WHITE PLAINS, N.Y., Nov. 17 /PRNewswire-FirstCall/ -- WHX
Corporation (NASDAQ:WXCO); ("WHX" or the "Company") today reported
financial results for the third quarter ended September 30, 2009.
The Company also announced that it will hold an earnings call on
Wednesday, November 18, 2009 at 4:00 pm Eastern Time. "WHX's net
sales and profitability were adversely effected by the world-wide
economic recession for the three months and the nine months ended
September 30, 2009," said Glen Kassan, Vice Chairman of the Board
and Chief Executive Officer of WHX. "Sales were down by 26% for
both the third quarter and nine months ended September 30, 2009,
compared to the same periods of 2008. All but one of the Company's
reportable segments experienced declines in operating income for
the third quarter and nine months ended September 30, 2009,
compared to the same periods in 2008. "During the third quarter of
2009 we continued to apply significant cost containment actions
across all of our business segments and the corporate headquarters.
These actions include a reduction in compensation and benefits for
salaried employees, layoffs in both the salaried and hourly
workforce, the temporary idling of certain of our manufacturing
facilities for various periods during 2009 to better match
production with customer demand, and certain other restructuring
activities. We believe these initiatives significantly contributed
to the Company improving its adjusted gross margin (as adjusted for
certain items as described below) in the second and third quarters
of 2009 versus the prior quarter, and effectively managing its
margin for the three and nine months ended September 30, 2009 as
compared to the same periods in 2008 despite the significant
decline in sales during 2009. Additionally, the Company has
continued to closely focus on effectively managing cash flow,
including working capital utilization, in 2009. Total debt,
including the Company's term loans, was reduced by $23.1 million
during the first nine months of 2009 while we maintained what we
believe to be sufficient liquidity. "Specifically, adjusted gross
margin, after excluding the operations of our Sumco subsidiary
which we expect to be classified as a discontinued operation at the
end of the year and certain non-cash inventory charges, was 25.4%
of sales for the third quarter of 2009, as compared to 24.7% and
23.6% in the second and first quarters of 2009, respectively. For
the three and nine months ended September 30, 2009, adjusted gross
margins were 25.4% and 24.6%, respectively, as opposed to 25.1% and
24.5%, respectively, for the same periods of 2008. "We are
encouraged that our operational disciplines allowed us to realize
the above operational results during this very difficult economic
environment. We have continued to expand the use and reliance on
the WHX Business System to achieve our operational goals which we
believe are positioning the Company to realize enhanced performance
as the global economies and the markets we serve recover. The WHX
Business System is the process-oriented set of management tools
that defines our continuous improvement culture in all our
operating units. It is the common thread that drives value for our
stakeholders." Financial Highlights: Third Quarter Results WHX
reported net income of $1.0 million on net sales of $145.2 million
in the third quarter of 2009, compared with net income of $9.5
million on net sales of $195.3 million for the third quarter of
2008. Basic and diluted net income per common share was $0.08 on
12,179,000 shares outstanding for the third quarter of 2009,
compared with net income per common share of $5.48 on 1,729,000
shares outstanding in the same period of 2008. Revenue for the
third quarter of 2009 was $145.2 million, a decrease of $50.2
million, or 25.7% from $195.3 million for 2008 amid the general
slow-down in the U.S. and world economies, especially weakness in
the U.S. housing, automotive, and general industrial markets. For
the nine months ended September 30, 2009, WHX reported a net loss
of $14.5 million on net sales of $417.4 million, as compared to net
income of $8.6 million on net sales of $564.6 million for the same
period of 2008. The net loss for the three months ended September
30, 2009 includes a net increase in non-cash pension expense of
$5.7 million and a $1.1 million non-cash goodwill impairment
charge, partially offset by a $3.0 million gain on proceeds from an
insurance claim. The net loss for the nine months ended September
30, 2009 includes a net increase in non-cash pension expense of
$17.0 million, non-cash asset and goodwill impairment charges of
$3.2 million, and a $3.0 million gain on proceeds from an insurance
claim. The 2008 quarter and nine-month results include gains of
$0.8 million and $3.4 million, respectively, from insurance
proceeds. Additionally, as compared to the same periods of 2008,
operating results for the nine months ended September 30, 2009
include a $1.8 million higher loss at our Indiana Tube Denmark
subsidiary, a discontinued operation, as well as a $1.9 million
higher loss at our Sumco Inc. subsidiary, which is currently being
wound down and is anticipated to be classified as a discontinued
