-----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, ET8/6vR2YU9GQpIn8tPf9qC/UVdm5Z+qGuFadf4flEDYwgBVdV+0GPp1tjRB4vms MccLBafVL8bdZpoYfHS1XQ== 0000950137-99-003704.txt : 19991019 0000950137-99-003704.hdr.sgml : 19991019 ACCESSION NUMBER: 0000950137-99-003704 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19991015 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19991018 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MOTIVEPOWER INDUSTRIES INC CENTRAL INDEX KEY: 0000919563 STANDARD INDUSTRIAL CLASSIFICATION: RAILROAD EQUIPMENT [3743] IRS NUMBER: 820461010 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-13225 FILM NUMBER: 99729658 BUSINESS ADDRESS: STREET 1: TWO GATEWAY CENTER 14TH FLOOR CITY: PITTSBURGH STATE: PA ZIP: 15222 BUSINESS PHONE: 4122011101 MAIL ADDRESS: STREET 1: TWO GATEWAY CENTER 14TH FLOOR CITY: PITTSBURGH STATE: PA ZIP: 15222 FORMER COMPANY: FORMER CONFORMED NAME: MK RAIL CORP DATE OF NAME CHANGE: 19940228 8-K 1 FORM 8-K 1 FORM 8-K SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 25049 CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Act of 1934 Date of Report (Date of earliest event reported): October 15, 1999. MotivePower Industries, Inc. - -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Pennsylvania 0-23802 82-0461010 - ---------------------------- ---------------- ---------------------- (State or other jurisdiction (Commission file (IRS Employer of incorporation) number) Identification Number) Two Gateway Center, Pittsburgh, PA 15222 - ---------------------------------------- -------- (Address of principal executive offices) Zip Code Registrant's telephone number, including area code: (412) 201-1101 Not applicable - -------------------------------------------------------------------------------- (Former name or former address, if changed since last report) 2 ITEM 5. OTHER EVENTS. The Registrant hereby incorporates by reference the information contained in Exhibit 99.1 hereto in response to this Item 5. ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS. (a) -- (b) Not applicable. (c) Exhibits. 99.1 Text of press release dated October 15, 1999, issued by MotivePower Industries, Inc., regarding 1999 third quarter earnings. - 2 - 3 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized. MOTIVEPOWER INDUSTRIES, INC. Date: October 15, 1999 By: /s/ David L. Bonvenuto -------------------------------- David L. Bonvenuto Vice President, Controller and Principal Accounting Officer 4 EXHIBIT INDEX
Exhibit Number Description of Exhibit ------ ---------------------- 99.1 Text of press release dated October 15, 1999, issued by MotivePower Industries, Inc., regarding 1999 third quarter earnings.
EX-99.1 2 TEXT OF PRESS RELEASE DATED 10/15/99 1 EXHIBIT 99.1 [PRESS RELEASE AND MOTIVEPOWER LETTERHEAD] CONTACT: TIM WESLEY AT (412) 201-2830 MOTIVEPOWER INDUSTRIES REPORTS E.P.S. OF 19 CENTS FOR THIRD QUARTER; BACKLOG STRONG FOR YEAR 2000 PITTSBURGH, October 15, 1999 - MotivePower Industries, Inc. (NYSE: MPO) today reported earnings per diluted share of 19 cents for the third quarter, and a strong backlog of work for the year 2000. For the third quarter ended Sept. 30, 1999, the company had net income of $5.3 million on net sales of $88.4 million, compared to net income of $7.7 million, or 28 cents per diluted share, on net sales of $87.4 million in the prior-year quarter. Excluding non-recurring and non-operating items from both quarters, the company had earnings per diluted share of 20 cents in the 1999 third quarter and 27 cents in the 1998 third quarter. The company attributed its lower results in the 1999 third quarter to significantly lower sales and operating income in the Locomotive Group, primarily due to the delayed timing of certain contracts, and the shift of some business in other freight and industrial market segments from the third to the fourth quarter. In addition, the company said it was negatively impacted by the effects of planning its pending merger with Westinghouse Air Brake Company (NYSE: WAB). "We are obviously disappointed by our financial results for the 1999 third quarter," said John C. (Jack) Pope, MotivePower Industries' chairman. "We are, however, optimistic about our prospects going forward, with the backlog of business in the Locomotive Group strengthening. As a result, we are comfortable with Wall Street's consensus earnings estimate of 32 cents for the fourth quarter for MotivePower Industries on a stand-alone basis." For the nine months ended Sept. 30, 1999, the company had net income of $22.4 million, or 80 cents per diluted share, on net sales of $294.3 million. For the same period, the company had normalized operating income of $42 million, 17 percent higher than the normalized operating income from the prior-year period. 1999 THIRD QUARTER HIGHLIGHTS Net sales increased slightly, with higher results in the Components Group offsetting lower results in the Locomotive Group. The company's gross margin was 23.1 percent, compared to 24.4 percent in the prior-year quarter, excluding non-recurring and non-operating expenses. The lower gross margin was due to product mix and lower sales in the Locomotive Group, which, in turn, impacted sales in the Components Group. 