-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, JLRv1lKdaXhXBpIZpNml0GI4oVNPxd2iT1BRlLqC2tnlrbk/F9BgnoBZCmtpAlTR UPM0FpZvNzX6zwzjAYCshA== 0000950134-01-000286.txt : 20010123 0000950134-01-000286.hdr.sgml : 20010123 ACCESSION NUMBER: 0000950134-01-000286 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20010118 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 20010118 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ELCOR CORP CENTRAL INDEX KEY: 0000032017 STANDARD INDUSTRIAL CLASSIFICATION: ASPHALT PAVING & ROOFING MATERIALS [2950] IRS NUMBER: 751217920 STATE OF INCORPORATION: DE FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-05341 FILM NUMBER: 1510793 BUSINESS ADDRESS: STREET 1: 14643 DALLAS PKWY STE 1000 STREET 2: WELLINGTON CTR CITY: DALLAS STATE: TX ZIP: 75240 BUSINESS PHONE: 9728510500 MAIL ADDRESS: STREET 1: WELLINGTON CENTRE STE 1000 STREET 2: 14643 DALLAS PKWY CITY: DALLAS STATE: TX ZIP: 75240-8871 FORMER COMPANY: FORMER CONFORMED NAME: ELCOR CHEMICAL CORP DATE OF NAME CHANGE: 19761119 8-K 1 d83388e8-k.txt FORM 8-K 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported) January 18, 2001 ---------------- ELCOR CORPORATION ----------------- (Exact name of Registrant as specified in its charter) DELAWARE 1-5341 75-1217920 - ------------------------------ ---------------------- ------------------- (State or other jurisdiction of Commission File number (I.R.S. Employer incorporation or organization) Identification No.)
14643 DALLAS PARKWAY SUITE 1000, WELLINGTON CENTRE, DALLAS, TEXAS 75240-8871 - -------------------------------------------- ---------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (972)851-0500 ------------- NOT APPLICABLE -------------- (Former name or former address, if changed since last report) 2 Item 5. Other Events Press Release On January 17, 2001, the company issued a press release containing "forward-looking statements" that involve risks and uncertainties about its prospects for the future. The statements that are not historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements usually are accompanied by words such as "outlook," "believe," "estimate," "plan," "project," "expect," "anticipate," "predict," "could," "should," "may," or similar words that convey the uncertainty of future events or outcomes. These statements are based on judgments the company believes are reasonable; however, Elcor's actual results could differ materially from those discussed here. Such risks and uncertainties include, but are not limited to, the following: 1. The company's roofing products business is substantially non-cyclical, but can be affected by weather, the availability of financing and general economic conditions. In addition, the asphalt roofing products manufacturing business is highly competitive. Actions of competitors, including changes in pricing, or slowing demand for asphalt roofing products due to general or industry economic conditions or the amount of inclement weather could result in decreased demand for the company's products, lower prices received or reduced utilization of plant facilities. Further, changes in building codes and other standards from time to time can cause changes in demand, or increases in costs that may not be passed through to customers. 2. In the asphalt roofing products business, the significant raw materials are ceramic-coated granules, asphalt, glass fibers, resins and mineral filler. Increased costs of raw materials can result in reduced margins, as can higher trucking and rail costs. Historically, the company has been able to pass some of the higher raw material and transportation costs through to the customer. Should the company be unable to recover higher raw material and/or transportation costs from price increases of its products, operating results could be adversely affected and/or lower than projected. 3. The company plans to continue its significant expansion plan over the next several years, including the construction of new facilities. Progress in achieving anticipated operating efficiencies and financial results is difficult to predict for new plant facilities. If such progress is slower than anticipated, if substantial cost overruns occur in building new plants, or if demand for products produced at new plants does not meet current expectations, operating results could be adversely affected. 