PRESS RELEASE
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PRESS RELEASE |
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Bellevue, Washington -- June 25, 2002 Penford Corporation Reports Third Quarter Results Penford Corporation (Nasdaq: PENX) today reported results for its third quarter ended May 31, 2002. For the third quarter, Penford Corporation reported net income of $1.4 million, or $0.18 per share, versus a net loss of $0.6 million, or $0.08 per share, for the same period last year. Last year's third quarter included a restructuring charge of $0.02 per share. Third quarter sales increased to $59.1 million from $58.8 million for the same period last year. For the first nine months of fiscal 2002, Penford Corporation reported earnings of $2.8 million, or $0.36 per share versus, a net loss last year of $1.2 million, or $0.16 per share. This year's nine-month results include $0.11 per share of charges associated with the previously announced corporate restructuring. Last year's nine-month results included $0.19 per share of non-recurring charges. Nine-month sales increased two percent to $170.3 million from $166.5 million for the same period in fiscal 2001. Growth of Penford's food products in North America and the positive impact of the acquisition of Penford Australia in September 2000 offset nine-month sales volume declines from Penford's industrial products .Thomas D. Malkoski, CEO of Penford, said, "We are pleased with the improvement of earnings over last year, however, the general soft demand in many of the primary markets we serve is holding back stronger revenue growth." "Our industrial ingredients business had a much improved third quarter performance over a year ago aided by lower cost inputs such as natural gas and slightly stronger product demand from our customers. This is the first quarter in two and a half years that our industrial group has shown year over year quarterly revenue growth. Most indicators continue to point to a further recovery in paper demand in the second half of calendar 2002," Malkoski said. "Our North American food ingredients group experienced lower demand for coating systems resulting in a revenue decrease for the quarter compared to a year ago, but is still nine percent ahead of last year's nine-month results. Our pipeline of new initiatives in the coatings and protein product categories should continue to provide a platform for growth as the markets we currently serve improve. Our Australian operations contributed to improved quarterly earnings over the year-earlier period, largely the result of improved cost performance," Malkoski said. "Our overall cost structure for the year benefited from lower natural gas costs and tightly managed operating expenses. In addition to cost controls in place, a strong focus on cash flow has led to significant year-to-date debt reductions and lower interest costs," Malkoski said. "Penford's long-term growth depends on delivering technically differentiated starch-based ingredient solutions that bring enhanced functional benefits to our customers' products and processes. After my first six months at Penford, I am even more convinced that the strategic resources we have in technology, market position and specialty manufacturing position us to deliver increased value to our customers and shareholders. As the general economy improves, we expect to be able to capitalize on an array of growth opportunities for the Company," Malkoski concluded. About Penford Corporation For automated shareholder information, please call 1-888-317-2013. This press release contains forward-looking statements concerning decreases in natural gas cost 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. This press release also contains forward-looking statements concerning the performance of the Company's North American food ingredients and in particular new products offered to a growing customer base. There is a variety of factors (some of which are set forth below) that could adversely affect the performance of new products in particular and the food ingredients in general and there is no assurance that the customer base will continue to grow. This press release also contains forward-looking statements about leveraging Penford Australia in Asia and introducing Australian technology in North American and there is a variety of factors (some of which are set forth below) that could adversely affect actual performance. 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, costs, 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, 2000. - Tables Follow -
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