EX-99.1 2 a5028611ex99_1.txt EXHIBIT 99.1 Exhibit 99.1 Dayton Superior Reports Third Quarter Results DAYTON, Ohio--(BUSINESS WIRE)--Nov. 28, 2005--Dayton Superior Corporation reported today that sales for the third quarter of 2005 totaled $114.1 million, flat with third quarter 2004 sales. Product sales were $96.6 million for the third quarter of 2005, flat with the third quarter of 2004. Unit volume was lower compared to the third quarter of 2004 mainly due to the adverse effects of hurricanes Katrina and Rita. This volume shortfall was offset by price increases. Rental revenue of $13.8 million in the third quarter of 2005 increased from $11.4 million in third quarter of 2004. The increase resulted from an improving rental market and better positioning of our fleet. Used rental equipment sales decreased to $3.7 million for the third quarter of 2005 from $6.5 million for the third quarter of 2004, as the Company emphasizes renting equipment rather than selling it. Gross profit on product sales for the third quarter of 2005 was $21.5 million, or 22.3% of sales, a decrease from the $25.2 million, or 26.1% of sales, in the third quarter of 2004. The decline was primarily due to higher freight and raw material costs, and the effect of lower production volume. Rental gross profit for the third quarter of 2005 was $4.2 million, an increase of $1.1 million over the third quarter of 2004. Depreciation on rental equipment for the third quarter of 2005 was $5.7 million, an increase from $4.8 million in the third quarter of 2004. Gross profit before depreciation was $9.9 million, or 71.6% of revenue, an increase of $2.0 million from $7.9 million, or 69.0% of revenue. The increase in gross profit dollars was a result of the increased rental revenue discussed above. Gross profit on the sales of used rental equipment for the third quarter of 2005 was $2.4 million, or 65.7% of sales, compared to $3.7 million, or 57.5% of sales, for the third quarter of 2004. Gross margin percentages fluctuate based on the mix and age of rental equipment sold and remained within historical ranges. Selling, general, and administrative expenses increased to $22.7 million in the recent quarter from $21.8 million for the third quarter of 2004. The increase was primarily due to moving two distribution centers to larger facilities and increased rental center costs due to higher rental activity. Interest expense increased slightly to $12.2 million for the third quarter of 2005 from $11.9 million for the third quarter of 2004. The Company reported a net loss of $(6.7) million for the third quarter of 2005, versus a net loss of $(1.8) million for the third quarter of 2004. Sales for the nine months ended September 30, 2005 totaled $317.6 million, a slight decrease from a year earlier nine-month sales of $318.9 million. Product sales were $269.6 million for the first nine months of 2005, a decrease of 1.3% from the same period of 2004. The decrease in sales was due to a decrease in unit volume due to lower demand in our markets from the adverse weather effects - hurricanes Katrina and Rita and snow into April in the Northeast and Midwest as well as some geographical market share losses due to selected competitors' willingness to sacrifice gross margin and give away freight costs to increase their unit volumes. Price increases implemented throughout 2004 helped to offset most of the volume decline. Rental revenue of $36.0 million in the first nine months of 2005 increased from $30.8 million in the first nine months of 2004 due to an improving rental market and to better positioning of our fleet. Used rental equipment sales decreased to $12.0 million for the first nine months of 2005 from $15.0 million for the first nine months of 2004 as the Company emphasizes renting rather than selling equipment. Gross profit on product sales for the first nine months of 2005 was $61.6 million, or 22.8% of sales, a decrease from $68.2, or 25.0% of sales, in the first nine months of 2004. The decline was primarily due to the decline in sales, higher raw material and freight costs, and the effects of lower production volume. Rental gross profit for the first nine months of 2005 was $8.6 million, an increase of $1.7 million over the first nine months of 2004. Depreciation on rental equipment for the first nine months of 2005 was $16.3 million, an increase from $14.3 million in the first nine months of 2004. Gross profit before depreciation was $24.9 million, or 69.2% of revenue, an increase of $3.7 million from $21.2 million, or 68.8% of revenue. The increase in gross profit dollars was a result of the increased rental revenue discussed above. Gross profit on the sales of used rental equipment for the first nine months of 2005 was $7.8 million, or 65.0% of sales, compared to $9.0 million, or 60.2% of sales, for the first nine months of 2004. Selling, general, and administrative expenses increased to $69.0 million in the recent nine months from $66.3 million for the first nine months of 2004. The increase