-----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, Iwv/vYYXJ2SAVi6PIR2wSlXWyZymcuDtpURs/iLh1qCEBrDIc/t8db0Ewk7+oGQ8 y9LcxPvNJOWgkxjtwfALjw== 0000094328-99-000015.txt : 19990824 0000094328-99-000015.hdr.sgml : 19990824 ACCESSION NUMBER: 0000094328-99-000015 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990823 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19990823 FILER: COMPANY DATA: COMPANY CONFORMED NAME: STEWART & STEVENSON SERVICES INC CENTRAL INDEX KEY: 0000094328 STANDARD INDUSTRIAL CLASSIFICATION: ENGINES & TURBINES [3510] IRS NUMBER: 741051605 STATE OF INCORPORATION: TX FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-11443 FILM NUMBER: 99697844 BUSINESS ADDRESS: STREET 1: 2707 N LOOP W CITY: HOUSTON STATE: TX ZIP: 77008 BUSINESS PHONE: 7138687700 MAIL ADDRESS: STREET 1: P O BOX 1637 CITY: HOUSTON STATE: TX ZIP: 77251-1637 8-K 1 SECOND QUARTER 1999 RESULTS 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): AUGUST 23, 1999 STEWART & STEVENSON SERVICES, INC. (Exact name of registrant as specified in its charter) TEXAS 0-8493 74-1051605 (State or other jurisdiction (Commission File Number) (I.R.S. Employer of incorporation) Identification No.) 2707 NORTH LOOP WEST HOUSTON, TEXAS 77008 (Address of principal executive offices) (Zip code) Registrant's telephone number, including area code: (713) 868-7700 Item 5. Other Events. On August 23, 1999, Stewart & Stevenson Services, Inc. (the "Company") issued the press release attached hereto as Exhibit 99.1 announcing the Company's second quarter results. Item 7. Exhibits. Exhibit 99.1 Company Press Release dated August 23, 1999 titled "Stewart & Stevenson Services, Inc. Announces Second Quarter 1999 Results." 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 hereunto duly authorized. STEWART & STEVENSON SERVICES, INC. Date: August 23, 1999 By:/s/ LAWRENCE E. WILSON Name: Lawrence E. Wilson Title: Vice President, Secretary and General Counsel EXHIBIT INDEX 99.1 Company Press Release dated August 23, 1999 titled "Stewart & Stevenson Services, Inc. Announces Second Quarter 1999 Results." - ------------------ EX-99.1 2 NEWS FROM: STEWART & STEVENSON CORPORATE HEADQUARTERS P.O. BOX 1637 HOUSTON, TX 77251-1637 FOR IMMEDIATE RELEASE: STEWART & STEVENSON SERVICES, INC. ANNOUNCES SECOND QUARTER 1999 RESULTS HOUSTON, TX August 23, 1999 - STEWART & STEVENSON SERVICES, INC. (NASDAQ:SSSS), a leading manufacturer and distributor of industrial and energy related equipment, announced sales for the fiscal quarter ended July 31, 1999, totaling $200.6 million compared to sales of $188.9 million in the First Quarter and $323.5 million for the same period a year ago. Net earnings for the Second Quarter totaled $3.0 million or $0.11 per share compared to net earnings of $2.1 million or $0.08 per share in the First Quarter and $8.4 million or $0.30 per share a year ago. The Power Products segment, which is responsible for marketing and aftermarket support of a wide range of industrial equipment recorded Second Quarter sales of $144.9 million compared to $121.3 million in the First Quarter and $137.7 million for the Second Quarter of 1998. Operating profit for the Power Products segment totaled $7.7 million for the quarter compared to $3.1 million in the First Quarter and $10.2 million a year ago. The depressed petroleum market continues to have an adverse impact on equipment, parts and services sales in selected geographic markets. The Power Products segment experienced improved earnings at four West Coast branches and from the acquisition of IPSC Co., as well as benefits from remedial actions taken earlier this year at other locations. The Petroleum Equipment segment manufactures equipment for oil and gas exploration, production, and well stimulation industries. Sales for this segment totaled $23.6 million for the Second Quarter compared to $28.5 million in the First Quarter and $27.5 million last year. Operating profit for Petroleum Equipment totaled $1.7 million compared to $2.0 million in the First Quarter and $2.4 million last year. The decrease in profits resulted from increased sales of lower margin marine riser products, offset by a decrease in higher-margin equipment sales, which remained depressed particularly in the U.S. Market. The Tactical Vehicle Systems segment, which manufactures tactical vehicles for the U.S. Army and others, recorded sales of $5.8 million compared to $6.2 million in the First Quarter and $139.2 million a year ago. Production on the original contract was completed as of January 31, 1999, and production on the follow-on contract is anticipated to start in the third quarter of Fiscal 1999. Operating profit for the Second Quarter of 1999 amounted to $2.0 million, compared to $1.1 million in the First Quarter and $3.1 million a year ago, and was largely comprised of adjustments to estimated costs to complete the original truck contract. Other business