News Details
CURTISS-WRIGHT ANNOUNCES 2001 FINANCIAL RESULTS; REPORTS SIXTH CONSECUTIVE YEAR OF REVENUE GROWTH AND THIRD CONSECUTIVE YEAR OF NORMALIZED EARNINGS GROWTH
February 06, 2002
LYNDHURST, N.J., Feb 6, 2002 /PRNewswire-FirstCall via COMTEX/ -- Curtiss-Wright Corporation (NYSE: CW, CW.B) today announced financial results for the fourth quarter and full year ended December 31, 2001.
* Net sales for the fourth quarter rose 18% to $97,226,000 from $82,410,000 for the comparable quarter last year.
* Net earnings for the fourth quarter, including a significant real estate gain, rose to $34,473,000, or $3.37 per diluted share, from $10,122,000, or $0.99 per diluted share, last year. Excluding net nonrecurring items related to a real estate gain, recapitalization costs, and a net gain related to various nonrecurring benefit-related issues, normalized 2001 fourth-quarter net earnings advanced to $12,226,000, or $1.20 per diluted share, a 22% increase over fourth quarter 2000 normalized net earnings of $10,207,000, or $1.00 per diluted share.
* Net sales for the full year 2001 rose 4% to $343,167,000 from $329,575,000 for 2000.
* Net earnings for the year, including the fourth-quarter real estate gain, increased 53% to $62,880,000, or $6.14 per diluted share, compared with net earnings for 2000 of $41,074,000, or $4.03 per diluted share. Excluding net nonrecurring items, normalized net earnings for 2001 increased 7% to $40,633,000, or $3.97 per diluted share, compared with $37,910,000, or $3.72 per diluted share, last year.
In both 2001 and 2000, the Company recognized a number of nonrecurring items such as real estate gains and costs associated with the common stock recapitalization. The year 2000 also included postretirement benefits and postemployment costs, favorable net insurance claim settlements associated with environmental remediation obligations and facility consolidation costs. These items, which are summarized in the following table presenting "Normalized Net Earnings," had a net positive impact on net earnings of $22,247,000, or $2.17 per diluted share, in 2001 and $3,164,000, or $0.31 per diluted share, in 2000.
Normalized Net
Earnings: Fourth Quarter Full Year
(In thousands except
per share figures) 2001 2000 2001 2000
Net earnings $34,473 $10,122 $62,880 $41,074
Environmental insurance
settlements, net - (731) - (1,894)
Postretirement benefits
and postemployment
costs, net (94) - (1,336)
Facility consolidation
costs - - 50
Gain on sale of
nonoperating
property (22,999) - (22,999) (894)
Recapitalization costs 1,500 910 1,500 910
Net nonrecurring benefit
gain (748) - (748) -
Normalized net
earnings $12,226 $10,207 $40,633 $ 37,910
Normalized net
earnings per
diluted share $1.20 $1.00 $3.97 $3.72
Reported operating income for the year declined 10% from last year. On a normalized basis, operating income showed a decrease of 1% to $47,441,000 in 2001 from $47,986,000 in 2000. Foreign exchange rates had an adverse affect on financial results in 2001. The decline in foreign exchange rates adversely affected sales for 2001 by $3,000,000 and operating income by $1,100,000.
Overall sales improvement was due to additional sales from acquisitions, an increase in aerospace OEM sales and an increase in shot-peening services along with sales growth for products related to land-based defense vehicles. These improvements were partially offset by a decrease in overhaul and repair services to the aerospace industry and a decline in sales to particular segments of the automotive industry.
New orders and backlog are at the highest levels in 23 years. New orders received in 2001 improved 9% to $326.5 million compared with those booked in 2000 and the December 31, 2001 backlog is at $241.9 million compared with $182.6 million at the end of 2000. Acquisitions made during 2001 represented $76 million of the existing backlog at December 31, 2001.
Martin Benante, Chairman and Chief Executive Officer of Curtiss-Wright, stated, "We are very proud to have achieved our sixth consecutive year of revenue increase, and third consecutive year of normalized earnings growth despite a very challenging economy. The industrial and commercial aerospace markets have been particularly challenging. Our diversification strategy is producing the balance of business that has allowed us to continue achieving growth during a weak economic cycle. The seven acquisitions made during 2001 significantly increase our market penetration, particularly within the military defense industry. They also expanded our geographic reach and technological capabilities, giving us strong reason to remain optimistic about the coming year.
"We are very pleased with the government's desire to increase military procurement spending to the highest levels since 1991, which may provide opportunities for us in the future. Our position on many defense programs is outstanding, with a mix of products for aerospace, land-based and naval defense markets that has never been stronger. We are well positioned on a balanced blend of projects that will provide both short- and long-term benefits."
