EXHIBIT 99.1
NEWS RELEASE
FOR IMMEDIATE RELEASE
TUFCO TECHNOLOGIES, INC. REPORTS
RESULTS FOR THIRD FISCAL QUARTER 2003;
CONTINUING POSITIVE TREND IN INCOME AND NEW ASSET START-UP
GREEN BAY, WI (August 13, 2003)--Tufco Technologies, Inc. (NASDAQ: TFCO), a
leader in providing diversified contract manufacturing, specialty printing
services and business imaging products today announced results for the third
fiscal quarter and first nine months of its fiscal year. Previously reported
results have been adjusted to reflect the Paint Sundries segment as discontinued
operations. The Paint Sundries segment was disposed of on March 31, by way of
sale, with an effective date of February 28, 2003.
In commenting on the quarter, Lou LeCalsey, the Company's President and CEO
stated, "We continue our positive trend on income from continuing operations
generated over the last three consecutive quarters, earning $.09 for the quarter
and $.16 for the nine months. At the same time, with the sale of the Paint
Sundries segment, we have delivered the strongest balance sheet in Tufco's
history. Late in the third quarter we began production on our new wide-web
flexographic press and also started production of disposable wet-wipe products
under a new contract for our new nonwovens production line. We expect to see
further improvements in profitability as we more fully utilize these assets
going forward."
For the third quarter of fiscal 2003, net sales from continuing operations were
$14.3 million, up 4.3% from third quarter 2002 sales from continuing operations
of $13.7 million, and up 11.6% from this year's second quarter sales of $12.8
million. For the nine months, net sales from continuing operations increased
5.5% to $39.6 million from nine month sales from continuing operations for 2002
of $37.5 million.
Net income from continuing operations was $.428 million or $.09 per share for
the third quarter of 2003 compared to $.882 million, or $.19 per share for 2002.
For the nine months ended June 30, 2003 net income from continuing operations
was $.747 million, or $.16 per share compared to $.665 million, or $.14 per
share for the first nine months of fiscal 2002. During the 2003 third quarter,
the Company absorbed $.16 million relating to closing Dallas corporate services.
To complete the transition, the Company expects to incur approximately $0.3
million in the fourth quarter. Once completed, the move is expected to generate
annual savings of $0.5 million.
Net income was $.370 million, or $0.08 per share for the June 30, 2003 quarter
compared to $.778 million, or $0.17 per share for the comparable quarter last
year. For the nine months, net income was $.282 million or $.06 per share for
2003 compared to a loss of $4.630 million ($1.00 per share) for the nine months
ending June 30, 2002.
During the second quarter of 2003, the Company sold the assets and business of
its Paint Sundries segment for $12.3 million and incurred a net loss of $.244
million (net of fees, expenses and taxes) on the transaction. That segment is
being reported as discontinued operations and previously reported amounts for
2002 and year to date 2003 have been restated. Almost $8 million of the
2
proceeds from the sale were used for debt reduction, reducing debt to $0.75
million. A portion of the proceeds have also been used to repurchase 35,500
shares of the Company's stock under a previously announced share repurchase
program.
Last year's reported nine month results included a loss of $4.652 million
resulting from the cumulative effect of an accounting change relating to the
implementation of SFAS No.142.
Tufco, headquartered in Green Bay, Wisconsin, has manufacturing operations in
Wisconsin and North Carolina.
INFORMATION ABOUT THE RESULTS REPORTED HEREIN, OR COPIES OF THE COMPANY'S
QUARTERLY REPORTS, MAY BE OBTAINED BY CALLING THE CONTACT PERSON LISTED BELOW.
Management's discussion of the Company's 2003 quarterly periods in comparison to
2002, contains forward-looking statements regarding current expectations, risks
and uncertainties for future periods. The actual results could differ materially
from those discussed here. As well as those factors discussed in this report,
other factors that could cause or contribute to such differences include, among
other items, cancellation of production agreements by significant customers,
material increases in the cost of base paper stock, competition in the Company's
product areas, or an inability of management to successfully reduce operating
expenses in relation to net sales without damaging the long-term direction of
the Company. Therefore, the condensed financial data for the periods presented
may not be indicative of the Company's future financial condition or results of
operations.
Contact: Michael B. Wheeler, VP and CFO
Tufco Technologies, Inc.
P.O. Box 23500
Green Bay, WI 54305-3500
(920) 336-0054
(920) 336-9041 (Fax)
3
TUFCO TECHNOLOGIES, INC.
