EXHIBIT 99.1
PRESS RELEASE
Contact: Allen Dillard
Director, Corporate Communications
(256) 580-3625
WOLVERINE TUBE REPORTS 2002 SECOND QUARTER RESULTS
OPERATING INCOME INCREASES 46% OVER LAST YEAR, CASH BALANCES INCREASE
$17 MILLION FROM LAST QUARTER
HUNTSVILLE, ALABAMA, JULY 31, 2002--Wolverine Tube, Inc. (NYSE: WLV) today
reported results for the second quarter ended June 30, 2002. Income from
continuing operations for the second quarter of 2002 was $3.5 million, or $0.28
per diluted share, as compared to income from continuing operations of $3.1
million, or $0.24 per diluted share, in the second quarter of 2001. Net sales
for the second quarter of 2002 were $152.5 million, a six percent decrease from
the comparable year-ago quarter. Total pounds of product shipped was 85.1
million, as compared to 84.4 million pounds in the prior year. Gross profit for
the second quarter of 2002 was $19.2 million, compared with a gross profit of
$15.8 million in the second quarter of 2001 an increase of 22 percent. Proforma
income from continuing operations in the second quarter of 2001, excluding
amortization of goodwill, was $3.7 million or $0.30 per diluted share. Including
the loss from discontinued operations, net loss in the second quarter of 2001
was ($0.6) million, or ($0.05) per diluted share.
Dennis Horowitz, Chairman, President and Chief Executive Officer, said, "These
results, while impacted by the economy, indicate we are executing toward our
goals, even in light of the challenging environment. Strong evidence of our
accomplishments in this quarter are a 46 percent increase in operating income,
cash flow from operations of $22.7 million, $5 million in debt reduction, an
increase in cash of $17 million and continued penetration in our global
markets."
SECOND QUARTER RESULTS BY SEGMENT
Shipments of commercial products totaled 59.8 million pounds, a two percent
increase from last year's second quarter of 58.4 million pounds. Net sales were
$118.9 million, down five percent from last year's second quarter of $124.5
million. Gross profit was $17.3 million, a 37 percent increase over last year's
second quarter of $12.7 million. The decrease in revenues reflects an
unfavorable product mix with volume decreases in technical and alloy tube,
offset by increased volumes of industrial tube and fabricated products. Gross
profit was increased principally due to cost reduction and manufacturing
efficiencies.
Shipments of wholesale products totaled 20.1 million pounds, a two percent
increase over last year's second quarter of 19.8 million pounds. Net sales were
$24.9 million, down four percent from last year's second quarter of $25.8
million. Gross profit was
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$1.4 million, down 33 percent from last year's second quarter. Wholesale
products were impacted by pricing pressures in this commodity market that
negatively impacted net sales. This was somewhat mitigated by cost reductions
and efficiencies.
Shipments of rod, bar and other products totaled 5.2 million pounds, a 16
percent decrease from last year's second quarter of 6.2 million pounds. Net
sales were $8.8 million, a 22 percent decrease from last year's second quarter
of $11.2 million. Gross profit was $0.5 million, down from last year's second
quarter due principally to the decrease in volumes.
EARNINGS OUTLOOK
Commenting on the outlook for the Company, Horowitz said, "While we are
encouraged by the positive impacts of our actions; customers, competitors and
most economic indicators predict continued soft market conditions. Given this,
we have adjusted our outlook with respect to the economy and its impact on our
2002 earnings. Based on the aforementioned, we expect 2002 third quarter
earnings to be in the range of $0.15 to $0.22 per share."
SECOND QUARTER CONFERENCE CALL
The Company will hold a conference call on July 31st at 9:30 a.m. Central (10:30
a.m. EST) to discuss the contents of this release with members of the investment
community. Please visit Wolverine's website at www.wlv.com to access the call. A
replay will be available through August 7, 2002 at Wolverine's website or by
calling (800) 858-5309 (access code 40179, pass code 40179). Should you have any
problems accessing the call or the replay, please contact the Company at (256)
890-0460.
ABOUT WOLVERINE TUBE, INC.
Wolverine Tube, Inc. is a world-class quality partner, providing its customers
with copper and copper alloy tube, fabricated products, metal joining products
as well as copper and copper alloy rod, bar and other products. Internet
addresses: www.wlv.com and www.silvaloy.com.
Forward-looking statements in this press release are made pursuant to the "Safe
Harbor" provisions of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements use such words as "may", "will", "expect",
"believe", "plan", "anticipate" and other similar terminologies. This press
release contains forward-looking statements regarding the expectations of future
sales and earnings of the Company. These forward-looking statements are subject
to various risks and uncertainties that could cause actual results to differ
materially from those stated or
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implied by such forward-looking statements. The Company undertakes no obligation
to publicly release any revision of any forward-looking statements contained
herein to reflect events or circumstances occurring after the date hereof or to
reflect the occurrence of unanticipated events. With respect to expectations of
future sales and earnings, factors that could affect actual results include,
without limitation, global and local economic and political environments,
weather conditions, environmental contingencies, regulatory pressures, labor
costs, raw material costs, fuel and energy costs, the mix of geographic and
product revenues, the effect of currency fluctuations, competitive products and
pricing. A discussion of such risks and uncertainties, which could cause actual
results to differ from those contained in the forward-looking statements, can be
found in the Company's Annual Report on Form 10-K for the most recently ended
fiscal year and reports filed from time to time with the Securities and Exchange
Commission.