Mr. Benante added, "Our balance sheet remains exceptionally strong, as our total debt declined 29% this year when compared with the balance at December 31, 2000. Our working capital levels were unchanged for the year and we had $67 million available in cash and short-term investments at December 31, 2001. During the year, we completed the sale of our Wood-Ridge business complex for $51,000,000. The proceeds are available to invest in projects that produce stronger returns and enhance long-term shareholder value. We were also very pleased to increase our quarterly dividend payment by 15% to an annual rate of 60 cents per share from 52 cents. The dividend increase reflects our confident business outlook and satisfaction with the progress made in implementing our strategic plans.
"In 2001 we reached a significant milestone in efforts to improve our stock's liquidity. We completed the recapitalization of our common stock, allowing Unitrin, Inc., our largest shareholder, to distribute its 44% equity position in our Company to its shareholder base. This transaction broadens our shareholder base, improves the stock's liquidity and has increased our stock's institutional appeal."
Mr. Benante concluded, "We begin 2002 confident in our ability to build on our solid business foundation and generate long-term shareholder value. Although 2002 is likely to present a challenging business environment, we are committed to creating shareholder value by executing our strategies and achieving our financial targets. Our diversification strategy and ongoing emphasis on technology should continue to bring growth opportunities in each of our three business segments."
Provided below is a summary of the financial results for the fourth- quarter and full-year periods for 2001 and 2000.
CURTISS-WRIGHT CORPORATION and SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(In thousands except per share data)
Three Months Ended Year Ended
December 31, December 31,
2001 2000 2001 2000
Net sales $97,226 $82,410 $ 343,167 $ 329,575
Cost of sales 62,444 51,607 215,350 208,605
Gross profit 34,782 30,803 127,817 120,970
Research & development
costs 1,204 1,107 4,383 3,443
Selling expenses 4,870 4,522 18,325 18,591
General and
administrative
expenses 16,909 13,415 57,784 49,792
Environmental
expenses
(recoveries), net 70 (1,286) 167 (3,041)
Operating income 11,729 13,045 47,158 52,185
Investment income, net 272 1,118 2,599 2,862
Rental income, net 918 617 3,312 3,638
Pension income, net 3,491 1,565 11,042 7,813
Gain on sale of real
property 38,882 0 38,882 1,436
Other income (expense),
net 736 (90) 384 (220)
Interest expense (263) (577) (1,180) (1,743)
Earnings before
income taxes 55,765 15,678 102,197 65,971
Provision for income
taxes 21,292 5,556 39,317 24,897
Net earnings $34,473 $10,122 $62,880 $41,074
Basic earnings per share $3.43 $1.01 $6.25 $4.10
Diluted earnings per
share $3.37 $0.99 $6.14 $4.03
Dividends per share $0.15 $0.13 $0.54 $0.52
Weighted average
shares outstanding:
Basic 10,061 10,015 10,061 10,015
Diluted 10,236 10,194 10,236 10,194
CURTISS-WRIGHT CORPORATION and SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands)
December 31, December 31, Change
2001 2000 $ %
Assets
Current Assets:
Cash and cash
equivalents $25,495 $8,692 $16,803 193.3%
Short-term investments 41,658 62,766 (21,108) -33.6%
Receivables, net 86,354 67,815 18,539 27.3%
Inventories, net 57,115 50,002 7,113 14.2%
Deferred income taxes 9,565 9,378 187 2.0%
Other current assets 5,770 3,419 2,351 68.8%
Total current
assets 225,957 202,072 23,885 11.8%
Property, plant and
equipment, at cost 226,435 250,654 (24,219) -9.7%
Less: Accumulated
depreciation 121,914 157,418 (35,504) -22.6%
Property, plant and
equipment, net 104,521 93,236 11,285 12.1%
Prepaid pension costs 70,796 59,765 11,031 18.5%
Goodwill and other
intangibles, net 90,914 47,543 43,371 91.2%
Property held for sale 2,460 2,460
Other assets 5,780 4,340 1,440 -33.2%
Total Assets $500,428 $409,416 $91,012 22.2%
Liabilities
Current Liabilities:
Current portion of
long-term debt $- $5,347 $(5,347) N/a
Accounts payable 19,362 13,766 5,596 40.7%
Accrued expenses 23,163 19,389 3,774 19.5%
Income taxes payable 17,704 4,157 13,547 325.9%
Other current
liabilities 15,867 9,634 6,233 64.7%
Total current
liabilities 76,096 52,293 23,803 45.5%
Long-term debt 21,361 24,730 (3,369) -13.6%
Deferred income taxes 26,043 21,689 4,354 20.1%
Other liabilities 26,974 20,480 6,494 31.7%
Total Liabilities 150,474 119,192 31,282 26.2%
Stockholders' Equity
Common stock, $1 par
value 10,618 15,000 (4,382) -29.2%
Class B common stock,
$1 par value 4,382 - 4,382 N/a
Capital surplus 52,532 51,506 1,026 2.0%
Retained earnings 469,303 411,866 57,437 13.9%
Unearned portion of
restricted stock (78) (22) (56) 254.5%
Accumulated other
comprehensive income (6,831) (5,626) (1,205) 21.4%
529,926 472,724 57,202 12.1%
Less: Common treasury