operation by year-end. In addition, during the third quarter and
nine months of 2009, gross profit included a non-cash gain of $0.7
million from the liquidation of precious metal inventories valued
at LIFO, as compared to a non-cash LIFO liquidation gain of $2.5
million in the third quarter and nine months of 2008. The Company
generated Adjusted EBITDA of $15.6 million for the third quarter of
2009, as compared to $18.2 million for the same period in 2008. The
decline in third quarter 2009 Adjusted EBITDA was principally due
to lower sales and income from continuing operations of our
businesses. Adjusted EBITDA excludes certain non-recurring and
non-cash items. See "Note Regarding Use of Non-GAAP Financial
Measurements" below for the definition of Adjusted EBITDA. Segment
Operating Results All data regarding segment operating results is
before corporate allocations. Precious Metal Segment Net sales for
the Precious Metal segment decreased by $14.5 million, or 36.0%, to
$25.8 million in the third quarter of 2009 from $40.3 million in
the third quarter of 2008. The decreased sales were primarily
driven by lower volume in all of the segment's markets. The brazing
alloys manufactured by this segment are fabricated into a variety
of engineered forms and are used in many industries including
automotive, air conditioning, general industrial and other
metal-joining industries. The electro-galvanized electronic and
electrical components sold by this segment are primarily for use in
the transportation industry. Segment operating income decreased by
$3.5 million, to $3.3 million, in the third quarter of 2009,
compared to $6.8 million in the third quarter of 2008, primarily
due to the sales decline. In addition, during the third quarter of
2009, gross profit included a non-cash gain of $0.7 million from
the liquidation of precious metal inventories valued at LIFO, as
compared to a non-cash LIFO liquidation gain of $2.5 million in the
third quarter of 2008. The sales decline was partially offset by
lower manufacturing and selling, general, and administrative
expenses as a result of cost saving efforts. Tubing Segment In the
third quarter of 2009, net sales for the Tubing segment decreased
by $8.8 million, or 31.9%, to $18.8 million from $27.6 million in
the third quarter of 2008. Sales were lower in the retail appliance
markets serviced by the Specialty Tubing Group. There was also a
reduction in sales to the petrochemical market serviced by the
Stainless Steel Tubing Group, which was partially offset by
strength in sales to the defense and aerospace markets. Segment
operating income decreased by $1.1 million to $1.4 million in the
third quarter of 2009 compared to $2.5 million in the third quarter
of 2008 primarily due to the decline in sales and a reduction in
gross profit percentage. Third quarter gross profit percentage was
2.7% lower compared to the same period of 2008, primarily resulting
from lower selling prices due to softer demand and product mix
changes in our Stainless Steel Tubing Group. A discontinued
operation, Indiana Tube Denmark, which was previously part of the
Tubing segment, has now been excluded from the segment's operating
results in both quarters. Engineered Materials Segment Net sales
for the Engineered Materials segment decreased $18.8 million, or
25.1%, to $56.1 million in the third quarter of 2009 from $74.9
million in the third quarter of 2008. We continued to experience
weakness in the commercial flat roofing fasteners market, natural
gas and other utility connectors used in residential construction,
as well as a drop in electrical connector sales to its
international markets. Segment operating income decreased by $2.2
million to $7.0 million in the third quarter of 2009 from $9.2
million in the same period of 2008. The decline in operating income
was principally the result of the lower sales volume. However,
gross profit percentage improved principally due to product mix,
and the segment also incurred lower selling, general and
administrative expenses due to the lower sales and cost saving
initiatives. Arlon Electronic Materials ("Arlon EM") In the third
quarter of 2009, net sales for the Arlon EM segment declined by
$3.6 million, or 21.6%, to $13.2 million, from $16.8 million in the
prior year. The decline was primarily due to slow worldwide
telecommunication material purchases, lower material demand from
the oil drilling industry, and military programs. Segment operating
loss was $0.5 million in the third quarter of 2009 compared to
income of $1.8 million during the same period of 2008 principally
as a result of a $1.1 million goodwill impairment charge based on
recent valuation of its Silicone Technology reporting unit. In
addition, a shift from higher margin military sales to lower margin
printed circuit board materials had a negative impact on gross
profit margin. This was partially offset by increased volume in the
low-cost China manufacturing facility as well as reduced staffing
and expense reductions as compared to the same quarter of the prior
year. Arlon Coated Materials ("Arlon CM") Arlon CM segment sales
declined by $2.3 million, or 12.3%, to $16.8 million in the third
quarter of 2009, from $19.1 million in the third quarter of 2008.
