-----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, Nx7BPYzbZgdOiWCT0IiRuyznF40/V5PHqwirCIO/MWkZJlP0wcjJ5S+FI2pXDo0R 56jopkp3xkF1SkwuIpPScw== 0000912057-01-007114.txt : 20010307 0000912057-01-007114.hdr.sgml : 20010307 ACCESSION NUMBER: 0000912057-01-007114 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20010301 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 20010302 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PW EAGLE INC CENTRAL INDEX KEY: 0000852426 STANDARD INDUSTRIAL CLASSIFICATION: MISCELLANEOUS PLASTIC PRODUCTS [3080] IRS NUMBER: 411642846 STATE OF INCORPORATION: MN FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 000-18050 FILM NUMBER: 1559947 BUSINESS ADDRESS: STREET 1: 2430 METROPOLITAN CENTRE STREET 2: 333 S SEVENTH ST CITY: MINNEAPOLIS STATE: MN ZIP: 55402 BUSINESS PHONE: 6123719650 MAIL ADDRESS: STREET 1: 2430 METROPOLITAN CENTRE STREET 2: 333 S SEVENTH STREET CITY: MINNEAPOLIS STATE: MN ZIP: 55402 FORMER COMPANY: FORMER CONFORMED NAME: EAGLE PACIFIC INDUSTRIES INC/MN DATE OF NAME CHANGE: 19950726 FORMER COMPANY: FORMER CONFORMED NAME: BLACK HAWK HOLDINGS INC /MN/ DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: BHH INC DATE OF NAME CHANGE: 19891019 8-K 1 a2040495z8-k.txt 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): March 1, 2001 PW EAGLE, INC. (Exact Name of Registrant as Specified in Its Charter) MINNESOTA (State or Other Jurisdiction of Incorporation) 0-18050 41-1642846 (Commission File Number) (I.R.S. Employer Identification Number) 222 SOUTH NINTH STREET, SUITE 2880, MINNEAPOLIS, MN 55402 (Address of Principal Executive Offices) (Zip Code) (612) 305-0339 (Registrant's Telephone Number, Including Area Code) Not Applicable (Former Name or Former Address, if Changed Since Last Report) Item 5. Other Events. On March 1, 2001, the Company issued a press release announcing: (i) its financial results for the three months and year ended December 31, 2000; and (ii) its long-term strategy and outlook. The Company also issued a press release announcing its intention to commence a Dutch Auction tender offer of its common stock. A copy of the press releases are attached as Exhibit 99.1 and 99.2 of this Current Report on Form 8-K. Item 7. Financial Statements and Exhibits. (c) Exhibits: 99.1 Press Release dated March 1, 2001. 99.2 Press Release dated March 1, 2001. 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. PW EAGLE, INC. Date: March 2, 2001 By /S/ William H. Spell ------------------------------------ William H. Spell, Chief Executive Officer 2 EXHIBIT INDEX to March 1, 2001 Form 8-K PW Eagle, Inc. Exhibit Number Exhibit Description 99.1 Press Release dated March 1, 2001. 99.2 Press Release dated March 1, 2001 3 EX-99.1 2 a2040495zex-99_1.txt EXHIBIT 99.1 Exhibit 99.1 FOR: PW Eagle, Inc. FOR IMMEDIATE RELEASE 222 South Ninth Street, Suite 2880 Minneapolis, MN 55402 (Nasdaq-NMS: "PWEI") CONTACT: WILLIAM H. SPELL Chief Executive Officer, PW Eagle, Inc. 612/305-0339 PW EAGLE REPORTS 4Q AND 2000 EARNINGS MINNEAPOLIS -- MARCH 1, 2001 -- PW Eagle, Inc. (Nasdaq-NMS: "PWEI", formerly "EPII") today reported its financial results for the three months and year ended December 31, 2000. PW Eagle also reported pro forma financial information associated with its previously announced acquisition of Pacific Extruded Plastics Company (PWPipe) to provide insight into what the operating results might have been if the two businesses had been combined in prior periods. A summary of the unaudited results for the fourth quarter and for the year ending December 31, 2000 and 1999 is set forth in the following table: Income Statement Information (In thousands, except for per share amounts)
Three months ended Year ended December 31, December 31, (UNAUDITED) ------------------------------ ----------------------------- 2000 1999 2000 1999 -------------- --------------- -------------- -------------- NET SALES $59,009 $73,754 $343,974 $153,950 GROSS PROFIT $209 $22,868 $87,358 $43,465 NET INCOME (LOSS) $(7,492) $6,304 $19,432 $14,562 BASIC EARNINGS (LOSS) PER SHARE $(.95) $.87 $2.50 $1.88 DILUTED EARNINGS (LOSS) PER SHARE $(.95) $.63 $1.83 $1.48 EBITDA $(6,510) $13,100 $53,827 $21,525
