EXHIBIT 99.1
BETTER MINERALS & AGGREGATES COMPANY REPORTS
FISCAL 2000 FOURTH QUARTER, YEAR-END RESULTS
Company Also Announces Renegotiation of Bank Agreement
BERKELEY SPRINGS, WV, March 05, 2001---Better Minerals & Aggregates Company
(BMAC), a leading producer of silica sand, crushed stone and bituminous paving
materials, today reported fourth quarter and full-year 2000 sales and earnings.
In releasing these figures, the company said it had adopted the provisions of
the Emerging Issues Task Force Issue No. 00-10: Accounting for Shipping and
Handling Fees and Costs, beginning with the fourth quarter 2000 reporting. As a
result, BMAC's total revenue figures for both 1999 and 2000 include the sales of
materials to customers, as well as freight and delivery costs billed to
customers. Discussion of the company's results, however, is based on product
sales, exclusive of the freight and delivery costs. At the same time, the
company also announced that it had successfully negotiated to amend its bank
agreement.
Fourth Quarter, Year-End Figures Announced
For the fourth quarter, revenue was $61.1 million, a decrease of four
percent from the 1999 fourth quarter sales of $63.5 million. Fourth quarter
EBITDA (earnings before income taxes, depreciation and amortization) was $10.1
million, down from $17.1 million for the same period in 1999.
For the fiscal year ended December 31, 2000, BMAC's sales were $247.3
million, up 18 percent from $209.0 million in 1999. Year-end EBITDA rose to
$53.7 million from the 1999 total of $49.0 million.
According to R.D. "Butch" Reeves, BMAC president and newly-appointed chief
executive officer, energy prices, particularly natural gas, continued to have a
significant negative impact on results in both industrial minerals and
aggregates for the quarter and the year. Natural gas, propane, and diesel fuel
price increases raised operating costs in the fourth quarter approximately $1.7
million from last year, and boosted total year expenses in these categories to
approximately $5.7 million over 1999.
2
Fourth quarter sales of industrial minerals, the company's largest business
segment, were $36.0 million, down from the prior year's fourth quarter sales of
$40.1 million. Fourth quarter sales for 1999 include $2.2 million from the
Company's Canadian operating subsidiary that was divested earlier in the year.
Excluding this, comparable industrial mineral sales were 4.7% less than the
prior year on a 6.6% reduction in volume. Sales decreases in the Company's
glass, foundry, matrix and fillers & extenders market segments, were only
partially offset by increased sales to the oil & gas extraction market. For
the year, sales totaled $155.5 million, as compared to the previous year's total
of $159.1 million. Excluding the $8.6 million in prior year sales from the
divested Canadian subsidiary, the company's ongoing industrial minerals
operations realized a 2.3% increase in revenue for the full year.
Aggregates sales for the quarter were $25.0 million, an increase from
fourth quarter 1999 totals of $23.3 million. Volume in manufactured stone and
asphalt decreased 9.2% from year ago levels, but was offset by increased selling
prices for asphalt and a $1.0 million increase in brokered stone products. Full
year sales were up significantly, to $91.7 million, from last year's sales of
$49.9 million due to the acquisition of its Pittsburgh aggregate operations,
which occurred October 1, 1999.
"Demand for industrial minerals softened significantly in the fourth
quarter in nearly all segments of the business, as our customers reacted to the
slowing domestic economy" Reeves said. "Demand was also weaker than expected in
aggregates. Early winter weather conditions in the fourth quarter put an abrupt
end to an already abbreviated construction season. We did see sufficient price
increases in asphalt at the end of the year to offset higher asphalt cement
costs, but our stone selling prices, on average, rose only slightly above their
1999 levels." Looking ahead, Reeves said "our backlog in the aggregates segment
is 15% greater than last year at this time and I am optimistic about their
outlook for 2001", but he expects a "difficult environment for industrial
minerals in the first half of the year because of continued high energy costs
and weakened customer demand."
BMAC Amends Bank Agreements
BMAC also recently completed negotiations to amend its bank credit
agreement, modifying its financial covenants through 2001. Under the new
agreement, the company agreed to a 25 basis point increase in interest rates
when the leverage ratio of the company exceeds certain defined levels, along
with a one-time 25 basis point amendment fee. Additionally,
3
BMAC cancelled its unused $40.0 million Acquisition Line of Credit. As a result
of this credit agreement amendment, the company anticipates its annual interest
expense will increase less than $400,000.
"We are pleased with the continuing support of our bank group. Modifying
the financial covenants provides us with the flexibility we need over the next
year," said BMAC chairman,
D. George Harris.
A portfolio company of D. George Harris & Associates (DGH&A) and JP Morgan
Partners (formerly Chase Capital Partners), BMAC is a leading producer of: high
quality silica sand and aplite for the glass, foundry, chemical, recreational
and construction industries; fine ground silica and kaolin clay products for the
paint, plastic and ceramic industries; and crushed stone and bituminous paving
materials to contractors, road builders and ready-mix concrete and bituminous
asphalt plants. Headquartered in Berkeley Springs, WV, the company has
approximately 1,050 employees at its 26 facilities in the United States.
