Exhibit 99.1
Rogers Corporation Reports Third Quarter Results
ROGERS, Conn.--(BUSINESS WIRE)--Oct. 19, 2005--Rogers Corporation
(NYSE:ROG) announced today that for the third fiscal quarter of 2005,
net income was $0.49 per diluted share, which includes a net positive
adjustment associated with a favorable Internal Revenue Service
determination on previous Durel Corporation federal income tax
filings. This compares to earnings per diluted share of $0.38 for the
third quarter of 2004. Excluding the one-time $1.6 million, or $0.10
per diluted share tax adjustment, non-GAAP net income for this quarter
was $6.6 million, or $0.39, which is near the high end of the range of
the Company's July 20, 2005 guidance of $0.36 to $0.40 per share.
Net sales in the third quarter were $83.6 million, compared to the
$86.7 million in the third quarter of 2004, slightly lower than the
Company's guidance of $85 to $88 million. Although net sales decreased
by $3.1 million, quarter-over-quarter, the Company's operating
effectiveness improved significantly with operating income up over
29%.
Printed Circuit Materials sales totaled $35.9 million, down 21%
from the third quarter of 2004, due mostly to a decline in flexible
circuit material sales. This business's operating profit was $4.4
million, compared to $7.0 million a year ago, when the flexible
circuit material product line was running at capacity. Flexible
circuit materials sales strengthened throughout the quarter but at a
slower rate than anticipated. Rogers expects this sales ramp to
continue into the fourth quarter. The Company's high frequency circuit
materials product line experienced softness in cellular infrastructure
applications early in the quarter, but sales strengthened in
September, and this trend is expected to result in a fourth quarter
significantly better than last year.
Third quarter sales of High Performance Foams reached an all-time
record of $24.6 million, up 19% over the third quarter of 2004.
Operating profit for this business was also a record at $4.7 million,
or 19% of sales, compared to $0.2 million in the third quarter of
2004. The increase in profitability is attributed to increased sales
in the PORON(R) urethane foam product line, improved operating
efficiency in our silicone foam product line, and to a lesser extent,
lower losses from the realignment of the Company's polyolefin foam
product line after the second quarter restructuring.
Sales of Polymer Materials and Components totaled $23.2 million
for the quarter, up 12% compared to last year's third quarter sales of
$20.7 million. This business's operating loss for the third quarter
was $2.0 million. Durel electroluminescent lamp (EL) product line
sales were up 42% from the third quarter of last year, and mitigated
year-over-year sales declines in both elastomer components and bus
bars. Although EL sales increased significantly this quarter, a major
quality issue, since corrected, and startup costs due to the expansion
in China resulted in a significant loss. The Company expects all
product lines in this business to have increased sales and
profitability in the fourth quarter. Good progress was achieved in the
production startup of both the bus bar and Durel product lines in
China this quarter and is expected to continue in the fourth quarter.
Rogers' 50% owned joint ventures had quarterly sales of $22.5
million, down 6% compared to the third quarter of last year. The sales
decline was attributed to Rogers Chang Chun Technologies and Rogers'
two joint ventures with Inoac Corporation. However, the Company's
urethane foam joint venture with Inoac in Suzhou, China, made good
progress in achieving customer qualifications and improving
operations. At quarter's end, a large customer in Asia qualified
product from this joint venture, which should generate improved
results in the fourth quarter. Rogers expects all of its joint
ventures to have increased sales and profits next quarter.
Despite slightly lower sales, and having expanded capacity over
the year, third quarter gross margin was 29% compared to 28% a year
ago. The decline in other income was primarily due to a decline in
joint venture profits and lower royalties.
The Company's cash and short-term investments ended the quarter at
$31.9 million. Rogers' capital expenditures in the quarter were $13.2
million and inventories ended the quarter down slightly at $41.8
million. The Company remains debt free and capital expenditures
continue to be funded from operations. Additionally, $0.3 million was
spent buying back shares during the quarter, adding to a total
repurchase of $15.5 million since the current program began.