2 [PRESS RELEASE AND MOTIVEPOWER LETTERHEAD} Selling, general and administrative expenses increased 8 percent, as lower general and incentive- related expenses were more than offset by expenses from three companies acquired since the year-ago quarter. Interest expense increased as the company incurred debt to fund the three acquisitions. At Sept. 30, 1999, debt, net of cash and equivalents, was $115.9 million (36 percent of total capital), compared to $43.2 million, or 21 percent of total capital, a year ago. The company had a foreign exchange loss of $205,000, compared to a gain of $1.2 million in the year-ago quarter. The loss resulted from the company's net peso liability position in its Mexican operations and the strengthening of the peso during the quarter. During the quarter, the company had operating cash flow (operating income plus depreciation and amortization) of $14.9 million, compared to a normalized $15.3 million in the prior-year quarter. Capital expenditures in the current-year quarter were $1.5 million, compared to $5.9 million in the prior-year quarter, as the company completed its three-year, $60 million investment program this year. Depreciation and amortization was $4.1 million in the current-year quarter, compared to $2.8 million in the prior-year quarter. SEGMENT HIGHLIGHTS For the quarter, the Components Group had a 39 percent net sales increase, primarily due to sales from acquisitions. Excluding these sales, the group's net sales increased 5 percent. The group's operating income increased 74 percent, but was flat excluding non-recurring and non-operating items, and acquisitions from the year-ago quarter. For the quarter, the Locomotive Group had a 36 percent net sales decrease and a 57 percent decrease in operating income. These results reflected the contract delays in the U.S. and product mix in Mexico. "We are very disappointed with the performance of our Locomotive Group this year," said Michael A. Wolf, MotivePower Industries' president and chief executive officer. "The business has been soft this year primarily due to order delays, and cutbacks in budgeting for new locomotive purchases and overhauls by Class I railroads. To date this year, the group's revenues are off 25 percent from a year ago, which also impacts our Components Group because of the `pull-through' nature of our business. As a result, we have taken further actions to lower overhead costs, including a work force reduction of 8 percent. In addition, we are bolstering our sales efforts for aftermarket components sales, as well as for the transit/commuter market in the U.S. and for growing international markets. Given these actions, good market fundamentals and our strong backlog for the next 12 months, we expect the Locomotive Group's performance to improve significantly." 3 [PRESS RELEASE AND MOTIVEPOWER LETTERHEAD} BACKLOG At Sept. 30, 1999, the company's multi-year backlog was $853 million, compared to $741 million a year ago. The company's backlog for the year 2000 was $161 million, compared to $86 million a year ago for 1999. During the quarter, the Locomotive Group added the following to its backlog: A five-year, $175 million contract to maintain locomotives and passenger cars for the Massachusetts Bay Transportation Authority; a 14-year, $16 million contract to maintain new locomotives for Transportacion Ferroviaria Mexicana in Mexico; and a $5 million contract to overhaul locomotives for Transtar. MERGER AGREEMENT WITH WESTINGHOUSE AIR BRAKE During the quarter, the company signed a revised merger agreement with Westinghouse Air Brake after the original transaction was delayed in mid-August. Under the revised agreement, shareholders of MotivePower Industries will receive .66 shares of Westinghouse Air Brake stock in exchange for each share of MotivePower Industries. The merger, which will create the premier supplier of products and services for the railroad industry, is expected to be completed by year-end, subject to shareholder approvals. The companies have set a record date of Oct. 20, 1999 and a meeting date of Nov. 19, 1999. This press release contains forward-looking statements, such as the company's statement that it is comfortable with Wall Street's consensus earnings estimates of 32 cents for the fourth quarter. The company's actual results could differ materially from the results suggested in any forward-looking statement. Factors that could cause or contribute to these material differences include, but are not limited to, the following: a slowdown in the U.S. or Mexican economy; a decrease in NAFTA rail traffic; continued consolidation by U.S. and Canadian railroads; the company's ability to implement productivity improvement plans; the company's ability to successfully complete its information technology project, including "Year 2000" compliance. The company assumes no obligation to update these forward-looking statements or advise of changes in the assumptions on which they were based. MotivePower Industries (www.motivepower.com) is a leader in the manufacturing of products for rail and other power-related industries. Through its subsidiaries, the company manufactures and distributes engineered locomotive components; provides locomotive and freight car fleet maintenance; overhauls locomotives, freight cars and diesel engines; manufactures new, environmentally friendly, switcher, commuter and mid-range locomotives up to 4,000 horsepower; and manufactures components for power, marine and industrial markets. #### 4