1 3 4. Certain facilities of the company's electronics manufacturing services and industrial products subsidiaries must utilize hazardous materials in their production process. As a result, the company could incur costs for remediation activities at its facilities or off-site, and other related exposures from time to time in excess of established reserves for such activities. 5. The company's litigation, including Elk's defense of purported class action lawsuits, is subject to inherent and case-specific uncertainty. The outcome of such litigation depends on numerous interrelated factors, many of which cannot be predicted. 6. Although the company currently anticipates that most of its needs for new capital in the near future will be met with internally generated funds or borrowings under its available credit facilities, significant increases in interest rates could substantially affect its borrowing costs under its existing loan facility, or its cost of alternative sources of capital. 7. Each of the company's businesses, especially Cybershield's shielding business, is subject to the risks of technological changes that could affect the demand for or the relative cost of the company's products and services, or the method and profitability of the method of distribution or delivery of such products and services. In addition, the company's businesses each could suffer significant setbacks in revenues and operating income if it lost one or more of its largest customers, or if its customers' plans and/or markets should change significantly. 8. Although the company insures itself against physical loss to its manufacturing facilities, including business interruption losses, natural or other disasters and accidents, including but not limited to fire, earthquake, damaging winds and explosions, operating results could be adversely affected if any of its manufacturing facilities became inoperable for an extended period of time due to such events. 9. Each of the company's businesses is actively involved in the development of new products, processes and services which are expected to contribute to the company's ongoing long-term growth and earnings. If such development activities are not successful, or the company cannot provide the requisite financial and other resources to successfully commercialize such developments, the growth of future sales and earnings may be adversely affected. Parties are cautioned not to rely on any such forward-looking beliefs or judgments in making investment decisions. Reference is made to the company's Annual Report on Form 10-K for the year ended June 30, 2000, for further information about risks and uncertainties. 2 4 Other Matters The company may, from time to time, find that it has commented on non-public information, including forward-looking information, to analysts. If that should occur, the company may post disclosures at www.elcor.com that it deems appropriate under Regulation F-D. No such disclosure, or similar information filed or furnished by Form 8-K, should be deemed an admission that such information is material to investors. Item 7. Exhibits 99.1 Press release dated January 17, 2001 of Elcor Corporation. 3 5 SIGNATURES Pursuant to the requirement of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. ELCOR CORPORATION DATE: January 18, 2001 /s/ Richard J. Rosebery ------------------------------ ---------------------------------- Richard J. Rosebery Vice Chairman, Chief Financial and Administrative Officer /s/ Leonard R. Harral ---------------------------------- Leonard R. Harral Vice President and Chief Accounting Officer 6 INDEX TO EXHIBITS
EXHIBIT NUMBER DESCRIPTION - ------- ----------- 99.1 Press release dated January 17, 2001 of Elcor Corporation.
