DALLAS--November 1, 1995--Eljer Industries,
Inc. (NYSE:ELJ) today reported results for the third quarter and
nine months of fiscal 1995 ended October 1, 1995.
For the third quarter, net income rose 6% to a record $4,522,000
or $0.63 per share compared with net income of $4,265,000 or $0.60
per share in the same quarter of 1994. Operating income increased
11% to $8,840,000 and included a nonrecurring gain of $2.7 million
resulting from pension plan amendments. Net sales for the 1995
third quarter were $102,752,000 compared with $107,872,000 in the
third quarter of 1994.
For the first nine months of 1995, net income was $2,434,000 or
$0.34 per share on net sales of $294,223,000, compared with
$7,011,000 or $0.99 per share on net sales of $302,103,000 in the
same period of 1994. Operating income was $14,378,000 compared with
$16,089,000 in the first nine months of 1994.
Third quarter sales were impacted by continued softness in the
U.S. and Canadian housing markets which lowered sales in all the
Company's North American businesses. This was partially offset by
increased European sales, which benefitted from favorable currency
exchange rates. Additionally, while the third quarter gross margin
of 28.0% declined in comparison to the same quarter of 1994 because
of continued high raw material costs, it improved from the 24.7%
reported in the 1995 second quarter. This was due primarily to
obtaining price increases on many of Eljer's products which offset
some of the substantial raw material cost increases incurred earlier
in the year, and a gain recorded in connection with amendments to
certain of the Company's pension plans. The pension plan amendments
reflect a change in Eljer's approach toward employee retirement
plans which includes providing increased benefits under its 401(k)
plan in lieu of certain of its pension plans.
The Company also reduced third quarter selling and
administrative expense by $3.7 million from the third quarter of
1994 through reductions in advertising and European administrative
expenses as well as through the pension plan amendment. Litigation
costs of $2,217,000 for the 1995 third quarter include a $202,000
reserve reduction to maintain the net book value of United States
Brass Corporation, the Company's indirect, wholly-owned subsidiary,
at zero. For the first nine months of 1995, the reserve reduction
totaled $2,443,000. U.S. Brass,
Eljer Manufacturing and the
Company filed an amended Plan of Reorganization and disclosure
statement in U.S. Brass' voluntary Chapter 11 bankruptcy on June
16, 1995. Third quarter 1995 interest costs increased $1,033,000
over the 1994 third quarter level reflecting rate increases on the
Company's debt.
Scott Arbuckle, President and Chief Executive Officer,
commented: "Our third quarter performance has returned Eljer to
profitability, despite reduced sales in North America. However, the
operating environment remains very competitive. U.S. housing
starts are 8% below last year and raw material costs remain
unusually high. We are pleased that our efforts to reduce costs are
proving effective and have enabled us to balance necessary price
increases with the need to remain competitive in our markets. We
expect to see the further benefits of our actions in 1996."
Eljer Industries, Inc. is a leading manufacturer and marketer
of high quality building products, including plumbing, heating and
venting products, for the residential and commercial construction,
remodeling and repair, and do-it-yourself markets.
ELJER INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED STATEMENTS OF INCOME
(unaudited)
(In thousands, except per share amounts)
For the Three Months For the Nine Months
Ended Ended
10/1/95 10/2/94 10/1/95 10/2/94
NET SALES $102,752 $107,872 $294,223 $302,103
COST OF SALES 74,016 75,850 219,279 218,378
GROSS PROFIT 28,736 32,022 74,944 83,725
SELLING & ADMINISTRATIVE
EXPENSES 17,679 21,376 56,098 61,701
LITIGATION COSTS 2,217 2,664 4,468 5,935
INCOME FROM OPERATIONS 8,840 7,982 14,378 16,089
OTHER (INCOME) EXPENSE, net 321 352 1,252 1,109
INTEREST (INCOME)
EXPENSE, net 3,441 2,408 10,106 8,064
INCOME BEFORE INCOME
TAXES 5,078 5,222 3,020 6,916
INCOME TAX EXPENSE
(BENEFIT) 556 957 586 (95)
NET INCOME $ 4,522 $ 4,265 $ 2,434 $ 7,011
EARNINGS PER SHARE $ 0.63$ 0.60 $ 0.34 $ 0.99
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES 7,137 7,130 7,132 7,117
GOSHEN, Ind., Nov. 1, 1995 -- Cobra
Industries, Inc.
(NYSE: COI) announced today that it has reached an agreement with
Congress Financial Corporation which gives the company the complete
use of its available cash and sale proceeds through December 9, 1995
in its Chapter 11 reorganization. In connection with that Court-
approved agreement, Cobra and Congress have agreed to commence
immediate negotiations concerning possible debtor-in-possession
(DIP) financing. Any such financing agreement would be subject to
the further approval of the Court.
The recreational vehicle manufacturer also announced today that
it has signed a contract to sell its profitable, but non-strategic,
TriStar distribution business. The sale is expected to bring Cobra
approximately $6 million in both cash and reduced liabilities, and
is pending court approval on November 16, 1995.