activities not identified in a specific segment include airline ground support products, and gas compression equipment for sale or lease. Sales in the Second Quarter totaled $26.3 million, compared to $19.2 for the same period last year. Most of the $7.1 million increase occurred in airline ground support equipment, associated with the acquisition of Tug Manufacturing Corporation (Tug) in December 1998. A Second Quarter 1999 operating loss of $1.2 million versus $0.1 million loss a year ago resulted primarily from product development expenses related to airline ground support equipment and start up of the gas compression business, partially offset by higher sales and margins associated with the Tug acquisition. Other income, net, included interest income earned in 1998 on proceeds from the sale of Gas Turbine Operations to General Electric Company which totaled $2.8 million for the Second Quarter and $7.0 million for the first six months. Net cash provided by operating activities for the Second Quarter totaled $73.4 million, largely resulting from a comprehensive asset reduction initiative. Total debt decreased $67.9 million during the quarter. "Operating performance for the quarter was again in line with our near term expectations," said Michael L. Grimes, Chief Executive Officer. He added, "We are encouraged by prospects for future earnings growth, driven by the anticipated startup of production on the new FMTV contract in September, the recovery in the petroleum sector early next year, growth opportunities in the services businesses, and asset and cost reduction initiatives." This report contains forward-looking information. The forward-looking statements, including without limitation statements relating to the Company's performance and industry conditions for the year, are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may be significantly impacted by various factors described herein and in the Company's Annual Report and Form 10-K filed with the Securities and Exchange Commission of the year ended January 31, 1999. There can be no assurance that anticipated developments will occur. Contact: Mr. David R. Stewart Treasurer Phone: (713) 868-7657 Fax: (713) 863-1519 Email: d.stewart@ssss.com HTTP://www.ssss.com ============================================================================
STEWART & STEVENSON SERVICES, INC. CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS (In thousands, except per share data) ---------------------------- ---------------------------- SIX MONTHS ENDED THREE MONTHS ENDED JULY 31, JULY 31, ---------------------------- ---------------------------- 1999 1998 1999 1998 (UNAUDITED) (UNAUDITED) Sales $389,551 $628,549 $200,640 $323,539 Cost of sales 328,410 565,775 169,360 291,799 --------- --------- -------- -------- Gross profit 61,141 62,774 31,280 31,740 Selling and administrative expenses 50,265 38,695 24,774 19,964 Interest expense 6,710 5,956 3,259 2,806 Other income, net (3,439) (10,230) (1,244) (4,208) -------- -------- ------- -------- 53,536 34,421 26,789 18,562 --------- ---------- ------- -------- Earnings before income taxes 7,605 28,353 4,491 13,178 Income tax provision 2,816 10,295 1,663 4,814 ---------- ---------- ------- -------- Earnings of consolidated companies 4,789 18,058 2,828 8,364 Equity in net earnings (loss) of unconsolidated affiliates 334 (456) 175 73 ---------- ---------- ------- -------- Net earnings $5,123 $ 17,602 $3,003 $8,437 ========== ========= ======= ======== Weighted average shares outstanding: Basic 27,986 30,046 27,989 28,178 Diluted 28,010 30,137 28,086 28,178 Earnings per share: Basic $.18 $.59 $.11 $.30 Diluted .18 .59 .11 .30 Cash dividends per share $.17 $.17 $.085 $.085 ========== ========== ========== =========
STEWART & STEVENSON SERVICES, INC. CONSOLIDATED CONDENSED STATEMENTS OF FINANCIAL POSITION (In thousands) JULY 31, 1999 MAY 1, 1999 JANUARY 31, 1999 ------------- ----------- ---------------- (UNAUDITED) (UNAUDITED) ASSETS CURRENT ASSETS Cash and equivalents $ 2,181 $ 1,652 $ 12,959 Accounts and notes receivable, net 185,095 178,029 164,547 Recoverable costs and accrued profits not yet billed 34,847 69,088 99,097 Income tax receivable 34,664 48,002 48,596 Inventories: Power Products 175,047 189,119 182,894 Petroleum Equipment 25,547 35,586 40,560 Other Business Activities 53,615 45,881 40,222 Excess of current cost over LIFO values (48,718) (48,570) (48,474) ------- ------- ------- 205,491 222,016 215,202 ------- ------- ------- TOTAL CURRENT ASSETS 462,278 518,787 540,401 PROPERTY, PLANT AND EQUIPMENT 277,687 275,950 271,658 Allowances for depreciation and amortization (151,036) (146,792) (142,913) -------- -------- -------- 126,651 129,158 128,745 DEFERRED INCOME TAX ASSETS 8,098 7,949 7,904 INVESTMENTS AND OTHER ASSETS 33,927 29,518 28,727 ------ ------ ------ $630,954 $685,412 $705,777 ======== ======== ======== LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Notes