EX-99.1 2 d83388ex99-1.txt PRESS RELEASE DATED JANUARY 17, 2001 1 EXHIBIT 99.1 Press Release dated January 17, 2001 of Elcor Corporation. 2 [ELCOR CORPORATION LETTERHEAD] PRESS RELEASE TRADED: NYSE FOR IMMEDIATE RELEASE SYMBOL: ELK FOR FURTHER INFORMATION: Richard J. Rosebery Harold R. Beattie, Jr. Vice Chairman, Chief Financial Vice President - Finance and Administrative Officer and Treasurer (972) 851-0510 (972) 851-0523 ELCOR REPORTS LOWER FISCAL 2001 SECOND QUARTER RESULTS IN LINE WITH EARLIER GUIDANCE DALLAS, TEXAS, January 17, 2001 . . . . Elcor Corporation today reported lower results for its fiscal 2001 second quarter ending December 31, 2000. Results were in line with guidance provided in the company's January 11, 2001, press release. For its second quarter ending December 31, 2000, net income was $1,005,000, or $0.05 per diluted share, compared to $7,471,000, or $0.37 per diluted share, in the year-ago quarter. Sales were $68,620,000, versus $81,736,000, in the same quarter last year. For its first half ending December 31, 2000, net income was $5,949,000, or $.30 per diluted share, on sales of $154,821,000, compared to net income of $17,480,000, or $.87 per diluted share, on sales of $177,525,000 in the same period last year. Harold K. Work, Elcor's Chairman, President and Chief Executive Officer, said, "Second quarter results were affected by lower residential asphalt roofing products sales. Several factors contributed to the decline. Unusually harsh winter weather conditions further impacted an already slow roofing market due to the economic slowdown. In addition to the slow roofing market, this business continued to be impacted by the high costs of asphalt and diesel fuel, as well as very competitive product pricing." ROOFING PRODUCTS: LOWER RESULTS IN A SLOW MARKET Elk's roofing products sales were $56,623,000 in this year's second quarter, compared to $68,830,000 in the record year-ago quarter. Its operating profits were $3,363,000, compared to $11,318,000 in the record quarter last year. Elk experienced a significant decline in both laminated asphalt shingle shipments and external shipments of nonwoven fiberglass mat to other roofing manufacturers during the quarter, as /more 3 PRESS RELEASE Elcor Corporation January 17, 2001 Page 2 compared to the record year-ago quarter. As indicated, unusually severe winter weather conditions further contributed to already slow demand in the roofing industry. Product pricing during the quarter was about flat with prior year. While asphalt costs have remained relatively stable during the first half of fiscal 2001, asphalt costs in this year's second quarter were 32% higher than in the year-ago quarter. NEW MYERSTOWN SHINGLE PLANT ACHIEVES SMOOTH START-UP Elk's new Myerstown, Pennsylvania premium laminated asphalt shingle plant is undergoing a very smooth start-up and has begun producing limited quantities of quality products during this year's December quarter. The Myerstown plant will increase Elk's laminated shingle capacity by about 38% and will significantly reduce Elk's transportation costs to serve Northeast and Middle Atlantic markets. According to Work, "We are receiving enthusiastic comments from roofing contractors about the improved appearance and winter handling performance of the new plant's Prestique laminated shingles. The Myerstown plant places Elk in a strong position to provide excellent service to an expanded distribution network in the Northeast and Middle Atlantic states in the years ahead," he added. ELECTRONICS MANUFACTURING SERVICES: CYBERSHIELD'S SALES AND EARNINGS ARE EXPECTED TO ACCELERATE SIGNIFICANTLY DURING THE SECOND HALF OF FISCAL 2001 Cybershield had lower sales of $8,347,000, compared to $9,865,000, and operating profits of $919,000, compared to $2,252,000, in the record year-ago second quarter. Last year's second quarter operating results had benefited from higher production levels of components for more mature digital cell phone models. However, this year's second quarter results reflect lower production volumes of these mature phone components and higher costs associated with ramping up production of components for several new phone models. Richard J. Rosebery, Elcor's Vice Chairman, said, "The scheduled ramp-up of new cellular handset components and other new products should provide significant sales and profit momentum to the third and fourth quarters of fiscal 2001. Many of these new products will have greater value added content provided by Cybershield, which should also contribute to higher sales and earnings during the second half of fiscal 2001. Although we see many uncertainties in the market, if our telecom customers maintain current production schedules, full year fiscal 2001 sales and operating earnings could exceed