Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Politics : High Tolerance Plasticity -- Ignore unavailable to you. Want to Upgrade?

To: jim_p who wrote (92)	2/22/2001 11:08:47 AM
From: The Ox	Read Replies (1) \| Respond to of 23153

NATCO Reports Strong Fourth Quarter and Full Year 2000 Results HOUSTON, Feb 22, 2001 /PRNewswire via COMTEX/ -- NATCO Group Inc. (NYSE: NTG chart, msgs) (the "Company") today announced fourth quarter revenue and net income of $56.5 million and $2.3 million ($0.15 per diluted share) compared to fourth quarter 1999 revenue and net income of $44.1 million and $0.2 million ($0.02 per diluted share). For the year ended December 31, 2000 the Company reported revenue of $224.6 million and net income, excluding first quarter unusual charges, of $8.6 million, or $0.57 per diluted share, compared to revenue and net income of $169.9 million and $0.6 million ($0.06 per diluted share) for the year ended December 31, 1999. Fourth quarter 2000 revenue increased 28% over fourth quarter 1999 revenue due to improved market conditions. For the full year, revenue was up 32% in 2000 over 1999. The Company's fourth quarter 2000 EBITDA (defined as gross margin less selling, general and administrative expense) increased 126% compared to the fourth quarter of 1999. For the year, EBITDA was up 126% over 1999. Results for the fourth quarter were particularly strong for NATCO's largest segment, Traditional Equipment and Services. Revenue for Traditional Equipment and Services increased 35% compared to fourth quarter 1999 and EBITDA contribution was up 133% over the same period. Sequentially, revenue and EBITDA were up 4% and 22%, respectively over the prior quarter. The Company noted that the fourth quarter run-rate for revenue in this segment exceeded $95 million on an annualized basis, dramatically higher than recent years. "Our momentum in the Traditional business indicates a recovery in spending by U.S. oil and gas producers, and bodes very well for NATCO in 2001," said Nat Gregory, NATCO's Chairman and CEO. Engineered Systems revenue and contribution to EBITDA increased 9% and 144% respectively in the fourth quarter of 2000 compared to 1999. Contributing to strong results in the quarter was continued excellent performance on NATCO's CTOC project. Importantly, the Company recorded its first significant Engineered Systems booking in recent quarters when it was awarded a $10 million project in Venezuela in late December. Total bookings for Engineered Systems for the fourth quarter were $17.7 million. "For the first time since the second quarter of 1999, our quarter-end backlog for Engineered Systems increased compared to the previous quarter," noted Mr. Gregory. "The market for larger projects appears to have turned, and we are finally in a position to restore our backlog during 2001." NATCO's Automation and Controls business (formerly referred to as Instrumentation and Electrical Systems), recorded fourth quarter revenue of $11.2 million, a 35% improvement compared to 1999, and EBITDA contribution of $1.0 million, a more than two-fold improvement compared to 1999. NATCO's Canadian operation reported revenue of $8.0 million during the fourth quarter of 2000. Contribution to EBITDA, however, was only $0.2 million, due to certain unusual charges. These compare to revenue and EBITDA of $7.2 million and $0.7 million, respectively, in 1999. Despite a disappointing quarterly result in Canada, NATCO continues to be well positioned to take advantage of improving market conditions there. During the quarter, the Company changed its method of accounting for the recognition of unrealized gains and losses on its postretirement medical benefit obligation from immediate recognition of gains and losses to the method of deferring gains and losses. The cumulative effect of the change resulted in a loss of $42,000 for the quarter and the year. As previously announced, subsequent to the fourth quarter, NATCO agreed to acquire Axsia Group Limited, a UK-based provider of oil and water processing equipment. The transaction is progressing as planned and should close within the next 30 days. "I am very pleased with the transition plans both companies are making as we move toward closing," noted Mr. Gregory. "The combined entity will be a leader in its markets and will be well positioned to take on an expanding scope with our customers."