The world-wide economic recession has adversely affected demand in
the Asian shipping container market and the North American and
European graphics market for corporate imaging. Arlon CM was also
adversely impacted by lower demand from its automotive, appliance
and electronics customers. Operating income increased $0.5 million
compared to the third quarter of 2008. Third quarter gross profit
percentage increased by 2.9% compared to the same period of the
prior year. This resulted from certain improvements from the
implementation of the WHX Business System, partially offset by
unfavorable overhead absorption. Kasco Replacement Parts and
Services Kasco segment sales declined by $2.1 million, or 12.5%
compared to the same period of 2008. Sales to U.S. grocery stores
and other route sales softened along with weakness in distributor
sales in North America and in European sales. Operating income from
the Kasco segment was $0.5 million in the third quarter, which was
$0.1 million lower compared to the same period of 2008. Lower gross
profit margin from sales mix was offset by more efficient
manufacturing operations and better labor and spending control.
During the third quarter of 2009, one of the segment's reporting
units, EuroKasco, recorded restructuring expenses of $0.5 million,
primarily severance payments, due to weakness in its machinery
sales volume. Other Matters For the nine months ended September 30,
2009, WHX provided $24.6 million of cash by operating activities,
as compared to $4.5 million of cash used in operating activities
during the same period in 2008. Cash used in operating activities
in 2008 also included the non-recurring payment of accrued interest
of $31.3 million. Cash provided by operating activities was
negatively impacted by reduced net income in the 2009 period, but
this was offset by reduced use of cash for working capital of $10.9
million in 2009 as compared to 2008. During the nine months ended
September 30, 2009, the Company made net repayments of $18.7
million under its term loan facilities. As of September 30, 2009,
the Company had total debt of $187.1 million, as compared to total
debt of $210.2 million as of December 31, 2008. Available
borrowings under the credit facilities of the Company's
subsidiaries, Handy & Harman and Bairnco Corporation as of
September 30, 2009 were $26.3 million and $10.6 million,
respectively. The Company has continued to closely focus on
effectively managing cash flow, including working capital
utilization, in 2009. WHX Corporation 3rd Quarter 2009 Earnings
Call, November 18, 2009 at 4:00 pm ET WHX Corporation will hold a
conference call to discuss the third quarter 2009 financial results
on Wednesday, November 18, 2009, at 4:00 pm ET. The dial
information for the call is: *US/Canada Dial-in #: (866) 760-1884
*Int'l/Local Dial-In #: (706) 758-7555 Conference ID 41356613 NOTE:
In order to join this conference call, all speakers and
participants will be required to provide the Conference ID Number
listed above. Note Regarding Presentation of Non-GAAP Financial
Measures: The financial data contained in this press release
includes certain non-GAAP financial measures as defined by the
Securities and Exchange Commission ("SEC"), including "Adjusted
EBITDA". The Company is presenting Adjusted EBITDA because it
believes that it provides useful information to investors about
WHX, its business and its financial condition. The Company defines
Adjusted EBITDA as net income before the effects of realized and
unrealized losses on derivatives, interest expense, taxes,
depreciation and amortization, LIFO liquidation gain, and pension
expense or credit and excludes certain non-recurring and non-cash
items. The Company believes Adjusted EBITDA is useful to investors
because it is one of the measures used by the Company's Board of
Directors and management to evaluate its business, including in
internal management reporting, budgeting and forecasting processes,
in comparing operating results across the business, as an internal
profitability measure, as a component in evaluating the ability and
the desirability of making capital expenditures and significant
acquisitions, and as an element in determining executive
compensation. Further, the Company believes that Adjusted EBITDA is
a measure of leverage capacity and the Company's ability to service
its debt. However, Adjusted EBITDA is not a measure of financial
performance under generally accepted accounting principles in the