record fiscal 2000 results by about one third," he concluded. INDUSTRIAL PRODUCTS: SIGNIFICANT TURNAROUND IN OPERATIONS ACHIEVED The Industrial Products segment had higher sales of $3,621,000, compared to $2,996,000, and an operating profit of $297,000, compared to an operating loss of /more 4 PRESS RELEASE Elcor Corporation January 17, 2001 Page 3 $845,000, in the year-ago quarter. Significantly improved results were due primarily to Chromium Corporation's turnaround after consolidating all manufacturing operations into its Cleveland, Ohio facility. Manufacturing productivity at the Cleveland facility improved throughout the quarter, and the outlook appears good for continued improvement as fiscal 2001 progresses. Ortloff Engineers' operating results were also better than in the year-ago quarter, and its outlook for additional awards of significant licenses of Elcor's leading edge patented cryogenic gas processing technology appears good. FINANCIAL POSITION: For the six months ending December 31, 2000, cash flows from operations of $15.1 million, $1.2 million in cash and $16.7 million in increased long-term debt, funded $25.9 million of net investments in property, plant and equipment and $7.1 million in dividends and share repurchases. Approximately $19.1 million of the net investments in property, plant and equipment were related to Elk's new Myerstown roofing plant. Elcor ended the second quarter with $58 million of inventory, compared to $35 million at the end of the year-ago quarter when roofing product inventory levels were significantly below desired levels. Compared to the year-ago quarter, asphalt shingle inventories increased on both a unit and cost per unit basis, as well as a result of building a base level inventory at the new Myerstown roofing plant. Nonwoven fiberglass mat inventories also increased. While management continues to closely monitor inventory levels in relation to current and projected sales levels, it does not consider the current level of inventory to be excessive. At December 31, 2000, the company had $108.0 million of long-term debt, $160.7 million of shareholders' equity and $268.7 million of total capital. Long-term debt, as a percent of total capital, increased to 40% from 24% last year. OUTLOOK: Mr. Work said, "It has been our experience that periods of below average shingle demand have often been followed by periods of significantly higher growth, since a number of existing roofs will require replacement each year, and each deferred replacement builds a backlog of future demand. Extended periods of abnormally dry weather can mask deteriorating roof conditions, and weakened economic conditions can provide economic incentive to temporarily defer replacement, both resulting in an increasing replacement backlog. Therefore, we are cautiously optimistic that recent heavy rains following a prolonged drought in the Western states, and the recent shift in Federal Reserve policy towards reduced interest rates, may provide the stimulus /more 5 PRESS RELEASE Elcor Corporation January 17, 2001 Page 4 necessary to increase shingle demand in coming months. On average, reroofing and remodeling account for about 80% of the asphalt shingle market. "We have received numerous reports that the unusually harsh winter weather in the Midwestern and Northern regions of the country has caused severe roof damage. It is possible that the same weather conditions which adversely affected roofing sales during the current quarter may provide an impetus for increased demand in the months ahead. "Elk is currently very well positioned to take advantage of any improvement in demand that may occur in the laminated asphalt shingle market. For the first time in several years, Elk has in place the manufacturing capacity, and inventory levels, to fully participate in a market recovery. "We also see some encouraging developments on the pricing front. During the December quarter, one roofing manufacturer announced a permanent closing of several inefficient roofing plants, and other manufacturers have temporarily curtailed production at selected roofing plants. These actions should help to reduce the excess inventories which have restricted the industry's ability to recover sharply higher raw material and transportation costs through increased