-----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, KUuH9WxHKwNhe3hlr61H87i+ZMiVvu1R63rPg97lHk5B+JGf+NT7P1M2cn0jUcBr C9m5iJZxNE0Uw4fxmYjDcQ== 0000898431-98-000317.txt : 19981022 0000898431-98-000317.hdr.sgml : 19981022 ACCESSION NUMBER: 0000898431-98-000317 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19981019 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19981021 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: UNIVERSAL STAINLESS & ALLOY PRODUCTS INC CENTRAL INDEX KEY: 0000931584 STANDARD INDUSTRIAL CLASSIFICATION: STEEL WORKS, BLAST FURNACES ROLLING MILLS (COKE OVENS) [3312] IRS NUMBER: 251724540 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 000-25032 FILM NUMBER: 98728529 BUSINESS ADDRESS: STREET 1: 600 MAYER ST CITY: BRIDGEVILLE STATE: PA ZIP: 15017 BUSINESS PHONE: 4122577600 MAIL ADDRESS: STREET 1: 600 MAYER ST CITY: BRIDGEVILLE STATE: PA ZIP: 15017 8-K 1 FORM 8-K 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): October 19, 1998 Universal Stainless & Alloy Products, Inc. (Exact name of registrant as specified in charter) Delaware 0-25032 25-1724540 (State or other jurisdiction (Commission file number) (IRS employer of incorporation) identification no.) 600 Mayer Street 15017 Bridgeville, Pennsylvania (Zip code) (Address of principal executive offices) Registrant's telephone number, including area code: (412) 257-7600 Item 5. Other Events. On October 19, 1998, Universal Stainless & Alloy Products, Inc. (the "Company") announced that it had entered into a letter of intent to acquire AL Tech Specialty Steel Corporation ("AL Tech"), a subsidiary of Sammi Steel Co., Ltd. of Korea, in a transaction valued at approximately $38 million. The transaction is subject to a number of conditions, including the completion of due diligence procedures, the execution of a definitive purchase agreement, successful negotiation of USWA labor and utility contracts, Hart-Scott-Rodino review, and the approval of AL Tech's plan of reorganization by the United States Bankruptcy Court for the Western District of New York. AL Tech filed a voluntary petition for reorganization under Chapter 11 of the Federal Bankruptcy Code on December 31, 1997 related to the earlier bankruptcy filing of its parent Sammi Steel Co., Ltd. under Korean insolvency laws. A copy of the Company's press release describing the proposed transaction is attached hereto as Exhibit 99.01 and is incorporated by reference herein in its entirety. Item 7. Financial Statements and Exhibits. (c) Exhibits. 99.01 Press Release of Universal Stainless & Alloy Products, Inc. dated October 19, 1998. - 2 - SIGNATURES 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 thereunto duly authorized. UNIVERSAL STAINLESS & ALLOY PRODUCTS, INC. Date: October 19, 1998 By: /s/ Clarence M. McAnnich -------------------------- Name: Clarence M. McAnnich Title: President and Chief Executive Officer - 3 - EXHIBIT INDEX EXHIBIT NO. DOCUMENT ----------- -------- 99.01 Press Release of Universal Stainless & Alloy Products, Inc. dated October 19, 1998. - 4 - EX-99 2 EXHIBIT 99.01 FOR: UNIVERSAL STAINLESS & ALLOY PRODUCTS, INC. APPROVED BY: Clarence "Mac" McAninch President & CEO (412) 257-7600 FOR IMMEDIATE RELEASE CONTACT: Morgen-Walke Associates June Filingeri, Eric Boyriven Media contact: Brian Maddox, Estelle Bieber (212) 850-5600 UNIVERSAL STAINLESS ANNOUNCES THIRD QUARTER RESULTS; SIGNS LETTER OF INTENT TO ACQUIRE AL TECH SPECIALTY STEEL; ANNOUNCES SHARE REPURCHASE PROGRAM BRIDGEVILLE, PA, October 19, 1998 -- Universal Stainless & Alloy Products, Inc. (Nasdaq:USAP) today announced results for the third quarter and nine-month period ending September 30, 1998. The Company also announced that it has signed a letter of intent to acquire the assets of AL Tech Specialty Steel Corporation. Additionally, the Company announced that it is initiating an open market share repurchase program. For the 1998 third quarter, net income was $982,000, or $0.16 per diluted share, compared with $2,053,000, or $0.32 per diluted share in the third quarter of 1997. Net sales for the third quarter of 1998 totaled $15,977,000 compared with $22,081,000 in the year ago period. For the 1998 nine month period, net income was $4,328,000, or $0.68 per diluted share, versus net income of $5,611,000, or $0.88 per diluted share, in the same period last year. Net sales for the nine month period were $59,489,000 versus $61,661,000 a year ago. Mac McAninch, President and Chief Executive Officer of Universal Stainless stated, "We are pleased with the solid results we posted in the third quarter, which were achieved despite difficult market conditions. Pricing and demand in many of the markets for our stainless and tool steel products have been affected by the economic crisis in Asia and the resulting influx of low priced imports into the US. This was somewhat offset by shipments of products from our new bar mill, -MORE- USAP Announces Third Quarter Results; Signs Letter of Intent; Announces Buyback Page 2 which we expect to increase after the completion of our new bar finishing facility this quarter." Mr. McAninch continued, "Although we expect current industry conditions to continue, we have begun to see an increase in orders from the power generation and aerospace markets, and expect demand from our service center customers to slowly improve based on current inventory levels. Despite this difficult environment, we are confident that we will be solidly profitable in the fourth quarter. Based on early indications, we expect earnings per diluted share to be in the range of 10 to 12 cents." Separately, the Company announced that it has signed a letter of intent to acquire the assets of AL Tech Specialty Steel Corporation in a transaction valued at approximately $38 million, of which approximately $24 million is related to the acquisition of accounts receivable and inventory. Funding for the transaction will consist of a note approximating $17 million, assumed liabilities of $8 to $10 million, and cash between $11 and $13 million. AL Tech, headquartered in Dunkirk, New York, is a producer