Exhibit 99.1
Ameron Reports Record Earnings in 2006
PASADENA, Calif.--(BUSINESS WIRE)--Feb. 1, 2007--Ameron
International Corporation (NYSE:AMN) today reported record net income
of $52.2 million, or $5.88 per diluted share, for the year ended
November 30, 2006, compared to net income of $32.6 million, or $3.80
per diluted share, for the year ended November 30, 2005. As previously
reported, the Company completed the divestiture of its worldwide
coatings and finishes business on August 1, 2006. Earnings per share
from continuing operations, excluding results of the coatings and
finishes business, were $5.64 for the year ended November 30, 2006,
compared to $3.44 in 2005. Earnings per share from discontinued
operations, which consisted of the coatings and finishes business,
totaled $.24 for the year ended November 30, 2006, compared to $.36
per share in 2005. Results of discontinued operations included a
slight loss of $0.2 million after taxes on the sale of the coatings
and finishes business.
Sales of continuing operations totaled $549.2 million for the year
ended November 30, 2006, compared to $494.8 million in 2005. In
addition, Ameron's unconsolidated joint-venture companies, including
TAMCO, had sales of $313 million in 2006, compared to $308 million in
2005.
"The Company's results were excellent and well-balanced, as
Fiberglass-Composite Pipe, Pole Products and Hawaiian operations, as
well as TAMCO, all achieved record earnings," commented James S.
Marlen, Ameron's Chairman, President and Chief Executive Officer. "The
broad-based performance more than offset the down-cycle year
experienced by the Water Transmission Group. Market conditions were
generally favorable worldwide, and, overall, our businesses achieved
improved operating efficiencies."
Sales of continuing operations in the fourth quarter ended
November 30, 2006 totaled $150.6 million, compared to $139.2 million
in the fourth quarter of 2005. Earnings per share from continuing
operations were $1.35, which exceeded the earnings in the fourth
quarter of 2005 of $1.27 per share. Solid quarterly performances by
Fiberglass-Composite Pipe, Infrastructure Products and TAMCO, offset
the lower earnings of the Water Transmission Group. Total earnings per
share were $1.33 in the fourth quarter of 2006, compared to $1.53 per
share in the fourth quarter of 2005. The fourth quarter of 2006
included a loss from discontinued operations of $0.02 per share,
compared to income from discontinued operations of $.26 per share
after taxes in the fourth quarter of 2005.
The Fiberglass-Composite Pipe Group had record sales and segment
income in 2006 as operations in the U.S., Europe and Asia all had
improved performances. Sales increased 32%, and segment income
increased 54% in 2006, compared to 2005. The sales improvement was
concentrated in key worldwide markets: industrial, onshore oilfield,
marine and offshore. The demand for onshore oilfield piping remained
strong; the chemical and industrial markets, especially in the Middle
East, had solid growth; and the demand for fuel-handling piping in the
U.S. increased. The marine and offshore markets, served primarily from
Ameron's Singapore and Malaysia subsidiary operations, were
particularly strong. The outlook for the key worldwide markets served
by the Fiberglass-Composite Pipe Group remains favorable. The business
is expected to continue to perform well.
The Water Transmission Group had lower sales and significantly
lower segment income in 2006, compared to the strong performance in
2005. The sales decline (9%) was attributable to the anticipated
cyclical slowdown in the water pipe market in the western U.S. The
decrease in water pipe sales was offset partially by higher sales of
large-diameter towers to the wind-energy market. The decline in
segment income in 2006 was exacerbated by lower margin projects caused
by soft market conditions, start-up costs associated with the
introduction of wind towers and to the completion in early 2006 of a
high-margin sewer project in Northern California. As a result of the
softness in the water infrastructure market, there are fewer major
projects in progress or scheduled to bid early in 2007; however,
bidding is expected to increase later in 2007. The wind-energy market
represents a significant growth opportunity, and the diversification
will help counterbalance the cyclical lull in the water infrastructure
market. The Company is completing a major investment program to add
manufacturing capacity. The short-term outlook for the Water
Transmission Group is for a steady recovery. Longer term, the outlook
is positive due to the need to upgrade the water infrastructure
systems throughout the U.S. and the growth prospects in wind energy.