stock, at cost 179,972 182,500 (2,528) -1.4%
Total Stockholders'
Equity 349,954 290,224 59,730 20.6%
Total Liabilities
and Stockholders'
Equity $500,428 $409,416 $91,012 22.2%
CURTISS-WRIGHT CORPORATION and SUBSIDIARIES
SEGMENT INFORMATION
(In thousands)
Three Months Ended Year Ended
December 31,
December 31,
% %
2001 2000 Change 2001 2000 Change
Sales:
Motion Control $ 41,412 $ 34,507 20.0% $137,103 $126,771 8.2%
Metal Treatment 26,385 25,297 4.3% 107,807 105,318 2.4%
Flow Control 29,429 22,606 30.2% 98,257 97,486 0.8%
Total Segments $ 97,226 $ 82,410 18.0% $343,167 $329,575 4.1%
Operating Income:
Motion Control $4,561 $4,328 5.4% $19,219 $15,383 24.9%
Metal Treatment 4,528 5,536 -18.2% 19,513 23,502 -17.0%
Flow Control 4,377 2,777 57.6% 10,703 10,276 4.2%
Total Segments 13,466 12,641 6.5% 49,435 49,161 0.6%
Corporate & Other (1,737) 404 N/a (2,277) 3,024 N/a
Total Operating
Income $11,729 $13,045 -10.1% $47,158 $52,185 -9.6%
Operating Margins:
Motion Control 11.0% 12.5% 14.0% 12.1%
Metal Treatment 17.2% 21.9% 18.1% 22.3%
Flow Control 14.9% 12.3% 10.9% 10.5%
Total Curtiss-
Wright 12.1% 15.8% 13.7% 15.8%
Motion Control -- Sales for the year increased 8% due principally to the acquisition of Lau Defense Systems and Vista Controls, higher shipments of OEM components for Boeing programs, the military's F-22 Raptor fighter aircraft and a generally strong growth in the global ground defense market. The sales improvement was partially offset by lower sales of aerospace overhaul and repair services, due to a slowing in commercial air travel and the grounding of aircraft by the airlines following September 11.
Operating margins for both the fourth quarter and the year benefited from stronger profits in the aerospace OEM components and cost improvements related to the consolidation of the Company's manufacturing operations. This improvement combined with improved margins related to its aiming and stabilizing systems for land-based military vehicles were offset by lower margins on overhaul and repair services for the airlines due to the reduced level of activity in that area.
Metal Treatment -- This business segment's sales increased slightly over 2%. The segment has the greatest exposure to fluctuating currency values with approximately 35% of its sales volume generated by its European operations. The sales improvement was primarily attributed to an increase in shot-peening, partially offset by a decrease in heat-treating services to the automotive industry.
Operating earnings for the year and fourth quarter declined due to start- up costs for three new facilities, higher operating costs due to higher natural gas prices, which impacts heat treating costs, and the adverse effect of foreign currency translations.
Flow Control -- Sales and operating profits for the segment, while essentially flat for the year, were strong in the fourth quarter due to higher sales to the U.S. Navy and nuclear power plants, partially offset by lower sales in the quarter for the oil refining and petrochemical markets and sharp declines for selective truck markets.
For the year, sales were up for all the Company's served markets with exception of the decline in sales to the truck markets. The profitability levels in this area suffered from lower volume levels. Operational profit margin percentages improved for all other product lines in this business segment from last year.
Curtiss-Wright Corporation is a diversified provider of highly engineered products and services to the Motion Control, Flow Control and Metal Treatment industries. The firm employs approximately 2,600 people. More information on Curtiss-Wright can be found on the Internet at curtisswright2014.q4web.com
Forward-looking statements in this release related to expectations of continued high revenues related to new commercial aircraft and continued sales and income growth, are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those expressed or implied. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. Such risks and uncertainties include, but are not limited to: a reduction in anticipated orders; an economic downturn; changes in the need for additional machinery and equipment and/or in the cost for the expansion of the Corporation's operations; changes in the competitive marketplace and/or customer requirements; an inability to perform customer contracts at anticipated cost levels; and other factors that generally affect the business of aerospace, defense, marine and industrial companies. Please refer to the Company's SEC filings under the Securities and Exchange Act of 1934, as amended, for further information.
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SOURCE Curtiss-Wright Corporation
CONTACT: Gary Benschip of Curtiss-Wright,
+1-201-896-8520,
or [email protected]
URL: http://curtisswright2014.q4web.com
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