EXHIBIT 99.1
WOLVERINE TUBE, INC.
PRESS RELEASE
Contact: Allen E. Dillard
Director, Corporate Communications
(256) 580-3625
WOLVERINE TUBE REPORTS 2003 FIRST QUARTER RESULTS
GROSS PROFIT INCREASES QUARTER OVER QUARTER
HUNTSVILLE, ALABAMA, APRIL 24, 2003--Wolverine Tube, Inc. (NYSE: WLV) today
reported results for the first quarter ending March 30, 2003. Net income for
the first quarter of 2003 was $0.6 million, or $0.05 per diluted share, versus
net income of $1.7 million, or $0.13 per diluted share, in the first quarter of
2002. Net sales for the first quarter of 2003 were $143.5 million, a 4.3
percent increase over the comparable year-ago quarter. Total pounds of product
shipped were 81.0 million, up 6.6 percent over the prior year. Gross profit for
the first quarter of 2003 was $14.6 million, compared with gross profit of
$14.3 million in the first quarter of 2002.
Dennis Horowitz, Chairman, President and Chief Executive Officer, said, "We are
pleased that we delivered bottom line results in the first quarter consistent
with our previous guidance. The fact is, we improved our operating
profitability on the strength of manufacturing efficiencies and market
penetration. This is encouraging, especially given the tepid business
environment, unpredictable global economy, high and erratic energy costs, and
general uncertainty related to political and social issues around the world.
Net income for the quarter was negatively affected by the increase in interest
expense due to our refinancing in March of last year."
FIRST QUARTER RESULTS BY SEGMENT
Shipments of commercial products totaled 56.2 million pounds, an 8.7 percent
increase over last year's first quarter of 51.7 million pounds. Net sales were
$110.3 million, up 3.7 percent over last year's first quarter of $106.4
million. These results reflect increases in volume primarily in industrial tube
and to a lesser extent technical tube and fabricated products. Sales were also
impacted by increased copper prices quarter over quarter offset by a decrease
in unit fabrication revenue primarily due to a change in mix. Gross profit was
$13.8 million, a 13.2 percent improvement over last year's first quarter of
$12.2 million. In part, the improvement in gross profit was attributable to the
success of the Company's cost containment programs. These positive impacts
helped mitigate cost escalations in pension, employee benefits and energy
expenses.
Shipments of wholesale products totaled 20.0 million pounds, an 8.1 percent
increase over last year's first quarter of 18.5 million pounds. Net sales were
$23.9 million, an increase of 8.8 percent from last year's first quarter of
$22.0 million. Shipments of wholesale products increased primarily due to
expanded channels to this market. Net sales were impacted by increased copper
prices, which were offset by a 13 percent decrease in fabrication revenues due
to significant price competition in this commodity market. Gross profit was $64
thousand as compared to $1.6 million in the first quarter of 2002. Gross profit
was decreased principally due to this pricing pressure.
Corporate Headquarters
200 Clinton Avenue West, Suite 1000
Hunstville, AL 35801
WOLVERINE TUBE, INC.
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Shipments of rod, bar and other products totaled 4.8 million pounds, a 16.6
percent decrease from 5.8 million pounds in the first quarter of 2002. Net
sales were $9.2 million this quarter, approximately the same as last year.
Gross profit was $0.8 million as compared to $0.6 million in the first quarter
last year. While volumes were decreased due to a decline in industrial demand,
sales were favorably impacted by some improvement in mix and the impact of the
strengthening Euro. Gross profit improved principally due to market penetration
of our European distribution business.
EARNINGS OUTLOOK
Commenting on the outlook for the Company, Horowitz said, "As we consider the
factors that affect our business, there are few indications that economic
conditions will improve in the short-term. Geopolitical events also add to the
general uncertainty. Having said that, in the second quarter we will continue
to see improvements in manufacturing costs, expansion of global capabilities
and market share penetration, based on actions and programs already in place.
All other things being equal, we would expect a quarter over quarter increase
in earnings per share. At the same time, erratic and potentially lower
wholesale pricing, and energy cost increases, exacerbated by global economic
conditions and SARS, cause concern. Consequently, we expect earnings per share
in the range of $0.21 to $0.29 in the second quarter."
FIRST QUARTER CONFERENCE CALL
The Company will hold a conference call on April 24th at 9:30 a.m. Central
(10:30 a.m. Eastern) to discuss the contents of this release. Please visit
Wolverine's website at www.wlv.com to access the call. You may also access the
call by calling (877) 853-4982 ten minutes prior to the scheduled start time
and by requesting to be connected to the "Wolverine Tube First Quarter Earnings
Call". If you are unable to participate in this conference call, a replay will
be available in the Investor Relations section of Wolverine's website through
May 8, 2003, or by dialing (800) 642-1687 or (706) 645-9291 (international
dial-in) and enter conference ID # 9772775. Should you have any problems
accessing the call or the replay, please contact the Company at (256) 890-0460.
