CONTACT: Jeffrey J. Hattara (NYSE -- BMC)
(612) 851-6030 FOR IMMEDIATE RELEASE
BMC REPORTS FIRST QUARTER 1998 EARNINGS
April 22, 1998 -- Minneapolis, MN -- BMC Industries, Inc. today reported first
quarter 1998 net earnings of $3,809,000 or $0.14 diluted earnings per share,
compared to $7,883,000 or $0.28 diluted earnings per share in the first quarter
1997. Total first quarter revenues increased 4% from $77,127,000 in 1997 to
$80,084,000 in 1998.
Paul B. Burke, BMC's Chairman and Chief Executive Officer stated "All of our
operations enjoyed significant profitability increases over 1997 except for our
Cortland, New York mask operating facility. As anticipated, the Cortland
facility incurred significant continuing start-up expenses in the first quarter
on its new production lines, particularly the high resolution monitor line,
which more than offset our gains everywhere else. I am pleased to report,
however, that the Cortland operation made significant progress in both
increasing and stabilizing yields on these lines and in qualifying new parts.
As also previously disclosed, we expect start-up activity and yield ramp up on
the high resolution line in Cortland to linger into the second quarter."
First quarter sales for the Precision Imaged Products operation (including
both the Mask Operations and Buckbee-Mears St. Paul) were slightly ahead of
first quarter 1997 sales. Computer monitor mask sales were approximately $8
million in the first quarter, an increase of 145% over the prior year
quarter. More importantly, production level computer monitor mask shipments
were made to additional customers in the first quarter, as the Mask Group
continues to diversify its monitor mask customer base. Entertainment mask
sales were down 7% (adjusted for currency translation) from the prior year
quarter due primarily to lower invar sales. Invar sales were down 45%
compared to the prior year quarter, and we expect the soft market for invar
entertainment masks to continue for the balance of the year. The migration
to larger sized masks continued in the first quarter. Jumbo (30" and larger)
and large (25" to 29") masks made of AK steel increased 11% and 18%,
respectively, over the prior year quarter. The strength of the U.S. dollar
verses the German mark had less than a $100,000 impact on earnings but
reduced sales, as compared to the prior year quarter, by approximately $1.8
million. Buckbee-Mears St. Paul
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(BMSP) achieved excellent financial results, posting a 21% revenue gain over
the prior year quarter and record profitability. BMSP is continuing to find
high demand for precision etched and electroformed parts.
BMC's Optical Products operation achieved sales growth of 7% over the prior
year, while profits grew 39%. The increased profitability was fueled by
exceptionally strong sales of high-end products (polycarbonate, high-index,
progressive and polarizing sun lenses) which grew 25% over the prior year
quarter. Transfer of the polycarbonate manufacturing operations to the new
production facility in Ramsey, Minnesota will be completed in the second
quarter. We expect to begin realizing the benefit of improved yields and
productivity from this new facility beginning in the second half of 1998.
The closing process for the recently announced acquisition of certain assets of
Orcolite, a division of Monsanto Company, is proceeding as planned and on
schedule.
Statements made in this press release which are not historical, including
statements regarding future performance, are forward looking statements and as
such are subject to a number of risks, including lower demand for televisions
and computer monitors, inability to penetrate the lead frame market, problems
associated with transfer of the polycarbonate operations, higher operating
expenses and lower yields associated with production start-up, foreign currency
fluctuations, successful customer part qualifications and the effect of economic
uncertainty in Asia. These and other risks and uncertainties are detailed in
the Company's Form 10-K for the year ended December 31, 1997.
BMC is one of the world's largest manufacturers of aperture masks for color
television picture tubes and computer monitors. The Company is also a leading
producer of glass, plastic and polycarbonate 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
March 31
----------------------
1998 1997
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Revenues $ 80,084 $ 77,127
Cost of products sold 68,455 61,145
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Gross Margin 11,629 15,982
Selling 3,289 2,837
Administrative 1,330 1,539
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Income from Operations 7,010 11,606
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Other Income and (Expense)
Interest expense (1,383) (144)
Interest income 32 42
Other income (expense) (144) 262
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Earnings before Income Taxes 5,515 11,766
Income Taxes 1,706 3,883
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Net Earnings $ 3,809 $ 7,883
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Net Earnings Per Share:
Basic $ 0.14 $ 0.29
Diluted 0.14 0.28
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Number of Shares Included in Per Share Computation:
Basic 26,994 27,410
Diluted 27,644 28,458
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BMC INDUSTRIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(in thousands)
March 31 December 31
-------- -----------
1998 1997
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ASSETS
Current Assets
Cash and cash equivalents $ 2,238 $ 2,383
Trade accounts receivable, net of allowances 35,893 29,824
Inventories 78,957 70,111
Deferred income taxes 6,171 5,881
Other current assets 9,173 13,595
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Total Current Assets 132,432 121,794
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Property, Plant and Equipment 285,666 283,070
Less Accumulated Depreciation 104,816 100,688
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Property, Plant and Equipment, Net 180,850 182,382
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Deferred Income Taxes 1,229 1,429
Other Assets, Net 14,110 13,802
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Total Assets $328,621 $319,407
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LIABILITIES AND STOCKHOLDERS' EQUITY
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Current Liabilities
Short-term borrowings $ 1,222 $ 1,139
Accounts payable 23,540 25,623
Income taxes payable 3,495 2,830
Accrued expenses and other current liabilities 18,826 17,288
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Total Current Liabilities 47,083 46,880
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Long-Term Debt 95,571 73,426
Other Liabilities 17,430 17,718
Deferred Income Taxes 2,824 2,631
Stockholders' Equity
Common stock 46,358 62,263
Retained earnings 122,099 118,693
Other comprehensive income (1,694) (1,217)
Other (1,050) (987)
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Total Stockholders' Equity 165,713 178,752
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Total Liabilities and Stockholders' Equity $328,621 $319,407
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