-----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, B7a7OLezBgKVAKu1/rvZvDB0TkhAAw7+AsbArzu/KJx5XOYnRpGOYTvW99Vb/IQU NYFyGGeHiM7UzctwO2N9xg== 0000094328-99-000023.txt : 19991201 0000094328-99-000023.hdr.sgml : 19991201 ACCESSION NUMBER: 0000094328-99-000023 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19991130 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19991130 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: 99766421 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 THIRD 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): November 30, 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 November 30, 1999, Stewart & Stevenson Services, Inc. (the "Company") issued the press release attached hereto as Exhibit 99.1 announcing the Company's Third Quarter 1999 Results. Item 7. Exhibits. Exhibit 99.1 Company Press Release dated November 30, 1999 titled "Stewart & Stevenson Services, Inc. Announces Third 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: November 30, 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 November 30, 1999 titled "Stewart & Stevenson Services, Inc. Announces Third Quarter 1999 Results." - ------------------ EX-99.1 2 Exhibit 99.1 News From: Stewart & Stevenson Corporate Headquarters P.O. Box 1637 Houston, TX 77251-1637 FOR IMMEDIATE RELEASE: STEWART & STEVENSON SERVICES, INC. ANNOUNCES THIRD QUARTER 1999 RESULTS HOUSTON, TX - November 30, 1999 - STEWART & STEVENSON SERVICES, INC. (NASDAQ:SSSS), a leading manufacturer and distributor of industrial and energy related equipment, announced sales for the quarter ended October 30,1999, totaling $234.7 million compared to sales of $ 321.1 million from continuing operations for the same period a year ago. Net earnings for the Third Quarter totaled $7.4 million or $0.26 per share compared to a net loss of $26.9 million and $0.96 per share a year ago. Results for the Third Quarter included a $2.7 million after-tax gain on sale of an investment. Excluding this gain, net income for the quarter totaled $4.6 million or $0.17 per share. The Power Products segment, which is responsible for marketing and after-market support of a wide range of industrial equipment, recorded Third Quarter sales of $130.4 million compared to $150.2 million for the same period in 1998. Operating profit for the Power Products segment totaled $4.9 million for the quarter compared to $6.7 million a year ago. Sales in this segment for the Second Quarter totaled $144.9 million and included seasonally high sales in the agricultural market as well as several large international orders that did not recur in the Third Quarter. This segment is achieving modest volume growth in selected markets but has not yet experienced improvements from the recent rebound in oil and gas prices. The Tactical Vehicle Systems segment, which manufactures tactical vehicles for the U. S. Army and others, recorded sales of $51.6 million in the Third Quarter compared to $5.8 million in the Second Quarter and $121.3 million a year ago. Production on the follow-on contract began in mid-September and generated an operating profit of $10.1 million for the quarter compared with a $17.1 million operating loss in the third quarter of 1998. Improved operating margins resulted from an effective cost reduction program and a higher initial sales price per truck sold to compensate for costs incurred during the production shutdown. The Petroleum Equipment segment manufactures equipment for oil and gas exploration, production, and well stimulation industries. Sales for this segment totaled $12.8 million for the Third Quarter compared to $31.1 million last year. Petroleum Equipment reported a $1.4 million operating loss for the Third Quarter compared with a profit of $2.7 million a year ago. The decrease in sales resulted from a depleted order backlog in the depressed oil and gas markets. However, order activity is starting to improve in the Fourth Quarter. 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 Third Quarter totaled $40.0 million, compared to $18.5 for the same period last year. Most of the $21.5 million increase occurred in airline ground support products, which includes sales of Tug Manufacturing Corporation which was acquired in December 1998. The Third Quarter 1999 operating loss of $1.3 million versus the $0.3 million operating loss a year ago resulted primarily from start up of the gas compression business, partially offset by higher sales and margins associated with the Tug acquisition. Other income, net, for 1998 included interest income earned on the proceeds from the sale of Gas Turbine Operations to General Electric Company which totaled $1.6 million for the Third Quarter and $8.7 million for the first nine months of 1998. Net cash provided by operating activities totaled $47.9 million during the Third Quarter and $92.9 million year to date. Net debt decreased $112.1 million during the past three quarters. "Operating performance for the quarter was again in line with our near term expectations," said Michael Grimes, Chief Executive Officer. He added, "We are encouraged by prospects for future earnings growth driven by the recent start-up of production on the new FMTV, significantly improved cash flow, the recovery in the petroleum sector early next year, growth opportunities in the service businesses, and lower material costs resulting from supply chain initiatives." Contact: Mr. David R. Stewart Treasurer Phone: (713) 868-7657 Fax: (713) 863-1519 Email: d.stewart@ssss.com HTTP://www.ssss.com This press release contains forward-looking statements that are based on current expectations, estimates, and projections about the markets and industries in which the Company operates, management's beliefs, and assumptions made by management. These forward-looking statements are made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions which are difficult to predict, including without limitation: risks associated with newly acquired businesses; price and product/service competition by foreign and domestic competitors; technological developments and changes; the mix of products and services; reliance on large customers; large, multi-year contracts; the cyclical nature of the markets served; the outcome of pending and future litigation and governmental proceedings; the continued availability of financing, financial instruments and financial resources in the amount, at the times and on the terms required to support the Company's business; the assessment of unanticipated taxes by foreign or domestic governmental authorities; cancellation or adjustment of specific orders and termination of significant government programs. In addition, such forward-looking statements could be affected by general market conditions and growth rates, general domestic and international conditions including interest rates, rates of inflation and currency exchange fluctuations and other future factors. Actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements.