The tables following the text of this press release provide financial details
that are included in this press release and that will be discussed on the
conference call. This includes a reconciliation of net cash provided (used) by
operating activities to free cash flow and net income to earnings before
interest, taxes, depreciation and amortization (EBITDA). This press release,
including these financial details, is now available on the Wolverine website at
www.wlv.com in the Investor Relations section under the heading Press Releases.
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WOLVERINE TUBE, INC.
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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 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, technology, 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--
WOLVERINE TUBE, INC.
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Consolidated Statements of Income
(Unaudited)
Three-month period ended
03/30/03 03/31/02
-------- --------
In thousands, except per share data
Pounds shipped 81,038 75,997
======== ========
Net sales $143,497 $137,543
Cost of goods sold 128,875 123,220
-------- --------
Gross profit 14,622 14,323
Selling, general and administrative expenses 8,142 7,904
-------- --------
Income from operations 6,480 6,419
Interest expense, net 5,178 3,730
Amortization and other, net 542 78
-------- --------
Income before income taxes 760 2,611
Income tax provision 122 923
-------- --------
Net income $ 638 $ 1,688
======== ========
Net income per common share--basic $ 0.05 $ 0.13
Net income per common share--diluted $ 0.05 $ 0.13
-------- --------
Basic shares 12,262 12,148
Diluted shares 12,398 12,269
======== ========
Segment Information
(Unaudited)
Three-month period ended
03/30/03 03/31/02
-------- --------
In thousands
Pounds:
Commercial 56,237 51,733
Wholesale 19,980 18,486
Rod, bar and other 4,821 5,778
-------- --------
Total pounds 81,038 75,997
======== ========
Net sales:
Commercial $110,320 $106,353
Wholesale 23,937 22,004
Rod, bar and other 9,240 9,186
-------- --------
Total net sales $143,497 $137,543
======== ========
Gross profit:
Commercial $ 13,778 $ 12,174
Wholesale 64 1,590
Rod, bar and other 780 559
-------- --------
Total gross profit $ 14,622 $ 14,323
======== ========
WOLVERINE TUBE, INC.
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Condensed Consolidated Balance Sheets
(Unaudited)
03/30/03 12/31/02
-------- --------
In thousands
Assets
Cash and cash equivalents $ 35,166 $ 53,920
Accounts receivable 85,524 65,212
Inventory 94,974 85,485
Other current assets 15,677 14,402
Property, plant and equipment, net 207,907 208,999
Other assets 123,611 122,702
-------- --------
Total assets $562,859 $550,720
======== ========
Liabilities and Stockholders' Equity
Accounts payable and other accrued expenses $ 54,584 $ 49,583
Short-term borrowings 1,401 1,217
Deferred income taxes 11,308 11,902
Pension liabilities 15,913 14,540
Long-term debt 255,290 255,712
Other liabilities 17,418 17,131
-------- --------
Total liabilities 355,914 350,085
-------- --------
Stockholders' equity 206,945 200,635
-------- --------
Total liabilities and stockholders' equity $562,859 $550,720
======== ========
Reconciliation of Net Cash Used by Operating Activities
to Free Cash Flow(1) (Unaudited)
Three-month period ended
03/30/03 03/31/02
-------- --------
In thousands
Net income $ 638 $ 1,688
Depreciation and amortization 4,617 4,153
Changes in operating assets and liabilities (24,241) (17,080)
Other 121 58
-------- --------
Net cash used by operating activities (18,865) (11,181)
Additions to property, plant and equipment (872) (1,948)
-------- --------
Free cash flow $(19,737) $(13,129)
======== ========
- ---------------
(1) This statement reconciles cash used by operations to free cash flow,
which is a non-GAAP financial measure. Management believes free cash
flow is a meaningful measure of financial performance and liquidity.
WOLVERINE TUBE, INC.
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Reconciliation of Net Income to Earnings Before Interest, Taxes,
Depreciation and Amortization(2) (Unaudited)
Three-month period ended
03/30/03 03/31/02
------- -------
In thousands
Net income $ 638 $ 1,688
Interest expense, net 5,178 3,730
Income tax provision 122 923
Depreciation and amortization 4,617 4,153
------- -------
Earnings before interest, taxes, depreciation and amortization $10,555 $10,494
======= =======
- ---------------
(2) This statement reconciles net income to earnings before interest,
taxes, depreciation and amortization (EBITDA), which is a non-GAAP
financial measure. Management believes EBITDA is a meaningful measure
of financial performance and the Company's ability to service debt.
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