Motivepower Industries Three Months Ended Three Months Ended Consolidated Statements of Income September 30, % of September 30, % of (In thousands except per share data) 1999 Net sales 1998 Net sales - ------------------------------------ ----------------- --------- ------------------ --------- Net sales $ 88,410 100.0% $ 87,406 100.0% Cost of sales (68,024) (76.9%) (68,324) (78.2%) ----------------- --------- ------------------ --------- Gross profit 20,386 23.1% 19,082 21.8% Selling, general and administrative expenses (9,644) (10.9%) (8,898) (10.2%) ----------------- --------- ------------------ --------- Operating income 10,742 12.2% 10,184 11.6% Investment income 239 0.3% 360 0.4% Interest expense (2,525) (2.9%) (1,212) (1.4%) Other income - 0.0% 677 0.8% Foreign exchange (loss) gain (205) (0.3%) 1,242 1.4% ----------------- --------- ------------------ --------- Income before income taxes 8,251 9.3% 11,251 12.8% Income tax expense (2,959) (3.3%) (3,539) (4.0%) ----------------- --------- ------------------ --------- Net income $ 5,292 6.0% $ 7,712 8.8% ================= ========= ================== ========= Earnings per common share - basic: Net income $ 0.20 $ 0.29 ================== ================== Adjusted weighted average common shares outstanding 27,135 26,775 ================== ================== Earnings per common share assuming dilution: Net income $ 0.19 $ 0.28 ================== ================== Adjusted weighted average common shares outstanding 28,004 27,912 ================== ================== Debt, net of cash and equivalents $ 115,954 $ 43,228 ================== ================== Stockholders' equity $ 202,501 $ 167,435 ================== ================== Operating Group Results Components Group % Change Net sales 60,469 39.1% 43,456 Operating income 7,592 74.4% 4,353 a Operating margin 12.6% 10.0% Locomotive Group Net sales 27,942 (36.4%) 43,950 Operating income 3,681 (56.6%) 8,475 Operating margin 13.2% 19.3%
a-- Includes $2.3 million of facility relocation expenses. 5
Motivepower Industries Nine months ended Nine months ended Consolidated Statements of Income September 30, % of September 30, % of (In thousands except per share data) 1999 Net sales 1998 Net sales - ------------------------------------ ----------------- --------- ------------------ --------- Net sales $ 294,347 100.0% $ 258,720 100.0% Cost of sales (218,752) (74.3%) (196,946) (76.1%) ----------------- --------- ------------------ --------- Gross profit 75,595 25.7% 61,774 23.9% Selling, general and administrative expenses (33,880) (11.5%) (29,395) (11.4%) ----------------- --------- ------------------ --------- Operating income 41,715 14.2% 32,379 12.5% Investment income 853 0.3% 918 0.4% Interest expense (7,136) (2.4%) (3,739) (1.5%) Other income 183 0.0% 2,622 1.0% Foreign exchange (loss) gain (774) (0.3%) 2,071 0.8% ----------------- --------- ------------------ --------- Income before income taxes 34,841 11.8% 34,251 13.2% Income tax expense (12,465) (4.2%) (11,549) (4.4%) ----------------- --------- ------------------ --------- Income before extraordinary item 22,376 7.6% 22,702 8.8% Extraordinary loss on extinguishment of debt net of income tax benefit of $265 -- 0.0% (472) (0.2%) ----------------- --------- ------------------ --------- Net income $ 22,376 7.6% $ 22,230 8.6% ================= ========= ================== ========= Earnings per common share - basic: Income before extraordinary item $ 0.83 $ 0.85 Extraordinary item -- (0.02) ----------------- ------------------ Net income $ 0.83 $ 0.83 ================= ================== Adjusted weighted average common shares outstanding 27,058 26,745 ================= ================== Earnings per common share assuming dilution: Income before extraordinary item $ 0.80 $ 0.81 Extraordinary item -- (0.02) ----------------- ------------------ Net income $ 0.80 $ 0.79 ================= ================== Adjusted weighted average common shares outstanding 28,046 27,899 ================= ================== Debt, net of cash and equivalents $ 115,954 $ 43,228 ================= ================== Stockholders' equity $ 202,501 $ 167,435 ================= ================== Operating Group Results Components Group % Change Net sales 201,500 48.8% 135,440 Operating income 31,418 68.9% 18,602 b Operating margin 15.6% 13.7% Locomotive Group Net sales 92,847 (24.7%) 123,280 Operating income 15,335 (31.6%) 22,430 c Operating margin 16.5% 18.2%
b-- Includes $4.6 million of facility relocation expenses. c-- Includes $1.2 million restructuring reserve reversal. -----END PRIVACY-ENHANCED MESSAGE-----