Exhibit 99.1
LEXINGTON PRECISION CORPORATION
40 East 52nd Street
New York, NY 10022
FOR IMMEDIATE RELEASE
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LEXINGTON PRECISION REPORTS FOURTH QUARTER AND YEAR RESULTS
NEW YORK, April 5, 2005 -- Lexington Precision Corporation reported net income
of $3,183,000, or 65 cents per diluted common share, for the fourth quarter
ended December 31, 2004, compared to a net loss of $3,643,000, or 77 cents per
diluted common share, for the fourth quarter of 2003.
Income from continuing operations totaled $3,750,000, or 76 cents per diluted
common share, for the fourth quarter of 2004, compared to a loss from continuing
operations of $380,000, or 10 cents per diluted common share, for the fourth
quarter of 2003. Income from continuing operations for the fourth quarter of
2004 included a pre-tax gain of $5,346,000 from the repurchase of $8,264,000
principal amount of the company's 12% senior subordinated notes.
Net sales of continuing operations for the fourth quarter of 2004 were
$24,392,000, compared to $27,806,000 for the fourth quarter of 2003, a decrease
of 12%. Net sales of the Rubber Group decreased by 16% to $21,219,000, while net
sales of the Metals Group increased by 22% to $3,173,000.
During the fourth quarter of 2004, income from operations (income before gain on
repurchase of debt, interest expense, and taxes) totaled $364,000, compared to
$1,411,000 for the fourth quarter of 2003. Income from operations at the Rubber
Group decreased to $1,463,000 from $2,585,000. The Metals Group reported a loss
from operations of $656,000, compared to a loss of $361,000 for the fourth
quarter of 2003. The loss from operations at the Corporate Office decreased to
$443,000 from $813,000.
Earnings before interest, taxes, depreciation, and amortization (EBITDA) from
continuing operations for the fourth quarter of 2004, totaled $2,493,000,
compared to EBITDA from continuing operations of $3,533,000 for the fourth
quarter of 2003, a decrease of 29%. EBITDA for the Rubber Group decreased to
$3,229,000 from $4,294,000, EBITDA for the Metals Group decreased to negative
$301,000 from positive $43,000, and EBITDA for the Corporate Office increased to
negative $435,000 from negative $804,000. For more information related to
EBITDA, please see the section of the press release captioned "Notice Relating
to Use of Non-GAAP Measures."
Net cash provided by operating activities of continuing operations for the
fourth quarter of 2004 totaled $2,824,000 compared to $1,837,000 for the fourth
quarter of 2003, an increase of 54%.
The company reported net income of $1,590,000, or 32 cents per diluted common
share, for the year ended December 31, 2004, compared to a net loss of
$6,449,000, or $1.36 per diluted common share, for 2003.
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Lexington Precision Corporation
April 5, 2005
Income from continuing operations totaled $4,798,000, or 97 cents per diluted
common share, for 2004, compared to a loss from continuing operations of
$1,549,000, or 35 cents per diluted common share, for 2003. Income from
continuing operations for 2004, included a pre-tax gain of $8,598,000 from the
repurchase of the company's debt.
Net sales of continuing operations for 2004 were $110,353,000, compared to
$113,231,000 for 2003. Net sales of the Rubber Group decreased by 4% to
$99,565,000, while net sales of the Metals Group increased by 8% to $10,788,000.
During 2004, income from operations totaled $4,666,000, compared to $5,507,000
for 2003. Income from operations at the Rubber Group decreased to $9,865,000
from $10,026,000. The Metals Group reported a loss from operations of
$2,788,000, compared to a loss of $1,840,000 for 2003. The loss from operations
at the Corporate Office decreased to $2,411,000 from $2,679,000.
EBITDA from continuing operations for 2004, totaled $13,110,000, compared to
$14,462,000 for 2003, a decrease of 9%. EBITDA for the Rubber Group decreased to
$16,794,000 from $17,147,000, EBITDA for the Metals Group decreased to negative
$1,312,000 from negative $44,000, and EBITDA for the Corporate Office increased
to negative $2,372,000 from negative $2,641,000.
Net cash provided by operating activities of continuing operations for 2004
totaled $7,068,000, compared to $13,470,000 for 2003, a decrease of 48%.
DISCONTINUED OPERATIONS
During the fourth quarter of 2004 and for the year ended December 31, 2004, we
classified the results of operations, net assets, liabilities, and cash flows of
the die casting division as discontinued operations because we committed to a
plan to sell the assets or business of the die casting division or, if a sale
does not occur, close the operations of the die casting division no later than
the second quarter of 2005.
During the fourth quarter of 2004, the loss from discontinued operations totaled
$567,000, or 11 cents per diluted common share, compared to a loss from
discontinued operations of $3,263,000, or 67 cents per diluted common share, for
the fourth quarter of 2003. The losses from discontinued operations for the
fourth quarters of 2004 and 2003 included pre-tax impairment charges of $667,000
and $2,588,000, respectively, to write down the carrying value of plant and
equipment.
During the year ended December 31, 2004, the loss from discontinued operations
totaled $3,208,000, or 65 cents per diluted common share, compared to a loss
from discontinued operations of $4,653,000, or 96 cents per diluted common
share, for 2003. The losses from discontinued operations for 2004 and 2003,
included pre-tax impairment charges of $1,595,000 and $2,588,000, respectively,
to write down the carrying value of plant and equipment.
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Lexington Precision Corporation
April 5, 2005
NOTICE RELATING TO USE OF NON-GAAP MEASURE
Attached to this press release are tables setting forth our condensed
consolidated statements of operations and selected consolidated and segment
financial data, including information concerning our cash flows from operations
and reconciliations of income (loss) from continuing operations to EBITDA from
continuing operations. EBITDA is not a measure of performance under U.S.
generally accepted accounting principles and should not be considered in
isolation or used as a substitute for income from operations, net income, net
cash provided by operating activities, or other operating or cash flow statement
data prepared in accordance with U.S. generally accepted accounting principles.