The Infrastructure Products Group's sales increased 17%, and
segment income increased 38% in 2006, compared to 2005. Both Ameron's
Pole Products Division and the Hawaiian Division had record sales and
segment income. The sales growth was broad-based as all construction
markets served by the Group experienced favorable conditions. Pole
Products continued to penetrate the southeastern U.S. residential
housing market for decorative concrete lighting poles. In addition,
sales in the western U.S. benefited from the strength of the housing
market and were also positively affected by a program at a major
utility in California to replace steel poles with decorative concrete
poles. The Hawaiian Division had improved sales on both Oahu and Maui
as a result of the strong Hawaiian construction markets, including
residential, commercial and military. Sales activity was particularly
strong on Maui, driven by residential demand and commercial
construction. The increase in segment income in both the Pole Products
and Hawaiian Divisions was attributable to the higher sales volume,
improved pricing and increased manufacturing efficiencies. Although
the housing market has softened, the outlook for the Infrastructure
Products Group's other construction markets remains firm.
TAMCO, Ameron's 50%-owned, steel mini-mill in California, had
record sales and net income in 2006, compared to 2005. The
construction market and demand for steel rebar in the western U.S.
continued at a favorable level. Net income increased due to a
favorable shift in product mix and improved steel pricing and margins,
commensurate with current market conditions and steel markets
worldwide. The outlook for TAMCO remains strong.
James Marlen concluded, "The Company's performance in 2006 was
outstanding, and our businesses operated at a high level in response
to favorable market conditions. The Company achieved record levels in
net income and earnings per share. We anticipate another strong
operating performance in 2007, and, longer term, we believe our core
businesses will continue to demonstrate steady, profitable growth."
Ameron International Corporation is a multinational manufacturer
of highly-engineered products and materials for the chemical,
industrial, energy, transportation and infrastructure markets. Traded
on the New York Stock Exchange (AMN), Ameron is a leading producer of
water transmission lines; fiberglass-composite pipe for transporting
oil, chemicals and corrosive fluids and specialized materials and
products used in infrastructure projects. The Company operates
businesses in North America, South America, Europe and Asia. It also
participates in several joint-venture companies in the U.S. and the
Middle East.
Cautionary statement for purposes of the "Safe Harbor" provisions
of The Private Securities Litigation Reform Act of 1995: Any
statements in this report that refer to the forecasted, estimated or
anticipated future results of Ameron International Corporation
("Ameron" or the "Company") are forward-looking and reflect the
Company's current analysis of existing trends and information. Actual
results may differ from current expectations based on a number of
factors affecting Ameron's businesses, including competitive
conditions and changing market situations. Matters affecting the
economy generally, including the state of economies worldwide, can
affect Ameron's results. Forward-looking statements represent the
Company's judgment only as of the date of this report. Since actual
results could differ materially, the reader is cautioned not to rely
on these forward-looking statements. Moreover, Ameron disclaims any
intent or obligation to update these forward-looking statements.
