-----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, IamhtgBJs1BIYDUQJ/95qIQI/wehAXZQiAPL6uQVP5K4PBJ1YMALJZuq0x+fmSO1 gKXKfkJyZnoLWvH9h0Mgsg== 0000950134-99-003117.txt : 19990421 0000950134-99-003117.hdr.sgml : 19990421 ACCESSION NUMBER: 0000950134-99-003117 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19990420 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19990420 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: 99597565 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 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) April 20, 1999 -------------- 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 On April 20, 1999, the company issued a press release containing "forward-looking statements" about its prospects for the future. A copy of the press release is attached hereto as Exhibit 99.1 and incorporated herein by reference. The above press release contains "forward-looking statements" about its prospects for the future, and from time to time the company may make others. Such statements are subject to certain risks and uncertainties which could cause actual results to differ materially from those projected. Such risks and uncertainties include, but are not limited to, the following: 1. The company's roofing products business is cyclical and is affected by weather and some of the same economic factors that affect the housing and home improvement industries generally, including interest rates, 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 lower than projected. 3. During fiscal 1997, the company completed the construction of a plant at the company's Ennis, Texas facility to manufacture nonwoven fiberglass roofing mats and other mats for a variety of industrial uses. The company also expects to make about $125 million in new investments to expand capacity and improve productivity at existing plants and to build new plants over a three year period beginning in fiscal 1999. 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 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 its patent infringement suits against GAF Building Materials Corporation and certain affiliates, 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. Even with fully developed action and contingency plans for Year 2000 readiness, it is possible that the company will not achieve full internal readiness. Further, the company's business may be adversely affected by external Year 2000 disruption that the company is not in position to control, including but not limited to potential disruptions in power and other energy supplies, telecommunications or other infrastructure, potential disruptions in transportation and the supply of raw materials, and potential disruptions in financial and banking systems. Year 2000 problems therefore could result in unanticipated expenses or liabilities, production or disruption delays or other adverse effects on the company. 7. Although the company currently anticipates that most of its needs for new capital in the near future will be met with internally generated funds, significant increases in interest rates could substantially affect its borrowing costs under its existing loan facility, or its cost of alternative sources of capital. 8. Each of the company's businesses, especially its Conductive Coatings Division's 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. 9. 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. Parties are cautioned not to rely on any such forward-looking beliefs or judgments in making investment decisions. 2 4 Reference is made to the company's Annual Report on Form 10-K for the year ended June 30, 1998, for further information about risks and uncertainties. Item 7. Exhibits 99.1 Press release dated April 20, 1999 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: April 20, 1999 /s/ Richard J. Rosebery -------------- ------------------------------------- Richard J. Rosebery Vice Chairman, Chief Financial and Administrative Officer, and Treasurer /s/ Leonard R. Harral ------------------------------------- Leonard R. Harral Vice President and Chief Accounting Officer 4 6 INDEX TO EXHIBITS EXHIBIT NUMBER DESCRIPTION - ------- -----------
27.1 Financial Data Schedule 99.1 Press release dated April 20, 1999 of Elcor Corporation.
EX-27.1 2 FINANCIAL DATA SCHEDULE
5 1,000 9-MOS JUN-30-1999 JUL-01-1998 MAR-31-1999 1,444 0 61,559 1,012 30,500 102,269 206,304 74,523 236,132 31,899 57,500 0 0 13,236 116,909 236,132 227,802 227,802 169,506 198,488 0 0 1,468 27,846 10,527 17,319 0 0 (4,340) 12,979 1.00 .98
