SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 3, 2003
MINE SAFETY APPLIANCES COMPANY
(Exact name of registrant as specified in its charter)
| Pennsylvania | 1-15579 | 25-0668780 | ||
| (State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
| 121 Gamma Drive RIDC Industrial Park O’Hara Township Pittsburgh, Pennsylvania |
15238 | |
| (Address of Principal Executive Offices) | (Zip Code) |
Registrant’s telephone number, including area code: (412) 967-3000
| Item 7. | Exhibits. |
| Exhibit Number |
Description | |
| 99.1 | Mine Safety Appliances Company Press Release dated November 4, 2003, announcing special distribution to shareholders. | |
| 99.2 | Mine Safety Appliances Company Press Release dated November 3, 2003, announcing financial results for the quarter ended September 30, 2003. | |
Item 5. Other Events and Regulation FD Disclosure.
On November 4, 2003, the Company issued a press release announcing a special distribution to shareholders of the net proceeds of the sale of the Company’s Callery Chemical division. A copy of the press release is filed herewith as Exhibit 99.1 to this report.
| Item 12. | Results of Operations and Financial Condition. |
On November 3, 2003, the Company issued a press release announcing its financial results for the quarter ended September 30, 2003. A copy of the press release is furnished herewith as Exhibit 99.2 to this report.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| MINE SAFETY APPLIANCES COMPANY (Registrant) | ||
| By: | /s/ Dennis L. Zeitler | |
| Dennis L. Zeitler Vice President – Finance | ||
Date: November 5, 2003
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EXHIBIT INDEX
| Exhibit Number |
Description | |
| 99.1 | Mine Safety Appliances Company Press Release dated November 4, 2003, announcing special distribution to shareholders. | |
| 99.2 | Mine Safety Appliances Company Press Release dated November 3, 2003, announcing financial results for the quarter ended September 30, 2003. | |
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Exhibit 99.1
[LOGO]
| FROM: |
Ketchum Six PPG Place - Pittsburgh, Pa. 15222-5488 Contact: Mark Deasy – (412) 456-3843 | |
| FOR: |
MSA (Mine Safety Appliances Company) Ticker: MSA (AMEX) Contact: Dennis L. Zeitler – (412) 967-3047 |
FOR IMMEDIATE RELEASE
MSA Announces Special $53.9 Million Distribution to Shareholders
Net Proceeds of Callery Chemical Division Sale to be Distributed
PITTSBURGH, November 4, 2003 — Mine Safety Appliances Company (Amex: MSA) announced today that it will distribute to shareholders net proceeds of $53.9 million received from the recent sale of its Callery Chemical division. The sale of that division to BASF Corporation closed on September 12, 2003, for approximately $65 million. Callery Chemical is a highly successful specialty chemical business that was an important investment for MSA for decades. The sale of Callery Chemical will allow MSA to focus on the growth of its core safety products business.
The net proceeds, estimated to be $4.38 per common share, will be distributed on November 24 to shareholders of record on November 14. This capital distribution represents the gross proceeds of the sale transaction, less expenses and taxes.
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“This distribution is a unique opportunity for MSA’s shareholders to benefit from our efforts at Callery Chemical over the nearly seven decades that we operated that business,” said John T. Ryan III, Chairman and CEO. “We are pleased to be able to make this special distribution at a time when our core safety business is growing and our cash flow from the continuing business is expected to be fully capable of funding future growth opportunities. Having just announced record third quarter and year-to-date 2003 earnings, this distribution represents another opportunity for our shareholders to participate in the growing success of MSA,” Mr. Ryan concluded.
MSA is the largest company dedicated to producing a complete range of equipment and systems for firefighters, homeland security, military, industrial workers and plant protection. A global company with 28 international affiliates, MSA has annual sales of over $650 million, and its products help protect lives in more than 140 countries. Key offerings include respiratory protective equipment including gas masks and self-contained breathing apparatus, products for head, eye and face protection, hearing protection products, thermal imaging cameras, fall protection equipment, and portable and permanently installed gas detection and monitoring devices.
# # #
Exhibit 99.2
[LOGO]
| FROM: |
Ketchum Six PPG Place - Pittsburgh, Pa. 15222-5488 Contact: Mark Deasy – (412) 456-3843 | |
| FOR: |
MSA (Mine Safety Appliances Company) Ticker: MSA (AMEX) Contact: Dennis L. Zeitler – (412) 967-3047 |
FOR IMMEDIATE RELEASE
MSA Reports Third Quarter and Year-to-Date Earnings
Global Safety Equipment Manufacturer Achieves Record Results from Continuing Operations
PITTSBURGH, November 3, 2003 — Continued demand for respiratory protection products in U.S. military, homeland security, and fire service markets led to record third quarter and year-to-date earnings from continuing operations for Mine Safety Appliances Company (Amex: MSA).
Net sales for the third quarter of 2003 were $171,927,000, compared with $143,398,000 for the third quarter of 2002, an increase of 20 percent. Net income for the third quarter was $24,540,000, or $2.00 per share, compared with $5,793,000, or 47 cents per share, for the same quarter last year.
Net sales for the nine months ended September 30, 2003 were $508,257,000, compared with $413,318,000 in 2002, an increase of 23 percent. Net income for the nine months ended September 30, 2003 was $50,018,000, or $4.09 per share, compared with $23,261,000, or $1.91 per share, for the same period last year.
