EX-99.1 2 l25863aexv99w1.htm EX-99.1 EX-99.1
 

Exhibit 99.1
For Immediate Release
April 25, 2007
GIBRALTAR REPORTS FIRST-QUARTER SALES AND EARNINGS
Company Expects Results to Strengthen in the Second and Third Quarters
     BUFFALO, NEW YORK (April 25, 2006) — Gibraltar Industries, Inc. (NASDAQ: ROCK) today reported its sales and earnings for the quarter ended March 31, 2007. The Company also said that its business conditions began to strengthen significantly during the last two weeks of March, setting the stage for much stronger results in the second and third quarters.
     Sales from continuing operations in the first quarter of 2007 were $318 million, a slight decrease from $323 million in the first quarter of 2006. Income from continuing operations before restructuring costs was $6.6 million in the quarter ended March 31, 2007, compared to $11.7 million in the first quarter of 2006, a decrease of approximately 43.6 percent. Earnings per share from continuing operations before restructuring costs were $.22 in the first quarter of 2007, within the range Gibraltar provided on April 17.
     On a GAAP basis, income from continuing operations was $6.2 million and earnings per share from continuing operations amounted to $.21 in the first quarter of 2007. Restructuring costs, which primarily relate to the consolidation of Buffalo, New York-based facilities in the Processed Metal Products segment, amounted to $0.7 million pre-tax, or $.01 per share on an after-tax basis.
     A number of factors combined to negatively impact results for the quarter, including softer-than-anticipated conditions in the new housing market, inventory control programs at a number of the Company’s retail sector customers, and adverse weather conditions that affected the overall construction market.
     “As we said last week, our business began to improve in the second half of March, and we expect our results to strengthen considerably in the second quarter,” said Brian J. Lipke, Gibraltar’s Chairman and Chief Executive Officer. “Helping to offset the sharp downturn in the residential building market is continued strength in the commercial, industrial, and architectural markets, improving results in our Processed Metal Products segment, as well as the contributions from recent acquisitions.”
     “While sales growth remains an important part of our strategic focus, we recognize that top-line gains are secondary to EPS growth, higher ROIC, margin improvements, and better cash flow. We use these measurements in our decision-making process when we look at internal and external growth opportunities,” said Mr. Lipke.
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Gibraltar Reports First-Quarter Sales and Earnings
Page Two
     “We have taken a number of steps to streamline and consolidate our operations. We are in the process of combining two Buffalo-area steel-processing facilities into one location, which will significantly enhance the performance of that business, and we are aggressively taking steps to control and cut costs, drive down inventories, and extract efficiencies from all of our businesses,” said Henning N. Kornbrekke, Gibraltar’s President and Chief Operating Officer.
     “While these steps will have an immediate impact, longer term they will enhance the core operating characteristics of the Company and better position Gibraltar for improved performance. When our sales return to more normalized levels, these actions will help us to generate higher margins, better returns, and stronger earnings,” said Mr. Kornbrekke.
     In light of the operating environment discussed above, Mr. Kornbrekke said that, barring a significant change in business conditions, Gibraltar expects its second-quarter earnings per share before any unusual items will be in the range of $.43 to $.48.
     Gibraltar Industries is a leading manufacturer, processor, and distributor of products for the building, industrial, and vehicular markets. The company serves customers in a variety of industries in all 50 states and throughout the world. It has approximately 4,000 employees and operates 85 facilities in 26 states, Canada, China, England, Germany, and Poland. Gibraltar’s common stock is a component of the S&P SmallCap 600 and the Russell 2000® Index.
     Information contained in this release, other than historical information, should be considered forward-looking, and may be subject to a number of risk factors, including: general economic conditions; the impact of the availability and the effects of changing raw material prices on the Company’s results of operations; energy prices and usage; the ability to pass through cost increases to customers; changing demand for the Company’s products and services; risks associated with the integration of acquisitions; and changes in interest or tax rates.
—30—
Gibraltar will review its first-quarter results and discuss its outlook for the second quarter during its quarterly conference call, which will be held at 9 a.m. Eastern Time on April 26. Details of the call can be found on Gibraltar’s Web site, at http://www.gibraltar1.com.
CONTACT: Kenneth P. Houseknecht, Vice President of Communications and Investor Relations, at 716/826-6500, khouseknecht@gibraltar1.com.
Gibraltar’s news releases, along with comprehensive information about the Company, are available on the Internet, at http://www.gibraltar1.com.