Included in the reported net income (loss) for the three months and year ended December 31, 2000 is an inventory writedown with a net after tax impact of $2.9 million, or approximately $.28 per share diluted earnings (loss) for the respective periods. THE PRO FORMA FINANCIAL INFORMATION SUMMARIZED BELOW ASSUMES THAT THE ACQUISITION OF PWPIPE TOOK PLACE ON JANUARY 1, 1998, CONSISTENT WITH PRO FORMA INFORMATION INCLUDED IN THE NOTES TO THE COMPANY'S 1999 AUDITED FINANCIAL STATEMENTS INCLUDED IN ITS FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 1999 AND FILED IN MARCH 2000 AND INCLUDES CERTAIN ADJUSTMENTS TO REFLECT WHAT THE COMPANY WILL EXPERIENCE ON AN ONGOING BASIS. A SUMMARY 4 OF THE PRO FORMA FINANCIAL INFORMATION FOR THE YEAR ENDING DECEMBER 31, 1999 IS SET FORTH IN THE FOLLOWING TABLE: Pro Forma Income Statement Information (In thousands, except for per share amounts)
Year ended December 31, ------------------------------ 2000 1999 Actual Pro Forma ------------- ---------------- NET SALES $343,974 $303,249 GROSS PROFIT $87,358 $89,753 NET INCOME $19,432 $17,756 BASIC EARNINGS PER SHARE $2.50 $2.43 DILUTED EARNINGS PER SHARE $1.83 $1.82 EBITDA $53,827 $49,059
INCLUDED IN THE HISTORICAL AND UNAUDITED PRO FORMA FINANCIAL INFORMATION FOR THE YEAR ENDING DECEMBER 31, 1999 ARE CERTAIN NONRECURRING CHARGES. THESE NONRECURRING ITEMS REDUCE HISTORICAL AND PRO FORMA NET INCOME FOR THE YEAR ENDING DECEMBER 31, 1999 BY $2.2 MILLION. ABSENT THESE NONRECURRING CHARGES, PRO FORMA BASIC AND DILUTED EARNINGS PER SHARE WOULD BE APPROXIMATELY $2.74 AND $2.05, FOR THE YEAR ENDING DECEMBER 31, 1999. William H. Spell, CEO, stated: "We reported record sales, earnings and cash flow for the year. Consequently, the Company's overall financial condition was significantly enhanced in 2000, when compared to 1999 as evidenced by the stockholders' equity increasing nearly 100%, from $22.1 million to $43.2 million and the debt being reduced from $105.3 million to $82.4 million. These results demonstrate the success of the strategy that we implemented several years ago to grow the company both internally and through acquisitions. Unfortunately, the softening of demand for our products and the decreasing prices of PVC resin and PVC pipe that we reported at the end of the third quarter continued throughout the fourth quarter as the economy continued to slow. As a result, we reported very disappointing results for the fourth quarter." "We expect that the adverse industry conditions will continue through the first quarter, although we have experienced some increase in demand in January and February from December levels. With the recent reductions in interest rates, we are hopeful that the economy and our industry will stabilize and begin to grow again as the year progresses. We do not expect to see any real improvement in our financial performance until the second quarter, and it is highly unlikely that we will report sales and earnings for the first and second quarters of this year comparable with the first and second quarters of last year." LONG-TERM STRATEGY PW Eagle also issued a statement about its long-term strategy for enhancing shareholder value. PW Eagle has had a long-term strategy to grow both through internal growth and acquisition. 5 Over the years, this strategy has resulted in the construction of an additional manufacturing plant in Hastings, Nebraska and a new manufacturing plant in Salt Lake City and the development of a distribution center in Baker City, Oregon. Corporate acquisitions have included the acquisition of Pacific & Arrow Plastics and PWPipe and the acquisition of a manufacturing facility in Phoenix. As a result, PW Eagle is now the largest extruder of PVC pipe in the western part of the United States. The Board has constantly considered, explored and evaluated a broad range of strategic alternatives to maximize shareholder value. During the second quarter of 2000, the Board retained an investment banker and together with its advisors commenced an extensive process to review its strategic alternatives to maximize shareholder value. During this process, the economy in general and the PVC pipe industry specifically experienced a sudden and significant downturn. These external events reduced the scope of alternatives available to PW Eagle. The process did, however, lead to a modification of PW Eagle's long-term strategy. The Company has a very strong franchise in the western part of the United States, an experienced and dedicated group of employees, an excellent management team and a strong balance sheet. The Board has modified PW Eagle's long-term strategy to focus