CONTACT: Michael P. Hawks (NYSE -- BMC)
(612) 851-6030 FOR IMMEDIATE RELEASE
BMC REPORTS RECORD THIRD QUARTER EARNINGS
October 22, 1997 -- Minneapolis, MN -- BMC Industries, Inc. today reported
record third quarter net earnings of $8,875,000 or $0.31 per share, an increase
of 24% from earnings of $7,157,000 or $0.25 per share in the year-earlier
period. Third quarter revenues increased 16% from $68.2 million in the third
quarter of 1996 to $79.1 million in the third quarter of 1997.
Net earnings for the first nine months of 1997 totaled $28,747,000 or $1.01 per
share. This represented an improvement of $5,565,000 or 24% over the
$23,182,000 or $0.82 per share recorded for the first nine months of the prior
year. Revenues for the first nine months of 1997 were 16% higher than the same
period in the prior year.
The third quarter of 1997 represented another quarterly earnings record for BMC
and its twenty-sixth consecutive quarter of increased net earnings over the
year-earlier period, excluding income from the sale of equipment and technology
and other non-recurring items. Once again, each division contributed to this
significant accomplishment.
The Company's Precision Imaged Products operation (PIP includes both the Mask
Operations and Buckbee-Mears St. Paul) posted record third quarter results.
Third quarter sales increased 22% over the prior year quarter while profits
increased 25%. The profitability of Mask Operations increased due to the
continued sales mix shift to higher margin products, including high resolution
computer monitor masks. However, television mask sales and profitability were
depressed by lower yields on the existing lines at Cortland caused by the strain
of the start-up of the two new lines. Sales of large (25 - 29 inches)
television aperture masks increased 19% over third quarter 1996 sales and for
the first nine months of 1997 are now 27% ahead of the same period last year.
While invar and jumbo mask sales lagged 1996 third quarter sales, invar mask
sales are up 9% for the first nine months of 1997. Jumbo mask sales continue to
lag 1996 sales for the nine months, which is a difficult comparison following a
51% increase over 1995. The strength of the U.S. dollar
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versus the German mark had less than a $200,000 impact on earnings but reduced
sales, as compared with the prior year quarter, by approximately $4 million.
Buckbee-Mears St. Paul had record sales and profits in the quarter.
Third quarter Precision Imaged Products sales included over $6 million of high
resolution computer monitor masks sales from the Company's German monitor mask
line. While higher sales are expected from this line in the fourth quarter, the
new part and customer qualification process will continue. The new monitor mask
line in Cortland was de-bugged and started-up in the third quarter. The line is
currently producing parts for qualification with customers, and will be working
to qualify parts and build inventory in the fourth quarter. The start-up of the
new television mask line in Cortland continued to ramp up, with a progressive
growth in sales in the third quarter while also undertaking additional part and
customer qualifications.
BMC's Optical Products operation also produced record third quarter results.
Third quarter sales and profits increased 5% over the prior year quarter. Sales
growth was driven by a 27% increase in high end products (polycarbonate,
progressive, high index and polarizing sun lenses) over the prior year. Due to
the strong sales growth of high end products, Optical Product's gross profit
increased despite one-time expenses related to the shut down of the Ft.
Lauderdale plastic lens manufacturing facility which ceased operations in July
and start-up of the new polycarbonate manufacturing, centralized distribution
and research and development facilities, as well as increased research and
development spending. The increase in gross profit was offset by increased
advertising and promotional expenses, primarily related to polycarbonate lenses.
Construction of the new polycarbonate facility was completed in the third
quarter of 1997. The transfer of a portion of the polycarbonate manufacturing
capacity to the new facility has begun, but a full transfer will not be
completed until the second quarter of 1998 to ensure that disruption of
polycarbonate manufacturing will be minimized. In the interim, the Company will
continue to incur duplicate facility costs.
BMC is one of the world's largest manufacturers of aperture masks for color
television tubes and computer monitors. The Company is also a leading supplier
of polycarbonate, glass and plastic eyewear lenses. The common stock of the
Company is traded on the New York Stock Exchange under the symbol "BMC".
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BMC INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
(Unaudited)
(in thousands, except per share amounts)
Three Months Ended Nine Months Ended
September 30 September 30
------------------------ -------------------------
1997 1996 1997 1996
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Revenues $ 79,086 $ 68,158 $ 236,470 $ 204,633
Cost of products sold 61,813 53,840 181,356 158,792
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Gross margin 17,273 14,318 55,114 45,841
Selling 3,042 2,334 8,616 7,451
Administrative 1,006 1,210 3,634 3,725
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Income from Operations 13,225 10,774 42,864 34,665
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Other Income and (Expense)
Interest expense (403) (246) (707) (436)
Interest income 45 60 143 210
Other income 71 89 300 120
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Earnings before Income Taxes 12,938 10,677 42,600 34,559
Income Taxes 4,063 3,520 13,853 11,377
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Net Earnings $ 8,875 $ 7,157 $ 28,747 $ 23,182
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Net Earnings Per Share $ 0.31 $ 0.25 $ 1.01 $ 0.82
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Number of Shares Included in Per Share Computation 28,619 28,390 28,524 28,346
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BMC INDUSTRIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(in thousands)
SEPTEMBER 30 DECEMBER 31
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ASSETS 1997 1996
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Current Assets
Cash and cash equivalents $ 2,138 $ 2,544
Trade accounts receivable, net of allowances 34,450 24,979
Inventories 62,080 50,451
Deferred income taxes 6,655 5,372
Other current assets 7,483 8,354
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Total Current Assets 112,806 91,700
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Property, Plant and Equipment 277,788 220,489
Less Accumulated Depreciation 99,171 96,644
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Property, Plant and Equipment, Net 178,617 123,845
--------- ---------
Deferred Income Taxes 4,783 5,797
Other Assets, Net 13,636 11,627
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Total Assets $309,842 $232,969
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LIABILITIES AND STOCKHOLDERS' EQUITY
- ----------------------------------------------------------------------------
Current Liabilities
Short-term borrowings $ 1,195 $ 1,355
Accounts payable 20,398 19,434
Income taxes payable 1,902 7,657
Accrued expenses and other current liabilities 17,914 21,900
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Total Current Liabilities 41,409 50,346
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Long-Term Debt 75,688 16,634
Other Liabilities 18,233 19,421
Deferred Income Taxes 2,685 2,460
Stockholders' Equity
Common stock 61,452 56,551
Retained earnings 112,137 84,629
Cumulative translation adjustment (1,010) 3,974
Other (752) (1,046)
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Total Stockholders' Equity 171,827 144,108
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Total Liabilities and Stockholders' Equity $ 309,842 $ 232,969
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