of finished specialty steel products including bar, rod and wire, with sales of $84 million for the twelve months ended September 30, 1998. Universal, a producer of semi-finished and certain finished specialty steels, had net sales of approximately $79 million for the same period. AL Tech filed a voluntary petition for reorganization under Chapter 11 of the Federal Bankruptcy Code on December 31, 1997 related to the earlier bankruptcy filing of its parent, Sammi Steel Co., Ltd. of Korea, under Korean insolvency laws. The potential acquisition of AL Tech is consistent with Universal's strategy to expand upon its product capabilities, maximize the use of its core assets, which include its primary melt shop, electro slag and vacuum arc remelting facilities and universal rolling mill, and increase its manufacture of finished products. Upon completion of the acquisition, Universal's revenues will nearly double, and finish specialty steel products will represent more than 50% of its revenue mix compared with 9% year to date. The addition of AL Tech also will substantially broaden -MORE- USAP Announces third Quarter Results; Signs Letter of Intent; Announces Buyback Page 3 Universal's customer base. The transaction is subject to a number of conditions, including the completion of due diligence procedures, the execution of a definitive purchase agreement, successful negotiation of utility and USWA labor contracts, Hart-Scott-Rodino review, final approval by the Boards of Directors of both Universal Stainless and AL Tech, and the approval of AL Tech's plan of reorganization by the United States Bankruptcy Court for the Western District of New York. Commenting on this development, Mr. McAninch stated, "This transaction, if completed, would be highly complementary to both companies, and represents an important opportunity to strengthen our competitive position in the specialty steel industry. Universal will be able to supply 100% of AL Tech's billet needs. While AL Tech's management team has made many operational improvements during the bankruptcy period, we are confident that the application of Universal's strategy and discipline to AL Tech's operations will enable us to achieve substantial synergies and provide significant opportunity for growth. Specifically, we expect the transaction to be non-dilutive to our 1999 results and accretive beginning in 2000. We intend to be in a position to complete the transaction by December 31, 1998, pending Federal Bankruptcy Court approval." The Company also announced that its has received approval from its Board of Directors to repurchase up to 315,000 shares, or approximately 5% of the Company's common stock. These purchases will be made in open market transactions at market prices. The share repurchase program may be implemented or discontinued at any time by the Company. Mr. McAninch concluded, "The Company remains proactive in response to current market conditions. This operating philosophy, which has enabled us to produce solid operating results since inception, allows us to be highly confident about our future." Universal Stainless & Alloy Products, Inc., headquartered in Bridgeville, Pa., manufactures and markets semi-finished and finished specialty steels, including stainless steel, tool steel and certain other alloyed steels. The Company's products are sold to rerollers, forgers, service centers and original equipment manufacturers, which primarily include the power generation and aerospace industries. -MORE- USAP Announces Third Quarter Results; Signs Letter of Intent; Announces Buyback Page 4 Except for historical information contained herein, the statements in this release are forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties which may cause the Company's actual results in future periods to differ materially from forecasted results. Those risks include, among others, risks associated with the receipt and timing of future customer orders, risks associated with the manufacturing process and production yields, risks related to plant and equipment additions and maintenance, and risks related to the potential acquisition described in this release. Certain of these risks and other risks are described in the Company's filings with Securities and Exchange Commission (SEC) over the last 12 months, copies of which are available from the SEC or may be obtained upon request from the Company. -FINANCIAL TABLES FOLLOW- UNIVERSAL STAINLESS & ALLOY PRODUCTS, INC. FINANCIAL HIGHLIGHTS (Dollars in thousands except per share information) (Unaudited) CONSOLIDATED STATEMENT OF OPERATIONS
For the Three Months Ended For the Nine Months Ended September 30, September 30, ------------- ------------- 1998 1997 1998 1997 ---- ---- ---- ---- Net sales $15,977 $22,081 $59,489 $61,661 Cost of products sold 13,141 17,539 48,940 49,012 Selling and administrative expenses 1,149 1,223 3,625 3,665 ------- ------- ------- ------- Operating income 1,687 3,319 6,924 8,984 Other income (expense) (129) (61) (54) (77) ------- ------- ------- ------- Income before taxes 1,558 3,258 6,870 8,907 Income taxes 576 1,205 2,542 3,296 ------- ------- ------- ------- Net income $ 982 $ 2,053 $ 4,328 $ 5,611 ======= ======= ======= ======= Earnings per share - Basic $ 0.16 $ 0.33 $ 0.69 $ 0.89 ======= ======= ======= ======= Earnings per share - Diluted $ 0.16 $ 0.32 $ 0.68 $ 0.88 ======= ======= ======= ======= Shares outstanding - Basic 6,315,450 6,287,290 6,307,387 6,284,932 ========= ========= ========= ========= Shares outstanding - Diluted 6,315,450 6,479,825 6,375,624 6,386,414 ========= ========= ========= ========= Tons shipped 10,625 14,783 38,854 41,651 ====== ====== ====== ======
BALANCE SHEET DATA
September 30, December 31, 1998 1997 Current assets $30,816 $31,045 Net property, plant & equipment 34,867 24,887 Other assets 262 219 ------- ------- $65,945 $56,151 ======= ======= Current liabilities $ 7,629 $10,959 Long-term debt 12,870 5,441 Other liabilities 3,108 1,983 Stockholders' equity 42,338 37,768 ------- ------- $65,945 $56,151 ======= =======
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