 

 

Gibraltar Reports First-Quarter Sales and Earnings
Page Three
 
GIBRALTAR INDUSTRIES, INC.
Financial Highlights
(in thousands, except per share data)
                 
    Three Months Ended  
    March 31, 2007     March 31, 2006  
 
                
Net sales
   $ 317,584     $ 322,637  
 
                
Income from continuing operations
   $ 6,168     $ 11,733  
 
                
Income per share from continuing operations — Basic
   $ .21     $ .40  
 
                
Weighted average shares outstanding — Basic
     29,844       29,652  
 
                
Income per share from continuing operations — Diluted
   $ .21     $ .39  
 
                
Weighted average shares outstanding — Diluted
     30,056       29,944  

 

 

GIBRALTAR INDUSTRIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except per share data)
                 
    March 31,     December 31,  
    2007     2006  
Assets
                
 
                
Current assets:
                
Cash and cash equivalents
   $ 20,675     $ 13,475  
Accounts receivable
     197,066       169,207  
Inventories
     248,797       254,991  
Other current assets
     19,082       18,107  
 
            
Total current assets
     485,620       455,780  
 
                
Property, plant and equipment, net
     245,189       243,138  
Goodwill
     388,874       374,821  
Acquired intangibles, net
     62,533       62,366  
Investments in partnerships
     2,719       2,440  
Other assets
     13,054       14,323  
 
            
 
   $ 1,197,989     $ 1,152,868  
 
            
 
                
Liabilities and Shareholders’ Equity
                
 
                
Current liabilities:
                
Accounts payable
   $ 92,003     $ 71,308  
Accrued expenses
     47,255       50,771  
Current maturities of long-term debt
     2,555       2,336  
 
            
Total current liabilities
     141,813       124,415  
 
                
Long-term debt
     418,174       398,217  
Deferred income taxes
     71,320       70,981  
Other non-current liabilities
     12,578       9,027  
Shareholders’ equity:
                
Preferred stock, $.01 par value; authorized: 10,000,000
shares; none outstanding
     —       —  
Common stock, $.01 par value; authorized 50,000,000 shares;
issued 29,883,795 and 29,883,795 shares in 2007 and 2006, respectively
     299       299  
Additional paid-in capital
     216,485       215,944  
Retained earnings
     335,354       332,920  
Accumulated other comprehensive income
     1,966       1,065  
 
            
 
     554,104       550,228  
 
                
Less: cost of 44,100 and 42,600 common shares held in treasury in 2007 and 2006
     —       —  
 
            
Total shareholders’ equity
     554,104       550,228  
 
            
 
   $ 1,197,989     $ 1,152,868  
 
            

 

 

GIBRALTAR INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share date)
                 
    Three Months Ended  
    March 31,  
    2007     2006  
Net sales
   $ 317,584     $ 322,637  
 
                
Cost of sales
     265,933       259,406  
 
            
 
                
Gross profit
     51,651       63,231  
 
                
Selling, general and administrative expense
     35,210       37,840  
 
            
 
                
Income from operations
     16,441       25,391  
 
                
Other (income) expense:
                
Equity in partnerships’ income and other income
     (362 )     (686 )
Interest expense
     7,237       6,779  
 
            
Total other expense
     6,875       6,093  
 
            
 
                
Income before taxes
     9,566       19,298  
 
                
Provision for income taxes
     3,398       7,565  
 
            
 
                
Income from continuing operations
     6,168       11,733  
 
                
Discontinued operations:
                
Income from discontinued operations before taxes
     —       4,303  
Income tax expense
     —       1,639  
 
            
Income from discontinued operations
     —       2,664  
 
            
 
                
Net income
   $ 6,168     $ 14,397  
 
            
 
