4)
Cash dividends declared -- (5.9) -- (11.8)
------ -------- ------ --------
TOTAL STOCKHOLDERS' EQUITY
ENDING BALANCE $860.9 $ 908.1 $860.9 $ 908.1
====== ======== ====== ========
8
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)
Six Months Ended
June 30,
----------------
(Dollars in millions) 2006 2005
------ -------
CASH FLOWS FROM OPERATING ACTIVITIES:
Cash used by operating activities ($93.8) ($55.5)
------ ------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale of assets 130.9 1.1
Capital expenditures (32.8) (60.5)
Business acquisition (2.0) --
------ ------
Cash provided by (used in) investing activities 96.1 (59.4)
------ ------
CASH FLOWS FROM FINANCING ACTIVITIES:
Dividends paid -- (11.8)
Repayment of Senior Guaranteed Notes (250.0) (50.0)
Repayment of Industrial Development Revenue Bonds (10.5) --
Proceeds from First Lien Credit Agreement, net 133.1 --
Proceeds from Second Lien Credit Agreement 100.0 --
Repayments of Second Lien Credit Agreement (45.1) --
Other borrowings, net 57.2 35.8
------ ------
Cash used in financing activities (15.3) (26.0)
------ ------
EFFECT OF EXCHANGE RATE CHANGES ON CASH 0.9 (12.0)
------ ------
DECREASE IN CASH AND CASH EQUIVALENTS (12.1) (152.9)
CASH AND CASH EQUIVALENTS:
Beginning of period 116.6 227.9
------ ------
End of period $104.5 $ 75.0
====== ======
CAUTIONARY STATEMENT RELATING TO FORWARD-LOOKING STATEMENTS
This report contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995 that are subject to the safe
harbor provisions created by that Act. In addition, forward-looking statements
may be made orally in the future by or on behalf of the Company. Forward-looking
statements can be identified by the use of terms such as "expects", "should",
"may", "believes", "anticipates", "will", and other future tense and
forward-looking terminology.
Readers are cautioned that actual results may differ materially from those
projected as a result of certain risks and uncertainties, including, but not
limited to, i) changes in business conditions and the economy in general in both
foreign and domestic markets; ii) the effect of terrorist activity and armed
conflict; iii) weather conditions affecting demand for air conditioners, lawn
and garden products, portable power generators and snow throwers; iv) the
success of our ongoing effort to bring costs in line with projected production
levels and product mix; v) financial market changes, including fluctuations in
interest rates and foreign currency exchange rates; vi) economic trend factors
such as housing starts; vii) emerging governmental regulations; viii)
availability and cost of materials, particularly commodities, including steel,
copper and aluminum, whose cost can be subject to significant variation; ix)
actions of competitors; x) the ultimate cost of resolving environmental and
legal matters; xi) our ability to profitably develop, manufacture and sell both
new and existing products; xii) the extent of any business disruption that may
result from the restructuring and realignment of our manufacturing operations or
system implementations, the ultimate cost of those initiatives and the amount of
savings actually realized; xiii) the extent of any business disruption caused by
work stoppages initiated by organized labor unions; xiv)the ability of the
Company to maintain adequate liquidity in total and within each foreign
operation; xv) potential political and economic adversities that could adversely
affect anticipated
9
sales and production in Brazil; xvi) potential political and economic
adversities that could adversely affect anticipated sales and production in
India, including potential military conflict with neighboring countries; xvii)
our ability to reduce a substantial amount of costs in the Engine & Power Train
group associated with excess capacity, and xviii) the ongoing financial health
of major customers. These forward-looking statements are made only as of the
date of this report, and we undertake no obligation to update or revise the
forward-looking statements, whether as a result of new information, future
events or otherwise.
Tecumseh Products Company will host a conference call to report on the
second quarter 2006 results on Tuesday, August 15, 2006 at 11:00 a.m. ET. The
call will be broadcast live over the Internet and then available for replay
through the Investor Relations section of Tecumseh Products Company's website at
www.tecumseh.com.
Press releases and other investor information can be accessed via the
Investor Relations section of Tecumseh Products Company's Internet web site at
http://www.tecumseh.com.
Contact: Pat Walsh
Tecumseh Products Company
517-423-8455
10