NN, INC. REPORTS SECOND QUARTER 2005 RESULTS
Resource from: CBCC Likes:2955
Aug 03,2005
Revenues Up 12%, Earnings Per Share Up 75%
Johnson City, Tenn, July 28, 2005 ?NN, Inc. (Nasdaq: NNBR) today reported its financial results for the second quarter ended June 30, 2005. Net sales for the second quarter of 2005 rose 11.8% to $84.2 million from $75.3 million for the same period of 2004. Net income for the second quarter of 2005 totaled $3.6 million, or $0.21 per diluted share, compared to $2.0 million, or $0.12 per diluted share for the second quarter of 2004, an increase of 80.0% and 75.0% respectively.
Net sales for the first half of 2005 were $170.9 million, up 11.8%, compared to $152.9 million for the same period of 2004. Net income for the first half of 2005 totaled $7.6 million, or $0.44 per diluted share, compared to $5.2 million, or $0.30 per diluted share for the same period of 2004, an increase of 46.2% and 46.7% respectively.
James H. Dorton, Vice President and Chief Financial Officer, commented, 揙f the total revenue increase of $18.0 million in the first half of 2005 as compared to the same period in 2004, volume improvements and new program share gains accounted for $7.8 million, the impact of currency translation accounted for $5.1 million and price increases associated with raw material pass through accounted for the remaining $5.1 million. Our 2005 second quarter revenues reflect slightly improving demand in both the North American and European automotive sectors and continuing year-to-date strong industrial demand in both markets.
揂s a percentage of net sales, 2005 second quarter cost of products sold was 78.4%. These margins, though essentially flat with the second quarter of 2004 level of 78.3%, were negatively impacted by increased resin prices at our Industrial Molding facility. Year-to-date cost of products sold was 78.2% which continued to show improvement over 2004 full year margins of 79.1%. This improvement was a direct result of the cost reduction efforts generated by our Level 3 initiative.
揝elling, general and administrative expenses of $7.3 million, or 8.7% of net sales for the second quarter of 2005 decreased $744,000 from $8.0 million, or 10.6% of net sales for the second quarter of 2004. The decrease was primarily due to lower Sarbanes-Oxley compliance costs as compared to the prior year. Selling, general and administrative expenses for the first half of 2005 remained on plan at 8.7% of net sales as compared to 9.9% of net sales for the same period in 2004.
Mr. Dorton concluded, 揇ebt minus cash remained relatively unchanged from the beginning of the year. Although traditionally our working capital needs are higher for the first half of the year, we are currently running behind our previously announced debt reduction goal of $12.0 million to $13.0 million for the full year of 2005. We remain committed to this goal and will take measures in the second half of the year to aggressively manage our working capital needs and reassess our capital expenditure plans.?O:P>
Roderick R. Baty, Chairman and Chief Executive Officer, commented, 揥e continue to be pleased with the start-up investments we have made in Slovakia and China, as well as certain strategic initiatives which have positioned the Company well for improving financial performance for the remainder of 2005 and beyond.
Mr. Baty concluded, 揑n total, our operations are performing at levels established in our original business plan. We anticipate the strong overall levels of demand we experienced during the first half of the year to continue into the third and fourth quarters. As a result, our capacity utilization rates should remain high for the remainder of the year. We still face concerns regarding the volatility of steel inflation in the U.S. We will continue to experience significant steel raw material inflation in the domestic market during the last six months of the year. In Europe, there is a downward trend for scrap surcharge pricing levels and we expect this trend to continue through the remainder of 2005. In addition to the steel inflation, we have experienced higher resin costs at our Industrial Molding operation due to historically high oil prices. Our 2005 earnings projections include provisions for a continuing pass through of both steel and plastic resin inflation in the form of higher selling prices to our customers.
揊inally, currency remains an open issue with respect to our previously provided guidance for both revenue and earnings in 2005. If the U.S. Dollar-Euro exchange rate for the remainder of the year remains at the level in place at the end of the second quarter, we would anticipate currency translation to negatively affect both revenue and earnings. Our revenue estimate for the full year would be adjusted downward by approximately $9.0 million to $328.0 million. Our anticipated full year earnings would be impacted by approximately $0.04 per diluted share and result in revised full year guidance of $0.86 to $0.90 per diluted share.?O:P>
NN, Inc. manufacturers and supplies high precision bearing components consisting of balls, rollers, seals, and retainers for leading bearing manufacturers on a global basis. In addition, the company manufactures a variety of other plastic components. NN, Inc. had sales of US $304 million in 2004.
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1.The news above mentioned with detailed source are from internet.We are trying our best to assure they are accurate ,timely and safe so as to let bearing users and sellers read more related info.However, it doesn't mean we agree with any point of view referred in above contents and we are not responsible for the authenticity. If you want to publish the news,please note the source and you will be legally responsible for the news published.
2.All news edited and translated by us are specially noted the source"CBCC".
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