EX-99.1 3 PRESS RELEASE DATED 4/20/99 1 EXHIBIT 99.1 FOR FURTHER INFORMATION: TRADED: NYSE SYMBOL: ELK Richard J. Rosebery, Vice Chairman, Chief Financial and Administrative Officer, and Treasurer (972) 851-0510 PRESS RELEASE FOR IMMEDIATE RELEASE ELCOR REPORTS RECORD FISCAL 1999 THIRD QUARTER SALES AND EARNINGS DALLAS, TEXAS, April 20, 1999 .... Elcor Corporation announced today that net income rose 52% for the third quarter ending March 31, 1999, to $5,115,000, or $.38 per diluted share, from $3,369,000, or $.25 per diluted share, in the year-ago quarter. Sales increased 19% to $70.7 million from $59.2 million last year. Both sales and earnings set new records for any March quarter. For the nine months ending March 31, 1999, income before a change in accounting principle rose 48% to $17,319,000, or $1.30 per diluted share, from $11,711,000, or $.87 per diluted share, last year. Net income for the first nine months was $12,979,000, or $.98 per diluted share, after a nonrecurring first quarter charge of $4,340,000, or $.32 per diluted share, for the cumulative effect of a change in accounting principle to apply AICPA AcSec Statement of Position 98-5, "Reporting on the Costs of Start-Up Activities." Sales increased 18% to $227.8 million from $193.7 million in the first nine months last year, reflecting strong growth in demand for its Elk Prestique premium laminated asphalt shingles and its conductive coatings and gaskets for digital wireless cellular phones. Harold K. Work, Elcor's Chairman, President and Chief Executive Officer, said, "Sharply higher third quarter results were driven by record March quarter shipments of our Elk Prestique premium laminated fiberglass asphalt shingles. Growing homeowner demand for our Elk Prestique laminated shingles, along with the relatively mild weather during much of the March quarter, sharply boosted demand in the residential roofing replacement market, which now accounts for about 83% of total asphalt shingle demand. In order to satisfy continuing strong growth in demand, all three of Elk's roofing plants continued production at high levels throughout the winter. During the March 31, 1999 quarter, net income continued to grow much faster than sales because of the increased level of production, higher prices for Elk laminated shingles and lower raw material costs than in the year-ago quarter. "Elcor's Industrial Products segment's sales were significantly higher than the record levels in the year-ago March quarter. However, operating profits were lower primarily as a result of reduced demand for Ortloff Engineers' patent licensing and engineering consulting services to the petroleum industry, that felt the impact of sharply lower oil and gas prices. Chromium Corporation's Conductive Coatings Division (CCD) sales for the March 1999 quarter more than doubled the year-ago level as a result of strong growth /more 2 PRESS RELEASE Elcor Corporation Quarterly Results April 20, 1999 Page 2 in demand for its conductive coatings and gaskets, plus the addition of results from CCD's new Canton, Georgia plant subsequent to its acquisition on January 11, 1999. While the new Canton plant is making good progress in improving performance, its operating losses reduced Elcor's after-tax earnings by about $.01 per diluted share for the March quarter," he said. FINANCIAL POSITION Elcor's financial position remains strong. First nine months' net cash flows from operating activities rose 63% to $20.1 million from $12.3 million during the same period last year; net cash used for investing activities more than tripled to $24.7 million from $7.4 million, as the company increased the pace of investments to expand capacity to satisfy the rapidly growing demand for its products; and net cash from financing activities was $0.8 million, compared with a $5.8 million reduction during the same period last year. At March 31, 1999, shareholders' equity was $130.2 million; total capital was $187.7 million; long-term debt as a percent of total capital was 31%; and the current ratio was 3.2:1. OUTLOOK Mr. Work said, "At the present time, we expect growing demand for Elk's patented Enhanced High Definition(R) and Raised Profile(TM) Prestique premium laminated fiberglass asphalt shingles and for our industrial products to substantially boost fourth quarter 1999 sales and earnings. Looking ahead to the longer term, we believe the investments we have made already and are continuing to make provide Elcor with the potential to more than double fiscal 1998 earnings of $1.36 per share over the next three fiscal years and to continue strong growth in the new millennium," he concluded. SAFE HARBOR PROVISIONS In accordance with the safe harbor provisions of the securities law regarding forward-looking statements, except for the historical information contained herein, the above discussion contains forward-looking statements that involve risks and uncertainties. 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 ended June 30, 1998, Forms 10Q for the fiscal 1999 quarters ending September 30, 1998 an December 31, 1998, and its Form 8-K dated April 20, 1999. - - - - - - - - Elcor, through its subsidiaries, manufactures roofing products and industrial products. 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; Dallas and Ennis, Texas. Its industrial products facilities are located in Canton, Georgia; Cleveland, Ohio; Dallas, Lufkin, and Midland, Texas. /more 3 PRESS RELEASE Elcor Corporation Quarterly Results April 20, 1999 Page 3
