Maverick Tube Corporation Reports Quarter and Fiscal Year 1998 Results
ST. LOUIS, Oct. 19 /PRNewswire/ -- Maverick Tube Corporation (Nasdaq: MAVK - news) announced today results for the quarter and year ended Sept. 30, 1998. The Company reported a net loss during the quarter of $1.2 million, or $0.08 per share, down from the profit reported in the same quarter last year of $5.4 million, or $0.35 per share. During the quarter, the company recorded a pre-tax charge of $1.6 million for the write-off of certain software and development costs relating to systems being replaced by a new enterprise resource planning system. Excluding the software charge, Maverick's loss during the quarter was $122,000, or $0.01 per share. For the full year of fiscal 1998, profits were $11.4 million, or $0.73 per share, down from the profit the previous year of $14.9 million, or $0.97 per share. Net sales for the quarter and year were $52 million and $265 million, respectively, down from $85 million and $291 million for the prior year periods.
Total tons of the Company's energy related product lines shipped during the fourth quarter declined by 51% compared to the same quarter of fiscal 1997. Drilling rates in the United States during the quarter were down by 20%, due to a 40% decrease in oil related drilling and a 6% decrease in gas related drilling, all in comparison to the previous year. Drilling decreased by 49% in Canada. Fourth quarter shipments of industrial products increased by 15% compared to the same quarter last year.
Gregg Eisenberg, President and CEO said, ''1998 finished on a very weak note after a strong start at the beginning of the year. Low oil prices and reduced producers' cash flows have certainly taken a toll on our business. Maverick's energy related product business slowed significantly during the last quarter due to both sharply lower demand and increased competition resulting from inventory reductions and continuing high levels of imports. On the other hand, our industrial products business was strong during the quarter, offsetting some of the weakness in our energy business.''
Eisenberg went on to say, ''Product pricing weakened some during the quarter, particularly on our energy products. However, we are starting to get the benefit of lower steel costs, which fell by 1% during the quarter. Our steel costs will continue to trend downward as replacement costs are 9% below our costs last quarter. We also reduced production sharply during the quarter, in reaction to lower demand as well as to reduce our own inventories to a more manageable level. This action should result in improved manufacturing costs in the coming months.''
Maverick Tube Corporation is a St. Louis, Missouri, based manufacturer of tubular products used in the energy industry in drilling, production and surface transportation applications as well as industrial tubing products (HSS and standard pipe) used in various industrial applications.
This news release contains forward looking information with respect to Maverick's operations and beliefs. Actual results may differ from these forward looking statements due to numerous factors, including those discussed in Exhibit 99.1 to Maverick's Form 10-K for its fiscal year ended Sept. 30, 1997.
Maverick Tube Corporation
Selected Consolidated Financial Data
For the Fourth Quarter And Year Ended Sept. 30, 1998
(In Thousands, except rig count, tons shipped per share data)
(Unaudited)
Fourth Quarter Ended Year Ended
Sept. 30 Sept. 30
1998 1997 1998 1997
Average U.S. Rig Count 796 990 906 905
Tons Shipped 89,906 133,731 428,216 469,958
Net Sales $51,773 $85,281 $265,390 $291,060
Gross Profit 3,578 14,108 33,351 38,257
(Loss) income from
operations(A) (1,983) 9,412 18,536 24,291
Pre-tax (loss)
income(A) (2,421) 8,836 16,805 22,224
Net (loss) income(A) ($1,221) $5,361 $11,386 $14,885
Basic (loss) earnings
per share(A)(B) ($0.08) $0.35 $0.74 $0.97
Diluted (loss) earnings
per share(A)(B) ($0.08) $0.35 $0.73 $0.97
Weighted average number
shares(B) 15,437 15,154 15,437 15,282
Working capital $60,362 $44,992
Property, plant and
equipment 69,879 55,506
Total Assets 156,885 162,064
Long-Term debt 35,626 18,879
Stockholders' equity $90,063 $77,868
Depreciation and
amortization $5,765 $5,697
(A) Loss from operations, pre-tax loss and net loss include a one-time
charge of $1.6 million ($1.1 million after tax) or $.07 per share for
the write-off of certain software and development costs relating to
systems being replaced by a new enterprise resource planning system.
(B) Earnings per share and weighted average number of shares has been
adjusted to reflect the two for one stock dividend distributed on
August 21, 1997.
SOURCE: Maverick Tube Corporation |