United States of America ("GAAP"), and the items excluded from
Adjusted EBITDA are significant components in understanding and
assessing financial performance. Therefore, Adjusted EBITDA should
not be considered a substitute for net income (loss) or cash flows
from operating, investing, or financing activities. Because
Adjusted EBITDA is calculated before recurring cash charges
including realized and unrealized losses on derivatives, interest
expense and taxes, and is not adjusted for capital expenditures or
other recurring cash requirements of the business, it should not be
considered as a measure of discretionary cash available to invest
in the growth of the business. There are a number of material
limitations to the use of Adjusted EBITDA as an analytical tool,
including the following: -- Adjusted EBITDA does not reflect the
Company's net realized and unrealized losses and gains on
derivatives and LIFO liquidations of its precious metal inventory;
-- Adjusted EBITDA does not reflect the Company's interest expense;
-- Adjusted EBITDA does not reflect the Company's tax expense or
the cash requirements to pay its taxes; -- Although depreciation
and amortization are non-cash expenses in the period recorded, the
assets being depreciated and amortized may have to be replaced in
the future, and Adjusted EBITDA does not reflect the cash
requirements for such replacement; and -- Adjusted EBITDA does not
include pension expense or credit. The Company compensates for
these limitations by relying primarily on its GAAP financial
measures and by using Adjusted EBITDA only supplementally. The
Company believes that consideration of Adjusted EBITDA, together
with a careful review of its GAAP financial measures, is the most
informed method of analyzing WHX. The Company reconciles Adjusted
EBITDA to Net income (loss), and that reconciliation is set forth
below. Because Adjusted EBITDA is not a measurement determined in
accordance with GAAP and is susceptible to varying calculations,
Adjusted EBITDA, as presented, may not be comparable to other
similarly titled measures of other companies. Revenues and expenses
are measured in accordance with the policies and procedures
described in the Company's Annual Report on Form 10-K for the year
ended December 31, 2008. Our Company WHX Corporation is a
diversified global industrial company delivering value through the
WHX Business System which drives innovation, operating excellence
and superior customer service. WHX and its affiliated companies
employ over 2,000 people at 35 locations in eight countries. Our
companies are organized into six business segments: Precious Metal,
Tubing, Engineered Materials, Arlon Electronic Materials, Arlon
Coated Materials and Kasco. We sell our products and services
through direct sales forces, distributors and manufacturer's
representatives. We serve a diverse customer base, including the
construction, electronics, telecommunications, home appliance,
transportation, utility, medical, semiconductor, and aerospace and
aviation markets. Other markets served include the signage industry
and meat room products and maintenance services for the food
industry. We are based in White Plains, New York and our common
stock is listed on the NASDAQ Capital Market under the symbol WXCO.
Forward-Looking Statements This press release contains certain
"forward-looking statements" within the meaning of Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"),
that reflect WHX's current expectations and projections about its
future results, performance, prospects and opportunities. WHX has
tried to identify these forward-looking statements by using words
such as "may," "should," "expect," "hope," "anticipate," "believe,"
"intend," "plan," "estimate" and similar expressions. These
forward-looking statements are based on information currently
available to the Company and are subject to a number of risks,
uncertainties and other factors, that could cause its actual
results, performance, prospects or opportunities in 2009 and beyond
to differ materially from those expressed in, or implied by, these
forward-looking statements. These factors include, without
limitation, WHX's need for additional financing and the terms and
conditions of any financing that is consummated, customers'
acceptance of its new and existing products, the risk that the
Company will not be able to compete successfully, and the possible
volatility of the Company's stock price and the potential
fluctuation in its operating results. Although WHX believes that
