EXHIBIT 99.1
NEWS
FINANCIAL
RELATIONS BOARD
Re: NN, Inc.
2000 Waters Edge Drive
Johnson City, TN 37604
FOR FURTHER INFORMATION:
AT THE COMPANY: AT FINANCIAL RELATIONS BOARD
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Will Kelly Marilynn Meek Susan Garland
Vice President, Chief Administrative Officer (General info) (Analyst info)
(423) 743-9151 212-827-3773 212-827-3775
FOR IMMEDIATE RELEASE
October 18, 2005
NN, INC.TO REPORT THIRD QUARTER 2005 RESULTS AND HOLD
CONFERENCE CALL ON NOVEMBER 1, 2005
ADJUSTS 2005 FULL YEAR EPS GUIDANCE
Johnson City, Tenn., October 18, 2005 - NN, Inc. (NASDAQ: NNBR) today announced
that it will release third quarter 2005 financial results for the period ended
September 30, 2005 before the opening of the market on November 1, 2005.
Management will hold a conference call at 11:00 a.m. ET that day to review the
Company's results. The call can be accessed via the internet live or as a replay
at www.fulldisclosure.com. For those who are unavailable to listen to the live
broadcast, a replay will be available shortly after the call for 90 days.
The Company also announced that it is revising its previously announced 2005
full year guidance of $0.90 to $0.94 per diluted share and now expects to report
earnings of $0.77 to $0.81 per diluted share for 2005 full year. The reduction
of approximately $0.13 per diluted share is attributable to three factors: lower
second half sales volume and resulting inefficiencies in Europe ($0.06 per
share), currency translation ($0.05 per share), and an adjustment to the U.S.
tax provision and the recording of a reserve for Delphi accounts receivable
($0.02 per share).
As mentioned in the Company's second quarter release, overall global demand
remained strong during the first half of 2005. However, demand from certain
European customers
has weakened in the second half of the year. Additionally, production delays at
the Company's new manufacturing facility in Slovakia have negatively impacted
planned sales volumes and resulting profitability. These lower sales volumes
have adversely affected capacity utilization rates in Slovakia and also the
remaining NN Europe facilities, thus lowering anticipated margins.
Currency translation associated with the U.S. Dollar-Euro exchange rates, which
was also mentioned in the second quarter earnings release, is now forecasted to
negatively impact sales and net income by approximately $12.0 million and $0.05
per diluted share, respectively for the 2005 full year.
Finally, two additional factors have contributed to the revised guidance, but to
a lesser degree. On Saturday, October 8, 2005, Delphi Corporation filed for
Chapter 11 bankruptcy protection. Due to this filing, the Company has reserved
certain amounts of its accounts receivable balance with Delphi. The recording of
this reserve resulted in a charge to after-tax earnings of approximately $0.01
per diluted share. The Company believes that Delphi post-bankruptcy is an
acceptable credit risk and plans to continue normal shipments of its product to
them. Secondly, the Company recorded a charge in the third quarter of
approximately $0.01 per diluted share related to an adjustment of its corporate
tax rate.
NN, Inc. manufacturers and supplies high precision bearing components consisting
of balls, rollers, seals, and retainers for leading bearing manufacturers on a
global basis. In addition, the company manufactures a variety of other plastic
components. NN, Inc. had sales of US $304 million in 2004.
Except for specific historical information, many of the matters discussed in
this press release may express or imply projections of revenues or expenditures,
statements of plans and objectives or future operations or statements of future
economic performance. These, and similar statements are forward-looking
statements concerning matters that involve risks, uncertainties and other
factors which may cause the actual performance of NN, Inc. and its subsidiaries
to differ materially from those expressed or implied by this discussion. All
forward-looking information is provided by the Company pursuant to the safe
harbor established under the Private Securities Litigation Reform Act of 1995
and should be evaluated in the context of these factors. Forward-looking
statements generally can be identified by the use of forward-looking terminology
such as "assumptions", "target", "guidance", "outlook", "plans", "projection",
"may", "will", "would", "expect", "intend", "estimate", "anticipate", "believe",
"potential" or "continue" (or the negative or other derivatives of each of these
terms) or similar terminology. Factors which could materially affect actual
results include, but are not limited to: general economic conditions and
economic conditions in the industrial sector, inventory levels, regulatory
compliance costs and the Company's ability to manage these costs, start-up costs
for new operations, debt reduction, competitive influences, risks that current
customers will commence or increase captive production, risks of capacity
underutilization, quality issues, availability and price of raw materials,
currency and other risks associated with international trade, the Company's
dependence on certain major customers, and other risk factors and cautionary
statements listed from time to time in the Company's periodic reports filed with
the Securities and Exchange Commission, including, but not limited to, the
Company's Annual Report on 10-K for the fiscal year ended December 31, 2004.