Robert D. Wachob, President and CEO, commented, "Our current
market position and outlook for Rogers fourth quarter remains strong.
Although we experienced sales declines with some of our product lines,
I am happy with our progress with both our capacity expansion projects
in China and improved operational execution. We expect the printed
circuit materials business sales to increase in the fourth quarter,
our high performance foams business to remain relatively strong, and
the polymer materials and components business to make strides in
reducing the losses associated with the startup projects. For the
fourth quarter we expect sales to be between $85 and $88 million, and
earnings per diluted share in the range of $0.40 to $0.44."
Rogers Corporation, headquartered in Rogers, CT, U.S.A., develops
and manufactures high-performance specialty materials, which serve a
diverse range of markets including: portable communication devices,
communication infrastructure, consumer products, computer and office
equipment, ground transportation, and aerospace and defense. Rogers
operates manufacturing facilities in Connecticut, Arizona, and
Illinois in the U.S., in Gent, Belgium, in Suzhou, China, and in
Hwasung City, Korea. Sales offices are located in Belgium, Japan,
Taiwan, Korea, China, and Singapore.
Safe Harbor Statement
Statements in this news release that are not strictly historical
may be deemed to be "forward-looking" statements within the meaning of
the Private Securities Litigation Reform Act of 1995. These
forward-looking statements are based on management's current
expectations and are 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 2004 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. All information in this press release is as of October 19,
2005, and Rogers undertakes no duty to update this information unless
required by law.
Additional Information and October 20th Conference Call
For more information, please contact the Company directly, visit
Rogers web site on the Internet, or send a message by email.
Web site Address: http://www.rogerscorporation.com
Financial News Contact: Paul B. Middleton, Acting Chief Financial
Officer and Corporate Controller, Phone: 860-774-9605, FAX:
860-779-4714
Editorial Contact: Edward J. Joyce, Manager of Investor and Public
Relations, Phone: 860-779-5705, FAX: 860-779-5509, Email:
edward.joyce@rogerscorporation.com
A conference call to discuss third quarter results will be held on
Thursday, October 20th at 9:00AM (Eastern Time).
The Rogers participants in the conference call will be:
Robert D. Wachob, President and CEO
Paul B. Middleton, Acting CFO and Corporate Controller
Robert M. Soffer, Vice President, Treasurer and Secretary
Debra J. Granger, Director, Corporate Compliance and Control
Edward J. Joyce, Manager of Investor and Public Relations
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
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 11:59PM (Eastern
Time), Thursday October 27, 2005. The pass code for the audio replay
is 1417001.
The call will also be webcast live in a listen only mode. The
webcast may be accessed through links available on the Rogers
Corporation web site at www.rogerscorporation.com. Replay of the
archived webcast will be available on the Rogers web site beginning
two hours following the webcast.
Consolidated Statements of Income
Three Months Nine Months
Ended Ended
(IN THOUSANDS, EXCEPT Oct. 2, Oct. 3, Oct. 2, Oct. 3,
PER SHARE AMOUNTS) 2005 2004 2005 2004
- ------------------------------- -------- -------- ---------- ---------
Net Sales $83,626 $86,740 $ 253,527 $277,733
Costs and Expenses:
Cost of Sales(a) 59,307 62,430 181,602 188,372
Selling and Administrative(b) 12,369 13,447 41,718 42,343
Research and Development 4,897 5,412 15,133 14,979
Impairment Charge(c) - - 20,030 -
------- ------- --------- --------
Total Costs and Expenses(d) 76,573 81,289 258,483 245,694
------- ------- --------- --------
Operating Income (Loss) 7,053 5,451 (4,956) 32,039
Other Income (Loss) less Other
Charges 1,000 3,132 3,254 8,487
Interest Income/(Expense), Net 194 31 556 131
------- ------- --------- --------
Income (Loss) Before Taxes 8,247 8,614 (1,146) 40,657
Income Taxes 31 2,153 (5,674) 10,164
------- ------- --------- --------
Net Income (Loss) $ 8,216 $ 6,461 $ 4,528 $ 30,493
------- ------- --------- --------
Net Income (Loss) Per Share:
Basic $ 0.51 $ 0.39 $ 0.28 $ 1.87
Diluted $ 0.49 $ 0.38 $ 0.27 $ 1.78
Shares Used in Computing:
Basic 16,267 16,460 16,314 16,342
Diluted 16,727 17,140 16,756 17,120
(a) Nine months ended includes $1,158 write down of inventory
associated with the polyolefin foam operation
(b) Nine months ended includes $440 of receivable write offs
associated with the polyolefin foam operation
(c) Nine months ended includes $19,766 of charges related to
impairment of long-lived assets associated with the polyolefin
foam operation and $264 related to the impairment of a
held-for-sale building formerly used for the Elastomer Components
Division in South Windham, CT.
