MSA Announces First Quarter Results
"MSA's consolidated sales in the first quarter were clearly impacted by
the effects of the ongoing global recession. Compared to the first quarter of
2008, sales are down 18% with decreases in each of our three geographic
segments. However, when you adjust our sales for the relative strength of the
U.S. dollar compared to the first quarter of last year, our global sales are
down 10% with a decline of 24% in
Sales in the company's North American segment decreased
Sales in the company's European segment were down
Sales in
Net income in MSA's North American segment was down
Net income in the European segment was
Net income in
"Following a 2008 in which we saw meaningful sales growth in each of our three geographic segments and achieved record annual sales, we knew 2009 would present a number of new challenges for MSA," Mr. Lambert commented. "In these uncertain economic times, our global teams are closely monitoring the markets we serve and adjusting our responses to meet market realities. Late last year and throughout the first quarter, we intensified our efforts to reduce costs across MSA. During the quarter, we reduced costs in all areas of the company, while we continue to implement our long-term strategy to enhance efficiency and operating margins on a global basis."
Mr. Lambert referenced several cost-cutting measures the company has implemented, including:
-- A voluntary retirement incentive program in North America , implemented
in the first quarter, which resulted in an 8.6% decrease in the U.S.
salaried workforce. This became effective February 1 . The cost of
this program was $6.6 million , all of which is non-cash in nature, but
is expected to provide an estimated $5 million annual savings.
-- A pay freeze for all salaried U.S. and Canadian-based employees,
saving an estimated $1.9 million this year. Additionally, the company
has implemented salary restrictions globally.
-- The elimination of overtime in factories. The company also has
responded quickly to demand changes by adjusting its hourly workforce
through temporary layoffs.
-- A reduction of staffing levels in some areas of the world, such as
Australia and Latin America, through restructuring activities and the
implementation of short-workweek programs to further reduce costs;
-- Restrictions on capital expenditures and discretionary spending, which
went into effect late last year and remain in place on a global basis;
-- The implementation of tighter cash-management processes and a very
focused working capital improvement program, of which there are early
indications of success; and
-- The suspension of the company match portion of its retirement savings
plans (401(k)), and a management salary reduction plan that cuts pay
in a graduated way from 5% at the manager level up to 20% for the CEO.
These combined cost reduction programs will save an estimated $2.6
million in expense this year.
"While I am pleased with the results of these actions to-date, we must continue to be diligent in our efforts to reduce costs and manage our business in ways that allow us to not only weather the current downturn, but be responsive in seizing opportunity when recovery occurs," Mr. Lambert concluded.
About MSA:
Established in 1914, MSA is a global leader in the development,
manufacture and supply of sophisticated safety products that protect people's
health and safety. Sophisticated safety products typically integrate any
combination of electronics, mechanical systems and advanced materials to
protect users against hazardous or life-threatening situations. The company's
comprehensive line of products is used by workers around the world in the fire
service, homeland security, construction and other industries, as well as the
military. Principal products include self-contained breathing apparatus, gas
masks, gas detection instruments, head protection, respirators and thermal
imaging cameras. The company also provides a broad range of consumer and
contractor safety products through retail channels. These products are
marketed and sold under the MSA Safety Works brand. MSA has annual sales of
approximately
Cautionary Statement Regarding Forward-Looking Statements:
Except for historical information, certain matters discussed in this press
release may be forward-looking statements within the meaning of Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended. Forward-looking statements, including
without limitation all projections and anticipated levels of future
performance, involve risks, uncertainties and other factors that may cause our
actual results to differ materially from those discussed herein. Actual
results can be affected by any number of factors, many of which are outside of
management's control. Among the factors that could cause such differences are
global economic conditions, spending patterns of government agencies,
competitive pressures, product liability claims, the success of new product
introductions, currency exchange rate fluctuations, the identification and
successful integration of acquisitions and the risks of doing business in
foreign countries. These risks, uncertainties and other factors are detailed
from time-to-time in our filings with the
Mine Safety Appliances Company
Consolidated Condensed Statement of Income (Unaudited)
(In thousands, except earnings per share)
Three Months Ended
March 31
2009 2008
Net sales $218,175 $266,344
Other income 859 1,059
219,034 267,403
Cost of products sold 135,198 159,992
Selling, general and administrative 56,820 66,094
Research and development 7,013 7,352
Restructuring and other charges 8,095 1,106
Interest 1,847 2,494
Currency exchange (gains) losses (926) 4,094
208,047 241,132
Income before income taxes 10,987 26,271
Provision for income taxes 3,614 10,101
Net income 7,373 16,170
Less: Net income attributable to the
noncontrolling interests 152 143
Net income attributable to Mine Safety
Appliances Company 7,221 16,027
Basic earnings per share $0.20 $0.45
Diluted earnings per share $0.20 $0.44
Dividends per common share $0.24 $0.22
Basic shares outstanding 35,633 35,540
Diluted shares outstanding 35,824 36,021
Mine Safety Appliances Company
Consolidated Condensed Balance Sheet (Unaudited)
(In thousands)
March 31 December 31
2009 2008
Current assets
Cash and cash equivalents $49,660 $50,894
Trade receivables, net 175,231 198,622
Inventories 152,439 159,428
Other current assets 60,744 68,831
Total current assets 438,074 477,775
Property, net 141,128 141,409
Prepaid pension cost 75,010 78,037
Goodwill 82,305 83,211
Other non-current assets 103,124 95,378
Total 839,641 875,810
Current liabilities
Notes payable and current portion of long-term
debt $56,325 $60,849
Accounts payable 44,671 50,126
Other current liabilities 94,071 108,712
Total current liabilities 195,067 219,687
Long-term debt 94,111 94,082
Pensions and other employee benefits 117,618 120,494
Deferred tax liabilities 36,297 36,491
Other non-current liabilities 9,008 9,931
Shareholders' equity 387,540 395,125
Total 839,641 875,810
Mine Safety Appliances Company
Segment Information (Unaudited)
(In thousands)
Three Months Ended
March 31
2009 2008
Net sales
North America $110,721 $146,642
Europe 56,917 60,405
International 50,537 59,297
Total 218,175 266,344
Net income attributable to Mine Safety
Appliances Company
North America $3,724 $14,582
Europe 2,069 688
International 615 3,566
Reconciling 813 (2,809)
Total 7,221 16,027
SOURCE MSA
CONTACT:
+1-412-967-3357
Web Site: http://www.msanet.com