STEWART & STEVENSON SERVICES, INC. CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS (LOSS) (In thousands, except per share data) --------------------------------- -------------------------------- Nine Months Ended Three Months Ended --------------------------------- -------------------------------- October 30, October 31, October 30, October 31, 1999 1998 1999 1998 -------------- ---------------- ------------- -------------- (Unaudited) (Unaudited) Sales $624,267 $949,670 $234,716 $321,121 Cost of sales 527,505 875,054 199,095 309,279 -------------- -------------- --------------- -------------- Gross profit 96,762 74,616 35,621 11,842 Selling and administrative expenses 76,431 62,011 26,166 23,316 Interest expense 8,812 8,868 2,102 2,912 Other income, net (3,778) (13,097) (339) (2,867) --------------- -------------- --------------- -------------- 81,465 57,782 27,929 23,361 -------------- -------------- --------------- -------------- Earnings (loss) from continuing operations before income taxes 15,297 16,834 7,692 (11,519) Income tax provision (benefit) 5,673 5,960 2,857 (4,335) -------------- -------------- --------------- -------------- Earnings (loss) of consolidated companies 9,624 10,874 4,835 (7,184) Gain on sale of investment, net of tax provision of $846 2,746 - 2,746 - Equity in net earnings (loss) of unconsolidated affiliates 142 (189) (192) 267 -------------- -------------- --------------- -------------- Net earnings (loss) from continuing operations 12,512 10,685 7,389 (6,917) Net loss from discontinued operations, net of tax benefit of $11,750 - (20,000) - (20,000) -------------- -------------- --------------- -------------- Net earnings (loss) $12,512 $ (9,315) $7,389 $ (26,917) ============== ============== =============== ============== Weighted average shares outstanding: Basic: 27,988 29,351 27,992 27,984 Diluted: 28,036 29,351 28,082 27,984 Earnings (loss) per share: Basic: Continuing operations $0.45 $0.36 $0.26 $(0.25) Discontinued operations - (0.68) - (0.71) -------------- -------------- --------------- -------------- $0.45 $(0.32) $0.26 $(0.96) Diluted: Continuing operations $0.45 $0.36 $0.26 $(0.25) Discontinued operations - (0.68) - (0.71) -------------- -------------- --------------- -------------- $0.45 $(0.32) $0.26 $(0.96) Cash dividends per share $0.255 $0.255 $0.085 $0.085 ============== ============== =============== ==============
STEWART & STEVENSON SERVICES, INC. SEGMENT INFORMATION (Unaudited) (In thousands) -------------------------------------- ------------------------------------- Nine Months Ended Three Months Ended -------------------------------------- ------------------------------------- October 30, October 31, October 30, October 31, 1999 1998 1999 1998 ----------------- ----------------- ----------------- ---------------- Sales Power Products $396,578 $424,005 $130,381 $150,177 Tactical Vehicle Systems 63,588 385,160 51,555 121,312 Petroleum Equipment 64,899 82,260 12,787 31,138 Other Business Activities 99,202 58,245 39,993 18,494 ----------------- ----------------- ----------------- ---------------- Total $624,267 $949,670 $234,716 $321,121 ================= ================= ================= ================ Operating Profit (Loss) Power Products $ 15,660 $ 26,799 $4,869 $ 6,726 Tactical Vehicle Systems 13,248 (11,363) 10,105 (17,140) Petroleum Equipment 2,222 7,135 (1,427) 2,650 Other Business Activities (1,623) 1,178 (1,262) (266) ----------------- ----------------- ----------------- ---------------- Total $ 29,507 $ 23,749 $ 12,285 $(8,030) ================= ================= ================= ================ Corporate expense, net (5,427) (6,736) (2,491) (2,201) Non-operating interest income 29 8,689 - 1,624 Interest expense (8,812) (8,868) (2,102) (2,912) ----------------- ----------------- ----------------- ---------------- (Loss) earnings from continuing operations before income taxes $ 15,297 $ 16,834 $ 7,692 $(11,519) ================= ================= ================= ================