payable $25,546 $27,192 $17,468 Accounts payable 56,975 45,718 83,127 Accrued payrolls and incentives 13,818 9,279 17,123 Current income taxes 2,931 3,331 2,931 Current portion of long-term debt 23,902 70,220 69,488 Other current liabilities 91,819 94,520 95,349 ------ ------ ------ TOTAL CURRENT LIABILITIES 214,991 250,260 285,486 ------- ------- ------- COMMITMENTS AND CONTINGENCIES LONG-TERM DEBT 78,749 98,699 83,530 DEFERRED INCOME TAXES 66 51 43 ACCRUED POSTRETIREMENT BENEFITS 13,735 13,528 13,019 DEFERRED COMPENSATION 2,782 2,866 3,336 SHAREHOLDERS' EQUITY Common Stock, without par value, 100,000,000 shares authorized; 27,992,203 and 27,984,035 shares issued at July 31, 1999 and January 31, 1999, respectively 47,722 47,723 47,819 Retained earnings 272,909 272,285 272,544 ------- ------- ------- TOTAL SHAREHOLDERS' EQUITY 320,631 320,008 320,363 ------- ------- ------- $630,954 $685,412 $705,777 ======== ======== ========
STEWART & STEVENSON SERVICES, INC. CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (In thousands) ----------------------------- ----------------------------- SIX MONTHS ENDED THREE MONTHS ENDED JULY 31, JULY 31, ----------------------------- ----------------------------- 1999 1998 1999 1998 OPERATING ACTIVITIES Net earnings $ 5,123 $ 17,602 $ 3,003 $8,437 Adjustments to reconcile net earnings to net cash provided by (used in) operating activities: Accrued postretirement benefits 716 (190) 207 (195) Depreciation and amortization 10,826 9,963 5,623 5,770 Deferred income taxes, net (171) (2,899) (134) - Change in operating assets and liabilities net of the effect of acquisition: Accounts and notes receivable, net (20,548) 42,347 (7,066) 55,814 Recoverable costs and accrued profits not yet billed 64,250 (6,713) 34,241 (10,546) Inventories 9,711 (14,433) 16,525 (16,156) Accounts payable (29,457) (14,378) 15,796 1,570 Current income taxes 13,932 (30,739) 12,938 (39,632) Other current liabilities (3,530) (24,761) (2,701) (23,854) Other--principally long-term assets and liabilities (5,851) 4,536 (5,032) 6,535 ------ ----- ------ ----- NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES 45,001 (19,665) 73,400 (12,257) INVESTING ACTIVITIES Collection of receivable from sale of Gas Turbine Operations - 600,000 - Expenditures for property, plant and equipment (16,685) (15,633) (8,864) (7,526) Acquisition of businesses - (18,750) - (9,300) Disposal of property, plant and equipment, net 7,953 665 6,286 259 ----- --- ----- --- NET CASH (USED IN) PROVIDED BY INVESTING ACTIVITIES (8,732) 566,282 (2,578) (16,567) FINANCING ACTIVITIES Additions to long-term borrowings 16,234 - - - Payments on long-term borrowings (66,601) (226,124) (66,268) (607) Net short-term borrowings (payments) 8,078 (34,178) (1,646) 329 Dividends paid (4,758) (5,001) (2,379) (2,318) Repurchase of common stock - (120,000) - (62,940) Exercise of stock options - 589 - (26) ------- -------- ------- -------- NET CASH USED IN FINANCING ACTIVITIES (47,047) (384,714) (70,293) (65,562) -------- -------- ------- -------- (Decrease) increase in cash and equivalents (10,778) 161,903 529 (94,386) Cash and cash equivalents, beginning of period 12,959 18,987 1,652 275,276 ------- ------- ------ -------- Cash and cash equivalents, end of period $ 2,181 180,890 $ 2,181 $ 180,890 ======= ======= ======= ========= SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: Net cash paid during the period for: Interest payments $ 7,162 $ 4,922 $6,176 $ 4,664 Income tax payments 733 $44,877 314 44,789
STEWART & STEVENSON SERVICES, INC. SEGMENT INFORMATION (In thousands) SIX MONTHS ENDED JULY 31, THREE MONTHS ENDED JULY 31, ------------------------------ -- ------------------------------- 1999 1998 1999 1998 ------------- -- ------------- -- -------------- - -------------- SALES Power Products $266,197 $273,829 $144,909 $137,661 Tactical Vehicle Systems 12,033 263,848 5,818 139,188 Petroleum Equipment 52,112 51,122 23,648 27,530 Other Business Activities 59,209 39,750 26,265 19,160 ============= ============= ============== ============== Total $389,551 $628,549 $200,640 $323,539 ============= ============= ============== ============== OPERATING PROFIT Power Products $ 10,791 $ 20,073 $7,701 10,168 Tactical Vehicle Systems 3,143 5,777 2,037 3,058 Petroleum Equipment 3,649 4,485 1,691 2,382 Other Business Activities (361) 1,444 (1,197) (52) ============= ============= ============== ============== Total $17,222 $ 31,779 $ 10,232 $ 15,556 ============= ============= ============== ============== Corporate expense, net (2,936) (4,535) (2,484) (2,414) Non-operating interest income 29 7,065 2 2,842 Interest expense (6,710) (5,956) (3,259) (2,806) ============= ============= ============== ============== Earnings before income taxes $ 7,605 $28,353 $ 4,491 $13,178 ============= ============= ============== ==============
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