pricing. "While there are reasons for guarded optimism about the future, we are also keenly aware of the realities of the recently completed quarter, and the uncertainties inherent in predicting the timing and magnitude of a turnaround in the roofing market. We therefore believe it is prudent to reduce our earnings guidance for the full fiscal year 2001 to the range of $0.65 to $0.75 per share," he concluded. CORPORATE QUARTERLY EARNINGS CONFERENCE CALL Elcor's quarterly earnings conference call for the quarter ended December 31, 2000, will be held tomorrow, Thursday, January 18, 2001, at 11:00 a.m. Eastern time (10:00 a.m. Central time). The conference call will be broadcast live over the Internet. Interested parties can access the conference call through the Elcor Website at www.elcor.com (Investor Relations / Calls & Presentations) or by visiting www.prnewswire.com. SAFE HARBOR PROVISIONS In accordance with the safe harbor provisions of the securities law regarding forward-looking statements, in addition to the historical information contained herein, the above discussion contains forward-looking statements that involve risks and uncertainties. The statements that are not historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements usually are accompanied by words such as "outlook," "believe," /more 6 PRESS RELEASE Elcor Corporation January 17, 2001 Page 5 "estimate," "potential," "project," "expect," "anticipate," "plan," "predict," "could," "should," "may," or similar words that convey the uncertainty of future events or outcomes. These statements are based on judgments the company believes are reasonable; however, Elcor's actual results could differ materially from those discussed here. Factors that could cause or contribute to such differences could include, but are not limited to, changes in demand, prices, raw material costs, transportation costs, changes in economic conditions of the various markets the company serves, changes in the amount and severity of inclement weather, as well as the other risks detailed herein and in the company's reports filed with the Securities and Exchange Commission, including but not limited to its Form 10-K for the fiscal year ending June 30, 2000, and subsequent Forms 8-K and 10-Q. - - - - - - - - Elcor, through its subsidiaries, manufactures roofing products and industrial products, and provides electronics manufacturing services. Each of Elcor's principal operating subsidiaries is the leader or one of the leaders within its particular market. Its common stock is listed on the New York Stock Exchange (ticker symbol: ELK). Elcor's roofing products facilities are located in Tuscaloosa, Alabama; Shafter, California; Myerstown, Pennsylvania; Dallas and Ennis, Texas. Its electronics manufacturing services facilities are located in Canton, Georgia; Dallas and Lufkin, Texas; and its industrial products facilities are located in Cleveland, Ohio and Midland, Texas. /more 7 PRESS RELEASE Elcor Corporation Quarterly Results January 17, 2001 Page 6 CONDENSED RESULTS OF OPERATIONS (Unaudited, $ in thousands)
Trailing Three Months Ended Six Months Ended Twelve Months Ended December 31, December 31, December 31, 2000 1999 2000 1999 2000 1999 ---------- ---------- ---------- ---------- ---------- ---------- SALES $ 68,620 $ 81,736 $ 154,821 $ 177,525 $ 327,571 $ 338,332 ---------- ---------- ---------- ---------- ---------- ---------- COSTS AND EXPENSES: Cost of sales 53,825 60,674 120,244 130,416 252,345 250,712 Selling, general & administrative 12,548 9,838 23,987 19,350 44,336 38,965 Interest expense and other, net 623 104 1,128 521 1,769 1,492 Gain from involuntary conversion 0 (889) 0 (889) (403) (889) ---------- ---------- ---------- ---------- ---------- ---------- Total Costs and Expenses 66,996 69,727 145,359 149,398 298,047 290,280 ---------- ---------- ---------- ---------- ---------- ---------- INCOME BEFORE INCOME TAXES 1,624 12,009 9,462 28,127 29,524 48,052 Provision for income taxes 619 4,538 3,513 10,647 11,123 17,493 ---------- ---------- ---------- ---------- ---------- ---------- NET INCOME $ 1,005 $ 7,471 $ 5,949 $ 17,480 $ 18,401 $ 30,559 ========== ========== ========== ========== ========== ========== INCOME PER COMMON SHARE-BASIC $ 0.05 $ 0.38 $ 0.31 $ 0.89 $ 0.94 $ 1.57 ========== ========== ========== ========== ========== ========== INCOME PER COMMON SHARE-DILUTED $ 0.05 $ 0.37 $ 0.30 $ 0.87 $ 0.93 $ 1.53 ========== ========== ========== ========== ========== ========== AVERAGE COMMON SHARES OUTSTANDING Basic 19,317 19,564 19,420 19,546 19,514 19,525 ========== ========== ========== ========== ========== ========== Diluted 19,438 20,071 19,597 20,027 19,871 20,010 ========== ========== ========== ========== ========== ==========