(d) Including Depreciation and Amortization of: 2005 - $4,182 &
$14,658; 2004 - $4,222 & $13,226
Consolidated Balance Sheets
Oct. 2, Jan. 2,
(IN THOUSANDS) 2005 2005
- --------------------------------------------- ------------ -----------
Assets
Current Assets:
Cash and Cash Equivalents $31,907 $37,967
Short-term Investments - 2,000
Accounts Receivable, Net 59,711 57,264
Accounts Receivable - Joint Ventures 5,905 5,176
Note Receivable, Current 2,099 2,100
Inventories 41,845 49,051
Asbestos-related insurance receivables 7,154 7,154
Other Current Assets 13,001 12,222
------------ -----------
Total Current Assets 161,622 172,934
------------ -----------
Notes Receivable, Long-term 4,200 4,200
Property, Plant and Equipment, Net 131,764 140,384
Investment in Unconsolidated Joint Ventures 18,154 18,671
Pension Asset 5,831 5,831
Goodwill and Other Intangible Assets, Net 22,720 29,072
Asbestos-related insurance receivables 28,803 28,803
Other Assets 5,441 5,300
------------ -----------
Total Assets $378,535 $405,195
------------ -----------
Liabilities and Shareholders' Equity
Current Liabilities:
Accounts Payable $17,945 $21,117
Accrued Employee Benefits and Compensation 16,451 18,427
Asbestos-related insurance liabilities 7,154 7,154
Other Current Liabilities 11,551 10,689
------------ -----------
Total Current Liabilities 53,101 57,387
------------ -----------
Noncurrent Deferred Income Taxes 5,023 14,111
Noncurrent Pension Liability 12,775 14,757
Noncurrent Retiree Health Care & Life
Insurance Benefits 6,483 6,483
Asbestos-related insurance liabilities 29,045 29,045
Other Long-term Liabilities 1,367 2,045
Shareholders' Equity 270,741 281,367
------------ -----------
Total Liabilities and Shareholders'
Equity $378,535 $405,195
------------ -----------
These statements are subject to year-end audit.
Reconciliation of Third Quarter Non-GAAP Net Income
GAAP Net Income, Millions $8.2
Less Tax Adjustment, Millions 1.6
- ----------------------------------------------------------------------
Non-GAAP Net Income, Millions $6.6
Reconciliation of Third Quarter Non-GAAP Earnings per Share
GAAP Earnings per Diluted Share $0.49
Less Tax Adjustment per share 0.10
- ----------------------------------------------------------------------
Non-GAAP Earnings per Diluted Share $0.39
Notes to our Non-GAAP Financial Measures:
Rogers believes that net income from continuing operations and
diluted earnings per share, excluding the effect of the one-time tax
adjustment, is useful information for investors and should be
presented in addition to income determined in accordance with
generally accepted accounting principles (GAAP).
The one-time tax adjustment is the result of an Internal Revenue
Service audit of Durel Corporation tax filings for certain years prior
to the Company's acquisition of this business in 2003.
CONTACT: Rogers Corporation
Edward J. Joyce, 860-779-5705
edward.joyce@rogerscorporation.com