NOTE: Unaudited financial tables follow.
####
Certain statements in this news release regarding expectations of future
performance of the company's businesses, the company's results of operations and
other matters, may be regarded as "forward-looking statements" within the
meaning of the Securities Litigation Reform Act. Such statements are subject to
various risks as discussed in detail in the company's SEC filings filed under
the Securities Act of 1933 and the Securities and Exchange Act of 1934.
BETTER MINERALS & AGGREGATES COMPANY
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in Thousands)
(Unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
------------ ------------
2000 1999 2000 1999
---- ---- ---- ----
Net sales:
Industrial Minerals $ 36,039 $ 40,126 $ 155,551 $ 159,169
Aggregates 25,022 23,332 91,750 49,907
Freight and delivery revenue 13,028 11,841 52,034 35,726
------- ------- ------- -------
Total net sales 74,089 75,299 299,335 244,802
Cost of goods sold 44,389 41,766 170,720 140,244
Freight and delivery costs 13,028 11,841 52,034 35,726
Depreciation, depletion and amortization 8,843 9,186 35,895 28,481
Selling, general & admininstrative 6,779 5,263 25,543 21,844
Incentive stock compensation - - 998 -
------- ------- ------- -------
Operating income 1,050 7,243 14,145 18,507
Interest expense 9,332 9,178 36,359 19,590
Accretion of preferred stock warrants - (171) - 56
Other (income) expense, net of interest income (127) (847) (1,575) (2,171)
------- ------- ------- -------
Loss before income taxes (8,155) (917) (20,639) 1,032
Provision (benefit) for income taxes (2,491) (2,658) (11,091) (2,714)
------- ------- -------- -------
Net (loss) income before extraordinary loss $ (5,664) $ 1,741 $(9,548) $3,746
========= ======== ========= =======
Extraordinary loss (less applicable taxes of $1,752) - 2,747 - 2,747
------- ------- ------- -------
Net (loss) income after extraordinary loss $ (5,664) $(1,006) $(9,548) $ 999
========= ========= ========= =====
EBITDA $ 10,092 $ 17,151 $ 53,787 $ 49,029
BETTER MINERALS & AGGREGATES COMPANY
CONSOLIDATED CONDENSED BALANCE SHEETS
(Dollars in Thousands)
(Unaudited)
December 31, December 31,
2000 1999
---- ----
ASSETS
Current assets $ 92,840 $ 91,405
Property and equipment - net 415,686 425,224
Goodwill and non compete agreements 16,649 19,907
Debt issuance costs 12,958 14,601
Other assets 153 466
---- ---
Total $ 538,286 $ 551,603
========== =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current portion of long-term debt $ 9,076 $ 2,039
Other current liabilities 45,678 43,651
------- ------
Total 54,754 45,690
Long-term debt 280,329 285,466
Deferred income taxes 110,676 117,637
Other long-term liabilities 39,311 38,475
Stockholders' equity 53,216 64,335
------- ------
Total $ 538,286 $ 551,603
========== =========
BETTER MINERALS & AGGREGATES COMPANY
CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS
(Dollars in Thousands)
(Unaudited)
Twelve Months Ended December 31,
----------------------------------------
2000 1999
---- ----
NET CASH (USED FOR) PROVIDED BY OPERATING ACTIVITIES $ 7,698 $ 29,519
INVESTING ACTIVITIES
Capital expenditures (26,369) (14,572)
Purchases of businesses, net of cash acquired - (172,379)
Proceeds from sale of property, plant, and equipment 670 1,310
Proceeds from sale of investments 3,136
Loans to related party (1,507) -
----------------- -------------------
NET CASH USED FOR INVESTING ACTIVITIES (24,070) (185,641)
FINANCING ACTIVITIES
Net (repayments) additions of long-term debt (3,600) (169,205)
Issuance of long-term debt - 325,006
Increase (decrease) in checks outstanding in excess of cash 2,238 (1,402)
Principal payments on capital lease obligations (73) (44)
Financing fees and prepayment penalties (435) (15,796)
Capital contributed by parent - 35,000
Net revolver credit agreement facility 5,500 (6,100)
----------------- -------------------
NET CASH USED FOR FINANCING ACTIVITIES 3,630 167,459
Effect of exchange rate on cash 29 14
----------------- -------------------
Net decrease in cash (12,713) 11,351
Cash and cash equivalents, January 1 13,573 2,222
----------------- -------------------
CASH AND CASH EQUIVALENTS, DECEMBER 31 $ 860 $ 13,573
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