We have presented EBITDA because this measure is used by investors, as well as
our own management, to evaluate the operating performance of our business,
including its ability to incur and to service debt. Nevertheless, EBITDA has
distinct limitations as compared to a GAAP number such as net income. By
excluding interest and tax payments, for example, an investor may not see that
both represent a reduction in cash available to the company. Likewise,
depreciation and amortization, while non-cash items, represent generally the
devaluation of assets that produce revenue for the company. Our definition of
EBITDA may not be the same as the definition of EBITDA used by other companies.
Lexington Precision Corporation manufactures rubber and metal components that
are used primarily by manufacturers of automobiles, automotive replacement
parts, and medical devices.
Contact: Warren Delano, President (212) 319-4657
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LEXINGTON PRECISION CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
QUARTER ENDED YEAR ENDED
DECEMBER 31 DECEMBER 31
------------------------- -------------------------
2004 2003 2004 2003
--------- --------- --------- ---------
(UNAUDITED)
Net sales $ 24,392 $ 27,806 $ 110,353 $ 113,231
Cost of sales 22,399 24,235 98,304 99,773
--------- --------- --------- ---------
Gross profit 1,993 3,571 12,049 13,458
Selling and administrative expenses 1,629 2,113 7,383 7,904
Impairment of goodwill -- 47 -- 47
--------- --------- --------- ---------
Income from operations 364 1,411 4,666 5,507
--------- --------- --------- ---------
Other income (expense):
Gain on repurchase of debt 5,346 -- 8,598 --
Interest expense (2,242) (1,776) (8,662) (6,980)
--------- --------- --------- ---------
Income (loss) before income taxes 3,468 (365) 4,602 (1,473)
Income tax provision (benefit) (282) 15 (196) 76
--------- --------- --------- ---------
Income (loss) from continuing operations 3,750 (380) 4,798 (1,549)
Loss from discontinued operations (567) (3,263) (3,208) (4,653)
--------- --------- --------- ---------
Income (loss) before cumulative effect of a
change in accounting principle 3,183 (3,643) 1,590 (6,202)
Cumulative effect of a change in accounting principle -- -- -- (247)
--------- --------- --------- ---------
Net income (loss) $ 3,183 $ (3,643) $ 1,590 $ (6,449)
========= ========= ========= =========
Basic and diluted income (loss) per share of common stock:
Continuing operations $ 0.76 $ (0.10) $ 0.97 $ (0.35)
Discontinued operations (.11) (0.67) (0.65) (0.96)
Cumulative effect of a change in accounting principle -- -- -- (0.05)
--------- --------- --------- ---------
Net income (loss) $ 0.65 $ (0.77) $ 0.32 $ (1.36)
========= ========= ========= =========
Reconciliation of income (loss) from continuing
operations to EBITDA from continuing operations
Income (loss) from continuing operations $ 3,750 $ (380) $ 4,798 $ (1,796)
Add:
Depreciation and amortization 2,129 2,122 8,444 8,955
Interest expense 2,242 1,776 8,662 6,980
Income tax provision (282) 15 (196) 76
Gain on repurchase of securities (5,346) -- (8,598) --
Cumulative effect of change in accounting
Principle -- -- -- 247
--------- --------- --------- ---------
EBITDA from continuing operations $ 2,493 $ 3,533 $ 13,110 $ 14,462
========= ========= ========= =========
Net cash provided by operating activities $ 2,824 $ 1,837 $ 7,068 $ 13,470
========= ========= ========= =========
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LEXINGTON PRECISION CORPORATION
SELECT CONSOLIDATED AND SEGMENT FINANCIAL DATA
CONTINUING OPERATIONS
(IN THOUSANDS)
QUARTER ENDED YEAR ENDED
DECEMBER 31 DECEMBER 31
------------------------- -------------------------
2004 2003 2004 2003
--------- --------- --------- ---------
(UNAUDITED)
Net sales:
Rubber Group $ 21,219 $ 25,211 $ 99,565 $ 103,243
Metals Group 3,173 2,595 10,788 9,988
--------- --------- --------- ---------
Total net sales $ 24,392 $ 27,806 $ 110,353 $ 113,231
========= ========= ========= =========
Income (loss) from operations:
Rubber Group $ 1,463 $ 2,585 $ 9,865 $ 10,026
Metals Group (656) (361) (2,788) (1,840)
Corporate Office (443) (813) (2,411) (2,679)
--------- --------- --------- ---------
Total income (loss) from operations 364 1,411 4,666 5,507
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Add back depreciation and amortization
included in income from operations:
Rubber Group 1,766 1,709 6,929 7,121
Metals Group 355 404 1,476 1,796
Corporate Office 8 9 39 38
--------- --------- --------- ---------
Total depreciation and amortization 2,129 2,122 8,444 8,955
--------- --------- --------- ---------
Earnings (loss) before interest, taxes, depreciation,
and amortization (EBITDA):
Rubber Group 3,229 4,294 16,794 17,147
Metals Group (301) 43 (1,312) (44)
Corporate Office (435) (804) (2,372) (2,641)
--------- --------- --------- ---------
Total EBITDA $ 2,493 $ 3,533 $ 13,110 $ 14,462
========= ========= ========= =========
Capital expenditures:
Rubber Group $ 1,756 $ 1,003 $ 5,277 $ 4,873
Metals Group 66 217 773 799
Corporate Office -- 3 7 14
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Total capital expenditures $ 1,822 $ 1,223 $ 6,057 $ 5,686
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