EX-99.1 3 d07772exv99w1.txt EARNINGS RELEASE EXHIBIT 99.1 [Encore Wire Corporation Logo Omitted] Encore Wire Corporation Contact: Frank J. Bilban 1410 Millwood Road Vice President & CFO McKinney, Texas 75069 972-562-9473 PRESS RELEASE FOR IMMEDIATE RELEASE JULY 28, 2003 ENCORE WIRE REPORTS INCREASED PROFITS ON RECORD SALES MCKINNEY, TX - Encore Wire Corporation (NASDAQ/NMS: WIRE) today reported financial results for the quarter ended June 30, 2003. Net sales for the second quarter of 2003 increased to $80,584,000 compared to $72,154,000 during the second quarter of 2002. The $80.6 million in sales represents a new record for Encore, beating the $80.2 million mark set in the third quarter of 2002. Shipment volume, measured in copper pounds sold, also set a new company record. Net income for the quarter increased to $2,653,000 versus $2,265,000 in the second quarter of 2002. Fully diluted net income per common share was $.17 in the second quarter of 2003 compared to $.15 of net income in the second quarter of 2002. Net income and fully diluted income per share in the second quarter of 2003 improved dramatically over the loss of $517,000 or $.03 per share in the first quarter of 2003. Net sales for the first six months of 2003 increased to $147,737,000 compared to $136,337,000 in the first six months of 2002. Net income was $2,136,000 in the first six months of 2003 versus $4,621,000 in the same period of 2002. Fully diluted net income per share was $.14 in the first six months of 2003 versus $.30 in the first six months of 2002. Commenting on the quarter ended June 30, 2003, Vincent A. Rego, Company Chairman and CEO remarked, "It is gratifying to see Encore Wire post $.17 per share in earnings this quarter versus the past three quarters in which we earned a cumulative net of $.06 per share. Our industry has been through difficult times over the last couple of years, but it appears that we may be coming out of it with strong volumes and increased margins. We managed our plants very efficiently during the quarter and controlled our manufacturing overheads, enabling us to enhance gross margins. Our staff continues to perform beyond expectations. The price of copper has recently shown signs of strength and most importantly, the building wire industry has injected some long overdue discipline into pricing policies. While we believe that margins still need improvement, we are obviously excited at the progress made this past quarter. We are also seeing strong demand in the marketplace. Housing starts have been a bright spot during this recession, and we are optimistic that commercial construction is starting to recover. With the plant, equipment and staff we have in place, we are capable of maintaining our high order fill rates and low cost structure. We have taken steps to strengthen our independent rep force in a few key markets and are already seeing those changes paying off. We will remain conservative in our spending to ensure our balance sheet remains strong. We thank our shareholders for their continued support. " Encore Wire Corporation manufactures a broad range of electrical wire for interior wiring in homes, apartments, manufactured housing and commercial and industrial buildings. The matters discussed in this news release, other than the historical financial information, including statements about the copper pricing environment, profitability and shareholder value, may include forward-looking statements that involve risks and uncertainties, including fluctuations in the price of copper, the impact of competitive pricing and other risks detailed from time to time in the Company's reports filed with the Securities and Exchange Commission. Actual results may vary materially from those anticipated. Encore Wire Corporation P.O. Box 1149 1410 Millwood Road McKinney, Texas 75069 (972) 562-9473 Condensed Consolidated Balance Sheet (In Thousands) (Unaudited)
JUNE 30, DECEMBER 31, 2003 2002 --------------- --------------- ASSETS Current Assets Cash $ 1,400 $ 160 Receivables, net 61,799 46,600 Inventories 43,860 50,165 Prepaid Expenses and Other 2,867 672 --------------- --------------- Total Current Assets 109,926 97,597 Property, Plant and Equipment, net 82,062 85,366 Other Assets 176 166 --------------- --------------- Total Assets $ 192,164 $ 183,129 =============== =============== LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities Accounts Payable $ 23,090 $ 10,735 Accrued Liabilities and Other 11,057 11,183 --------------- --------------- Total Current Liabilities 34,147 21,918 Long Term Liabilities Note Payable 40,000 47,500 Non-Current Deferred Income Taxes 9,251 7,193 --------------- --------------- Total Long Term Liabilities 49,251 54,693 Total Liabilities 83,398 76,611 Stockholders' Equity Common Stock 170 169 Additional Paid in Capital 34,138 34,138 Treasury Stock (15,275) (15,275) Retained Earnings 89,733 87,486 --------------- --------------- Total Stockholders' Equity 108,766 106,518 --------------- --------------- Total Liabilities and Stockholders' Equity $ 192,164 $ 183,129 =============== ===============
Encore Wire Corporation P.O. Box 1149 1410 Millwood Road McKinney, Texas 75069 (972) 562-9473 Condensed Consolidated Statement of Income (In Thousands) (Unaudited)
QUARTER ENDED JUNE 30, -------------------------------------------------------------- 2003 2002 ----------------------------- ----------------------------- Net Sales $ 80,584 100.0% $ 72,154 100.0% Cost of Sales 68,783 85.4% 62,102 86.1% ------------- ------------- ------------- ------------- Gross Profit 11,801 14.6% 10,052 13.9% Selling, General and Administrative Expenses 6,982 8.7% 5,966 8.3% ------------- ------------- ------------- ------------- Operating Income 4,819 6.0% 4,086 5.7% Net Interest & Other Expense 674 0.8% 546 0.8% ------------- ------------- ------------- ------------- Income before Income Taxes 4,145 5.1% 3,540 4.9% Income Taxes 1,492 1.9% 1,275 1.8% ------------- ------------- ------------- ------------- Net Income $ 2,653 3.3% $ 2,265 3.1% ============= ============= ============= ============= Basic Earnings Per Share $ 0.18 $ 0.15 ============= ============= Diluted Earnings Per Share $ 0.17 $ 0.15 ============= ============= Weighted Average Number of Common and Common Equivalent Shares Outstanding: -Basic 15,119 15,267 ============= ============= -Diluted 15,212 15,514 ============= ============= SIX MONTHS ENDED JUNE 30, -------------------------------------------------------------- 2003 2002 ----------------------------- ----------------------------- Net Sales $ 147,737 100.0% $ 136,337 100.0% Cost of Sales $ 130,279 88.2% $ 116,505 85.5% ------------- ------------- ------------- ------------- Gross Profit 17,458 11.8% 19,832 14.5% Selling, General and Administrative Expenses 12,936 8.8% 11,738 8.6% ------------- ------------- ------------- ------------- Operating Income 4,522 3.1% 8,094 5.9% Net Interest & Other Expense 1,184 0.8% 873 0.6% ------------- ------------- ------------- ------------- Income before Income Taxes 3,338 2.3% 7,221 5.3% Income Taxes 1,202 0.8% 2,600 1.9% ------------- ------------- ------------- ------------- Net Income $ 2,136 1.4% $ 4,621 3.4% ============= ============= ============= ============= Basic Earnings Per Share $ 0.14 $ 0.30 ============= ============= Diluted Earnings Per Share $ 0.14 $ 0.30 ============= ============= Weighted Average Number of Common and Common Equivalent Shares Outstanding: -Basic 15,119 15,263 ============= ============= -Diluted 15,193 15,494 ============= =============