Although Burke Mills (NASDAQ:BMLS)had previously told me that 1996
earnings would be released toward the end of March, the Company
released them yesterday.
Although I was "blind-sided" by the timing of the release, I am rather
pleased about the results that were announced, since they are better
than I projected in the February 3rd Analysis in The Napeague Letter,
and they confirm that the Company's turn-around is on track.
I've updated the summary of Burke's quarterly financial statements to
include the most recent quarter to show that its previous trends are
continuing. Revenue growth rebounded in the first quarter of 1996
and appears to be accelerating, and gross profits are rising toward the
levels achieved prior to the conversion to the new dying process.
----------- 1996 ---------- --------- 1995 ------------
4th 3rd 2nd 1st 4th 3rd 2nd 1st
------ ------ ------ ------ ------ ------ ------ ------
Revenues 10,214 10,226 10,304 9,905 8,632 7,385 8,586 9,545
Gross Profit 1,183 1,104 785 690 945 258 1,098 1,181
Pre-tax Income 424 469 43 ( 67) 184 ( 284) 606 650
Net Income 314 285 26 ( 41) 352 ( 173) 369 396
Net Income/Sh 0.11 0.10 0.01 (0.02) 0.13 ( .06) 0.14 0.14
Gross Margin 12% 11% 8% 7% 11% 4% 13% 12%
As you can see, it is not too meaningful to compare the latest quarter
with the fourth quarter of 1995, since the results for that quarter were
impacted by non-recurring tax benefits.
In my February 3rd Analysis, I projected total 1996 revenues of
$41,225,000, and actual revenues were slightly lower, at $40,649,000.
I projected earnings per share of $0.19, while actual results were
$0.21 per share.
The press release issued by the Company notes that "As the company
moves into 1997, the positive impact of the improvements in the dyeing
operation may be offset by the market for upholstery yarn that is
currently slow and could have an impact on first quarter results."
Other indicators do not show that the upholstery segment is slowing
down, but I will discuss this with BMLS management in the near future.
I will update my Analysis as soon as I have had a chance to review the
Company's 10-K Report. A complete copy of this press release can be
obtained from a number of sources, including Yahoo.
NOTICE:
This analysis is based on publicly-available information and discussions
with the Company's management, and is in no way warranted by me as
toaccuracy or completeness. I do not guarantee to advise you as to any
change in this information. I currently am a stockholder in this
Company and may from time to time purchase or sell this Company's
securities. I otherwise have no affiliation with this Company. If
you have any questions or constructive comments, please E-mail me at
rmdavis1@ix.netcom.com. |