CONDENSED RESULTS OF OPERATIONS (Unaudited, $ in thousands) Third Quarter Trailing Three Months Ended Nine Months Ended Twelve Months Ended March 31, March 31, March 31, 1999 1998 1999 1998 1999 1998 (a) --------- --------- --------- --------- --------- --------- SALES $ 70,735 $ 59,225 $ 227,802 $ 193,706 $ 302,274 $ 252,170 --------- --------- --------- --------- --------- --------- COSTS AND EXPENSES: Cost of sales 53,132 45,225 169,506 147,927 224,206 192,195 Selling, general & administrative 8,898 8,257 28,982 25,446 38,052 33,014 Interest expense, net 464 514 1,468 1,887 2,158 2,776 --------- --------- --------- --------- --------- --------- Total Costs and Expenses 62,494 53,996 199,956 175,260 264,416 227,985 --------- --------- --------- --------- --------- --------- INCOME BEFORE INCOME TAXES 8,241 5,229 27,846 18,446 37,858 24,185 Provision for income taxes 3,126 1,860 10,527 6,735 13,926 8,887 --------- --------- --------- --------- --------- --------- INCOME BEFORE CHANGE IN ACCOUNTING PRINCIPLE 5,115 3,369 17,319 11,711 23,932 15,298 Cumulative effect of change in accounting principle (b) 0 0 (4,340) 0 (4,340) 0 --------- --------- --------- --------- --------- --------- NET INCOME $ 5,115 $ 3,369 $ 12,979 $ 11,711 $ 19,592 $ 15,298 ========= ========= ========= ========= ========= ========= INCOME PER COMMON SHARE-BASIC: Before change in accounting principle $ 0.39 $ 0.25 $ 1.33 $ 0.88 $ 1.83 $ 1.16 Cumulative effect of change in accounting principle 0.00 0.00 (0.33) 0.00 (0.33) 0.00 --------- --------- --------- --------- --------- --------- Net Income Per Share-Basic $ 0.39 $ 0.25 $ 1.00 $ 0.88 $ 1.50 $ 1.16 ========= ========= ========= ========= ========= ========= INCOME PER COMMON SHARE-DILUTED: Before change in accounting principle $ 0.38 $ 0.25 $ 1.30 $ 0.87 $ 1.79 $ 1.13 Cumulative effect of change in accounting principle 0.00 0.00 (0.32) 0.00 (0.32) 0.00 --------- --------- --------- --------- --------- --------- Net Income Per Share-Diluted $ 0.38 $ 0.25 $ 0.98 $ 0.87 $ 1.47 $ 1.13 ========= ========= ========= ========= ========= ========= AVERAGE COMMON SHARES OUTSTANDING Basic 12,996 13,269 13,038 13,234 13,099 13,224 ========= ========= ========= ========= ========= ========= Diluted 13,302 13,544 13,294 13,504 13,359 13,480 ========= ========= ========= ========= ========= =========
(a) Restated for a change in accounting for inventories in fiscal 1998. (b) Represents cumulative effect of applying AICPA AcSec Statement of Position 98-5, "Reporting on the Costs of Start-Up Activities." 4 PRESS RELEASE Elcor Corporation Quarterly Results April 20, 1999 Page 4 CONDENSED BALANCE SHEET (Unaudited, $ in thousands)
March 31, ASSETS 1999 1998 (a) - ------ -------- -------- Cash and cash equivalents $ 1,444 $ 2,823 Receivables, net 60,547 47,773 Inventories 30,500 33,785 Deferred income taxes 847 2,723 Prepaid expenses and other 8,931 2,816 -------- -------- Total Current Assets 102,269 89,920 Property, plant and equipment, net 131,781 118,454 Other assets 2,082 1,749 -------- -------- Total Assets $236,132 $210,123 ======== ========
March 31, LIABILITIES AND SHAREHOLDERS' EQUITY 1999 1998 (a) - ------------------------------------ -------- -------- Accounts payable and accrued liabilities $ 31,899 $ 24,669 Current maturities on long-term debt 0 0 -------- -------- Total Current Liabilities 31,899 24,669 Long-term debt, net 57,500 48,700 Deferred income taxes 16,498 14,920 Shareholders' equity 130,235 121,834 -------- -------- Total Liabilities and Shareholders' Equity $236,132 $210,123 ======== ========
(a) Restated for a change in accounting for inventories in fiscal 1998. 5 PRESS RELEASE Elcor Corporation Quarterly Results April 20, 1999 Page 5 CONDENSED STATEMENT OF CASH FLOWS (Unaudited, $ in thousands)
For the Nine Months Ended March 31, 1999 1998 -------- -------- CASH FLOWS FROM: OPERATING ACTIVITIES Net income $ 12,979 $ 11,711 Adjustments to net income Depreciation and amortization 6,825 8,116 Deferred income taxes 4,340 1,554 Cumulative effect of accounting change 4,340 0 Changes in assets and liabilities: Trade receivables (3,101) (4,595) Inventories (1,355) (1,579) Prepaid expenses and other (7,131) 756 Accounts payable and accrued liabilities 3,157 (3,616) -------- -------- Net cash from operations 20,054 12,347 -------- -------- INVESTING ACTIVITIES Additions to property, plant & equipment 22,236) (9,079) Acquisition of business, net of cash (5,298) 0 Insurance proceeds and other 2,883 1,718 -------- -------- Net cash from investing activities (24,651) (7,361) -------- -------- FINANCING ACTIVITIES Long-term borrowings, net 9,500 (3,900) Dividends on common stock (2,729) (2,385) Treasury stock transactions and other, net (5,970) 521 -------- -------- Net cash from financing activities 801 (5,764) -------- -------- NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (3,796) (778) CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 5,240 3,601 -------- -------- CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 1,444 $ 2,823 ======== ========
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