FOR IMMEDIATE RELEASE
PEERLESS MFG. CO. REPORTS FISCAL YEAR 2003 THIRD QUARTER RESULTS
Dallas, Texas -- May 14, 2003 -- Peerless Mfg. Co., (Nasdaq: PMFG), today
announced its operating results for the third quarter of fiscal year 2003 ended
March 31, 2003.
The Company's third quarter revenues were $13.6 million, a decrease of $15.5
million, or 53.3 percent, compared to $29.1 million for the third quarter of
fiscal 2002. The decrease in revenues was primarily due to a decrease in the
demand for new power plant construction, a weak economic environment and delays
and rescheduling of awarded projects. The Company recorded a net loss of
$375,000 or $0.13 per basic and diluted share for the third quarter compared to
net income of $1.19 million or $0.40 per basic share ($0.38 per diluted share)
for the comparable period in fiscal 2002.
Mr. Sherrill Stone, Chairman and Chief Executive Officer of Peerless, stated,
"The $375,000 loss experienced for the quarter was due to lower overall revenue
and in particular lower revenue from our Selective Catalytic Reduction ("SCR")
Systems business unit which is resulting from reduced new power plant
construction and delays of existing projects. Given these trying market
conditions, we are encouraged by the relative stability of our $46 million
backlog which has increased by approximately $8 million since September 30,
2002."
The Company also announced receipt of multiple orders for nuclear steam
separation equipment to be used to upgrade various nuclear power plants in the
U.S. and internationally. These orders exceed $2.5 million and are scheduled in
Fiscal 2004. In addition, the Company recently announced the receipt of a
multi-million dollar SCR retrofit order to be installed at a natural gas power
plant located in the Houston, Texas region and an order for SCR components to
reduce NOx at eight electric power generating units located in the state of
Florida.
About Peerless Mfg. Co.
Peerless Mfg. Co. is engaged in the business of designing, engineering,
manufacturing and selling highly specialized products used for the abatement of
air pollution and products for the separation and filtration of contaminants
from gases and liquids. The Company, headquartered in Dallas, Texas, markets its
products worldwide.
Safe Harbor Under The Private Securities Litigation Reform Act of 1995
Certain statements contained in this press release that are not historical facts
are forward-looking statements that involve a number of known and unknown risks,
uncertainties and other factors that could cause the actual results, performance
or achievements of the Company to be materially different from any future
results, performance or achievement expressed or implied by such forward-looking
statements. The words "anticipate," "preliminary," "expect," "believe," "intend"
and similar expressions identify forward-looking statements. The Private
Securities Litigation Reform Act of 1995 provides a "safe harbor" for such
forward-looking statements. In order to comply with the terms of the safe
harbor, the Company notes that a variety of factors could cause actual results
and experience to differ materially from the anticipated results or other
expectations expressed in such forward-looking statements. The risks and
uncertainties that may affect the operations, performance, development and
results of the Company include, but are not limited to: the growth rate of the
Company's revenue and market share, the consummation of new, and the
non-termination of, existing contracts; the Company's ability to effectively
manage its business functions while growing its business in a rapidly changing
environment, the Company's ability to adapt and expand its services in such an
environment; the quality of the Company's plans and strategies; and the
Company's ability to execute such plans and strategies. Other important
information regarding factors that may affect the Company's future performance
is included in the public reports that the Company files with the Securities and
Exchange Commission. The Company undertakes no obligation to revise any
forward-looking statements or to update them to reflect events or circumstances
occurring after the date of this release, or to reflect the occurrence of
unanticipated events. Readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date hereof. The
inclusion of any statement in this release does not constitute an admission by
the Company or any other person that the events or circumstances described in
such statement are material.
For Further Information Contact:
Mr. Sherrill Stone, Chairman and Chief Executive Officer
Mr. Richard L. Travis, Vice President and Chief Financial Officer
Peerless Mfg. Co.
2819 Walnut Hill Lane
Dallas, Texas 75229
Phone: (214) 353-5590
Fax: (214) 351-4172
www.peerlessmfg.com
PEERLESS MFG. CO.
UNAUDITED CONDENSED FINANCIAL HIGHLIGHTS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
OPERATING RESULTS
<Table>
<Caption>
Three months ended Nine months ended
March 31, March 31,
2003 2002 2003 2002
---------- --------- --------- ---------
Revenues $ 13,564 $ 29,087 $ 48,760 $ 80,640
Cost of goods sold 10,185 21,080 37,769 58,769
---------- --------- --------- ---------
Gross profit 3,379 8,007 10,991 21,871
Operating expenses 4,031 6,196 13,368 17,554
Restructuring expenses -- -- 483 --
---------- --------- --------- ---------
Operating income (loss) (652) 1,811 (2,860) 4,317
Other income 66 74 91 291
Tax expense (benefit) (211) 698 (1,025) 1,705
---------- --------- --------- ---------
Net earnings (loss) $ (375) $ 1,187 $ (1,744) $ 2,903
========== ========= ========= =========
Basic and diluted earnings (loss)
per share
Basic $ (0.13) $ 0.40 $ (0.58) $ 0.98
Diluted $ (0.13) $ 0.38 $ (0.58) $ 0.94
Weighted average shares
outstanding
Basic 2,999 2,983 2,995 2,976
Diluted 2,999 3,086 2,995 3,088
</Table>
BALANCE SHEET
<Table>
<Caption>
March 31, June 30,
2003 2002
--------- ----------
Cash, cash equivalents and
short-term investments $ 6,765 $ 1,693
Current assets $ 33,097 $ 41,746
Total assets $ 37,305 $ 46,506
Total current liabilities $ 16,448 $ 23,991
Long-term liabilities $ -- --
Shareholders' equity $ 20,857 $ 22,515
</Table>