                
Net income per share — Basic:
                
Income from continuing operations
     .21       .40  
Income from discontinued operations
   $ .00     $ .09  
 
            
Net Income
   $ .21     $ .49  
 
            
 
                
Weighted average shares outstanding — Basic
     29,844       29,652  
 
            
 
                
Net income per share — Diluted:
                
Income from continuing operations
     .21       .39  
Income from discontinued operations
   $ .00     $ .09  
 
            
Net Income
   $ .21     $ .48  
 
            
 
                
Weighted average shares outstanding — Diluted
     30,056       29,944  
 
            

 

 

GIBRALTAR INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
                 
    Three Months Ended  
    March 31,  
    2007     2006  
Cash flows from operating activities
                
Net income
   $ 6,168     $ 14,397  
Income from discontinued operations
     —       2,664  
 
            
Income from continuing operations
     6,168       11,733  
Adjustments to reconcile net income to net cash used in operating activities:
                
Depreciation and amortization
     7,461       6,789  
Provision for deferred income taxes
     (229 )     —  
Equity in partnerships’ (loss) income
     279       131  
Distributions from partnerships
     —       188  
Stock compensation expense
     541       706  
Other non-cash adjustments
     3       25  
Increase (decrease) in cash resulting from changes in (net of acquisitions):
                
Accounts receivable
     (23,291 )     (31,252 )
Inventories
     10,565       (16,970 )
Other current assets and other assets
     384       73  
Accounts payable
     17,822       15,420  
Accrued expenses and other non-current liabilities
     (2,986 )     4,056  
 
            
 
                
Net cash provided by (used in) continuing operations
     16,717       (9,101 )
Net cash provided by discontinued operations
     —       5,531  
 
            
Net cash provided by (used in) operating activities
     16,717       (3,570 )
 
            
 
                
Cash flows from investing activities
                
Purchases of property, plant and equipment
     (5,369 )     (5,303 )
Net proceeds from sale of property and equipment
     445       36  
Acquisitions, net of cash acquired
     (22,492 )     —  
 
            
 
                
Net cash used in investing activities for continuing operations
     (27,416 )     (5,267 )
Net cash used in investing activities for discontinued operations
     —       (1,074 )
 
            
Net cash used in investing activities
     (27,416 )     (6,341 )
 
            
 
                
Cash flows from financing activities
                
Long-term debt reduction
     (3,675 )     (8,320 )
Proceeds from long-term debt
     23,074       —  
Payment of deferred financing costs
     (8 )     (161 )
Net proceeds from issuance of common stock
     —       552  
Payment of dividends
     (1,492 )     (1,487 )
Tax benefit from stock options
     —       115  
 
            
 
                
Net cash provided by (used in) financing activities
     17,899       (9,301 )
 
            
 
                
Net increase (decrease) in cash and cash equivalents
     7,200       (19,212 )
 
                
Cash and cash equivalents at beginning of year
     13,475       28,529  
 
            
 
                
Cash and cash equivalents at end of period
   $ 20,675     $ 9,317  
 
            

 

 

GIBRALTAR INDUSTRIES, INC.
Segment Information
(in thousands)
                                 
    Three Months Ended March 31,  
                    Increase (Decrease)  
    2007     2006     $     %  
Net Sales
                                
Building products
   $ 207,226     $ 214,742     $ (7,516 )     (3.5 %)
Processed metal products
     110,358       107,895       2,463       2.3 %
 
                          
 
                                
Total Sales
   $ 317,584     $ 322,637     $ (5,053 )     (1.6 %)
 
                                
Income from Operations
                                
Building products
   $ 18,731     $ 31,271     $ (12,540 )     (40.1 %)
Processed metal products
     4,427       5,819       (1,392 )     (23.9 %)
Corporate
     (6,717 )     (11,699 )     4,982       (42.6 %)
 
                          
 
                                
Total Operating Income
   $ 16,441     $ 25,391     $ (8,950 )     (35.2 %)
 
                                
Operating Margin
                                
Building products
     9.0 %     14.6 %                
Processed metal products
     4.0 %     5.4 %