CLEVELAND, Oct. 30 /PRNewswire-FirstCall/ -- Park-Ohio Holdings Corp. today announced results for its third quarter ended September 30, 2007.
NINE MONTHS RESULTS
Park-Ohio reported net sales of $823.6 million for the first nine months of 2007, a 5% increase on sales of $785.8 million for the same period of 2006. Park-Ohio reported net income of $17.3 million, or $1.48 per share dilutive, for the first nine months of 2007, a 29% increase on $13.4 million, or $1.17 per share dilutive, in the same period of 2006.
THIRD QUARTER RESULTS
Park-Ohio reported net sales of $269.1 million for third quarter 2007, a 5% increase on sales of $257.2 million for third quarter 2006. Park-Ohio reported net income of $6.2 million, or $.53 per share dilutive, for third quarter 2007, a 68% increase on net income of $3.7 million, or $.33 per share dilutive, for third quarter 2006.
Edward F. Crawford, Chairman and Chief Executive Officer, stated, "Solid results during what has historically been our seasonally slow third quarter demonstrate the strength of our international performance and the results of ongoing margin improvement initiatives. We expect 2007 EPS to be between $2.10 and $2.20 dilutive."
A conference call reviewing Park-Ohio's third quarter results will be broadcast live over the Internet on Wednesday, October 31, 2007 commencing at 10:00 am Eastern Time. Simply log on to http://www.pkoh.com/.
Park-Ohio is a leading provider of supply chain logistics services and a manufacturer of highly engineered products. Headquartered in Cleveland, Ohio, the Company operates 24 manufacturing sites and 54 supply chain logistics facilities.
This news release contains forward-looking statements, including statements regarding future performance of the Company that are subject to certain risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or projected.
Among the key factors that could cause actual results to differ materially from expectations are: the cyclical nature of the vehicular industry; timing of cost reductions; labor availability and stability; changes in economic and industry conditions; adverse impacts to the Company, its suppliers and customers from acts of terrorism or hostilities; the financial condition of the Company's customers and suppliers, including the impact of any bankruptcies; the Company's ability to successfully integrate the operations of acquired companies; the uncertainties of environmental, litigation or corporate contingencies; and changes in regulatory requirements. These and other risks and assumptions are described in the Company's reports that are
available from the United States Securities and Exchange Commission. The Company assumes no obligation to update the information in this release.
CONSOLIDATED CONDENSED STATEMENTS OF INCOME (UNAUDITED) PARK-OHIO HOLDINGS CORP. AND SUBSIDIARIES (In Thousands, Except per Share Data) Three Months Ended Nine Months Ended September 30, September 30, 2007 2006 2007 2006 Net sales $269,104 $257,167 $823,626 $785,841 Cost of products sold 226,880 220,968 700,413 675,039 Gross profit 42,224 36,199 123,213 110,802 Selling, general and administrative expenses 24,187 22,443 74,537 66,372 Gain on sale of assets held for sale 0 0 (2,299) 0 Operating income 18,037 13,756 50,975 44,430 Interest expense 7,993 8,065 24,286 23,170 Income before income taxes 10,044 5,691 26,689 21,260 Income taxes 3,816 1,955 9,408 7,866 Net income $6,228 $3,736 $17,281 $13,394 Amounts per common share: Basic $0.56 $0.34 $1.56 $1.22 Diluted $0.53 $0.33 $1.48 $1.17 Common shares used in the computation: Basic 11,127 11,007 11,079 10,987 Diluted 11,707 11,451 11,641 11,448 Other financial data: EBITDA, as defined $23,821 $18,332 $66,178 $59,356 Note A--EBITDA, as defined, reflects earnings before interest and income taxes and excludes depreciation, amortization, certain non-cash charges and corporate-level expenses as defined in the Company's Revolving Credit Agreement. EBITDA is not a measure of performance under generally accepted accounting principles ("GAAP") and should not be considered in isolation or as a substitute for net income, cash flows from operating, investing and financing activities and other income or cash flow statement data prepared in accordance with GAAP or as a measure of profitability or liquidity. The Company presents EBITDA because management believes that EBITDA is useful to investors as an indication of the Company's satisfaction of its Debt Service Ratio covenant in its revolving credit agreement and because EBITDA is a measure used under the Company's revolving credit facility to determine whether the Company may incur additional debt under such facility. EBITDA as defined herein may not be comparable to other similarly titled measures of other companies. The following table reconciles net income to EBITDA, as defined: Three Months Ended Nine Months Ended September 30, September 30, 2007 2006 2007 2006 Net income $6,228 $3,736 $17,281 $13,394 Add back: Income taxes 3,816 1,955 9,408 7,866 Interest expense 7,993 8,065 24,286 23,170 Depreciation and amortization 5,254 4,270 15,782 14,097 Gain on the sale of assets held for sale 0 0 (2,299) 0 Miscellaneous 530 306 1,720 829 EBITDA, as defined $23,821 $18,332 $66,178 $59,356 CONSOLIDATED CONDENSED BALANCE SHEETS PARK-OHIO HOLDINGS CORP. AND SUBSIDIARIES September 30, December 31, 2007 2006 (Unaudited) (Audited) (In Thousands) ASSETS Current Assets Cash and cash equivalents $18,878 $21,637 Accounts receivable, net 197,644 181,893 Inventories 206,828 223,936 Deferred tax assets 34,142 34,142 Other current assets 41,866 24,218 Total Current Assets 499,358 485,826 Property, Plant and Equipment 260,177 248,065 Less accumulated depreciation 158,223 146,980 Total Property Plant and Equipment 101,954 101,085 Other Assets Goodwill 99,097 98,180 Net assets held for sale 4,112 6,959 Other 95,144 92,092 Total Other Assets 198,353 197,231 Total Assets $799,665 $784,142 LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities Trade accounts payable $118,734 $132,864 Accrued expenses 80,089 78,655 Current portion of long-term liabilities 9,535 5,873 Total Current Liabilities 208,358 217,392 Long-Term Liabilities, less current portion 8.375% Senior Subordinated Notes due 2014 210,000 210,000 Revolving credit maturing on December 31, 2010 155,600 156,700 Other long-term debt 1,918 4,790 Deferred tax liability 32,089 32,089 Other postretirement benefits and other long-term liabilities 28,238 24,434 Total Long-Term Liabilities 427,845 428,013 Shareholders' Equity 163,462 138,737 Total Liabilities and Shareholders' Equity $799,665 $784,142 BUSINESS SEGMENT INFORMATION (UNAUDITED) PARK-OHIO HOLDINGS CORP. AND SUBSIDIARIES (In Thousands) Three Months Ended Nine Months Ended September 30, September 30, 2007 2006 2007 2006 NET SALES ILS $134,066 $149,133 $403,956 $449,630 Aluminum Products 41,188 33,274 131,838 120,889 Manufactured Products 93,850 74,760 287,832 215,322 $269,104 $257,167 $823,626 $785,841 INCOME BEFORE INCOME TAXES ILS $8,288 $8,796 $20,420 $29,449 Aluminum Products 1,131 (118) 3,285 4,318 Manufactured Products 11,619 8,148 35,292 19,942 21,038 16,826 58,997 53,709 Corporate and Other Costs (3,001) (3,070) (8,022) (9,279) Interest Expense (7,993) (8,065) (24,286) (23,170) $10,044 $5,691 $26,689 $21,260