the expectations reflected in these forward-looking statements are
reasonable and achievable, such statements involve significant
risks and uncertainties and no assurance can be given that the
actual results will be consistent with these forward-looking
statements. Investors should read carefully the factors described
in the "Risk Factors" section of the Company's filings with the
SEC, including the Company's Form 10-K for the year ended December
31, 2008 for information regarding risk factors that could affect
the Company's results. Except as otherwise required by Federal
securities laws, WHX undertakes no obligation to publicly update or
revise any forward-looking statements, whether as a result of new
information, future events, changed circumstances or any other
reason. WHX CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited) Three Months ended Nine Months ended September 30,
September 30, ------------------ ----------------- 2009 2008 2009
2008 ---- ---- ---- ---- (in thousands except per share) Net sales
$145,172 $195,331 $417,421 $564,631 Cost of goods sold 109,183
143,854 316,733 425,754 ------- ------- ------- ------- Gross
profit 35,989 51,477 100,688 138,877 Selling, general and
administrative expenses 24,469 34,690 81,801 104,882 Pension
expense (credit) 3,521 (2,185) 10,436 (6,555) Asset impairment
charges - - 2,046 - Goodwill impairment charge 1,140 - 1,140 -
Proceeds from insurance claims, net (3,000) (757) (3,000) (3,447)
Restructuring charges 625 278 2,350 1,628 Other operating expense
(income) (136) 73 (239) 245 ---- --- ---- --- Income from
continuing operations 9,370 19,378 6,154 42,124 ----- ------ -----
------ Other: Interest expense 6,693 8,981 18,768 30,211 Realized
and unrealized (gain) loss on derivatives 622 (400) 316 925 Other
expense (income) (53) 637 (169) 655 --- --- ---- --- Income (loss)
from continuing operations before tax 2,108 10,160 (12,761) 10,333
Tax provision 261 841 427 2,311 --- --- --- ----- Income (loss)
from continuing operations, net of tax 1,847 9,319 (13,188) 8,022
----- ----- ------- ----- Discontinued Operations: Income (loss)
from discontinued operations, net of tax (1,029) 149 (2,938) 567
Gain on disposal, net of tax 182 - 1,671 - --- --- ----- --- Net
income (loss) from discontinued operations (847) 149 (1,267) 567
---- --- ------ --- Net income (loss) $1,000 $9,468 $(14,455)
$8,589 ====== ====== ======== ====== Basic and diluted per share of
common stock (a) Income (loss) from continuing operations, net of
tax $0.15 $5.39 $(1.08) $6.44 Discontinued operations, net of tax
(0.07) 0.09 (0.11) 0.45 ----- ---- ----- ---- Net income (loss)
$0.08 $5.48 $(1.19) $6.89 ===== ===== ====== ===== Weighted average
number of common shares outstanding 12,179 1,729 12,179 1,246 (a)
Basic and diluted net income per common share was $0.08 for the
three months ended September 30, 2009, and basic and diluted net
loss per common share was $1.19 for the nine months ended September
30, 2009, both computed on 12,179,000 shares outstanding. This
compared with net income of $5.48 per share and $6.89 per share on
1,729,000 and 1,246,000 shares outstanding, respectively, in the
same periods of 2008. The large change in the number of shares
outstanding is due to the additional shares issued in a rights
offering in September 2008. In addition, the Company consummated a
1 for 10 reverse stock split in November 2008 of its outstanding
common stock. To enhance comparability, the 2008 periods have been
adjusted on a retroactive basis as if the reverse stock split had
occurred on January 1, 2008. WHX CORPORATION CONSOLIDATED BALANCE
SHEETS (Unaudited) September 30, December 31, (Dollars and shares
in thousands) 2009 2008 ------------- ------------ ASSETS Current
Assets: Cash and cash equivalents $9,998 $8,656 Trade and other
receivables - less allowance for doubtful accounts of $3,190 and
$3,174 at 9/30/09 and 12/31/08, respectively 82,260 79,696
Inventories 67,703 71,846 Deferred income taxes 1,106 1,310 Other
current assets 9,159 10,285 Current assets of discontinued
operations 1,204 7,187 ----- ----- Total current assets 171,430
178,980 Property, plant and equipment at cost, less accumulated
depreciation and amortization 90,802 98,423 Goodwill 63,949 65,070
Other intangibles, net 34,758 36,965 Non-current assets of
discontinued operations 2,790 4,084 Other non-current assets 15,361
18,718 ------ ------ $379,090 $402,240 ======== ========
LIABILITIES AND STOCKHOLDERS' (DEFICIT) EQUITY Current Liabilities:
Trade payables $44,019 $35,965 Accrued environmental liability
7,145 8,478 Accrued liabilities 26,169 36,890 Current portion of
pension liability 9,200 1,800 Accrued interest expense - related
party 1,234 262 Current portion of long-term debt 5,944 8,295
Short-term debt 28,963 32,970 Deferred income taxes 257 257 Current
liabilities of discontinued operations 326 5,787 --- ----- Total
current liabilities 123,257 130,704 Long-term debt 98,144 110,174
Long-term debt - related party 54,098 54,098 Accrued interest
expense - related party 9,107 2,237 Accrued pension liability
134,841 132,190 Other employee benefit liabilities 3,741 4,233
Deferred income taxes 5,009 5,307 Long-term liabilities of
discontinued operations 111 188 Other liabilities 5,554 5,016 -----
----- 433,862 444,147 ------- ------- Stockholders' (Deficit)
Equity: Preferred stock- $.01 par value; authorized 5,000 shares;
issued and outstanding - 0 - shares - - Common stock -$.01 par
value; authorized 180,000 shares; issued and outstanding 12,179
shares 122 122 Accumulated other comprehensive loss (162,148)
(163,502) Additional paid-in capital 552,819 552,583 Accumulated
deficit (445,565) (431,110) -------- -------- Total stockholders'
deficit (54,772) (41,907) ------- ------- $379,090 $402,240
======== ======== WHX CORPORATION CONSOLIDATED STATEMENTS OF CASH
FLOWS (Unaudited) Nine Months Ended September 30,
------------------- 2009 2008 ---- ---- (in thousands) Cash flows
from operating activities: Net income (loss) $(14,455) $8,589
Adjustments to reconcile net income (loss) to net cash provided by
(used in) operating activities: Depreciation and amortization
14,229 15,744 Non-cash stock based compensation 173 378
Amortization of debt related costs 1,329 1,441 Long-term interest
on related party debt 6,870 5,285 Deferred income taxes (141) (362)
Loss on asset dispositions 59 159 Asset impairment charges 2,046 -
Goodwill impairment charge 1,140 - Unrealized loss (gain) on
derivatives 135 (249) Reclassification of net cash settlements on
derivative instruments 181 1,174 Net cash provided by operating
activities of discontinued operations 4,075 1,561 Decrease
(increase) in operating assets and liabilities: Trade and other
receivables (2,247) (27,427) Inventories 4,390 4,774 Other current
assets 1,010 2,530 Accrued interest expense-related party 972
(19,615) Other current liabilities 5,010 1,258 Other items-net
(174) 259 ---- --- Net cash provided by (used in) operating
activities 24,602 (4,501) ------ ------ Cash flows from investing
activities: Plant additions and improvements (4,963) (9,926) Net
cash settlements on derivative instruments (181) (1,174) Proceeds
from sales of assets 252 8,179 Proceeds from sale of investment
3,113 - Net cash provided by sale of assets of discontinued
operations 2,640 - ----- --- Net cash provided by (used in)
investing activities 861 (2,921) --- ------ Cash flows from
financing activities: Proceeds of stock-rights offering - 155,790
Proceeds from term loans - domestic 9,328 4,000 Net revolver
repayments (4,286) (13,127) Net proceeds of term loans - foreign
249 - Repayments of term loans - domestic (23,732) (16,394)
Repayments of term loans - related party - (111,188) Deferred
finance charges (2,228) (1,534) Net change in overdrafts 1,089
3,845 Net cash used to repay debt of discontinued operations
(4,559) (371) Other (208) - ---- --- Net cash provided by (used in)
financing activities (24,347) 21,021 ------- ------ Net change for
the period 1,116 13,599 Effect of exchange rate changes on net cash
226 (3) Cash and cash equivalents at beginning of period 8,656
6,090 ----- ----- Cash and cash equivalents at end of period $9,998
$19,686 ====== ======= WHX CORPORATION CONSOLIDATED SEGMENT DATA
(Unaudited) Statement of operations Three Months Ended Nine Months
Ended data: September 30, September 30, ------------------
----------------- (in thousands) 2009 2008 2009 2008 ---- ---- ----
---- Net Sales: Precious Metal $25,837 $40,344 $74,249 $131,624
Tubing 18,782 27,564 56,371 78,408 Engineered Materials 56,055
74,884 153,180 198,636 Arlon Electronic Materials 13,154 16,777
44,034 48,409 Arlon Coated Materials 16,762 19,103 43,921 56,763
Kasco 14,582 16,659 45,666 50,791 ------ ------ ------ ------ Total
net sales $145,172 $195,331 $417,421 $564,631 ======== ========
======== ======== Segment operating income: Precious Metal (a)
$3,263 $6,759 $2,514 $14,120 Tubing (b) 1,399 2,458 3,597 6,812
Engineered Materials 7,037 9,238 14,288 20,458 Arlon Electronic