its efforts on capitalizing on the opportunities presented by these strengths. This focus will include continuing to seek out and take advantage of the synergies from the combination of the various businesses that have been acquired and to become an even more efficient producer while remaining focused on providing the highest level of customer service. PW Eagle will also focus on generating cash flow, reducing its debt and further strengthening its balance sheet. The Company expects that these efforts will result in a stronger and more profitable company. While PW Eagle has made these modifications to its long-term strategy, the Board will continue to explore and evaluate a broad range of strategic alternatives to enhance and maximize shareholder value. However, the Board and Management realize that the lifeblood of PW Eagle is its customers and employees, and regardless of any future strategic developments that the Company may pursue, it will not jeopardize these constituents. OUTLOOK For the first quarter of 2001, we currently anticipate net sales of between $60 and $66 million with a net loss of between $1.0 and $2.0 million or a net loss per share of between $.13 and $.25 and EBITDA of between $2.3 and $3.8 million. By comparison, for the first quarter of 2000, we reported net sales of $92,599,000 with net income of $9,166,000 or $.87 per share diluted earnings and EBITDA of $20,477,000. We remain optimistic that the economy will improve later in 2001. Consequently, for the year 2001, we currently anticipate net sales of between $320 and $340 million with net income of between $8.5 and $12.5 million or $.75 to $1.10 per share diluted earnings and EBITDA of between $35 and $40 million. These earnings forecasts exclude any impact that the proposed "Dutch Auction" tender offer announced earlier would have on the earnings of the Company. By comparison, for the year 2000, we reported net sales of $343,974,000 with net income of $19,432,000 or $1.83 per share diluted earnings and EBITDA of $53,827,000. To illustrate the potential impact of the "Dutch Auction" tender, if the Company were to purchase $10,000,000 of the Company's common stock at $8.75 per share in the "Dutch 6 Auction" tender offer, the net income for the year 2001 would be reduced by approximately $400,000, but the per share diluted earnings would increase by approximately $.03. INFORMATION IN THIS OUTLOOK SECTION AND OTHER STATEMENTS IN THIS PRESS RELEASE ARE FORWARD LOOKING INFORMATION - ACTUAL RESULTS MAY DIFFER The Company's statements under the caption "OUTLOOK," those that are not strictly historical and other statements in this press release including those made by William H. Spell regarding the Company beliefs and expectations that (i) the adverse industry conditions will continue through the first quarter; (ii) the economy and pipe industry will stabilize and begin to grow again as the year progresses; (iii) the Company will not see any real improvement in financial performance until the second quarter; and (iv) the Company's plan to focus on generating cash, reducing its debt and strengthening its balance sheet will result in a stronger and more profitable company are forward looking statements made under the safe harbor provisions of the Private Securities Litigation Reform Act. These statements involve known and unknown risks and uncertainties that may cause the actual results to differ materially from those expected and forecasted in this "Outlook" section and press release. Actual results could differ as a result of: (i) a further slowdown of economic growth in the United States; (ii) an increase in interest rates or the failure of the Federal Reserve to lower interest rates further; (iii) a decline in resin and pipe prices and a decline in the demand for plastic pipe; (iv) a decline in the construction of commercial and residential building; and (v) other risks described from time to time in our periodic reports and press releases. FOURTH QUARTER CONFERENCE CALL PW Eagle will hold its fourth quarter conference call on March 2, 2001 at 1:30 PM (Central Time) to discuss the fourth quarter and year results, as well as its strategy for enhancing shareholder value. The conference call will be available live on the Internet at www.pweagleinc.com. The call will also be available for one week following its original webcast. PW Eagle, Inc. is a leading extruder of PVC pipe and polyethylene tubing products. The Company operates ten manufacturing facilities in the midwestern and western United States. PW Eagle's common stock is traded on the Nasdaq National Market under the symbol "PWEI". - FINANCIALS FOLLOW - 7 PW EAGLE, INC. CONDENSED STATEMENTS OF OPERATIONS (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
