DALLAS, Aug. 3 /PRNewswire-FirstCall/ -- CompX International Inc. announced today sales of $29.2 million for the second quarter of 2009 compared to $43.7 million in the same period of 2008. For the six months ended June 30, 2009, sales were $57.7 million compared to $84.2 million in the previous year. CompX reported an operating loss of $949,000 in the second quarter of 2009 compared to income of $4.5 million in the same period in 2008, and reported an operating loss of $1.9 million for the six months ended June 30, 2009 compared to income of $8.0 million for 2008. The 2009 operating losses include aggregate charges relating to litigation expenses and a valuation adjustment for assets held for sale of $1.6 million for the quarter and $1.7 million for the six month period. Net loss for the second quarter of 2009 was $1.6 million, or $0.13 per share, compared to net income of $2.1 million, or $0.17 per share, for the same period of 2008. Net loss for the six months ended June 30, 2009 was $2.2 million, or $0.18 per diluted share, compared to net income of $3.4 million, or $0.30 per diluted share, in 2008.
Net sales decreased principally due to lower order rates from our customers across all business segments as a result of general unfavorable economic conditions in North America. The decrease in operating income is primarily due to the negative effects of the lower order rates, reduced coverage of overhead and fixed manufacturing costs from the resulting under utilization of production capacity, higher legal expense relating to certain patent related litigation and the assets held for sale charge, partially offset by the positive effects of cost reductions implemented in response to the lower order rates and the favorable impact of relative changes in foreign currency exchange rates. The assets held for sale charge related to the write-down to estimated fair market value of certain land and buildings which are no longer used in operations and are being actively marketed for sale.
"Sales continue to be a challenge due to the general economic conditions compounded by inconsistent order flow from customers as they seek to minimize their own inventory levels due to the uncertainty of their businesses," commented David A. Bowers, President & CEO. "In response, we have invested a great deal of effort over the last eighteen months to align our cost structure with current demand levels while maintaining our long term operating capability. As a result, we continue to generate positive cash flow from operations and are positioned to take advantage of improved order flow when the economy recovers."
CompX is a leading manufacturer of security products, furniture components and performance marine components. It operates from six locations in the U.S., Canada and Taiwan and employs approximately 1,000 people.
Forward-Looking Statements
Statements in this release relating to matters that are not historical facts are forward-looking statements based upon management's belief and assumptions using currently available information. Although CompX believes the expectations reflected in such forward-looking statements are reasonable, it cannot give any assurances that these expectations will prove to be correct. Such statements, by their nature, involve substantial risks and uncertainties that could significantly impact expected results, and actual future results could differ materially from those described in such forward-looking statements. While it is not possible to identify all factors, CompX continues to face many risks and uncertainties. Among the factors that could cause actual future results to differ materially include, but are not limited to, general economic and political conditions, changes in raw material and other operating costs, demand for office furniture, service industry employment levels, competitive products and prices, fluctuations in currency exchange rates, the introduction of trade barriers, potential difficulties in integrating completed acquisitions, the ability to sustain or increase operating income improvement resulting from cost control initiatives, uncertainties associated with the development of new product features and other risks and uncertainties detailed in CompX's Securities and Exchange Commission filings. Should one or more of these risks materialize or if the consequences worsen, or if the underlying assumptions prove incorrect, actual results could differ materially from those currently forecasted or expected. CompX disclaims any intention or obligation to publicly update or revise such statements whether as a result of new information, future events or otherwise.
COMPX INTERNATIONAL INC. SUMMARY OF CONSOLIDATED OPERATIONS (In millions, except per share amounts) (Unaudited) Three months ended Six months ended June 30, June 30, 2008 2009 2008 2009 ---- ---- ---- ---- Net sales $43.7 $29.2 $84.2 $57.7 Cost of goods sold 32.7 23.0 63.3 46.7 ---- ---- ---- ---- Gross margin 11.0 6.2 20.9 11.0 Selling, general and administrative expense 6.5 6.4 12.9 12.1 Assets held for sale write-down - 0.7 - 0.7 Other operating expense, net - - - 0.1 --- --- --- --- Operating income (loss) 4.5 (0.9) 8.0 (1.9) Interest expense (0.5) (0.3) (1.3) (0.6) Other non-operating income, net - - 0.2 - --- --- --- --- Income (loss) before income taxes 4.0 (1.2) 6.9 (2.5) Provision (benefit) for income taxes 1.9 0.4 3.2 (0.3) --- --- --- ----- Net income (loss) $2.1 $(1.6) $3.7 $(2.2) ==== ===== ==== ===== Net income (loss) per diluted common share $0.17 $(0.13) $0.30 $(0.18) ===== ====== ===== ====== Weighted average diluted common 12.4 12.4 12.4 12.4 shares outstanding ==== ==== ==== ==== COMPX INTERNATIONAL INC. CONDENSED CONSOLIDATED BALANCE SHEETS (In millions) December 31, June 30, 2008 2009 ---- ---- Assets (Unaudited) Current assets: Cash and equivalents $14.4 $15.0 Accounts receivable, net 16.8 14.3 Inventories, net 22.7 18.8 Deferred income taxes and other 4.7 5.4 Note receivable 0.9 - --- --- Total current assets 59.5 53.5 Intangibles 32.9 32.6 Net property and equipment 67.4 65.3 Assets held for sale 3.5 2.8 Other assets 0.1 0.1 --- --- Total assets $163.4 $154.3 ====== ====== Liabilities and Stockholders' Equity Current liabilities: Current maturities of note payable to affiliate $1.0 $1.0 Accounts payable and accrued liabilities 14.3 11.4 Interest payable to affiliate 0.5 0.2 Income taxes 1.2 0.6 --- --- Total current liabilities 17.0 13.2 Note payable to affiliate 42.0 41.2 Deferred income taxes and other 13.1 13.3 Stockholders' equity 91.3 86.6 ---- ---- Total liabilities and stockholders' equity $163.4 $154.3 ====== ======
CompX International Inc.
CONTACT: David A. Bowers, President & CEO of CompX International Inc.,
+1-864-286-1122