was mainly due to severance expenses of $1.0 million related to the termination of employment of our former President and Chief Executive Officer, moving two distribution centers to larger facilities, increased rental center costs due to higher rental activity and non-recurring recruiter fees paid in the search for a new Chief Executive Officer. Interest expense increased to $36.6 million for the first nine months of 2005 from $35.5 million for the first nine months of 2004. This increase was primarily due to the higher interest rates on the revolving credit facility and higher average borrowings compared to the first nine months of 2004. The Company reported a net loss of $(26.9) million for the first nine months of 2005, versus a net loss of $(20.4) million for the first nine months of 2004. Rick Zimmerman, Dayton Superior's President and Chief Executive Officer said, "While we are not pleased with our recovery rate, we do see the current construction market trends and our rental rate and utilization improvement from 2004 as very positive indicators. Additionally, we know that the hurricanes adversely affected revenues in the Gulf Coast markets and caused cost spikes in freight. All in all, we currently expect improving markets with material cost stability. Early fourth quarter sales results support this view. Our challenge will be ensuring that we have the proper resources to improve our performance while we implement our cost reduction plans." The Company has scheduled a conference call at 11:00 a.m. ET, Tuesday, November 29, 2005 to discuss the third quarter results. The conference call can be accessed by dialing 1-866-261-7281. A replay of the call will be available from 4:00 p.m. ET on Tuesday, November 29, 2005 through 11:59 p.m. ET on Tuesday, December 6 by calling 1-888-266-2081 and entering reservation #803083. Dayton Superior is the largest North American manufacturer and distributor of metal accessories and forms used in concrete construction, and a leading manufacturer of metal accessories used in masonry construction in terms of revenues. The company's products are used in two segments of the construction industry: infrastructure construction, such as highways, bridges, utilities, water and waste treatment facilities and airport runways, and non-residential building, such as schools, stadiums, prisons, retail sites, commercial offices, hotels and manufacturing facilities. The company sells most products under the registered trade names Dayton Superior(R), Dayton/Richmond(R), Symons(R), Aztec(R), BarLock(R), Conspec(R), Edoco(R), Dur-O-Wal(R) and American Highway Technology(R). Note: Certain statements made herein concerning anticipated future performance are forward-looking statements. These forward-looking statements are based on estimates, projections, beliefs and assumptions of management and are not guarantees of future performance. Actual future performance, outcomes and results may differ materially from those expressed in forward-looking statements as a result of a number of important factors. Representative examples of these factors include (without limitation) the cyclical nature of nonresidential building and infrastructure construction activity, which can be affected by factors outside Dayton Superior's control such as the general economy, governmental expenditures, interest rate increases, and changes in banking and tax laws; the amount of debt Dayton Superior must service; the effects of weather and the seasonality of the construction industry; Dayton Superior's ability to implement cost savings programs successfully and on a timely basis; Dayton Superior's ability to successfully integrate acquisitions on a timely basis; the mix of product sales, rental revenues, and sales of used rental equipment; cost increases in raw materials and operating costs; and favorable market response to sales price increases. This list of factors is not intended to be exhaustive, and additional information concerning relevant risk factors can be found in Dayton Superior's Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and current Reports on Form 8-K filed with the Securities and Exchange Commission. Dayton Superior Corporation Summary Income Statement, Unaudited (in thousands) For the fiscal quarter ended: September 30, October 1, 2005 2004 Product sales $96,557 $96,640 Rental revenue 13,816 11,449 Used rental equipment sales 3,698 6,459 --------------- -------------- Net Sales 114,071 114,548 --------------- -------------- Product cost of sales 75,018 71,442 Rental cost of sales 9,594 8,304 Used rental equipment cost of sales 1,270 2,743 --------------- -------------- Cost of Sales 85,882 82,489 --------------- -------------- Product gross profit 21,539 25,198 Rental gross profit 4,222 3,145 Used rental equipment gross profit 2,428 3,716 --------------- -------------- Gross Profit 28,189 32,059 Rental gross profit without depreciation 9,890 7,891 Product gross profit % 22.3% 26.1% Rental gross profit % 30.6% 27.5% Used rental