Defense News:
CAMDEN, N.Y.--(BUSINESS WIRE)--International Wire Group, Inc. (Pink Sheets: ITWG - News) today announced its results for the fourth quarter and year ended December 31, 2009. Fourth quarter 2009 results were significantly greater than 2008 levels. Despite the improved fourth quarter results, operating income and net income for the full year ended December 31, 2009 decreased from 2008 levels.Net debt (total debt less cash) was $69.3 million as of December 31, 2009, which represents a decrease of $11.1 million from December 31, 2008, primarily as the result of cash flow from operations. Availability under the Company’s revolving credit facility was $83.4 million as of December 31, 2009.
Fourth Quarter Results:
Net sales for the quarter ended December 31, 2009 were $131.0 million, an increase of 3.4%, or $4.3 million, compared to $126.7 million for the same period in 2008. This increase was primarily due to a significant increase in copper prices, a decreased level of tolled copper, higher customer pricing/mix, and the impact of a weaker U.S. dollar versus the euro. These factors were partially offset by lower sales volume. Tolled copper is the processing of customer-owned copper and is excluded from net sales and cost of sales. Excluding the effects of higher copper prices and a decreased level of tolled copper, net sales decreased $20.2 million, or 15.9%. This decrease resulted from $22.3 million of lower sales volume, partially offset by $0.5 million of higher customer pricing/mix and $1.6 million of currency impact in the Europe segment. Total pounds sold for the fourth quarter of 2009 declined by 19.6% compared to the fourth quarter of 2008.
Operating income for the three months ended December 31, 2009 was $5.5 million compared to an operating loss of $10.0 million for the three months ended December 31, 2008, an increase of $15.5 million. This increase was due to plant operating efficiencies, lower selling and administrative expenses, a LIFO liquidation impact in 2009 and the absence in 2009 of: the LIFO cost of sales impact of rapidly declining copper prices, the impact of the acquired Global Wire inventories on the Company’s existing LIFO inventories, and increased scrap losses from declining metals prices. These increases were partially offset by lower sales volume and an impairment charge related to the closing of two plants.
Net income of $0.8 million, or $0.08 per basic and diluted share, for the three months ended December 31, 2009 increased by $9.5 million, or $0.95 per basic share and $0.93 per diluted share, compared to the prior year period, due primarily to higher operating income partially offset by a higher effective income tax rate in 2009.
“Sales demand was weak in our major markets for most of the year due to global recessionary pressures, but demand in the aerospace, automotive and European markets improved in the fourth quarter. We continued to realize the benefits of our many cost reduction initiatives,” said Rodney D. Kent, Chief Executive Officer of International Wire Group, Inc.
Full Year Results:
Net sales for the year ended December 31, 2009 were $449.5 million, a decrease of $286.9 million, or 39.0%, from 2008 levels of $736.4 million. Sales decreased primarily due to lower copper prices, decreased sales volume, lower customer pricing/mix, and an unfavorable foreign currency effect. These factors were partially offset by a decreased level of tolled copper. Excluding the effects of lower copper prices and a decreased level of tolled copper business, net sales decreased $212.3 million, or 28.8%. This decrease was primarily due to $201.7 million of lower sales volume, $6.0 million of lower customer pricing/mix and $4.6 million of unfavorable currency effects in the Europe segment. Total pounds sold for the year ended December 31, 2009 declined by 29.6% compared to the year ended December 31, 2008.
Operating income for the year ended December 31, 2009 was $16.6 million, compared to $22.1 million in 2008, a decrease of $5.5 million or 24.9%. This decrease was primarily due to lower sales volume and an impairment charge in 2009 related to the closing of two plants, partially offset by plant operating efficiencies, lower selling and administrative expenses, a LIFO liquidation impact in 2009 and the absence in 2009 of: the LIFO cost of sales impact of rapidly declining copper prices, the impact of the acquired Global Wire inventories on the Company’s existing LIFO inventories, and increased scrap losses from declining metals prices.
Net income was $4.4 million, or $0.44 per basic and diluted share, for the year ended December 31, 2009 compared to $6.5 million, or $0.66 per basic share and $0.64 per diluted share, in 2008. The decline of $2.1 million, or 32.3%, in 2009 was the result of lower operating income, partially offset by reduced interest expense.
Rodney D. Kent concluded: “We decreased our cost structure through plant consolidations, adjustments to headcount, effective plant operations and lower administrative expenses, but we have maintained the ability to respond if sales demand improves in 2010. We are pleased with our strong balance sheet and liquidity position coming out of the difficult economic climate in 2009.”
About International Wire Group, Inc.
International Wire Group, Inc. is a manufacturer and marketer of wire products, including bare, silver-plated, nickel-plated and tin-plated copper wire, for other wire suppliers, distributors and original equipment manufacturers or “OEMs.” Its products include a broad spectrum of copper wire configurations and gauges with a variety of electrical and conductive characteristics and are utilized by a wide variety of customers primarily in the aerospace, appliance, automotive, electronics/data communications, industrial/energy and medical device industries. The Company manufactures and distributes its products at 17 facilities located in the United States, Belgium, France and Italy.
Forward-Looking Information is Subject to Risk and Uncertainty
Certain statements in this release may constitute “forward-looking” statements. Forward-looking statements include all statements that are not historical facts and can be identified by the use of forward-looking terminology such as the words “believes,” “expects,” “may,” “will,” “should,” “seeks,” “pro forma,” “anticipates,” “intends,” “plans,” “estimates,” or the negative of any thereof or other variations thereof or comparable terminology, or by discussions of strategy or intentions. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions as to future events that may not prove to be accurate. Actual outcomes and results may differ materially from what is expressed or forecasted in these forward-looking statements. As a result, these statements speak only as of the date they were made and we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Many important factors could cause our results to differ materially from those expressed in forward-looking statements. These factors include, but are not limited to, fluctuations in our operating results and customer orders, unexpected decreases in demand or increases in inventory levels, changes in the price of copper, tin, nickel and silver, the failure of our acquisitions and expansion plans to perform as expected, the competitive environment, our reliance on our significant customers, lack of long-term contracts, substantial dependence on business outside of the U.S. and risks associated with our international operations, limitations due to our indebtedness, loss of key employees or the deterioration in our relationship with employees, litigation, claims, liability from environmental laws and regulations and other factors. For additional information regarding risk factors, see the discussion in our Consolidated Financial Information as of December 31, 2009 available at http://itwg.client.shareholder.com.
ITWG-G
Source: DTN News / Reuters By Phil Stewart
ersions of the unmanned aircraft are still off-limits, a U.S. military official said on Monday.
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