THREE MONTHS ENDED DEC. 31, TWELVE MONTHS ENDED DEC. 31, 2000 1999 2000 1999 =================================================================== NET SALES $59,009 $73,754 $343,974 $153,950 COST OF GOODS SOLD 58,800 50,886 256,616 110,485 ------------------------------------------------------------------- Gross profit 209 22,868 87,358 43,465 OPERATING EXPENSES: Selling expenses 5,905 7,529 28,168 16,855 General and administrative expenses 2,960 3,395 13,290 5,979 Nonrecurring items (30) 800 (195) 1,963 ------------------------------------------------------------------- 8,835 11,724 41,263 24,797 ------------------------------------------------------------------- OPERATING INCOME (LOSS) (8,626) 11,144 46,095 18,668 OTHER EXPENSES (INCOME): Interest expense 3,022 3,293 13,655 5,125 Other income, net (2) (19) (249) (226) Nonrecurring items 180 - 880 1,825 ------------------------------------------------------------------- 3,200 3,274 14,286 6,724 ------------------------------------------------------------------- INCOME (LOSS) BEFORE INCOME TAXES (11,826) 7,870 31,809 11,944 INCOME TAX EXPENSE (BENEFIT) (4,334) 1,566 12,377 (2,618) ------------------------------------------------------------------- NET INCOME (LOSS) (7,492) 6,304 19,432 14,562 PREFERRED STOCK DIVIDEND AND LOSS ON REDEMPTION - - - 1,401 ------------------------------------------------------------------- NET INCOME (LOSS) APPLICABLE TO COMMON $(7,492) $6,304 $19,432 $13,161 STOCK =================================================================== NET INCOME (LOSS) PER COMMON SHARE: Basic $(.95) $.87 $2.50 $1.88 =================================================================== Diluted $(.95) $.63 $1.83 $1.48 =================================================================== WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING: Basic 7,883 7,280 7,778 6,998 Diluted 10,575 10,001 10,592 9,812
8 PW EAGLE, INC. CONDENSED BALANCE SHEETS (IN THOUSANDS, EXCEPT FOR SHARES AND PER SHARE AMOUNTS)
ASSETS DEC. 31, 2000 DEC. 31, 1999 ------------- ------------- CURRENT ASSETS: Cash and cash equivalents $ 816 $ 2,669 Accounts receivable, net 18,246 26,159 Inventories 44,391 45,777 Deferred income taxes 2,740 2,487 Income tax receivable 3,376 - Other 291 233 ------------------------ ---------------------- Total current assets 69,860 77,325 Property and equipment, net 76,589 74,895 OTHER ASSETS: Deferred financing costs, net 3,940 5,300 Land held for sale 655 1,346 Goodwill, less accumulated amortization of $705 and $593, respectively 3,763 3,874 Deferred income taxes - 4,901 Other 2,821 146 ------------------------ ---------------------- 11,179 15,567 ------------------------ ---------------------- TOTAL ASSETS $ 157,628 $ 167,787 ======================== ====================== LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Borrowings under revolving credit facility $ 16,458 $ 30,558 Current maturities of long-term debt 10,408 10,441 Accounts payable 7,839 22,347 Accrued liabilities 14,482 12,244 ------------------------ ---------------------- Total current liabilities 49,187 75,590 OTHER LONG-TERM LIABILITIES 2,713 - DEFERRED INCOME TAXES 1,080 - LONG-TERM DEBT, less current maturities 27,500 37,500 SENIOR SUBORDINATED DEBT 28,068 26,752 COMMITMENTS AND CONTINGENCIES - - STOCK WARRANTS 5,887 5,887 STOCKHOLDERS' EQUITY: Series A preferred stock, 7% cumulative dividend; convertible; $2 per - 38 share liquidation preference; no par value; 2,000,000 shares authorized; issued and outstanding none and 18,750 shares, respectively Undesignated stock, $.01 par value; 14,490,000 shares authorized; - - none issued and outstanding Common stock, $.01 par value; 30,000,000 shares authorized; issued 81 77 and outstanding 8,069,675 and 7,721,214 shares, respectively Class B Common stock, $.01 par value; 3,500,000 shares authorized; - - none issued and outstanding Additional paid-in capital 40,521 39,013 Unearned compensation (473) (587) Notes receivable from officers and employees on common stock purchases (1,181) (1,296) Retained earnings/(accumulated deficit) 4,245 (15,187) ------------------------ ---------------------- Total stockholders' equity 43,193 22,058 ------------------------ ---------------------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 157,628 $ 167,787 ======================== ======================
