Turbodyne Reports Second Quarter 1998 Results
Woodland Hills, CA - August 14, 1998 -- Turbodyne Technologies Inc. (Nasdaq:TRBD, Easdaq:TRBD) today announced financial results for its second quarter ended June 30, 1998.
The company's revenues for the six months ended June 30, 1998 rose 3 percent to $20.75 million from $20 million for the six months ended June 30, 1997. The net loss for the period was $7.8 million, ($0.23 per share), compared to a net loss of $5 million, ($0.26 per share), for the year ago period. Sales in these periods were primarily attributable to the Light Metals Division. The start-up sales attributable to the Engine Technology Division were minimal during these periods.
For the quarter ended June 30, 1998, net sales remained essentially flat at $11.0 million compared to $11.1 million for the quarter ended June 30, 1997. The net loss for the quarter ended June 30, 1998 was $3.7 million, ($0.11 per share), compared to a net loss of $3.1 million, ($0.15 per share), for the second quarter 1997.
The strength of the Company's balance sheet has improved substantially from December 31, 1997 to June 30, 1998. Cash on hand has increased by $10.2 million to $11.1 million. Total current assets have increased by $13.5 million or 77.6 percent to $30.9 million, while total assets of the company have increased by $14.9 million or 30 percent to $64.6 million. Current liabilities have remained flat at $8.9 million resulting in a very strong current ratio of 3.5 compared to 2 on December 31, 1997. Shareholders' equity increased by $11.9 million, or 38.5 percent to $42.7 million over the same period.
"The less than expected sales for the first half were due to weaker than planned aftermarket wheel orders," said Walter F. Ware, Turbodyne's President & CEO. "Although the automotive components segment of the Light Metals Division grew faster than anticipated in the first half, it did not grow fast enough to offset the decline in the aftermarket wheel segment experienced in the first half of the year."
The greater than expected increase in orders in the automotive engine components segment in the first six months of 1998, further supports the Light Metals Division strategy to grow this segment to be the dominant segment of the Division. However, these orders came earlier than expected and required delivery prior to completion of the relocation of the components manufacturing operations to the newly acquired facility in Ensenada, Mexico, and therefore the company incurred unexpected interim costs to ensure that customers' orders were timely met.
"The extraordinary efforts made in conjunction with the manufacturing relocation and the modernization of the Ensenada facility will payoff in the long term as we work to shift the distribution of sales revenues from wheels to the more stable and growing engine and vehicle components segment," said Ware.
Turbodyne 2Q Results
August 14, 1998
"The ramping up of production activities at Turbodyne relating to the Turbopac~ 2500 product line, in order to satisfy the company's commitments under its contract with Detroit Diesel Corporation, also impacted costs in the first half of the year," Ware continued. "The company continues to ramp up production of the Turbopac product during the third quarter of this year, in preparation for further shipments to Detroit Diesel and for initial deliveries to the TransBusiness Group of Moscow, Russia pursuant to its recent purchase order. The first shipment to the TransBusiness Group is currently anticipated to begin in the fourth fiscal quarter, assuming all of the financing arrangements can be completed within that time frame.
Turbodyne Systems, the Engine Technology Division of Turbodyne, develops, manufactures, designs, markets and develops patented pollution-reduction, fuel economy and performance enhancing products for internal combustion engines in the automotive, transportation, construction, marine, agriculture, mining, military and power generation industries. Turbodyne's light metals division is a manufacturer of machined aluminum castings and a leading supplier to the automotive industry.
Offices and plants are located in Carpinteria, La Mirada, Encinitas and Woodland Hills, CA; Ensenada and Mexico City, Mexico; Northants, England; Frankfurt, Germany; Vancouver, Canada; and Paris, France.
Turbodyne's world wide web address is :
turbodyne.com
Contacts:
Mark White, Investor Relations, 800-350-2031
Tom Laughran, The Investor Relations Company, 847-564-5610
Except for the historical information contained in this news release, the matters discussed herein include forward-looking statements that involve risks and uncertainties. Among the important factors that could cause actual results to differ from those indicated in the forward-looking statements are: the availability and acceptance of the Turbodyne products; the impact of competitive products and pricing; the performance by the company under existing purchase contracts and the ability to obtain new contracts; the ability of the company to contain expenses, conditions within the global automotive market, general economic conditions and political changes both domestically and overseas.
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