Exhibit 99.1
Rogers Corporation Announces Second Quarter 2003 Results; E
arnings up 14% over the Second Quarter of 2002
and up over 30% Year-to-Date
ROGERS, Conn.--(BUSINESS WIRE)--July 16, 2003--Rogers Corporation
(NYSE:ROG) announced today that earnings per share for the second
quarter of 2003 increased by 14% compared to the second quarter of
2002. Earnings for the first half of the year were over 30% higher
than the same period last year. Diluted earnings per share for the
quarter were $0.32 compared to the $0.28 earned in last year's second
quarter. Rogers had projected earnings of between $0.32 and $0.36 per
diluted share on revenues of $49 to $52 million.
Net sales in the second quarter were $49.2 million, compared to
the $57.3 million sold in the second quarter of 2002, reflecting the
divestiture of the Company's Moldable Composites Division ("MCD") that
occurred in November of 2002. MCD sales were $8.7 million for the
second quarter of 2002. As expected, sales were slightly down
sequentially from the first quarter of 2003 due to the normal
seasonality associated with some of the markets served by the
Company's product lines.
The Company's four unconsolidated joint ventures had total
revenues in the second quarter of 2003 of $27.0 million versus $31.5
million in the same quarter last year. Adding the Company's 50% share
of these joint venture sales to the Company's net sales, Rogers'
Combined Sales this quarter were $62.7 million compared to $73.1
million in last year's second quarter. (See reconciliation for
Combined Sales to net sales under Non-GAAP information included at the
end of this press release.)
Sales of Printed Circuit Materials for the quarter totaled $22.0
million, up almost 10% from the $20.1 million reported in the second
quarter of 2002. Revenue increases were driven by a significant
increase in high frequency material sales for the satellite television
LNB business as the Company gains more market share, and from new
adoptions in automotive wireless applications. Increased sales of high
frequency materials were somewhat offset by lower sales of flexible
circuit materials as a major cell phone program reached end of life
and excess handset inventory in the retail channel cancelled a new
program. Compared to the first quarter of 2003, revenues were
negatively impacted by normal seasonality in two key markets, as well
as lower sales for cell phone base station materials as two of the
infrastructure companies that purchased materials in the first
quarter, adjusted their inventories.
Second quarter sales of High Performance Foams were $17.1 million,
down approximately 4% from quarter two last year and about flat
sequentially. High performance urethane materials used in mobile
phones were strong as the Company continues to gain design wins in
more models; however weakness on the consumer side of the business, as
well as in aerospace and chip packaging, caused a slight decline in
total revenues.
Sales of Polymer Materials and Components totaled $10.1 million,
down from the $19.5 million in last year's second quarter mostly as a
result of the Company's divestiture of MCD. Sales of power
distribution components rose 36% over last year's second quarter
driven in part by a European application in DSL, a system that moves
network data over phone lines at high speeds. This increase was offset
by a significant decline in the office equipment roller business.
The revenues of Rogers' joint ventures decreased by 14% compared
to last year's second quarter, driven by an over 30% decline in sales
at Durel Corporation, the largest of Rogers' joint ventures. Durel's
revenues were impacted by the continuing shift to color displays for
cellular telephones which cannot utilize electroluminescence for
backlighting. However, Durel anticipates that its sales should remain
relatively level over the next twelve months. Polyimide Laminate
Systems, a supplier of specialty laminate materials to the disk drive
industry, had sales that were essentially unchanged compared to last
year's second quarter. Rogers Inoac Corporation realized double-digit
growth over the previous year's second quarter as it continues to win
new designs for its urethane foam materials as seals and shock
absorbing components in mobile phones. Rogers Chang Chun Technologies
continued to make progress in the second quarter with two new major
design wins for its flexible circuit materials.
The Company was able to realize gross margins for the second
quarter of 30%, compared to 32% achieved in the first quarter of 2003.
Lower sales due to second quarter seasonality, and the duplication of
some labor and overhead expenses caused by the start-up of operations
in both Carol Stream, Illinois and Suzhou, China, were responsible for
the lower rate.
Other income was up significantly compared to the second quarter
of last year due to higher royalties, primarily from the MCD
divestiture, and lower litigation expenses; even though joint venture
income decreased by approximately 5%, commensurate with the 14%
decline in joint venture revenues. During the next four and a half
years, the Company expects to continue to recognize royalties for the
intellectual property license related to the MCD divestiture.
Capital expenditures were $4.5 million during this year's second
quarter. The Company still projects total capital expenditures for
2003 to be $25 million. Most capital spending for 2003 is expected to
reflect equipment purchases associated with the move of the polyolefin
business to Illinois and the expansion of manufacturing operations in
China.
Rogers' balance sheet continues in excellent condition. Cash for
the quarter was up by $2.4 million, rising to $32.6 million, even
after the Company made an additional voluntary $2.5 million pension
contribution. Through effective working capital management,
inventories declined and the Company's days of sales outstanding for
receivables went from 58 days to 55 days.
Walter E. Boomer, Chairman and CEO stated, "Rogers is doing fine,
maintaining good operating margins and winning additional market share
with several important 'design-ins.' We continue to make important
progress in marketing our products worldwide. While we are seeing an
increasing number of new projects and opportunities, we still have not
seen hard evidence that would indicate a general rise in business that
everyone continues to hope for. We remain conservative in our
projections because of that and as a result, our guidance for the
third quarter is for slightly higher sales between $50 and $53
million, with earnings per diluted share between $0.33 and $0.37. This
equates to an earnings improvement of 10% to 23% over the third
quarter of 2002."