Materials (c) (501) 1,849 2,305 4,232 Arlon Coated Materials (d)
682 185 (433) (211) Kasco (e) 494 625 2,264 2,703 --- --- -----
----- Total segment operating income $12,374 $21,114 $24,535
$48,114 ------- ------- ------- ------- Unallocated corporate
expenses & non operating units 2,542 4,665 9,110 15,833
Unallocated pension expense (credit) 3,503 (2,185) 10,418 (6,555)
Proceeds from insurance claims, net (3,000) (757) (3,000) (3,447)
Asset impairment charge - - 1,158 - Corporate restructuring costs
(26) - 636 - (Gain) loss on disposal of assets (15) 13 59 159 ---
--- --- --- Income from continuing operations 9,370 19,378 6,154
42,124 ----- ------ ----- ------ Interest expense 6,693 8,981
18,768 30,211 Realized and unrealized (gain) loss on derivatives
622 (400) 316 925 Other (income) expense (53) 637 (169) 655 --- ---
---- --- Income (loss) from continuing operations before tax $2,108
$10,160 $(12,761) $10,333 ====== ======= ======== ======= (a)
Segment operating income for the Precious Metal segment for the
nine months ended September 30, 2009 includes restructuring charges
of $0.4 million relating to the closure of a facility in New
Hampshire, and $0.5 million relating to Sumco, an operation
currently being wound down and expected to be classified as a
discontinued operation by year-end. The results for the Precious
Metal segment for the three and nine month periods ended September
30, 2009 and 2008 also include $0.7 million and $2.5 million of
gain, respectively, resulting from the liquidation of precious
metal inventory valued at LIFO. (b) Segment operating income for
the Tubing segment for the nine months ended September 30, 2009
includes non-cash asset impairment charges of $0.9 million to
write-down to fair value certain equipment formerly used in the
manufacture of a discontinued product line. (c) Segment operating
results for the Arlon EM segment for the three and nine months
ended September 30, 2009 include a $1.1 million goodwill impairment
charge recorded to adjust the carrying value of one of its
reporting units to fair value. (d) Segment operating results for
the Arlon CM segment for the three and nine months ended September
30, 2009 include $0.1 million and $0.3 million of restructuring
costs, respectively, related to the closure and relocation of an
operation in Dallas, Texas. In the segment operating results for
the three and nine month periods ended September 30, 2008, $0.3
million and $1.6 million of move costs, respectively, were incurred
to consolidate two plants in San Antonio, Texas into one. In
addition to the direct move costs, the results of those periods
were negatively impacted by a plant shutdown and related operating
inefficiencies during the move. (e) Segment operating income for
the Kasco segment for the three and nine months ended September 30,
2009 includes $0.5 million of costs related to restructuring
activities at its EuroKasco operation. Supplemental Non-GAAP
Disclosures EBITDA and Adjusted EBITDA (Unaudited) Three Months
Ended Nine Months Ended Sept. 30, Sept. 30, ------------------
----------------- 2009 2008 2009 2008 ---- ---- ---- ---- (in
thousands) Income (loss) from continuing operations, net of tax
$1,847 $9,319 $(13,188) $8,022 Add (Deduct): Tax provision 261 841
427 2,311 Interest expense 6,693 8,981 18,768 30,211 Depreciation
and amortization expense 4,643 5,352 14,229 15,744 Non-cash WHX
& other pension expense (credit) 3,521 (2,185) 10,436 (6,555)
Non-cash goodwill impairment charge 1,140 - 1,140 - Non-cash asset
impairment charges - - 2,046 - Non-cash effects of precious metal
inventory (397) (3,239) (253) (3,215) Realized and unrealized
(gain) loss on derivatives 622 (400) 316 925 Non-cash stock-based
compensation expense 15 172 164 412 Loss on disposal of assets (15)
13 59 159 --- --- --- --- "EBITDA" from continuing operations
18,330 18,854 34,144 48,014 Adjusted EBITDA: EBITDA of Sumco
excluding restructuring costs (540) (275) 948 (1,076) Other 200 118
514 361 Proceeds from insurance claims (3,000) (757) (3,000)
(3,456) Non-recurring restructuring & plant consolidation costs
620 278 1,891 1,628 --- --- ----- ----- Adjusted EBITDA $15,610
$18,218 $34,497 $45,471 ======= ======= ======= ======= CONTACT:
WHX Corporation Glen Kassan, Vice Chairman of the Board and Chief
Executive Officer 914-461-1260 DATASOURCE: WHX Corporation CONTACT:
WHX Corporation, Glen Kassan, Vice Chairman of the Board and Chief
Executive Officer, +1-914-461-1260
Copyright