AMERON INTERNATIONAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Year ended November 30,
(Dollars in thousands, except per share
data) 2006 2005
- -------------------------------------------- ----------- -----------
Sales $ 549,180 $ 494,767
Cost of sales (416,791) (369,557)
----------- -----------
Gross profit 132,389 125,210
Selling, general and administrative expenses (94,689) (90,283)
Pension plan curtailment/settlement - -
Other income, net 11,397 2,137
----------- -----------
Income from continuing operations before
interest, income taxes and equity in
earnings of joint venture 49,097 37,064
Interest expense, net (1,682) (5,520)
----------- -----------
Income from continuing operations before
income taxes and equity in earnings of
joint venture 47,415 31,544
Provision for income taxes (10,905) (11,040)
----------- -----------
Income from continuing operations before
equity in earnings of joint venture 36,510 20,504
Equity in earnings of joint venture, net of
taxes 13,550 9,005
----------- -----------
Income from continuing operations 50,060 29,509
Income from discontinued operations, net of
taxes 2,140 3,101
----------- -----------
Net income $ 52,200 $ 32,610
=========== ===========
Basic earnings per share:
Income from continuing operations $ 5.73 $ 3.51
Income from discontinued operations, net of
taxes .25 .37
----------- -----------
Net income $ 5.98 $ 3.88
=========== ===========
Diluted earnings per share:
Income from continuing operations $ 5.64 $ 3.44
Income from discontinued operations, net of
taxes .24 .36
----------- -----------
Net income $ 5.88 $ 3.80
=========== ===========
Weighted-average shares (basic) 8,731,839 8,410,563
Weighted-average shares (diluted) 8,871,695 8,579,194
AMERON INTERNATIONAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS - ASSETS
(Unaudited)
As of November 30,
(Dollars in thousands, except per share data) 2006 2005
- ---------------------------------------------- ---------- ----------
ASSETS
Current assets
Cash and cash equivalents $ 139,479 $ 44,671
Receivables, less allowances of $4,912 in
2006 and $7,693 in 2005 160,173 180,558
Inventories 77,134 98,389
Deferred income taxes 23,861 17,598
Prepaid expenses and other current assets 15,921 11,714
---------- ----------
Total current assets 416,568 352,930
Investments in joint ventures
Equity method 14,501 13,777
Cost method 3,784 5,922
Property, plant and equipment
Land 33,327 38,959
Buildings 57,434 88,606
Machinery and equipment 261,538 284,593
Construction in progress 20,657 15,500
---------- ----------
Total property, plant and equipment at
cost 372,956 427,658
Accumulated depreciation (238,486) (272,993)
---------- ----------
Total property, plant and equipment, net 134,470 154,665
Deferred income taxes - 143
Intangible assets, net of accumulated
amortization of $3,017 in 2006 and $10,142
in 2005 2,143 13,259
Other assets 63,198 37,340
---------- ----------
Total assets $ 634,664 $ 578,036
========== ==========
AMERON INTERNATIONAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS - LIABILITIES AND STOCKHOLDERS' EQUITY
(Unaudited)
As of November 30,
(Dollars in thousands, except per share data) 2006 2005
- ------------------------------------------------ --------- ---------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Current portion of long-term debt $ 10,000 $ 18,333
Trade payables 45,650 54,349
Accrued liabilities 68,970 63,071
Income taxes payable 11,481 1,051
--------- ---------
Total current liabilities 136,101 136,804
Long-term debt, less current portion 72,525 77,109
Other long-term liabilities 62,813 67,625
--------- ---------
Total liabilities 271,439 281,538
Commitments and contingencies
Stockholders' equity
Common stock, par value $2.50 per share,
authorized 24,000,000 shares, outstanding
9,075,094 shares in 2006 and 8,698,148
shares in 2005, net of treasury shares 29,431 28,450
Additional paid-in capital 39,500 28,936
Unearned restricted stock - (2,084)
Retained earnings 371,894 326,795
Accumulated other comprehensive loss (27,232) (36,324)
Treasury stock (2,697,148 shares in 2006 and
2,681,811 shares in 2005) (50,368) (49,275)
--------- ---------
Total stockholders' equity 363,225 296,498
--------- ---------
Total liabilities and stockholders' equity $634,664 $578,036
========= =========
CONTACT: Ameron International Corporation
James S. Marlen, Chairman, President and Chief Executive
Officer
Gary Wagner, Executive Vice President, Chief Operating
Officer
James R. McLaughlin, Senior Vice President, Chief
Financial Officer
626-683-4000