As previously announced, Cobra filed a petition for
reorganization on October 27, 1995 in the wake of unsuccessful
efforts by the company to reduce reserve requirements and increase
cash available from its financing agreement with its lender.
Cobra Industries, Inc., headquartered in Goshen, Indiana, is one
of North America's largest recreational vehicle manufacturers.
Cobra manufactures conventional trailers, park trailers, folding
camper trailers and van conversions. The company has manufacturing
and distribution facilities in Indiana, California, Texas and
Georgia.
/CONTACT: James J. Roop or Robert G. Berick of Watt, Roop & Co.,
216-566-7019/
TORONTO, Ontario--Nov. 1, 1995--href="internat.canada.trenton.html">TRENTON
INDUSTRIES (TSE: TII) The court has adjourned the motions for
approval of the Proposals under the Bankruptcy and Insolvency Act of
Trenton Industries Inc. and its two subsidiaries, Trenton Machine
Tool Inc. and SailRail Enterprises Limited. The motions for court
approval will now be heard on November 14, 1995. The adjournment
was sought by the Trenton Group in order to provide it with an
additional period of time in which to finalize financing for its
obligations under the Proposals and to support a return to normal
business operations.
CONTACT: Dean Antonakes,
Trenton Industries Inc.,
(613) 394-4861
HOUSTON, Nov. 1, 1995 -- Digicon
Inc. (AMEX: DGC), an
integrated geophysical services company operating in selected
markets worldwide, today announced that it has filed a shelf
registration statement with the S.E.C. covering the possible resale
of 4,901,701 shares of its outstanding common stock. The shares
include 1,708,497 shares which were reacquired by the company in
June 1995 in conjunction with the sale of its interests in the
former Soviet Union and then resold to three institutional
investors. Also included were 3,193,204 shares issued in connection
with the company's emergence from bankruptcy in 1991, which the
company is contractually obligated to register. Holders of all the
shares have advised the company they have no present intention to
sell. However, registration will enhance the liquidity of all the
shares being registered, will permit them to be sold conveniently,
and should ultimately improve the overall liquidity of the stock in
the market. The registration will not increase the number of
currently outstanding shares which total 11,134,939.
Digicon provides seismic data acquisition and processing
services to the petroleum industry. The company operates seismic
survey ships, land data acquisition crews and geophysical data
processing centers providing predominantly 3D services around the
world. Digicon is a Houston-based company whose common stock is
listed on the American Stock Exchange under the symbol "DGC."
/CONTACT: Stephen J. Ludlow or Richard W. McNairy of Digicon Inc.,
713-526-5611 or 800-DIGICON.
TUPELO, Miss.--Nov. 1, 1995--Hancock Fabrics,
Inc. (NYSE symbol: HKF) announced today that the Company is
conducting preliminary discussions with href="chap11.hf.html">House of Fabrics, Inc., of
Sherman Oaks, California, directed toward a negotiated transaction
for its acquisition of House of Fabrics.
Any transaction would be consummated as part of a plan of
reorganization in the chapter 11 cases of House of Fabrics and its
affiliates pending before the United States Bankruptcy Court for the
Central District of California. Approval of the House of Fabrics
creditors in bankruptcy, appropriate governmental authorities and
the respective Boards of Directors would be required.
Hancock Fabrics, Inc. is a retail and wholesale merchant of
fabric and related home sewing and decorating accessories. The
Company currently operates 505 retail fabric stores in 33 states
under the names "Hancock Fabrics," "Minnesota Fabrics," "Fabric
Warehouse," and "Fabric Market" and supplies almost 200 independent
wholesale customers.
CONTACT: Hancock Fabrics Inc., Tupelo,
Larry G. Kirk, 601/842-2834, Ext. 114
SHERMAN OAKS, Calif., Nov. 1, 1995 -- href="chap11.hf.html">House of Fabrics,
Inc. (NYSE: HF) reported today that it will ask the Court to
retain
the investment banking services of Houlihan, Lokey, Howard & Zukin,
Inc. to assist the company in evaluating its strategic alternatives.
The company also reported that it is conducting preliminary
discussions regarding a potential transaction with Hancock Fabrics,
Inc. (NYSE: HKF). The company has requested that Houlihan, Lokey
assist it in exploring potential transactions, including one with
Hancock Fabrics.
House of Fabrics emphasized that the discussions with Hancock
are at an early stage. The company acknowledged that any
transaction would be consummated as part of its plan of
reorganization in the Chapter 11 proceeding.
House of Fabrics operates 361 company-owned House of Fabrics,
Sofro Fabrics, Fabricland, and Fabric King retail fabric and craft
stores in 34 states and employs approximately 8,600 people. The
company and its subsidiaries filed to restructure under Chapter 11
on November 2, 1994.
/CONTACT: Rivian Bell or Sandra Sternberg of Sitrick And Company,
Inc., 310-788-2850/