equipment gross profit % 65.7% 57.5% Gross Profit % 24.7% 28.0% Rental gross profit % without depreciation 71.6% 68.9% Selling, General & Administrative 22,736 21,757 Selling, General & Administrative % 19.9% 19.0% Facility Closing and Severance Expenses 211 429 (Gain) loss on Disposals of Property, Plant, and Equipment (543) (464) Amortization of Intangibles 180 302 --------------- -------------- Operating Income 5,605 10,035 Operating Income % 4.9% 8.8% Interest Expense, net 12,183 11,923 Other (Income) Expense 79 (45) --------------- -------------- Loss Before Income Taxes (6,657) (1,843) Pretax Margin (5.8%) (1.6%) Benefit for Income Taxes - - --------------- -------------- Net Loss $(6,657) $(1,843) =============== ============== Rental Depreciation $5,668 $4,746 Other Depreciation and Amortization 2,272 2,435 --------------- -------------- Total Depreciation and Amortization $7,940 $7,181 =============== ============== Dayton Superior Corporation Summary Income Statement, Unaudited (in thousands) For the fiscal nine months ended: September 30, October 1, 2005 2004 Product sales $269,643 $273,101 Rental revenue 35,961 30,792 Used rental equipment sales 11,953 14,978 -------------- -------------- Net Sales 317,557 318,871 -------------- -------------- Product cost of sales 208,030 204,948 Rental cost of sales 27,389 23,852 Used rental equipment cost of sales 4,188 5,956 -------------- -------------- Cost of Sales 239,607 234,756 -------------- -------------- Product gross profit 61,613 68,153 Rental gross profit 8,572 6,940 Used rental equipment gross profit 7,765 9,022 -------------- -------------- Gross Profit 77,950 84,115 Rental gross profit without depreciation 24,901 21,086 Product gross profit % 22.8% 25.0% Rental gross profit % 23.8% 22.5% Used rental equipment gross profit % 65.0% 60.2% Gross Profit % 24.5% 26.4% Rental gross profit % without depreciation 69.2% 68.5% Selling, General & Administrative 68,993 66,294 Selling, General & Administrative % 21.7% 20.8% Facility Closing and Severance Expenses 542 1,393 (Gain) loss on Disposals of Property, Plant, and Equipment (1,629) (386) Amortization of Intangibles 486 857 -------------- -------------- Operating Income 9,558 15,957 Operating Income % 3.0% 5.0% Interest Expense, net 36,417 35,507 Loss on Early Extinguishment of Long-term Debt - 842 Other Expense 84 - -------------- -------------- Loss Before Income Taxes (26,943) (20,392) Pretax Margin (8.5%) (6.4%) Benefit for Income Taxes - - -------------- -------------- Net Loss $(26,943) $(20,392) ============== ============== Rental Depreciation $16,329 $14,146 Other Depreciation and Amortization 6,907 7,080 -------------- -------------- Total Depreciation and Amortization $23,236 $21,226 ============== ============== Dayton Superior Corporation Summary Balance Sheet, Unaudited (in thousands) As of: September 30, December 31, 2005 2004 Summary Balance Sheet: Cash $1,352 $4,504 Accounts Receivable, Net 73,188 68,031 Inventories 64,435 59,389 Other Current Assets 9,529 14,222 ------------- ------------ Total Current Assets 148,504 146,146 Rental Equipment, Net 69,959 69,662 Property & Equipment, Net 51,429 59,458 Goodwill & Other Assets 115,471 118,872 ------------- ------------ Total Assets $385,363 $394,138 ============= ============ Current Portion of Long-Term Debt $2,403 $2,455 Accounts Payable 21,003 21,086 Other Current Liabilities 31,962 27,322 ------------- ------------ Total Current Liabilities 55,368 50,863 Revolving Credit Facility 69,725 58,800 Other Long-Term Debt 317,148 316,389 Other Long-Term Liabilities 25,192 23,616 Shareholders' Deficit (82,070) (55,530) ------------- ------------ Total Liabilities & Shareholders' Deficit $385,363 $394,138 ============= ============ Dayton Superior Corporation Summary Cash Flow Statement, Unaudited (in thousands) For the nine months ended: September 30, October 1, 2005 2004 Net Loss $(26,943) $(20,392) Non-Cash Adjustments to Net Loss 17,026 16,471 Changes in Assets and Liabilities (2,455) (29,959) -------------- ----------- Net Cash Used in Operating Activities (12,372) (33,880) -------------- ----------- Property, Plant and Equipment Additions, Net (2,900) (3,130) Rental Equipment Additions, Net (8,861) (1,693) Acquisition - (245) -------------- ----------- Net Cash Provided By (used in) Investing Activities (11,761) (5,068) -------------- ----------- Borrowings Under Revolving Credit Facility 108,125 119,804 Repayments of Long-Term Debt Including Revolving Credit Facility (99,179) (80,314) Financing Costs Incurred (3) (2,554) Proceeds From Sale-Leaseback 11,636 - Purchase of Treasury Shares (325) - Changes in Loans to Shareholders 335 (27) Issuance of Common Shares 13 73 -------------- ----------- Net Cash Provided By Financing Activities 20,602 36,982 -------------- ----------- Other, Net 379 (29) -------------- ----------- Net Decrease in Cash $(3,152) $(1,995) ============== =========== CONTACT: Dayton Superior Corporation, Dayton Edward J. Puisis, 937-428-7172 Fax: 937-428-9115