EX-99.2 3 a2040495zex-99_2.txt EXHIBIT 99.2 Exhibit 99.2 FOR: PW Eagle, Inc. FOR IMMEDIATE RELEASE 222 South Ninth Street, Suite 2880 Minneapolis, MN 55402 (Nasdaq-NMS: "PWEI") CONTACT: WILLIAM H. SPELL Chief Executive Officer, PW Eagle, Inc. 612/305-0339 PW EAGLE ANNOUNCES PROPOSED "DUTCH AUCTION" TENDER MINNEAPOLIS -- MARCH 1, 2001 -- PW Eagle, Inc. (Nasdaq-NMS: "PWEI", formerly "EPII") announced that its Board of Directors proposed a "Dutch Auction" tender offer to purchase such number of shares of the Company's common stock that does not exceed the aggregate purchase price of $10,000,000. The Company currently has approximately 8,069,675 shares outstanding. Commencement of the proposed tender offer will be subject to, among other things, completion of all regulatory filings and financing arrangements. The Company plans to use funds provided by its current revolving credit facility to finance the proposed Dutch Auction. The offer is expected to commence by the end of March 2001. Shareholders will be invited to sell their shares to the Company at prices determined by the tendering shareholders within a range to be specified in the proposed offer, expected not to be in excess of $9.00 nor less than $7.50 per share, in $.25 increments, subject to market conditions. There is no certainty that the Company will purchase all shares tendered in the completed offer, and in the event of an over-subscription within the specified range, shares tendered by shareholders owning less than 100 shares will be accepted first and the remaining tendered shares accepted by the Company will be accepted on a pro rata basis. The Company has been advised that neither the Company's directors or executive officers intend to tender any shares pursuant to the proposed offer. William H. Spell, Chief Executive Officer, stated, "We believe that PW Eagle stock is currently undervalued by the market and that there may not be sufficient trading volume to permit shareholders to sell their holdings. Unfortunately, we don't expect that the difficulties currently being encountered by our industry and the general economy will abate soon, and we are not likely to report improved earnings until after the second quarter of this year. This combination led us to conclude that it would enhance the value of the holdings of the remaining shareholders while at the same time providing liquidity to those who want to sell their shares if we conducted a "Dutch Auction" tender offer. The process will be started as soon as the documents can be completed and mailed to the shareholders." - MORE - 10 THIS PRESS RELEASE IS FOR INFORMATIONAL PURPOSES ONLY AND IS NOT AN OFFER TO BUY OR THE SOLICITATION OF AN OFFER TO SELL ANY SHARES OF PW EAGLE, INC. COMMON STOCK. COMMENCEMENT OF THE PROPOSED TENDER OFFER IS SUBJECT TO, AMONG OTHER THINGS, COMPLETION OF ALL REGULATORY FILINGS. ANY SOLICITATION OF OFFERS TO BUY PW EAGLE, INC. COMMON STOCK WILL ONLY BE MADE PURSUANT TO AN OFFER TO PURCHASE AND RELATED MATERIALS TO BE SENT BY PW EAGLE, INC. TO ITS SHAREHOLDERS ON THE COMMENCEMENT OF THE PROPOSED OFFER. SHAREHOLDERS SHOULD CAREFULLY READ THOSE MATERIALS WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION, INCLUDING THE VARIOUS TERMS AND CONDITIONS OF THE OFFER. SHAREHOLDERS WILL BE ABLE TO OBTAIN COPIES OF THE OFFER TO PURCHASE, RELATED MATERIALS AND OTHER DOCUMENTS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION THROUGH THE COMMISSION'S WEB SITE AT HTTP://WWW.SEC.GOV: WITHOUT CHARGE WHEN THESE DOCUMENTS BECOME AVAILABLE. SHAREHOLDERS WILL ALSO BE ABLE TO OBTAIN COPIES OF THE OFFER TO PURCHASE AND RELATED MATERIALS, WITHOUT CHARGE, WHEN AVAILABLE, FROM PW EAGLE, INC. BY ORAL OR WRITTEN REQUEST TO PW EAGLE, INC. ATTENTION: INVESTOR RELATIONS, 222 SOUTH 9TH STREET, SUITE 2880, MINNEAPOLIS, MN 55402 OR BY CALLING (612) 305-0339. PW Eagle, Inc. is a leading extruder of PVC pipe and polyethylene tubing products. The Company operates ten manufacturing facilities in the midwestern and western United States. PW Eagle's common stock is traded on the Nasdaq National Market under the symbol "PWEI". 11 -----END PRIVACY-ENHANCED MESSAGE-----