Safe Harbor Statement
Statements in this news release that are not strictly historical
may be deemed to be "forward-looking" statements which should be
considered as subject to the many uncertainties that exist in the
Company's operations and environment. These uncertainties, which
include economic conditions, market demand and pricing, competitive
and cost factors, rapid technological change, new product
introductions, legal proceedings, and the like, are incorporated by
reference in the Rogers Corporation 2002 Form 10-K filed with the
Securities and Exchange Commission. Such factors could cause actual
results to differ materially from those in the forward-looking
statements.
Additional Information and July 17th Conference Call
For more information, please contact the Company directly, visit
Rogers website on the Internet, or send a message by email.
Website Address: http://www.rogerscorporation.com
Financial E-mail: finfo@rogers-corp.com
Financial News Contact: James M. Rutledge, Vice President Finance
and Chief Financial Officer, Phone: 860-774-9605, FAX:
860-779-5585
Editorial Contact: Debra J. Granger, Phone: 860-774-9605, FAX:
860-779-5509, email: debra.granger@rogers-corp.com
A conference call to discuss second quarter results will be held
on Thursday, July 17th at 9:00AM (Eastern Time).
Rogers participants in the conference call will be:
Walter E. Boomer, Chairman of the Board and CEO
Robert D. Wachob, President and COO
James M. Rutledge, Vice President Finance and CFO
Robert M. Soffer, Vice President and Secretary
A Q&A session will immediately follow management's comments.
To participate in the conference call, please call: 1-800-574-8929
toll-free in the United States and 1-706-634-1907 internationally.
There is no passcode for the live teleconference. For playback access,
please call: 1-800-642-1687 in the United States and 1-706-645-9291
internationally through 9:00AM, Friday, August 1st. The passcode for
the audio replay is 1447892.
The call will also be webcast live in a listen only mode. The
webcast may be accessed through links available on the Rogers
Corporation website at www.rogerscorporation.com. Replay of the
archived webcast will be available on the Rogers website beginning two
hours following the webcast.
Presentation of Information in this Press Release
In an effort to provide investors with additional information
regarding the Company's results, the Company may disclose certain
Non-GAAP information which management believes provides useful
information to investors. Management sometimes refers to "Combined
Sales" which are defined as net sales (as reported under GAAP) plus
50% of the revenues from the Company's four unconsolidated joint
ventures. These unconsolidated joint ventures are viewed by management
as important to the Company's business and make a significant
contribution towards the Company's profits.
Reconciliation of Non-Gaap Financial Information
(Dollars in Thousands) Second Quarter
2003 2002
Net Sales, as reported in this $49.2 $57.3
report and in accordance with
generally accepted accounting
principles
50% of Rogers' Joint Venture 13.5 15.8
Sales
Combined Sales $62.7 $73.1
(Financial Statements Follow)
Consolidated Statements of Income (Unaudited)
Quarters Ended Six Months Ended
(IN THOUSANDS, EXCEPT PER June 29, June 30, June 29, June 30,
SHARE AMOUNTS) 2003 2002 2003 2002
Net Sales $49,159 $57,330 $101,037 $111,888
Costs and Expenses:
Cost of Sales 34,433 39,634 69,823 77,949
Selling and Administrative 9,115 10,099 18,816 20,208
Research and Development 2,810 3,640 5,648 7,105
Total Costs and Expenses
(Including Depreciation and
Amortization of: 2003 - 46,358 53,373 94,287 105,262
$7,027; 2002 - $7,175)(a)
Operating Income 2,801 3,957 6,750 6,626
Other Income less Other
Charges 4,092 2,173 7,720 4,780
Interest Income/(Expense),
Net 56 (89) 131 (186)
Income Before Income Taxes 6,949 6,041 14,601 11,220
Income Taxes 1,737 1,510 3,650 2,805
Net Income $5,212 $4,531 $10,951 $8,415
Net Income Per Share:
Basic $0.33 $0.29 $0.70 $0.54
Diluted $0.32 $0.28 $0.68 $0.52
Shares Used in Computing:
Basic 15,742 15,487 15,647 15,445
Diluted 16,305 16,101 16,162 16,076
(a)For the six month periods.
Consolidated Balance Sheets (Unaudited)
(IN THOUSANDS) June 29, December 29,
2003 2002
Assets
Current Assets:
Cash and Cash Equivalents $32,640 $22,300
Short-term Investments -- 6,628
Accounts Receivable, Net 33,385 32,959
Accounts Receivable - Joint Ventures 1,184 1,414
Note Receivable, Current 2,100 --
Inventories 17,884 18,069
Other Current Assets 6,467 6,305
Total Current Assets 93,660 87,675
Notes Receivable, Long Term 9,900 12,000
Property, Plant and Equipment, Net 103,292 99,883
Investment in Unconsolidated Joint
Ventures 24,004 21,860
Pension Asset 8,951 8,951
Goodwill and Other Intangible Assets,
Net 22,201 22,204
Other Assets 5,400 5,128
Total Assets $267,408 $257,701
Liabilities and Shareholders' Equity
Current Liabilities:
Accounts Payable $8,436 $10,125
Accrued Employee Benefits and
Compensation 8,838 10,414
Other Current Liabilities 17,966 14,241
Total Current Liabilities 35,240 34,780
Noncurrent Deferred Income Taxes 8,529 8,308
Noncurrent Pension Liability 17,119 22,658
Noncurrent Retiree Health Care and Life
Insurance Benefits 6,197 6,197
Other Long-Term Liabilities 2,073 2,720
Shareholders' Equity 198,250 183,038
Total Liabilities and Shareholders'
Equity $267,408 $257,701
CONTACT: Rogers Corporation (Financial News Contact)
James M. Rutledge, 860-774-9605
or
Rogers Corporation (Editorial Contact)
Debra J. Granger, 860-774-9605
debra.granger@rogers-corp.com