STEWART & STEVENSON SERVICES, INC. CONSOLIDATED CONDENSED STATEMENTS OF FINANCIAL POSITION (In thousands) -------------------------- ------------------------ October 30, 1999 January 31, 1999 -------------------------- ------------------------ (Unaudited) ASSETS CURRENT ASSETS Cash and cash equivalents $19,935 $12,959 Accounts and notes receivable, net 198,041 164,547 Recoverable costs and accrued profits not yet billed 8,408 99,097 Income tax receivable 32,587 48,596 Inventories: Power Products 156,402 182,894 Petroleum Equipment 25,277 40,560 Other Business Activities 58,727 40,222 Excess of current cost over LIFO values (49,104) (48,474) ------------ ------------ 191,302 215,202 ------------ ------------ TOTAL CURRENT ASSETS 450,273 540,401 PROPERTY, PLANT AND EQUIPMENT 279,314 271,658 Allowances for depreciation and amortization (155,828) (142,913) ------------ ------------ 123,486 128,745 DEFERRED INCOME TAX ASSETS 8,144 7,904 INVESTMENTS AND OTHER ASSETS 36,619 28,727 ------------ ------------ $618,522 $705,777 ============ ============ LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Notes payable $14,961 $17,468 Accounts payable 72,744 83,127 Accrued payrolls and incentives 12,058 17,123 Current income taxes 2,920 2,931 Current portion of long-term debt 8,920 69,488 Other current liabilities 86,145 95,349 ------------ ------------ TOTAL CURRENT LIABILITIES 197,748 285,486 ------------ ------------ COMMITMENTS AND CONTINGENCIES LONG-TERM DEBT 78,436 83,530 DEFERRED INCOME TAX LIABILITIES 58 43 ACCRUED POSTRETIREMENT BENEFITS 13,794 13,019 DEFERRED COMPENSATION 2,846 3,336 SHAREHOLDERS' EQUITY Common Stock, without par value, 100,000,000 shares authorized; 27,992,203 and 27,984,035 shares issued, respectively 47,722 47,819 Retained earnings 277,918 272,544 ------------ ------------ TOTAL SHAREHOLDERS' EQUITY 325,640 320,363 ------------ ============ $618,522 $705,777 ============ ============
STEWART & STEVENSON SERVICES, INC. CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (In thousands) ----------------------------- --------------------------- Nine Months Ended Three Months Ended ----------------------------- --------------------------- October 30, October 31, October 30, October 31, 1999 1998 1999 1998 ------------ ------------- ------------ ------------ (Unaudited) (Unaudited) Operating Activities Net earnings (loss) from continuing operations $12,512 $ 10,685 $ 7,389 $(6,917) Adjustments to reconcile net earnings to net cash provided by (used in) operating activities: Accrued postretirement benefits 775 - 59 190 Depreciation and amortization 15,895 14,046 5,069 4,083 Deferred income taxes, net (225) (2,899) (54) - Loss on sale of business - 243 - 243 Change in operating assets and liabilities, net of the effect of acquisition: Accounts and notes receivable, net (33,494) (14,095) (12,946) (56,442) Recoverable costs and accrued profits not yet billed 90,689 (40,146) 26,439 (33,433) Inventories 23,900 (24,252) 14,189 (9,819) Accounts payable (15,448) 41 14,009 14,419 Current income taxes, net 15,998 (61,301) 2,066 (30,562) Other current liabilities (9,204) (20,969) (5,674) 3,792 Other--principally long-term assets and liabilities 2,546 (2,628) (1,990) (8,479) (8,478) ------------ ------------- ------------ ------------ Net Cash Provided By (Used In) Continuing Operations 92,919 (136,101) 47,918 (116,436) Operations (136,101) Net Cash Provided By (Used In) Discontinued Operations - 516,000 - (84,000) ------------ ------------- ------------ ------------ Net Cash Provided By (Used in) Operating Activities 92,919 379,899 47,918 (200,436) Investing Activities Expenditures for property, plant and equipment (24,690) (23,612) (8,005) (7,979) Acquisition of businesses - (19,951) - (1,201) Proceeds from sale of business - 4,600 - 4,600 Disposal of property, plant and equipment, net 14,054 1,931 6,101 1,266 ------------ ------------- ------------ ------------ Net Cash Used In Investing Activities (10,636) (37,032) (1,904) (3,314) Financing Activities Additions to long-term borrowings 16,234 25,000 - 25,000 Payments on long-term borrowings (81,896) (226,459) (15,295) (335) Net short-term (payments) borrowings (2,507) (28,037) (10,585) 6,141 Dividends paid (7,138) (7,380) (2,380) (2,379) Repurchase of common stock - (120,000) - - Exercise of stock options - 759 - 170 ------------ ------------- ------------ ------------ Net Cash (Used In) Provided By Financing Activities (75,307) (356,117) (28,260) 28,597 Increase (decrease) in cash and cash equivalents 6,976 (13,250) 17,754 (175,153) Cash and cash equivalents, beginning of period 12,959 18,987 2,181 180,890 ------------ ------------- ------------ ------------ Cash and cash equivalents, end of period $19,935 $ 5,737 $19,935 $ 5,737 ------------ ------------- ------------ ------------ Supplemental disclosure of cash flow information: Net cash paid during the period for: Interest payments $ 7,775 $ 7,308 $ 613 $ 2,386 Income tax payments $ 2,609 $75,483 $ 1,876 $30,606 Non-cash investing activities: Issuance of notes receivable in sale of investment $ 4,224 $ 4,224
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