PRESS RELEASE
| To return to the Penford site, please exit the browser window. | |
|
PRESS RELEASE |
|
|
BELLEVUE, Wash., March 19, 2002 Penford Corporation Reports Second Quarter Results Penford Corporation (Nasdaq: PENX) today reported results for its second quarter ended February 28, 2002. Penford Corporation reported net income of $0.1 million, or $0.02 per share, versus a net loss of $0.8 million, or $0.11 per share, in the second quarter of last year. This year's second quarter results include a pretax restructuring charge of $1.4 million, which decreased earnings by $0.12 per share. Net income, prior to restructuring charges, was $1.0 million or $0.14 per share. As part of the strategic restructuring announced on January 4, 2002, Penford is relocating its corporate headquarters from Bellevue, Washington to Denver, Colorado, a location more central to customers and operations. The restructuring charge of $1.4 million relates primarily to employee termination costs and costs associated with the closure of the Bellevue office. In addition to the restructuring charge, the Company will incur incremental operating expenses as it opens the corporate office in Denver and hires new employees. Incremental operating expenses of $0.2 million were incurred in the second fiscal quarter. The Company expects to record $0.2 - $0.3 million of incremental costs each quarter until the transition is completed as expected late this fall. Second quarter sales decreased two percent to $54.8 million, versus $55.8 million for the same period last year. Lower sales volumes of the Company's industrial products more than offset improved sales volumes of our food products in North America. For the first six months of fiscal 2002, Penford Corporation reported earnings of $1.4 million, or $0.18 per share after the restructuring charge, versus a net loss last year of $0.6 million, or $0.08 per share, inclusive of an extraordinary loss of $0.9 million, or a loss of $0.12 per share. Absent the restructuring charge, net income for the first six months of fiscal 2002 was $2.3 million, or $0.30 per share. Six-month sales increased three percent to $111.1 million, versus $107.7 million for the same period in fiscal 2001. Growth of our food products in North America and the positive impact of the acquisition of Penford Australia in September 2000 offset sales volume declines from our industrial products. Thomas D. Malkoski, CEO of Penford, said, "Continued growth of our global food ingredients business and lower key cost inputs like natural gas and interest expense have resulted in improved operating performance for the first half of fiscal 2002. Improved profitability and working capital management over the past three quarters have allowed us to reduce our debt by more than $16 million from peak levels last May," he said. "Our North American food ingredients group increased revenue 12 percent over last year's second quarter and 23 percent over the first half of fiscal 2001. I'm very encouraged by the pipeline of new initiatives we have in our coatings and protein product categories. Also, our Australian operations have benefited from increased export demand for our core product lines in key Asian markets," Malkoski said. "On the industrial side of our business, natural gas costs have declined substantially over last year's historic highs, but production levels at our paper industry customers are still weak. We remain concerned with the near-term outlook for the health of the North American paper industry although most indicators point to a modest recovery in paper demand for the second half of calendar 2002," Malkoski added. "Penford's long term growth depends on delivering technically differentiated starch-based ingredients that bring enhanced functional benefits to our customers' products and processes. Despite the recent economic downturn, we are optimistic that the strategic resources we have in research, market position and specialty manufacturing will continue to deliver strong value to our customers and shareholders in the marketplace," Malkoski said. Penford Corporation will host a conference call to discuss second quarter financial and operational results Tuesday, March 19, at 8:00 a.m. PST (11:00 a.m. EST). The live Web-cast and replay of the call will be available at www.penx.com until April 18, 2002. About Penford Corporation For automated shareholder information, please call 1-888-317-2013. This press release contains forward-looking statements concerning the benefits and costs of a planned restructuring, new product initiatives in coatings and protein product categories, the Company's ability to deliver technically differentiated starch-based ingredients, decreases in natural gas cost, that most indicators point to a modest recovery in paper demand in the second half of calendar 2002 and increases in demand for North American paper customers' products. Such matters are beyond the control of the Company, are based on statements by certain industry analysts and may not occur because of various factors. Additionally, there are a variety of factors (some of which are set forth below) that could adversely affect the Company's ability to deliver new product initiatives or to produce technically differentiated starch-based ingredients. Among the factors that could adversely affect the performance described in the forward-looking statements are the performance of the economy as a whole (including the economies in markets served by the Company, such as North America and Asia) and the impact of such performance on the Company's customers, customer acceptance of new products or technologies at less than anticipated rates, issues related to lack of increases in or decreases or delays in customer demand or orders, increased competition, unanticipated costs or timing delays associated with a planned restructuring, the possible ineffectiveness of the restructuring, timing and other issues related to introduction of new technologies, decreases in market share, unfavorable changes in product mix, disappointments in product development efforts and introductions, interest rate and energy cost volatility, foreign exchange rate fluctuations and those listed in the Company's SEC reports, including the reports on Form 10-K for the year ended August 31, 2001. - Tables Follow -
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||