Balance Sheet
(Amounts in 000's)
<Table>
<Caption>
June 30, September 30,
2003 2002
------------ -------------
ASSETS
Cash & Cash Equivalents $ 3,564 $ 251
Restricted Cash -- 100
Accounts Receivable - net 6,215 11,121
Inventories 4,248 6,585
Other Current Assets 2,268 1,710
------------ ------------
Total Current Assets 16,295 19,767
Property, Plant and Equipment - net 14,883 16,305
Goodwill - net 7,212 10,345
Other Assets 447 750
------------ ------------
Total $ 38,837 $ 47,167
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Portion of Long-term Debt $ 250 $ 923
Accounts Payable 2,765 5,280
Accrued Liabilities 1,535 2,261
------------ ------------
Total Current Liabilities 4,550 8,464
Long-term Debt - Less current portion 500 5,234
Deferred Income Taxes 686 661
Common Stock and Paid-in Capital 25,136 25,135
Retained Earnings 8,686 8,404
Treasury Stock and Stockholder Notes Receivable (721) (691)
Accumulated Other Comprehensive Loss, net of tax -- (40)
------------ ------------
Total Stockholders' Equity 33,101 32,808
------------ ------------
Total $ 38,837 $ 47,167
============ ============
</Table>
TUFCO TECHNOLOGIES, INC.
Condensed Consolidated Statements of Operations
(Amounts in 000's except share and per share data)
<Table>
<Caption>
Three Months Ended Nine Months Ended
June 30, June 30,
2003 2002 2003 2002
----------- ----------- ----------- -----------
Net Sales $ 14,272 $ 13,689 $ 39,595 $ 37,541
Cost of Sales 11,919 10,941 34,202 32,185
----------- ----------- ----------- -----------
Gross Profit 2,353 2,748 5,393 5,356
SG&A Expense 1,398 1,021 3,647 2,993
Employee Severance Costs 163 -- 210 209
Facility Restructuring Costs -- -- -- 233
Property & Inventory Write Downs -- -- -- 311
Loss (Gain) on Asset Sales -Net 20 2 51 (27)
----------- ----------- ----------- -----------
Operating Income 772 1,725 1,485 1,637
Interest Expense (11) (104) (188) (364)
Other Income (Expense) -Net (24) (2) (17) 21
----------- ----------- ----------- -----------
Income from Continuing Operations
Before Income Tax 737 1,619 1,280 1,294
Income Tax Expense 309 737 533 629
----------- ----------- ----------- -----------
Income From Continuing Operations 428 882 747 665
Loss From Discontinued Operations:
Net Loss from Operations of Discontinued Segment, Net of Tax (58) (104) (221) (643)
Net Loss from Sale of Discontinued Operations, Net of Tax -- -- (244) --
----------- ----------- ----------- -----------
Income Before Accounting Change 370 778 282 22
Cumulative Effect of Accounting Change -- -- -- (4,652)
----------- ----------- ----------- -----------
Net Income (Loss) $ 370 $ 778 $ 282 $ (4,630)
----------- ----------- ----------- -----------
BASIC EARNINGS (LOSS) PER SHARE:
Income from Continuing Operations $ 0.09 $ 0.19 $ 0.16 $ 0.14
Net Loss from Operations of Discontinued Segment (0.01) (0.02) (0.05) (0.13)
Net Loss from Sale of Discontinued Operations -- -- (0.05) --
----------- ----------- ----------- -----------
Income before Accounting Change 0.08 0.17 0.06 0.01
Cumulative Effect of Accounting Change -- -- -- (1.01)
----------- ----------- ----------- -----------
Net Income(Loss) $ 0.08 $ 0.17 $ 0.06 $ (1.00)
DILUTED EARNINGS (LOSS) PER SHARE:
Income from Continuing Operations $ 0.09 $ 0.19 $ 0.16 $ 0.14
Net Loss from Operations of Discontinued Segment (0.01) (0.02) (0.05) (0.13)
Net Loss from Sale of Discontinued Operations -- -- (0.05) --
----------- ----------- ----------- -----------
Income before Accounting Change 0.08 0.17 0.06 0.01
Cumulative Effect of Accounting Change -- -- -- (1.01)
----------- ----------- ----------- -----------
Net Income(Loss) $ 0.08 $ 0.17 $ 0.06 $ (1.00)
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
Basic 4,618,677 4,627,844 4,624,788 4,627,844
Diluted 4,642,807 4,629,754 4,634,272 4,627,844
</Table>