While positive financial reports from publicly held electrical manufacturers and distributors have been rare in recent months, several companies had good news to report for 2002's fourth-quarter. Following is a sampling of financial statements from manufacturers and distributors.
Thomas & Betts Corp. T&B Corp., Memphis, Tenn., reported net income of $13.7 million compared with a year-ago loss of $90.4 million after a pretax restructuring charge of $93 million.
Sales in the fourth quarter fell 2 percent from a year earlier to $335.1 million.
Fourth quarter 2002 sales in the company's electrical segment were $247.8 million, compared with $249.7 million in the prior year period. Electrical segment earnings were $14.4 million in the fourth quarter, versus a loss of $24.5 million in the year-ago period. Lower manufacturing and freight costs, improved selling prices and tight management of SG&A expenses contributed to the improved year-over-year performance. Both the 2002 and 2001 fourth quarter electrical segment results were adversely impacted by charges associated with the restructuring of manufacturing operations ($2.9 million and $4.3 million, respectively).
“During the year, we successfully completed an aggressive manufacturing restructuring program, continued to tightly manage discretionary spending, maintained an intense focus on effectively managing working capital and returned to profitability in the fourth quarter,” said T. Kevin Dunnigan, chairman and chief executive officer. “Although the persistently weak market conditions mask the full magnitude of improvement in our operations, we consider the company's turnaround to be largely complete.”
The company said first-quarter trends indicate 2003 will be another very tough year with little improvement in underlying market conditions.
WESCO International Inc. WESCO, Pittsburgh, reported net sales for the fourth quarter of 2002 of $815.5 million versus $880.3 million in 2001, a decline of 7.4 percent. Operating income for the current quarter totaled $18.3 million versus $20.2 million in last year's comparable quarter, a 9.4 percent decline. Net income for the 2002 fourth quarter increased to $4.7 million from $4.1 million in 2001.
Stephen A. Van Oss, vice president and chief financial officer, said, “The weakness in industrial production and commercial construction markets continues to present ongoing challenges to the company, resulting from continued soft demand in almost every market sector. The company is responding to this challenging market by stimulating sales activity, working on margin improvements, managing its cost structure, and reducing debt levels through sound working capital management practices.”
For the company's fiscal year ended Dec. 31, 2002, net sales totaled $3.3 billion versus $3.7 billion during fiscal 2001, a decline of 9.1 percent. Net income for 2002 totaled $23.1 million versus $20.2 million in 2001.
Lamson & Sessions. Lamson & Sessions, Cleveland, reported net income of $780,000 for the fourth quarter of 2002. In the fourth quarter of 2001, Lamson incurred a net loss of $3.3 million, including a net gain and a restructuring charge.
Net sales in the fourth quarter of 2002 totaled $74.8 million, a decline of $1.9 million, or 2.5 percent, from the $76.7 million reported in the fourth quarter of 2001. The continuing weakness of the industrial and commercial construction markets, further exacerbated by poor weather conditions in the fourth quarter of 2002, were primarily responsible for the lower sales activity.
For the year, the company reported net sales of $314.5 million in 2002 compared with $352.7 million in 2001, a decline of 10.8 percent. While new and existing residential construction activity remained resilient throughout the year, the company's lower sales resulted from very weak conditions for the industrial, commercial and telecommunications infrastructure construction markets, partially offset by strength in the retail market.
For 2002, the company reported a net loss of $41.2 million compared with a net loss of $3.8 million for 2001.
In the fourth quarter of 2002, plant operating rates and margins at Carlon's PVC Pipe business segment were reduced and resulted in an operating loss of $1.5 million in the fourth quarter and an operating loss of $784,000 for the year. While the fourth-quarter result was disappointing, the overall loss for 2002 is an improvement from the operating loss of $10.7 million reported in 2001.
In the Carlon business segment, the impact of very weak demand was evident in all areas for electrical distribution and telecommunications infrastructure products. Carlon's net sales for the fourth quarter of 2002 declined to $33.9 million, which is 16.7 percent less than the $40.7 million reported in the prior-year quarter.
Eaton Corp. Cleveland-based Eaton posted fourth-quarter net income of $67 million compared with net income of $30 million in the year-earlier period.
Sales rose 4.7 percent to $1.78 billion from $1.7 billion.
“For the past three quarters, we have experienced revenue growth and significantly higher operating margins compared to the same periods a year ago,” said Alexander M. Cutler, Eaton's chairman and chief executive officer. “The restructuring actions we took in 2001 and 2002 have generated the $130 million in savings we expected, allowing us to post significantly higher earnings despite our end markets showing yet another year of decline in 2002,” Cutler said.
For the full year, the company posted net income of $281 million compared with net income of $169 million in 2001. Operating earnings came to $315 million, compared with $233 million.
Sales for the full-year of 2002 dropped 1.2 percent to $7.21 billion from $7.30 billion in the year earlier.
General Cable Corp. General Cable, Highland Heights, Ky., said it posted a fourth-quarter loss on charges and lower revenues and projected break-even earnings this quarter.
General Cable reported a fourth-quarter net loss of $9.2 million, which included charges of $6.5 million related mainly to costs from discontinued operations, additional severance and plant closures. The company a year earlier had a net profit of $3.4 million, or 10 cents a share.
The company said it expects first-quarter revenues to be flat or marginally up from the fourth quarter and a year earlier.