/more 8 PRESS RELEASE Elcor Corporation Quarterly Results January 17, 2001 Page 7 FINANCIAL INFORMATION BY COMPANY SEGMENTS (Unaudited, $ in thousands)
Trailing Three Months Ended Six Months Ended Twelve Months Ended December 31, December 31, December 31, 2000 1999 2000 1999 2000 1999 ---------- ---------- ---------- ---------- ---------- ---------- SALES Roofing Products $ 56,623 $ 68,830 $ 131,841 $ 151,769 $ 285,468 $ 291,407 Electronics Manufacturing Services 8,347 9,865 16,736 19,009 30,753 32,964 Industrial Products 3,621 2,996 6,185 6,658 11,221 13,782 Corporate & Eliminations 29 45 59 89 129 179 ---------- ---------- ---------- ---------- ---------- ---------- $ 68,620 $ 81,736 $ 154,821 $ 177,525 $ 327,571 $ 338,332 ========== ========== ========== ========== ========== ========== OPERATING PROFIT (LOSS) Roofing Products $ 3,363 $ 11,318 $ 14,362 $ 27,595 $ 39,791 $ 50,511 Electronics Manufacturing Services 919 2,252 1,616 3,612 2,908 5,115 Industrial Products 297 (845) (948) (676) (4,925) (1,244) Corporate & Eliminations (2,332) (1,501) (4,440) (2,772) (6,884) (5,727) ---------- ---------- ---------- ---------- ---------- ---------- $ 2,247 $ 11,224 $ 10,590 $ 27,759 $ 30,890 $ 48,655 ========== ========== ========== ========== ========== ==========
/more 9 PRESS RELEASE Elcor Corporation Quarterly Results January 17, 2001 Page 8 CONDENSED BALANCE SHEET (Unaudited, $ in thousands)
December 31, ASSETS 2000 1999 - ------ ---------- ---------- Cash and cash equivalents $ 3,461 $ 3,270 Receivables, net 48,429 51,259 Inventories 58,204 35,027 Deferred income taxes 2,937 2,413 Prepaid expenses and other 4,127 4,918 ---------- ---------- Total Current Assets 117,158 96,887 Property, plant and equipment, net 214,466 161,811 Other assets 2,797 3,234 ---------- ---------- Total Assets $ 334,421 $ 261,932 ========== ==========
December 31, LIABILITIES AND SHAREHOLDERS' EQUITY 2000 1999 - ------------------------------------ ---------- ---------- Accounts payable and accrued liabilities $ 43,228 $ 40,871 Current maturities on long-term debt 0 0 ---------- ---------- Total Current Liabilities 43,228 40,871 Long-term debt, net 108,000 49,300 Deferred income taxes 22,474 18,749 Shareholders' equity 160,719 153,012 ---------- ---------- Total Liabilities and Shareholders' Equity $ 334,421 $ 261,932 ========== ==========
/more 10 PRESS RELEASE Elcor Corporation Quarterly Results January 17, 2001 Page 9 CONDENSED STATEMENT OF CASH FLOWS (Unaudited, $ in thousands)
For the Six Months Ended December 30, 2000 1999 ---------- ---------- CASH FLOWS FROM: OPERATING ACTIVITIES Net income $ 5,949 $ 17,480 Adjustments to net income Depreciation and amortization 6,699 5,254 Deferred income taxes 1,276 401 Gain from involuntary conversion 0 (889) Changes in assets and liabilities: Trade receivables 23,283 21,607 Inventories (17,239) (9,257) Prepaid expenses and other 185 2,672 Accounts payable and accrued liabilities (5,059) 6,987 ---------- ---------- Net cash from operations 15,094 44,255 ---------- ---------- INVESTING ACTIVITIES Additions to property, plant & equipment (26,048) (31,330) Insurance proceeds from involuntary conversion 0 1,651 Other 147 (72) ---------- ---------- Net cash from investing activities (25,901) (29,751) ---------- ---------- FINANCING ACTIVITIES Long-term borrowings, net 16,700 (13,700) Dividends on common stock (1,936) (1,956) Treasury stock transactions and other, net (5,198) 236 ---------- ---------- Net cash from financing activities 9,566 (15,420) ---------- ---------- NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (1,241) (916) CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 4,702 4,186 ---------- ---------- CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 3,461 $ 3,270 ========== ==========
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