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Net income from continuing operations for the third quarter of 2003 was $10,984,000, or 89 cents per share, compared with $5,323,000, or 43 cents per share, for the same quarter last year, an increase of 106 percent. Net income from continuing operations for the nine months ended September 30, 2003 was $33,675,000, or $2.75 per share, compared with $20,944,000, or $1.72 per share, for the same period last year, an increase of 61 percent.
During September 2003, the company sold its Callery Chemical Division to BASF. Net income for the three- and nine-month periods ended September 30, 2003 of $24,540,000 and $50,018,000, respectively, includes a $13,658,000 after-tax gain on the sale of the division.
Sales growth in the third quarter of 2003 occurred primarily in the United States, reflecting continued strength in shipments of gas masks to military and homeland security markets and breathing apparatus to the fire service market. Current quarter local currency sales in Europe were somewhat lower than in the third quarter of 2002 due to ongoing sluggishness in industrial markets. When stated in U.S. dollars, however, European sales were flat quarter-to-quarter on the favorable translation effect of a stronger Euro. Local currency sales in other international markets improved when compared to the third quarter of 2002, and also benefited from favorable currency translation effects.
The improvement in third quarter net income from continuing operations reflects the previously-discussed increase in safety products shipments in North America. Net income from continuing operations in the current quarter also included a net after-tax benefit of approximately $500,000 related to the favorable effect of a change in the vacation vesting policy for U.S. employees of $950,000 and the unfavorable effect of a change in standard shipping terms on sales to U.S distributors of $450,000.
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“I am very pleased to report strong quarterly results and record year-to-date earnings by our core safety products business.” said John T. Ryan III, Chairman and CEO. “These results reflect continuing strength in the shipments to the U.S. homeland security and fire service markets. Additionally, the results of our international companies in markets outside of North America and Europe have shown significant advancement this year,” Mr. Ryan continued. “Our overall success thus far in 2003 could be seen as an effective combination of ‘offense’ and ‘defense.’ We have made fine progress in areas and markets where there have been substantial opportunities this year, such as those noted above. Most of those are markets on which the company has placed emphasis in recent years. Additionally, in those areas where economic conditions have not been favorable, we have been able to limit the shortfall of results as compared to our plan. Manufacturing operations results, particularly in safety products in North America, have been quite positive,” Mr. Ryan said.
Mr. Ryan added that the outlook for the remainder of 2003 appears to be good, but noted that maintaining the present rate of growth in sales and earnings will be challenging. “Major factors that will impact our performance going forward include the future funding levels in the fire service and homeland security markets; a continuation and acceleration of economic recovery in the U.S.; the global economic outlook, particularly in the very sluggish western European industrial markets; and the progress on a number of new products that are being or will be launched, including several that have received or are awaiting approval under recent chemical and biological protection standards,” he concluded.
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Certain statements contained in this release may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially from expectations contained in such statements. Factors that may materially affect financial condition and future results include: global economic conditions; the impact of unforeseen economic and political changes, including the threat of terrorism and its potential consequences; the timely and successful introduction of new products; the availability of funding in fire service and homeland security markets; the ability of third party suppliers to provide key materials and components; liquidity; and interest and currency exchange rates.
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The results for the three-month and nine-month periods ended September 30 are as follows.
(Note: Amounts in thousands, except earnings per share and shares outstanding)
| Three Months Ended September 30 |
Nine Months Ended September 30 | |||||||||||||
| 2003 |
2002 |
2003 |
2002 | |||||||||||
| Net sales |
$ | 171,927 | $ | 143,398 | $ | 508,257 | $ | 413,318 | ||||||
| Other income (expense) |
1,586 | (232 | ) | 2,116 | 1,923 | |||||||||
| Cost of products sold |
107,609 | 90,398 | 314,644 | 257,701 | ||||||||||
| Selling and administrative costs |
41,761 | 35,621 | 123,076 | 102,874 | ||||||||||
| Depreciation, amortization and other costs |
6,434 | 7,642 | 17,975 | 19,862 | ||||||||||
| Income from continuing operations before income taxes |
17,709 | 9,505 | 54,678 | 34,804 | ||||||||||
| Provision for income taxes |
6,725 | 4,182 | 21,003 | 13,860 | ||||||||||
| Net income from continuing operations |
10,984 | 5,323 | 33,675 | 20,944 | ||||||||||
| Net income (loss) from discontinued operations |
(102 | ) | 470 | 2,685 | 2,317 | |||||||||
| Gain on sale of discontinued operations – after tax |
13,658 | — | 13,658 | — | ||||||||||
| Net income |
24,540 | 5,793 | 50,018 | 23,261 | ||||||||||
| Basic earnings per share |
||||||||||||||
| Continuing operations |
.89 | .43 | 2.75 | 1.72 | ||||||||||
| Discontinued operations |
1.11 | .04 | 1.34 | .19 | ||||||||||
| Net income |
2.00 | .47 | 4.09 | 1.91 | ||||||||||
| Diluted earnings per share |
||||||||||||||
| Continuing operations |
.88 | .43 | 2.72 | 1.70 | ||||||||||
| Discontinued operations |
1.09 | .04 | 1.32 | .19 | ||||||||||
| Net income |
1.97 | .47 | 4.04 | 1.89 | ||||||||||
| Average number of common shares outstanding (basic) |
12,247,919 | 12,193,592 | 12,230,049 | 12,159,059 | ||||||||||
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