--TABLES TO FOLLOW--
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Consolidated Statements of Income (Unaudited)
Three-month period Six-month period
ended ended
06/30/02 07/01/01 06/30/02 07/01/01
- ----------------------------------------------------------------------------------------------------------------
In thousands, except per share data
Pounds shipped 85,113 84,408 161,110 171,634
================================================================================================================
Net sales $152,547 $ 161,517 $290,090 $ 333,954
Cost of goods sold 133,335 145,725 256,555 296,396
- ----------------------------------------------------------------------------------------------------------------
Gross profit 19,212 15,792 33,535 37,558
Selling, general and administrative expenses 8,250 8,261 16,154 16,320
- ----------------------------------------------------------------------------------------------------------------
Operating income from continuing operations 10,962 7,531 17,381 21,238
Interest expense, net 5,571 3,114 9,301 6,888
Amortization and other, net 524 186 602 107
- ----------------------------------------------------------------------------------------------------------------
Income from continuing operations
before income taxes 4,867 4,231 7,478 14,243
Income tax provision 1,381 1,149 2,304 4,186
- ----------------------------------------------------------------------------------------------------------------
Income from continuing operations 3,486 3,082 5,174 10,057
Loss from discontinued operations, net of
income taxes -- (3,643) -- (4,491)
- ----------------------------------------------------------------------------------------------------------------
Net income (loss) $ 3,486 $ (561) $ 5,174 $ 5,566
================================================================================================================
Basic earnings per share:
- ----------------------------------------------------------------------------------------------------------------
Income from continuing operations $ 0.28 $ 0.25 $ 0.42 $ 0.82
Loss from discontinued operations -- (0.30) -- (0.37)
- ----------------------------------------------------------------------------------------------------------------
Net income (loss) $ 0.28 $ (0.05) $ 0.42 $ 0.45
Diluted earnings per share:
- ----------------------------------------------------------------------------------------------------------------
Income from continuing operations $ 0.28 $ 0.24 $ 0.41 $ 0.80
Loss from discontinued operations -- (0.29) -- (0.36)
- ----------------------------------------------------------------------------------------------------------------
Net income (loss) $ 0.28 $ (0.05) $ 0.41 $ 0.44
- ----------------------------------------------------------------------------------------------------------------
Basic shares 12,251 12,073 12,200 12,063
Diluted shares 12,369 12,405 12,328 12,311
================================================================================================================
Note: The financial information for 2001 has been retroactively restated to
reflect the impact of discontinued operations along with the impact for the
change in accounting for inventory from Last In First Out (LIFO) method to the
First In First Out (FIFO) method.
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Segment Information (Unaudited)
Three-month period ended Six-month period ended
06/30/2002 07/01/2001 06/30/2002 07/01/2001
- --------------------------------------------------------------------------------------------------------------
==============================================================================================================
In thousands
Pounds:
Commercial 59,791 58,425 111,524 120,691
Wholesale 20,131 19,779 38,617 36,973
Rod, bar and other 5,191 6,204 10,969 13,970
- --------------------------------------------------------------------------------------------------------------
Total pounds 85,113 84,408 161,110 171,634
==============================================================================================================
Net sales:
Commercial $118,868 $124,508 $225,221 $261,126
Wholesale 24,883 25,776 46,887 49,271
Rod, bar and other 8,796 11,233 17,982 23,557
- --------------------------------------------------------------------------------------------------------------
Total net sales $152,547 $161,517 $290,090 $333,954
==============================================================================================================
Gross profit:
Commercial $ 17,317 $ 12,667 $ 29,491 $ 31,159
Wholesale 1,355 2,022 2,945 4,297
Rod, bar and other 540 1,103 1,099 2,102
- --------------------------------------------------------------------------------------------------------------
Total gross profit $ 19,212 $ 15,792 $ 33,535 $ 37,558
==============================================================================================================
Condensed Consolidated Balance Sheets (Unaudited)
06/30/2002 12/31/2001
- --------------------------------------------------------------------------------------------------------------------------
In thousands
Assets
Cash and cash equivalents $ 45,437 $ 22,739
Accounts receivable 90,952 67,164
Inventory 82,276 103,360
Other current assets 12,351 9,640
Property, plant and equipment, net 214,813 218,476
Other assets 124,886 118,048
- --------------------------------------------------------------------------------------------------------------------------
Total assets $570,715 $539,427
==========================================================================================================================
Liabilities, Redeemable Cumulative Preferred Stock and Stockholders' Equity
Accounts payable and other accrued expenses $ 59,261 $ 59,826
Short-term borrowings 895 1,684
Deferred income taxes 8,837 9,225
Long-term debt 270,227 247,698
Other liabilities 17,191 17,582
- --------------------------------------------------------------------------------------------------------------------------
Total liabilities 356,411 336,015
- --------------------------------------------------------------------------------------------------------------------------
Redeemable cumulative preferred stock -- 2,000
Stockholders' equity 214,304 201,412
- --------------------------------------------------------------------------------------------------------------------------
Total liabilities, redeemable cumulative preferred stock and
stockholders' equity $570,715 $539,427
==========================================================================================================================
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